<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K
(Mark One)

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
      ACT OF 1934
                   For the fiscal year ended December 31, 2001
                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
                        Commission File Number 001-12131

                           AMF BOWLING WORLDWIDE, INC.
             (Exact name of registrant as specified in its charter)

         Delaware                                          13-3873272
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                          Identification No.)

                                 8100 AMF Drive
                            Richmond, Virginia 23111
          (Address of principal executive offices, including zip code)

               Registrant's telephone number, including area code:
                                 (804) 730-4000

        Securities registered pursuant to Section 12(b) of the Act: None

        Securities registered pursuant to Section 12(g) of the Act: None


    Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

     Indicate by a check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]

    Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [X] No [ ]

     The number of shares issued or issuable under the Registrant's Plan of
Reorganization as of March 20, 2002 was 10,000,000. The aggregate market value
of Common Stock held by non-affiliates was not determinable because of the
absence of a recognized trading market.

                   DOCUMENTS INCORPORATED BY REFERENCE: None.

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

                           Annual Report on Form 10-K

                                December 31, 2001

                                Table of Contents

                                     PART I
                                                                            Page

Item 1     -    Business.......................................................3

Item 2     -    Properties....................................................11

Item 3     -    Legal Proceedings.............................................14

Item 4     -    Submission of Matters to a Vote of Security Holders...........15

                                     PART II

Item 5     -    Market for Worldwide Common Stock and Related
                 Stockholder Matters..........................................16

Item 6     -    Selected Financial Data.......................................16

Item 7     -    Management's Discussion and Analysis of Financial
                 Condition and Results of Operations..........................18

Item 7(A)  -    Quantitative and Qualitative Disclosures About Market Risk....30

Item 8     -    Financial Statements and Supplementary Data...................30

Item 9     -    Changes in and Disagreements with Accountants on Accounting
                 and Financial Disclosure.....................................30

                                    PART III

Item 10    -    Directors and Executive Officers..............................31

Item 11    -    Executive Compensation........................................34

Item 12    -    Security Ownership of Certain Beneficial Owners
                 and Management...............................................40

Item 13    -    Certain Relationships and Related Transactions................41

                                     PART IV

Item 14    -    Exhibits, Financial Statement Schedules, and Reports
                 on Form 8-K..................................................42

Signatures   .................................................................45

                   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index of Financial Statements and Supplementary Data.........................F-1


<PAGE>

                                     PART I

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

     Certain matters discussed in this report contain forward-looking
statements, which are statements other than historical information or statements
of current condition. Statements set forth in this report or statements
incorporated by reference from documents filed with the Securities and Exchange
Commission are or may be forward-looking statements, including possible or
assumed future results of the operations of AMF Bowling Worldwide, Inc., a
Delaware corporation ("Worldwide" and, together with its subsidiaries, the
"Company"), including but not limited to (a) any statements contained in this
report concerning: (i) the Company's ability to comply with covenants in its
financing facilities, (ii) the Company's ability to generate cash flow to
service its indebtedness and meet its debt payment obligations under its
financing facilities, (iii) the continued availability of sufficient borrowing
capacity or other financing to supplement cash flow and fund operations, (iv)
the results of the Company's plans to improve its bowling centers operations,
(v) the results of the Company's efforts to improve its business of selling
bowling equipment and products, (vi) the ability of the Company's management to
execute the Company's initiatives, (vii) the results of operations of the
Company's businesses, (viii) the outcome of existing or potential litigation,
and (ix) the amounts of capital expenditures needed to maintain or improve the
Company's bowling centers, (b) any statements preceded by, followed by or
including the words "believes," "expects," "predicts," "anticipates," "intends,"
"estimates," "should," "may" or similar expressions and (c) other statements
contained or incorporated in this report regarding matters that are not
historical facts.

     These forward-looking statements relate to the plans and objectives of the
Company or future operations. In light of the risks and uncertainties inherent
in all future projections and the Company's financial position, particularly
risks associated with the Company's recent emergence from Chapter 11, the
inclusion of forward-looking statements in this report should not be regarded as
a representation by the Company that the objectives, projections or plans of the
Company will be achieved. Many factors could cause the Company's actual results
to differ materially from those in the forward-looking statements, including,
but not limited to: (i) the Company's ability, and the ability of its
management, to implement successfully the Company's business initiatives, (ii)
the continuation of adverse financial results and substantial competition in the
Company's businesses, including its bowling products business, (iii) the
Company's ability to retain and attract higher quality bowling center managers
and other key staff, (iv) the Company's ability to implement successfully
initiatives designed to improve customer traffic in its bowling centers, (v) the
Company's ability to attract and retain bowlers in its bowling centers, (vi) the
risk of adverse political acts or developments in the Company's international
markets, (vii) fluctuations in foreign currency exchange rates, (viii) continued
or increased competition, (ix) the popularity of bowling, (x) the decline in
general economic conditions, (xi) adverse judgments in pending or future
litigation and (xii) changes in interest rates.

     The foregoing review of important factors should not be construed as
exhaustive and should be read in conjunction with other cautionary statements
included elsewhere in this report. The Company undertakes no obligation to
release publicly the results of any future revisions it may make to
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.

                                       2

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ITEM 1.  BUSINESS

General Business

     The Company is engaged in two business segments: (i) the operation of
bowling centers throughout the United States (the "U.S.") and internationally
("Centers") and (ii) the manufacture and sale of bowling equipment such as
automatic pinspotters, automatic scoring equipment, bowling pins, lanes, ball
returns, lane machines, bowling center supplies and the resale of other allied
products, including bowling balls, bags and shoes ("Products"). The principal
customers for bowling equipment are bowling center operators. Products' revenue
consists of two major sales categories: (a) New Center Packages ("NCPs") (all of
the equipment necessary to outfit a new bowling center or expand an existing
bowling center) and (b) Modernization and Consumer Products (modernization
equipment used to upgrade an existing center, spare parts, supplies and
consumable products used in the operation of a bowling center and resale
products for bowlers). In addition, Products refurbishes and sells used
pinspotters. Combined with new automatic scoring, lanes, bowler seating and
other components, these used pinspotters are sold as Factory Certified Packages
("FCPs"). FCP revenue is included in the NCP category. The Company also
manufactures and sells the PlayMaster, Highland and Renaissance brands of
billiard tables.

     Worldwide serves as the corporate headquarters of the Company. Its
employees provide certain management and administrative services for Centers and
Products. All of Worldwide's business operations are conducted through, and its
operating assets are held in, subsidiaries. The Centers business in the U.S. is
primarily owned and operated in AMF Bowling Centers, Inc. ("AMF Centers"), a
wholly owned, indirect subsidiary of Worldwide. The Centers business outside of
the U.S. is owned and operated in separate, indirect subsidiaries of Worldwide
that own and operate bowling centers in various countries. The Products business
is owned and operated in AMF Bowling Products, Inc. ("AMF Products"), which is a
wholly owned, indirect subsidiary of Worldwide.

     See "Item 6. Selected Financial Data," and "Note 14. Geographic Segments"
and "Note 15. Business Segments" in the Notes to Consolidated Financial
Statements for discussions regarding geographic and business segments.

Background

     In May 1996, an investor group led by Goldman, Sachs & Co. ("Goldman
Sachs") acquired the Company. At the time, the Company operated approximately
200 U.S. and 79 international bowling centers and also owned Products. In
connection with the acquisition, the Company became a wholly owned subsidiary of
AMF Group Holdings Inc. ("Group Holdings"), which was in turn a wholly owned
subsidiary of AMF Bowling, Inc. ("AMF Bowling").

     The Company soon announced and began to aggressively pursue a business
strategy that included: (i) acquiring bowling centers, (ii) building a
recognized national brand of bowling and entertainment centers and (iii)
capitalizing on demand for bowling equipment in certain international markets.
To facilitate the Company's strategy, AMF Bowling completed an initial public
offering of common stock in 1997 and a sale of zero coupon convertible
debentures in 1998 (the "AMF Bowling Financings"), a portion of the proceeds of
each of which was used to fund the acquisition program.

     In mid-1998, after acquiring approximately 260 bowling centers that were
financed through borrowings and the AMF Bowling Financings, management
recognized that Centers revenue and cash flow from operations (as measured on a
constant center basis) were generally declining below the levels in prior years.
Moreover, the rapid growth through acquisitions led to problems in integrating
new centers and managing the expanded base of operations. At the same time,
management also recognized that Products revenue and operating cash flow were
declining as demand for bowling equipment dropped dramatically following
economic difficulties in the Asia Pacific region, Products' largest growth
market, and as product quality issues and order fulfillment problems began to
adversely impact sales. These financial and operational problems caused the
Company to curtail its acquisition program and focus on improving operations
rather than building a national brand.

                                       3

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     During 1998, the Company negotiated amendments to modify its senior secured
credit agreement dated May 1, 1996, as amended and restated (the "Old Credit
Agreement") to relax certain of its financial covenants. As part of these
amendments, certain restrictions on acquisitions were put in place. In mid-1999,
management of the Company implemented a number of initiatives designed to
improve the Company's performance. Shortly thereafter, AMF Bowling, the
Company's former parent, issued common stock in a rights offering to raise
capital, a portion of which was contributed to Worldwide, as part of a
recapitalization plan designed to provide further financial flexibility. At the
same time, the Company also negotiated further amendments to the Old Credit
Agreement.

     In 2000, the Company recognized that its 1999 recapitalization plan had not
succeeded, that the initiatives to improve the Company's performance would take
additional time to implement and that current and expected levels of cash flow
were insufficient to service long term debt obligations. The Company engaged a
financial advisor in mid-2000 to evaluate options, including assisting the
Company in developing and negotiating with the appropriate parties, a plan to
restructure its indebtedness. In August 2000, the Company entered into
discussions and negotiations with informal committees of both its lenders under
the Old Credit Agreement and the holders of its subordinated debt and publicly
disclosed that it would not make scheduled interest payments on its subordinated
indebtedness. During December 2000, the Company failed to make scheduled
principal payments and delayed scheduled interest payments under the Old Credit
Agreement. While discussions and negotiations continued with the various
creditor groups, it became apparent that the filing of a voluntary petition for
relief under Chapter 11 ("Chapter 11"), Title 11 of the United States Bankruptcy
Code (the "Bankruptcy Code") was a potential option for the Company.

Chapter 11 and Emergence

     On July 2, 2001 (the "Petition Date"), Worldwide and certain of its U.S.
subsidiaries (collectively, the "Debtors") filed voluntary petitions for relief
under Chapter 11 with the United States Bankruptcy Court for the Eastern
District of Virginia, Richmond Division (the "Bankruptcy Court"). During the
Chapter 11 proceeding, the Debtors managed and operated their assets and
businesses as debtors-in-possession subject to the supervision and orders of the
Bankruptcy Court. The international subsidiaries of the Company did not file for
relief under Chapter 11. Subsequent to the Petition Date, AMF Bowling, the
Company's former indirect parent, filed a separate petition for relief under
Chapter 11.

     On the Petition Date, the Company was in default on approximately $622.3
million of indebtedness under the Old Credit Agreement and approximately $573.8
million of principal and accrued and unpaid interest under the Company's 12 1/4%
Series B Senior Subordinated Discount Notes due 2006 (the "Old Senior
Subordinated Discount Notes") and its 10 7/8% Series B Senior Subordinated Notes
due 2006 (the "Old Senior Subordinated Notes" and collectively with the Old
Senior Subordinated Discount Notes, the "Old Subordinated Notes").

     On August 8, 2001, the Bankruptcy Court approved the Company's motion to
obtain a debtor-in-possession financing in an aggregate amount up to $75.0
million (the "DIP Loan") from a syndicate of banks. The DIP Loan was available
to provide financing for working capital, letters of credit, capital
expenditures and general corporate purposes.

     On February 1, 2002, the Bankruptcy Court confirmed the Second Amended
Second Modified Joint Plan of Reorganization (the "Plan") of the Debtors. The
Plan became effective March 8, 2002 (the "Effective Date"), which is the date on
which the Debtors formally emerged from Chapter 11. As part of the Plan,
Worldwide entered into a senior secured credit agreement with Bankers Trust
Company, as Administrative Agent, and certain other lenders dated as of February
28, 2002 (the "New Credit Agreement"). Worldwide also entered into an indenture
dated as of March 8, 2002 (the "New Indenture") providing for the issuance of
$150.0 million aggregate principal amount of 13.00% Senior Subordinated Notes
due 2008 (the "New Subordinated Notes"). Pursuant to the Plan, as of the
Effective Date, the Old Credit Agreement, the Old Subordinated Notes and
substantially all of the Company's other pre-petition indebtedness were
discharged and terminated.

     On the Effective Date, the Company borrowed $290.0 million under a term
facility (the "Term Facility") and $10.0 million under a $60.0 million revolving
credit facility (the "Revolver" and, collectively with the Term Facility, the
"Exit Facility") provided by the New Credit Agreement. These funds were used to
make cash payments to satisfy certain claims and expenses required to be paid in
cash under the Plan. Subsequent to the Effective Date,

                                       4

<PAGE>

the outstanding $10.0 million borrowing under the Revolver was repaid. The
Revolver continues to be available for the Company's working capital and general
corporate needs, subject to customary borrowing conditions.

     Pursuant to the Plan, on the Effective Date, the shares of common stock of
Worldwide formerly held by its parent, Group Holdings, were cancelled. Worldwide
issued 9,250,000 shares of new common stock, $0.01 par value (the "New AMF
Common Stock"), and $150.0 million in New Subordinated Notes and paid $286.7
million in cash to Worldwide's former senior secured creditors (the "Former
Secured Creditors") in full satisfaction of their claims. In addition, Worldwide
will distribute to the Debtors' unsecured creditors (the "Former Unsecured
Creditors") up to 750,000 shares of New AMF Common Stock, 1,764,706 Series A
Warrants (the "Series A Warrants") and 1,724,138 Series B Warrants (the "Series
B Warrants" and collectively with the Series A Warrants, the "Warrants") in full
satisfaction of their claims. Distributions of these securities will occur from
time to time pursuant to and in accordance with the terms of the Plan. See "Note
12. Equity" in the Notes to the Consolidated Financial Statements for additional
information regarding the New AMF Common Stock and the Warrants.

     Worldwide is obligated to distribute shares of New AMF Common Stock and
Warrants to the Former Unsecured Creditors, but is not required to make any cash
distribution to the Former Unsecured Creditors. The number of shares of New AMF
Common Stock and Warrants to be distributed to individual Former Unsecured
Creditors is contingent on the resolution of their individual claims.

     AMF Bowling, the indirect parent of Worldwide prior to the Effective Date,
did not receive any distribution based upon its equity interest in Group
Holdings. The Company no longer has any affiliation with either AMF Bowling or
Group Holdings and the New AMF Common Stock, which represents the equity
ownership of Worldwide, is distinct from the shares of common stock of AMF
Bowling that remain outstanding at this time. Management of the Company
understands that AMF Bowling plans to file a liquidating Chapter 11 plan.

Capital Structure of the Company after Emergence from Chapter 11

     Under the Plan, as described above, the Former Secured Creditors received a
combination of cash, 9,250,000 shares of the New AMF Common Stock and $150.0
million aggregate principal amount of the New Subordinated Notes, and the Former
Unsecured Creditors will receive up to 750,000 shares of the New AMF Common
Stock, 1,764,706 Series A Warrants and 1,724,138 Series B Warrants, in each
case, in full satisfaction of their claims against the Company. As of the
Effective Date, substantially all of the pre-Chapter 11 indebtedness of the
Company will be discharged and eliminated from the Company's balance sheet
through the application of fresh start accounting required by the American
Institute of Certified Public Accountant's Statement of Position 90-7 ("SOP
90-7"). Pursuant to the Plan, as of the Effective Date, the Company was
authorized to issue to management options to purchase shares of New AMF Common
Stock. See "Note 12. Equity" in the Notes to Consolidated Financial Statements
for additional information regarding stock options.

     Under fresh start accounting, the reorganization value of the Company,
which represents the going concern value of all of the Company's assets
(excluding liabilities) under the Plan, is allocated among the Company's assets
in accordance with Statement of Financial Accounting Standards ("SFAS") 141
"Business Combinations." In addition, those liabilities which were not otherwise
discharged under the Plan, other than deferred taxes, are stated at their fair
values.

     As of the Effective Date, the Company's outstanding indebtedness (excluding
trade payables incurred in the ordinary course since the Petition Date and
administrative expenses incurred in the Chapter 11 proceeding) consists of:
$290.0 million of debt under the Term Facility; $150.0 million of the New
Subordinated Notes; borrowing capacity under the Revolver of $60.0 million, of
which $10.0 million was outstanding; and approximately $3.1 million of other
debt, representing one mortgage and one capitalized equipment lease, that was
reinstated as senior debt under the Plan.

     The Company's unaudited pro forma reorganized balance sheet as of December
31, 2001 is set forth below. It reflects the pro forma effect of the
cancellation of indebtedness that resulted from the Chapter 11 proceeding, fresh
start accounting, the closing of the Exit Facility, the issuance of the New
Subordinated Notes and the write-off of goodwill in accordance with SFAS 142 as
if each had occurred on December 31, 2001. The unaudited pro forma

                                       5

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reorganized balance sheet should be reviewed in conjunction with the
corresponding notes. This presentation has not been audited and does not
necessarily reflect the actual adjustments that will be made as of the Effective
Date.

                           AMF BOWLING WORLDWIDE, INC.
                       Pro Forma Reorganized Balance Sheet
                                December 31, 2001
                                   (Unaudited)
                                 (In thousands)

<TABLE>
<CAPTION>
                                                                                                              Pro Forma
                                                December 31,    Reorganization          Other                December 31,
                                                  2001 (a)        Adjustments         Adjustments                2001
                                              -------------      ------------        ------------          ---------------
<S>                                           <C>                <C>                 <C>                   <C>
ASSETS
Cash and cash equivalents                     $      25,291      $                   $                     $        25,291
Accounts and notes receivable, net                   27,381                                                         27,381
Inventories                                          38,732                                                         38,732
Advances and deposits                                14,337                                                         14,337
Property and equipment, net                         685,154                              (46,293) (b)              638,861
Leasehold interests and other                        40,138            13,725 (c)        (28,510) (b)               25,353
Goodwill, net                                       718,414                             (718,414) (d)                  -
                                              -------------      ------------        -----------           ---------------
         Total assets                         $   1,549,447      $    $13,725        $  (793,217)          $       769,955
                                              =============      ============        ===========           ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable                              $      24,246                                                $        24,246
Accrued expenses and other                           78,450                                                         78,450
Old Credit Agreement                                616,395          (616,395)(e)                                      -
Revolver                                                               10,000 (f)                                   10,000
Term Facility                                                         290,000 (f)                                  290,000
New Subordinated Notes                                                150,000 (g)                                  150,000
Liabilities subject to resolution                   595,463                             (595,463) (b)                  -
Other long-term debt                                  3,107                                                          3,107
Other long-term liabilities                           2,252                                                          2,252
                                              -------------      ------------        -----------           ---------------
         Total liabilities                        1,319,913          (166,395)          (595,463)                  558,055

Total stockholders' equity                          229,534           180,120           (197,754)                  211,900
                                              -------------      ------------        -----------           --------------
Total liabilities and stockholders'
equity                                        $   1,549,447      $     13,725        $  (793,217)          $       769,955
                                              =============      ============        ===========           ==============

</TABLE>

Notes to Pro Forma Reorganized Balance Sheet
--------------------------------------------
(a)  The historical balance sheet and the other historical financial statements
     and data included in this Form 10-K do not reflect the effects of fresh
     start accounting or SFAS 142.
(b)  Reflects the application of SOP 90-7, including the write down of certain
     long lived assets to reflect the reorganization value upon emergence from
     Chapter 11.
(c)  Reflects expected fees and expenses associated with the Exit Facility.
(d)  Reflects the write-off of goodwill of $718,414 in January 2002 upon
     application of SFAS 142.
(e)  Reflects the exchange of debt outstanding under the Old Credit Agreement
     pursuant to the Plan.
(f)  Reflects amounts borrowed under the Exit Facility as of the Effective Date.
(g)  Reflects the issuance of the New Subordinated Notes.


Historical Financial Statements

     The accompanying historical consolidated financial statements do not
reflect the effects resulting from the Company's emergence from the Chapter 11
proceeding and represent the financial position and capital structure on

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December 31, 2001, which was prior to the implementation of the Plan. As such,
among other things, the historical consolidated financial statements do not
reflect the effects of the cancellation of indebtedness that resulted from the
Chapter 11 proceeding, fresh start accounting or the write-off of goodwill. See
"--Capital Structure of the Company after Emergence from Chapter 11." The
historical consolidated financial statements should be read with the
understanding that the reorganization significantly altered the historical
capital structure reflected in the accompanying historical balance sheet as of
December 31, 2001.

Proposed Change of Fiscal Year

     On March 20, 2002, Worldwide's Board of Directors (the "New Board")
approved the change of the Company's fiscal year end from December 31 to the
Sunday closest to June 30 and the use of a retail calendar, which will result in
future fiscal years having either 52 or 53 weeks. These changes will be
implemented effective after June 30, 2002. The Company intends to file a Form
10-K with respect to the period from January 1, 2002 through June 30, 2002.

Business Segments

Centers

     After the Company closes 13 bowling centers in the spring of 2002, it will
operate 387 centers in 40 states and Puerto Rico. Outside the U.S., after the
Company ceases operations in Brazil and Argentina, and sells one center in the
United Kingdom, the Company will operate 102 bowling centers in six countries:
Australia (48), the United Kingdom (34), Mexico (9), the People's Republic of
China, including Hong Kong (4), France (4) and Japan (3). The Company recorded
$22.4 million as a reorganization item for the year ended December 31, 2001 to
reflect its decision to close these centers and cease operations. This charge
also includes the closing or disposition of one center in Germany, two centers
in Spain, two golf practice ranges and one golf retail store in 2001 and early
2002.

     Centers derives revenue from three principal sources: (i) bowling, (ii)
food and beverage and (iii) other, including shoe rental, amusement machines,
billiards and pro shops ("Ancillary Sources"). In 2001, bowling, food and
beverage and Ancillary Sources represented 58.3%, 27.4% and 14.3% of total
revenue, respectively.

     Bowling, the largest component of a center's revenue, is derived primarily
from league and recreational play. Recreational play includes managed, or
scheduled (such as birthday or corporate parties), and open, or unscheduled,
play. Food and beverage sales are primarily through snack bars that offer food,
soft drinks and, at most centers, alcoholic beverages.

     In the U.S., the operation of bowling centers has generally been
characterized by declining lineage (number of games bowled per lane per day).
This decline has been primarily caused by a decrease in the number of league
bowlers. Centers has experienced difficulty in its efforts to improve lineage.
In the last three years, the decline in lineage has been generally offset with
annual price increases, yielding a modest net constant center revenue growth.
During this period, improvement or decline in the Company's operating cash flow
was primarily dependent on the results of management's cost reduction
initiatives. See "--Business Strategy" and "Management's Discussion of Financial
Condition and Results of Operations--Centers." There can be no assurances that
in the future lineage will increase or not further decline, that further
declines in lineage will be offset by price increases or that management's cost
reduction initiatives will succeed.

     See Item 7. "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and "Note 14. Geographic Segments" and "Note 15.
Business Segments" in the Notes to Consolidated Financial Statements for
additional information regarding business and geographic segments.

Products

     For over 20 years, the majority of NCP sales have been to international
markets. Traditionally, as bowling is introduced and becomes popular in new
markets, there is demand for NCPs assuming the economics of constructing and
operating bowling centers are favorable. During the early to mid-1990's, demand
was unusually strong and was fueled by the growth of bowling in the Asia Pacific
region. Economic difficulties in the Asia Pacific region

                                       7

<PAGE>

beginning in 1997 ended this period of strong demand. Continued economic
difficulties in a number of countries and regions, the limited availability of
financing for customers desiring to build new bowling centers and the lack of a
significant market to replace the Asia Pacific region have kept demand for NCPs
below historical levels.

     Sales of Modernization and Consumer Products to bowling center operators
provide a somewhat more stable base of recurring annual revenue than NCP sales.
Some of these products, such as bowling pins, typically are replaced on
approximately an annual basis to maintain a center, while certain less frequent
investments in other equipment are necessary to modernize a center and are often
required to retain customers.

     See Item 7. "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and "Note 14. Geographic Segments" and "Note 15.
Business Segments" in the Notes to Consolidated Financial Statements for
additional information regarding business and geographic segments.

Business Strategy

U.S. Centers

     Since mid-1998, Centers has not pursued its former strategy to acquire
bowling centers and build a national brand of bowling and entertainment centers.
Centers' focus has been and continues to be on the following initiatives:

         .     improved training for center and facility managers;
         .     enhanced incentive-based compensation for center managers and key
               staff;
         .     more effective marketing programs; and
         .     implementation of cost reduction initiatives, such as improved
               management of payroll through more effective labor scheduling and
               more efficient center purchasing through centralized programs.

     Management believes that if these initiatives are successful, the Company
will have better opportunities to reduce the decline in lineage that adversely
impacts Centers and the bowling center industry in the U.S. and can improve the
financial performance of Centers.

     Management believes quality and experience of the center manager and staff
are two important factors that differentiate the better performing centers.
Because a center manager is responsible for a wider range of functional areas
than many other retail managers, the quality and experience of a center manager
may have a greater impact on the operations of a center than a typical retail
store manager. During 2001, Centers established a new training school for center
managers and is attempting to recruit higher quality center managers and staff.

     During 2001, Centers established a new incentive compensation plan for
center managers that rewards performance with an increased bonus for achievement
in excess of budgeted expectations. Management believes improved cash flow will
offset the cost of this plan. The new compensation plan should also help attract
better manager candidates as well as reduce center manager turnover.

     Centers will also continue to focus on improving food and beverage revenue
through initiatives to provide better customer service and improve the quality
of food and beverage offerings. Implementation of better inventory and cost
controls, along with menu modifications, are also expected to improve food and
beverage margins.

     Irrespective of the number of centers acquired by the Company since 1996,
the Company has generally closed approximately 10 bowling centers per year. For
a summary of the Company's terminated acquisition program, see "Item 6. Selected
Financial Data." These closings include the 13 centers in the U.S. that were
closed during the Chapter 11 proceeding. When deciding to cease a center's
operations, management evaluates the center's recent performance as well as any
investment in capital that might be necessary to maintain or improve the
center's operating cash flow and, in the case of a center operated on leased
premises, anticipated increases in rent that might adversely impact operating
cash flow. If center closings continue at this rate and operating cash flow is
not increased at the Company's remaining centers, the overall performance of the
Company may decline.

                                       8

<PAGE>

International Centers

     The Company's operating strategies vary by country, although in general,
local management will focus on implementing initiatives similar to those
described for U.S. bowling centers. In 2002, management will seek to concentrate
its efforts on its operations in Australia and the United Kingdom, the Company's
largest bowling center operations outside of the U.S.

Products

     Since 1998, Products has undergone a series of organizational
restructurings including work force reductions, that were intended to size its
operating expenses to declining revenue, correct product quality and order
fulfillment problems and improve Products' management of working capital. In
March 2001, Products hired John Suddarth as Chief Operating Officer. His
management team has evaluated strategy, operations and organization to put in
place a plan that focuses on:

         .     reorganization of the business to decrease costs and increase
               focus on key product lines, customer service and product quality;
         .     consolidation of country-based sales offices and warehouses;
         .     implementation of working capital management programs; and
         .     improvement of the accuracy and completeness of shipments through
               better order fulfillment processes.

     In May 2001, Products' management team began implementing a restructuring
plan to reduce manufacturing costs and operating expenses. The plan included
replacing the then existing functional organization with five product-oriented
divisions, each led by a general manager. The restructuring eliminated over 150
positions worldwide and should result in cost savings.

     As part of the restructuring plan, Products also began streamlining its
European sales and service network. The previous organizational structure had
separate offices in the United Kingdom, France, Germany and Sweden, each with
its own warehousing, administrative and accounting functions and technical and
sales personnel. Administrative, accounting and warehousing are now being
consolidated in Rotterdam, the Netherlands. Local country sales forces will be
maintained. Technical support will be centrally managed but technicians will be
based throughout Europe. Products' management believes the new structure will
improve customer support and reduce operating expenses.

     To achieve efficiency, Product's management is working towards the
elimination of outdated and redundant stock keeping units and the improvement of
management information systems. It is also implementing a working capital
management program that focuses on the reduction in the level of inventory and
accounts receivable. In addition, the Company is attempting to implement changes
to Products' marketing programs in an effort to enhance its revenue.

     While Products is continuing to pursue its restructuring efforts and is
attempting to address cost and revenue issues, Products continues to experience
substantial competition and weak markets in a number of its product categories.
Management believes that it is unlikely that, for the foreseeable future,
Products will generate revenue that will reach its historical levels.

Seasonality

     Centers' business is seasonal. Cash flows typically peak in the winter and
are lower in the summer.

     Products' sales are also seasonal. The beginning of league play in the fall
of each year drives the U.S. market, which is primarily a market for
Modernization and Consumer Products, and with the decline in demand for NCPs, is
the largest market for Products. While bowling center proprietors purchase
consumer products throughout the year, they often place larger orders during the
summer in preparation for the start of league play in the fall. Summer is also
generally the peak period for installation of modernization equipment.
Proprietors typically sign purchase orders for modernization equipment during
the spring after they have indications of fall league sign ups.

                                       9

<PAGE>

Modernization equipment is then shipped and installed during the summer when
bowling centers generally have fewer bowlers.

Industry and Competition

Centers

     Bowling is both a competitive sport and a recreational entertainment
activity and faces competition from numerous other leisure activities. The
future performance of Centers is subject to continued interest in bowling, the
availability and affordability of other sports, recreational and entertainment
alternatives, the amount of customer leisure time, as well as various other
social and economic factors over which the Company has no control.

     The ownership of bowling centers in the U.S. is fragmented. There are two
large bowling center operators, the Company and Brunswick Corporation
("Brunswick") (which operated approximately 100 centers as of December 31,
2001), three smaller chains that together operate approximately 55 bowling
centers and approximately 5,000 bowling centers owned by single-center and
small-chain operators that typically own four or fewer centers.

     The international bowling center industry is also highly fragmented. There
are few chain operators in any country and a large number of single-center
operators. The Company believes it is competitively well positioned in Australia
and the United Kingdom.

     Centers competes primarily through customer service, quality of bowling
equipment, location, facilities, food and beverage offerings and marketing
programs. See "--Business Strategy" and "Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operation" for further
discussion.

Products

     The Company and Brunswick are the two largest manufacturers of bowling
center equipment and are the only full-line manufacturers of bowling equipment
and supplies that compete on a global basis. Management believes this is a
competitive advantage in the case of NCP sales where the purchasers often desire
to buy all of the bowling equipment necessary to outfit a new center from a
single supplier.

     Following record sales of NCPs in the 1990's, mainly to the Asia Pacific
region, NCP sales have declined in recent years to below historical levels.
Management believes that uncertain political and economic conditions have
depressed demand. In addition, as purchasers of NCPs are often startup
businesses, current political and economic conditions have increased the
difficulty that purchasers face in obtaining financing to build and equip new
bowling centers.

     The Company also competes with smaller companies in the sale of
Modernization and Consumer Products. This competition has become greater in the
past decade as additional manufacturers and suppliers have entered the
Modernization and Consumer Products business.

     The low demand for NCPs and additional competition for NCPs and
Modernization and Consumer Products from manufacturers that may enjoy a lower
cost structure have also increased price competition among competitors.
Management expects the trend toward lower cost products to continue, especially
in the Asia Pacific region. The lingering effects of previous technical
difficulties with the scoring and back office systems introduced in 1998 may
still adversely impact some sales opportunities.

International Operations

     The Company's international operations are subject to the usual risks
inherent in operating internationally, including, but not limited to, currency
exchange rate fluctuations, economic and political instability, other disruption
of markets, restrictive laws, tariffs and other actions by foreign governments
(such as restrictions on transfer of funds, import and export duties and quotas,
foreign customs, tariffs and value added taxes and unexpected changes in
regulatory environments), difficulty in obtaining distribution and support for
products, the risk of nationalization, the laws and policies of the U.S.
affecting trade, international investment and loans, and foreign tax law
changes.

                                       10

<PAGE>

As is the case of other U.S.-based manufacturers with export sales,
local currency devaluation increases the cost of Products' bowling equipment in
a market. As a result, a strengthening U.S. dollar exchange rate may adversely
impact sales volume and profit margins during such periods.

     Foreign currency exchange rates also impact the translation of operating
results from international bowling centers. Revenue and EBITDA of international
bowling centers represented 15.9% and 23.5% of consolidated revenue and EBITDA,
respectively, in 2001. Revenue and EBITDA of international bowling centers
represented 15.9% and 25.4% of consolidated revenue and EBITDA, respectively, in
2000.

     See "Note 14. Geographic Segments" and "Note 15. Business Segments" in the
Notes to Consolidated Financial Statements for additional financial information
concerning the Company's operations in different geographic areas.

Employees

Centers

     As of March 15, 2002, Centers had approximately 16,500 full- and part-time
employees worldwide, of which approximately 13,600 were employed in the U.S.
(substantially all of whom are non-union employees) and approximately 2,900 were
employed internationally. The Company believes its relations with its Centers
employees are satisfactory.

Products

     As of March 15, 2002, Products had approximately 660 full-time employees
worldwide, of which approximately 430 were employed in manufacturing and
approximately 230 in sales and administration. The Company believes its
relations with its Products employees are satisfactory.

Corporate

     As of March 15, 2002, corporate had approximately 135 full-time employees.
The Company believes its relations with its corporate employees are
satisfactory.


ITEM 2.  PROPERTIES

Centers

     As of December 31, 2001, the Company operated 400 bowling centers and
related facilities in the U.S. and Puerto Rico and 117 centers in nine other
countries. The average age of its U.S. bowling centers, including leased
centers, is over 30 years. A typical bowling center has approximately 1,000
square feet of total space per bowling lane.

     During the Chapter 11 proceeding, the Company decided to close 13 U.S.
bowling centers (12 of which were premises subject to leases rejected in the
Chapter 11 proceeding) and two other operating locations and is now in the
process of closing them. Once these closings are completed, the Company will
operate 387 bowling centers in the U.S. In addition, the Company rejected leases
in the Chapter 11 proceeding for nine centers that were closed prior to the
Petition Date. The following table reflects the Company's U.S. centers following
those closings:

                                       11

<PAGE>

                              U.S. BOWLING CENTERS


       Region                          Owned                         Leased
       ------                          -----                         ------
       East                              91                             49
       Central                           90                             35
       West                              77                             45
                                         --                             --
            Total                       258                            129
                                        ===                            ===

     The Company's bowling center leases are subject to periodic renewal.
Forty-one of the U.S. centers have leases that expire during the next three
years, of which 17 have renewal options at fixed rent increases.

     There can be no assurance that the Company will be able to renew leases for
centers in cases in which the lease does not contain a renewal option. There can
also be no assurance the Company will be able to renew leases, absent a fixed
rent in the option, at rents that would permit the Company to maintain or
increase existing cashflow margins or on terms that are otherwise favorable to
the Company. In addition, in light of the age of the Company's centers, which
may require significant capital expenditures for maintenance, the Company may
choose not to renew leases for marginal performing centers. If the Company is
unable to renew leases at rents that allow centers to remain profitable or
management chooses not to renew leases, the number of centers may decrease,
resulting in lower revenue, which may impact the Company's operations and its
ability to meet its financial obligations.

     The Company has closed or is in the process of closing, selling or
otherwise disposing of, 11 centers in Brazil, two in Spain, one in the United
Kingdom and one in Argentina. The following table reflects the Company's
international centers following those changes:

                          INTERNATIONAL BOWLING CENTERS

                                            Number of
       Country                              Locations      Owned       Leased
       -------                              ---------      -----       ------

       Australia                               48           27           21
       United Kingdom                          34           11           23
       Mexico                                   9            5            4
       The People's Republic of China           4            0            4
       France                                   4            0            4
       Japan                                    3            0            3
                                               ---          --           --
            Total                              102          43           59
                                               ===          ==           ==

     For information concerning material encumbrances on the Company's owned
real estate, see "Note 6. Long-Term Debt" in the Notes to Consolidated Financial
Statements.

                                       12

<PAGE>


Products

     As of December 31, 2001, Products owned or leased facilities at three
locations in the U.S. Two are used for its bowling equipment business and one is
used for its billiards business. For information concerning major encumbrances
on the Company's owned real estate, see "Note 6. Long-Term Debt" in the Notes to
Consolidated Financial Statements.

                                 U.S. Facilities

<TABLE>
<CAPTION>
                                                                                         Approximate       Owned/
Location                                 Function                                       Square Footage     Leased
--------                                 --------                                       --------------     ------
<S>                  <C>                                                                     <C>           <C>
Richmond, VA         Corporate headquarters of Worldwide, Products and Centers;              360,000        Owned
                     Products manufacturing facility for pinspotters, automatic
                     scoring, synthetic lanes, other capital equipment and its
                     warehouse and distribution facility.
Lowville, NY         Manufacturing facility for pins and wood lanes                          171,000        Owned
Bland, MO            Manufacturing facility for billiard tables                              116,900        Owned
                                                                                              33,000       Leased
</TABLE>

     At December 31, 2001 Products leased all of its international facilities.

                            International Facilities

<TABLE>
<CAPTION>
                                                                          Approximate                 Owned/
Location                                            Function            Square Footage                Leased
--------                                            --------            --------------                ------
<S>                                                 <C>                       <C>                     <C>
Emu Plains, Australia                                Office                      400                  Leased
                                                    Warehouse                 10,100                  Leased
Hong Kong                                            Office                    2,500                  Leased
Shanghai, the People's Republic of China             Office                      400                  Leased
Beijing, the People's Republic of China             Warehouse                  4,000                  Leased
Levallois-Perret, France                             Office                    1,000                  Leased
Mainz-Kastel, Germany                                Office                      700                  Leased
New Delhi, India                                     Office                    2,000                  Leased
Yokohama, Japan                                      Office                    3,000                  Leased
                                                 Services Center               9,000                  Leased
Osaka, Japan                                          Sales                      800                  Leased
Fukuoka, Japan                                       Office                      400                  Leased
Mexico City, Mexico                                  Office                    1,300                  Leased
                                                    Warehouse                 11,400                  Leased
Warsaw, Poland                                       Office                      200                  Leased
Granna, Sweden                                       Office                    4,500                  Leased
                                                   Warehouse*                 12,700                  Leased
Hemel Hempstead, United Kingdom                      Office                   11,500                  Leased
                                                   Warehouse*                 11,800                  Leased
Moscow, Russia                                       Office                      500                  Leased
                                                    Warehouse                  3,000                  Leased
Rotterdam, the Netherlands                           Office                    5,500                  Leased
                                                    Warehouse                  7,900                  Leased
</TABLE>
------------------
*Scheduled to be closed as part of European consolidation.

                                       13

<PAGE>

ITEM 3.  LEGAL PROCEEDINGS

     The Company emerged from Chapter 11 on March 8, 2002 and accordingly no
longer operates under the constraints of Chapter 11. Under the Plan, however,
the Bankruptcy Court retained jurisdiction over certain matters, including
matters relating to claims objections, executory contracts and unexpired leases,
litigation pending in the Bankruptcy Court at the time of confirmation,
litigation the Company or other parties may commence relating to the Chapter 11
proceeding, and specific matters relating to the implementation and consummation
of the Plan. See "Item 1. Business--Chapter 11 and Emergence" for additional
information regarding the Company's Chapter 11 proceeding.

     In June 1998, Harbin Hai Heng Bowling Entertainment Co. Ltd. ("Hai Heng")
filed an action against AMF Products in the Harbin Intermediate People's Court
in Heilongjing, the People's Republic of China. Hai Heng sought to recover $3.0
to $4.0 million in damages relating to equipment purchased from AMF Products.
Hai Heng asserted the poor quality of the equipment entitled Hai Heng to recover
the purchase price and damages for lost profits and the cost of storing the
equipment.

     In November 1998, the Intermediate Court awarded Hai Heng approximately
$3.5 million. AMF Products appealed the award to the High People's Court of
Heilongjing Province (the "People's Court"). Prior to completion of the appeal
review, the President of the People's Court in February 1999 issued a judgment
in favor of Hai Heng for approximately $2.8 million and ordered Hai Heng to
return a portion of the equipment to AMF Products. AMF Products filed an appeal
to the Supreme People's Court in Beijing, the People's Republic of China (the
"Supreme Court"). The Supreme Court declined to review the case and the People's
Court judgment is now final.

     AMF Products and Hai Heng have signed a settlement agreement under which
the judgment of the People's Court against AMF Products will be satisfied in
full by AMF Products paying Hai Heng $150,000 and not disputing Hai Heng's
seizure of approximately $940,000 formerly on deposit in AMF Products' Beijing
bank account. The Company has recently learned that Hai Heng has refused to
complete the terms of the settlement.

     On January 19, 2001, AMF Products entered into an administrative Consent
Order with the New York State Department of Environmental Conservation ("DEC"),
whereby AMF Products agreed to submit an approvable engineering report and
implement a schedule for installation of new control equipment and boiler
upgrades and perform stacks tests to ensure compliance of its 22.8 MBtu per hour
wood fired boiler with New York State air emission requirements. AMF Products
also agreed to pay a $15,000 penalty of which $5,000 was suspended. AMF Products
is presently negotiating an Amended Consent Order relating to the same matter,
which arises from allegations by DEC that AMF Products did not comply with the
schedule under the Consent Order.

     The Company currently and from time to time is subject to claims and
actions arising in the ordinary course of its business, including environmental
claims, employee and workers' compensation claims and personal injury claims
from customers of Centers. In some actions, plaintiffs request punitive or other
damages that may not be covered by insurance. In management's opinion, the
claims and actions in which the Company is involved are not expected to have a
material adverse impact on its financial position or results of operations.
However, it is not possible to predict the outcome of such claims and actions.

Regulatory Matters

     There are no unique federal or state regulations applicable to bowling
center operations or equipment manufacturing. State and local governments
require establishments to hold permits to sell alcoholic beverages, and,
although regulations vary from state to state, once permits are issued, they
generally remain in place indefinitely (except for routine renewals) without
burdensome reporting or supervision other than revenue tax reports.

Environmental Matters

     The Company's operations are subject to federal, state, local and foreign
environmental laws and regulations that impose limitations on the discharge of,
and establish standards for the handling, generation, emission, release,
discharge, treatment, storage and disposal of, certain materials, substances and
wastes.

                                       14

<PAGE>

     The Company currently and from time to time is subject to environmental
claims. In management's opinion, the various claims in which the Company
currently is involved are not likely to have a material adverse impact on its
financial position or results of operations.

     The Company cannot predict with any certainty whether existing conditions
or future events, such as changes in existing laws and regulations, may give
rise to additional environmental costs. Furthermore, actions by federal, state,
local and foreign governments concerning environmental matters could result in
laws or regulations that could increase the cost of producing the Company's
products, or providing its services, or otherwise adversely affect the demand
for its products or services.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     The Company solicited votes for the acceptance or rejection of the
Company's Second Amended Joint Plan for Reorganization under Chapter 11 of the
Bankruptcy Code during the period from on or about November 19, 2001 through
January 4, 2002. In accordance with the Bankruptcy Code and the Plan, votes were
solicited from, among other creditors, beneficial holders of the Company's Old
Subordinated Notes (collectively comprising Class 6 under the Plan). Forty-two
beneficial holders holding approximately $24.2 million of the outstanding claims
in Class 6 voted to accept the Plan. Forty-one beneficial holders holding
approximately $352.4 million of the outstanding claims in Class 6 voted to
reject the Plan. Accordingly, approximately 50.6% of those Class 6 claimants
that voted, representing approximately 6.4% of the dollar amount of the claims
held by those Class 6 claimants that voted, voted to accept the Plan.
Approximately 49.4% of those Class 6 claimants that voted, representing
approximately 93.6% of the claims held by those Class 6 claimants that voted,
voted to reject the Plan. Notwithstanding this adverse vote, the Bankruptcy
Court approved the Plan on February 1, 2002.

                                       15

<PAGE>

                                     PART II

ITEM 5.  MARKET FOR WORLDWIDE COMMON STOCK AND RELATED STOCKHOLDER MATTERS

     The common stock of Worldwide issued and outstanding prior to the Effective
Date, which was wholly owned by Worldwide's former parent, Group Holdings, was
cancelled on the Effective Date. The Former Secured Creditors received 9,250,000
shares of the New AMF Common Stock and the New Subordinated Notes as part of
their distribution under the Plan. As of the Effective Date, based solely on
information provided by the Former Secured Creditors, the Company believes that
there were approximately 30 beneficial owners of the outstanding New AMF Common
Stock. The New AMF Common Stock and the New Subordinated Notes were issued in
reliance on the provisions of Section 1145(a)(1) of the Bankruptcy Code that
exempt the initial offer and distribution, and certain resales, of those
securities from registration under the federal securities laws (the "Bankruptcy
Code Exemption"). Up to 750,000 shares of the New AMF Common Stock, 1,764,706
Series A Warrants and 1,724,138 Series B Warrants will be issued and distributed
in reliance on the Bankruptcy Code Exemption to the Former Unsecured Creditors
from time to time in accordance with the Plan.

     Neither the New AMF Common Stock nor the Subordinated Notes are listed or
quoted on any national securities exchange or national market system or
registered under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). There is no recognized public trading market for the New AMF Common Stock
or the New Subordinated Notes. However, the Company has been advised that
isolated trades of small amounts of the New AMF Common Stock may be occurring.
The Company has no reliable information about the prices at which any of these
trades might be made.

     Worldwide did not pay cash dividends on its former common stock during the
past two years. Worldwide is prohibited under the New Credit Agreement and the
New Indenture from paying cash dividends and does not anticipate paying any cash
dividends on the New AMF Common Stock for the foreseeable future.

     See "Note 12. Equity" in the Notes to the Consolidated Financial Statements
for a more detailed description of certain terms of Worldwide's equity
securities.


ITEM 6.  SELECTED FINANCIAL DATA

     The selected financial data set forth below for the fiscal years indicated
were derived from the Company's audited consolidated financial statements for
each of the years in the five year period ended December 31, 2001. The data
should be read in conjunction with the Company's Consolidated Financial
Statements and "Management's Discussion and Analysis of Financial Condition and
Results of Operations" that appear elsewhere in this report. The selected
financial data do not reflect the effects resulting from the Company's emergence
from Chapter 11 and represent the Company's financial position and capital
structure on December 31, 2001, which was prior to the implementation of the
Plan. As such, among other things, the data do not reflect the effects of the
cancellation of indebtedness resulting from the Chapter 11 proceeding, fresh
start accounting or the write-off of goodwill.

     The Company's consolidated financial statements for 2001 were prepared in
accordance with SOP 90-7 which provides guidance for financial reporting by
entities that file petitions under the Bankruptcy Code and expect to reorganize
under Chapter 11. Under SOP 90-7, the financial statements of an entity in a
Chapter 11 proceeding distinguish transactions and events directly associated
with the reorganization from those of operations of the ongoing business.
Revenue and expenses, realized gains and losses, and provisions for losses
resulting from the reorganization and restructuring of the business are reported
in the statement of operations separately as reorganization items, net. See
"Note 7. Liabilities Subject to Resolution" and "Note 8. Reorganization Items,
Net and Other Charges" in the Notes to the Consolidated Financial Statements for
further discussion.

     In connection with the Company's emergence from Chapter 11, the Company
will apply fresh start accounting in accordance with SOP 90-7. Under SOP 90-7,
the reorganization value of the Company will be allocated to the Company's
assets in accordance with SFAS 141 and the liabilities will be stated at their
present values. The application of SOP 90-7 will result in the write down of
certain long lived assets. The Company will also write-off all of its goodwill
effective January 1, 2002 in accordance with SFAS 142 (See "Note 2. Significant
Accounting

                                       16

<PAGE>
<TABLE>
<CAPTION>

Policies" in the Notes to the Consolidated Financial Statements). See "Item 1. Business" for the Company's unaudited pro forma
reorganized balance sheet as of December 31, 2001.

     In addition to the effects of fresh start accounting, the comparability of the selected financial data is affected by the
Company's bowling center acquisition program. In 1997, Centers acquired 122 bowling centers from a number of unrelated sellers for
an aggregate purchase price of $232.7 million (including amounts paid in 1998 for certain bowling centers included in the 1997
total). In 1998, Centers acquired 83 bowling centers from a number of unrelated sellers for an aggregate purchase price of $156.8
million. In 1999, Centers acquired one center for a purchase price of $1.4 million. In 2000, Centers acquired 4 centers (excluding
13 centers that were owned in a joint venture between the Company and Playcenter S.A., a Brazilian entertainment company, until the
Company acquired the 50% interest of Playcenter S.A. in December 2000) for a combined purchase price of $8.6 million. In 2001,
Centers acquired no bowling centers.

                                                                    For the year ended December 31,
                                                  ---------------------------------------------------------------------
                                                    1997           1998            1999            2000          2001
                                                  --------      ---------        --------         -------    ----------
                                                                         (dollars in millions)
<S>                                               <C>           <C>              <C>              <C>        <C>
Statement of Operations Data (a):
Operating revenue                                 $  713.7      $   736.4        $  732.7         $ 715.0    $     694.9
Cost of goods sold                                   212.6          202.2           177.2           173.1         154.6
Bowling center operating expenses                    251.2          334.0           373.4           386.9         376.6
Selling, general and administrative expenses          64.5           63.8            71.5            64.5          60.8
Restructuring and asset impairment  charges           -              -               16.6             5.0           5.6
Refinancing charges                                   -              -               -                6.5          13.0
Depreciation and amortization                        102.5          120.3           132.7           136.0         130.0
                                                  --------      ---------        --------         -------    ----------
     Operating income (loss)                          82.9           16.1           (38.7)          (57.0)        (45.7)
Interest expense, gross                              118.4          101.9           111.3           121.5         104.9
Other income (expense), net                           (8.2)          (5.5)           (4.8)           (0.2)         (4.9)
                                                  --------      ---------        --------         -------    ----------
     Net loss before provisions for income
         taxes                                       (43.7)         (91.3)         (154.8)         (178.7)       (155.5)
Provision (benefit) for income taxes                 (12.9)           7.3            27.6             2.3           4.8
                                                  --------      ---------        --------         -------    ----------
     Net loss before equity in loss of
         joint  ventures  and  extraordinary
         items                                       (30.8)         (98.6)         (182.4)         (181.0)       (160.3)
Equity  in loss of  joint  ventures,  net of
income taxes                                          (1.4)          (8.2)          (18.6)           (0.5)           -
                                                  ---------     ---------        --------         -------    ----------
     Net loss before extraordinary item              (32.2)        (106.8)         (201.0)         (181.5)       (160.3)
Extraordinary item, net of income taxes              (23.4)           -               -              -               -
                                                  ---------     ---------        --------         -------    ----------
     Net loss before reorganization items, net       (55.6)        (106.8)         (201.0)         (181.5)       (160.3)
Reorganization items, net                             -               -              -               -             56.7
                                                  ---------     ---------        --------         -------    ----------
     Net loss                                     $  (55.6)     $  (106.8)       $ (201.0)        $(181.5)   $   (217.0)
                                                  =========     ==========       =========        ========   ==========

Selected Data:
EBITDA (b)                                        $  185.4      $   136.4        $  110.6         $  90.5    $    102.9
EBITDA margin                                         26.0%          18.5%           15.1%           12.7%         14.8%

</TABLE>
<TABLE>
<CAPTION>
                                                                    For the year ended December 31,
                                                  ---------------------------------------------------------------------
Balance Sheet Data:                                 1997           1998            1999            2000          2001
                                                  --------      ---------        --------         -------    ----------
                                                                            (dollars in millions)
<S>                                               <C>           <C>              <C>              <C>        <C>
Working capital (c)(d)                            $   44.0      $    59.5        $    7.1         $(1,105.1) $   (613.4)
Goodwill (e)                                         772.3          772.7           765.1             746.1       718.4
Total assets (e)                                   1,831.8        1,956.0         1,805.4           1,726.3     1,549.4
Liabilities subject to resolution (f)                  -              -               -                 -         595.5
Total debt (e)                                     1,060.6        1,047.1         1,048.6           1,136.6       619.5
Stockholder's equity (e)                          $  653.9      $   803.9        $  641.7         $   453.9  $    229.5

</TABLE>
-----------------------
(a)  Certain amounts have been reclassified to conform with current year
     presentation.
(b)  EBITDA represents earnings before net interest expense, income taxes,
     depreciation and amortization, restructuring and asset impairment charges,
     refinancing charges and reorganization items, net. EBITDA is not intended
     to represent and should not be considered more meaningful than, or an
     alternative to, other measures of performance determined in accordance with
     U.S. generally accepted accounting principles. EBITDA includes charges
     primarily related to fixed assets, goodwill, inventory and accounts
     receivable of $15.1 million in 2001, $39.2 million in 2000 and $26.5
     million in 1999. In addition, in 2001, EBITDA also includes charges

                                       17

<PAGE>

     of $5.3 million recorded for prepetition expenses incurred but not yet
     invoiced as of June 30, 2001 as a result of filing the petitions commencing
     the Chapter 11 proceeding.
(c)  Working capital as of December 31, 2000, includes the classification of
     $1,134.6 million of long-term debt as a current liability. Working capital
     as of December 31, 2001 includes the classification of $616.4 million of
     the Company's indebtedness under the Old Credit Agreement (the "Bank Debt")
     in the current portion of long-term debt.
(d)  Working capital as of December 31, 2001, excludes the classification of
     $595.5 million of liabilities subject to resolution.
(e)  Does not reflect the impact of SFAS 142 or SOP 90-7 which, as indicated in
     the unaudited pro forma reorganized balance sheet set forth in "Item 1.
     Business", would result in pro forma goodwill, total assets, total debt and
     stockholder's equity of $0.0, $770.0 million, $453.1 million and $211.9
     million, respectively, at December 31, 2001.
(f)  Liabilities subject to resolution refers to those unsecured claims that
     were impaired under the Plan. The holders of those claims will not receive
     the full amount of their claims but will receive a pro rata distribution of
     up to 750,000 shares of the New AMF Common Stock, 1,764,706 Series A
     Warrants and 1,724,138 Series B Warrants.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

Chapter 11 and Emergence

     On the Petition Date, the Debtors filed voluntary petitions under Chapter
11. During the Chapter 11 proceeding, the Debtors managed and operated their
assets and businesses as debtors-in-possession subject to the supervision and
orders of the Bankruptcy Court. The international subsidiaries of the Company
did not file for relief under Chapter 11. Subsequent to the Petition Date, AMF
Bowling, the Company's former indirect parent, filed a separate petition for
relief under Chapter 11.

     On the Petition Date, the Company was in default on approximately $622.3
million of indebtedness under the Old Credit Agreement and approximately $573.8
million of principal and accrued and unpaid interest under the Old Subordinated
Notes.

     On August 8, 2001, the Bankruptcy Court approved the Company's motion to
obtain a $75.0 million DIP Loan from a syndicate of banks. The DIP Loan was
available to provide financing for working capital, letters of credit, capital
expenditures and general corporate purposes.

     On February 1, 2002, the Bankruptcy Court confirmed the Plan of the
Debtors. The Plan became effective on March 8, 2002, which is the date on which
the Debtors formally emerged from Chapter 11. As part of the Plan, Worldwide
entered into the New Credit Agreement with Bankers Trust Company, as
Administrative Agent, and certain other lenders. Worldwide also entered into the
New Indenture providing for the issuance of the New Subordinated Notes. Pursuant
to the Plan, as of the Effective Date, the Old Credit Agreement, the Old
Subordinated Notes and substantially all of the Company's other pre-petition
indebtedness were discharged and terminated.

     On the Effective Date, the Company borrowed $290.0 million under the Term
Facility and $10.0 million under the Revolver provided by the New Credit
Agreement. These funds were used to make cash payments to satisfy certain claims
and expenses required to be paid in cash under the Plan. Subsequent to the
Effective Date, the outstanding $10.0 million borrowing under the Revolver was
repaid. The Revolver continues to be available for the Company's working capital
and general corporate needs, subject to customary borrowing conditions.

     Pursuant to the Plan, on the Effective Date, the shares of common stock of
Worldwide formerly held by Group Holdings were cancelled. Worldwide issued
9,250,000 shares of New AMF Common Stock and $150 million in New Subordinated
Notes and paid $286.7 million in cash to the Former Secured Creditors in full
satisfaction of their claims. In addition, Worldwide will distribute to the
Former Unsecured Creditors up to 750,000 shares of New AMF Common Stock,
1,764,706 Series A Warrants and 1,724,138 Series B Warrants in full satisfaction
of their claims. Distributions will occur as the amount and value of their
claims are resolved which will not occur until later

                                       18

<PAGE>

in 2002. See "Note 12. Equity" in the Notes to the Consolidated Financial
Statements for additional information regarding the New AMF Common Stock and the
Warrants.

     Worldwide is obligated to distribute shares of New AMF Common Stock and
Warrants to the Former Unsecured Creditors, but is not required to make any cash
distribution to the Former Unsecured Creditors. The number of shares of New AMF
Common Stock and Warrants to be distributed to individual Former Unsecured
Creditors is contingent on the resolution of their claims.

     AMF Bowling did not receive any distribution based upon its equity interest
in Group Holdings. The Company no longer has any affiliation with either AMF
Bowling or Group Holdings and the New AMF Common Stock, which represents the
equity ownership of Worldwide, is unrelated to and distinct from, the shares of
AMF Bowling that remain outstanding at this time. Management of the Company
understands that AMF Bowling plans to file a liquidating Chapter 11 plan.

     See "Item 1. Business--Capital Structure of the Company after Emergence
from Chapter 11" for the Company's unaudited pro forma reorganized balance
sheet.

Background

     To facilitate a meaningful comparison, certain portions of this
Management's Discussion and Analysis of Financial Condition and Results of
Operations discuss results of Centers and Products separately.

     Management's discussion and analysis of the Company's financial condition
and the results of operation, except for "--Liquidity, Capital Resources and
Capital Expenditures," does not reflect the effects resulting from the Company's
emergence from the Chapter 11 proceeding but represents the Company's financial
position and capital structure on December 31, 2001, which was prior to the
implementation of the Plan. As such, among other things, management's discussion
does not reflect the effects of the cancellation of indebtedness that resulted
from the Chapter 11 proceeding, fresh start accounting or the write-off of
goodwill. The application of fresh start accounting will result in the write-off
of leasehold interests and the revaluation of the Company's tangible non current
assets. This will result in depreciation and amortization expense being lower in
periods subsequent to the Effective Date compared with historical accounting
periods prior to such date. In addition, the write-off of goodwill will
significantly reduce amortization expense in periods subsequent to December 31,
2001.

     The results of operations of Centers, Products and the consolidated group
of companies are set forth below. The business segment results presented below
are before intersegment eliminations since the Company's management believes
this provides a more accurate comparison of performance by segment. The
intersegment eliminations are not material. The comparative results of Centers
for 2001 reflect the closing of 9 centers and the opening of 1 center. The
comparative results of Centers for 2000 reflect the closing of 14 centers, the
sale of 4 previously closed centers and the acquisition of 4 centers.

     The Company's consolidated financial statements for 2001 were prepared in
accordance with SOP 90-7, which provides guidance for financial reporting by
entities that file petitions under the Bankruptcy Code and expect to reorganize
under Chapter 11. Under SOP 90-7, the financial statements of an entity in a
Chapter 11 distinguish transactions and events directly associated with the
reorganization from those of operations of the ongoing business. Revenue and
expenses, realized gains and losses, and provisions for losses resulting from
the reorganization and restructuring of the business are reported in the
statement of operations separately as reorganization items, net. See "Note 7.
Liabilities Subject to Resolution" and "Note 8. Reorganization Items, Net and
Other Charges" in the Notes to the Consolidated Financial Statements for further
discussion.

     The results discussed below include operating results expressed in terms of
EBITDA, which represents earnings before net interest expense, income taxes,
depreciation and amortization, restructuring and asset impairment charges,
refinancing charges and reorganization items, net. EBITDA information is
included because the Company understands that such information is a standard
measure commonly reported and widely used by certain investors and analysts.
EBITDA is not intended to represent and should not be considered more meaningful
than, or an alternative to, other measures of performance determined in
accordance with generally accepted accounting principles.

                                       19

<PAGE>

Performance by Business Segment

Centers

     Centers' results reflect all bowling centers operations. To facilitate a
meaningful comparison, the constant center results discussed below reflect the
results of 498 centers that had been in operation one full fiscal year as of
December 31, 2000. The discussion of new center results reflects the results of
5 centers that were either purchased since January 1, 2000 or had been in
operation less than one full fiscal year as of December 31, 2000. Centers
derives its revenue from three principal sources: (i) bowling, (ii) food and
beverage and (iii) Ancillary Sources. In 2001, bowling, food and beverage and
Ancillary Sources represented 58.3%, 27.4% and 14.3% of total Centers revenue,
respectively. In 2000, bowling, food and beverage and Ancillary Sources
represented 58.0%, 27.5% and 14.5% of total Centers revenue, respectively.

     Centers' EBITDA included charges of $0.4 million in 2001 related to the
termination of a joint venture that formerly operated one center in the People's
Republic of China and $4.6 million recorded for prepetition expenses incurred
but not yet invoiced as of June 30, 2001 as a result of filing the petitions
commencing the Chapter 11 proceeding. In 2000, Center's EBITDA included charges
of $12.0 million primarily related to the write-off of goodwill and fixed assets
in the U.K. and increased reserves in the U.S. for center closures and insurance
expense. Centers' EBITDA included charges of $6.6 million in 1999 primarily
related to special charges taken in 1999. See "--Consolidated Items" and "Note
8. Reorganization Items, Net and Other Charges" in the Notes to Consolidated
Financial Statements for additional information on these charges.

<TABLE>
<CAPTION>
                                                         For the year ended December 31,
                                                      ------------------------------------
                                                         1999          2000        2001
                                                      ----------   ----------   ----------
                                                              (dollars in millions)
<S>                                                   <C>          <C>          <C>
Centers (before intersegment eliminations)
Operating revenue                                     $    585.7   $    580.4   $    577.1
                                                      ----------   ----------   ----------
Cost of goods sold                                          61.1         60.1         57.9
Bowling center operating expenses                          374.5        388.0        377.8
Selling, general and administrative expenses                12.8          6.7          8.0
Restructuring and asset impairment charges                   8.3          2.6          3.5
Refinancing charges                                            -          0.8          1.9
Depreciation and amortization                              109.4        111.7        105.4
                                                      ----------   ----------   ----------
     Operating income                                 $     19.6   $     10.5   $     22.6
                                                      ==========   ==========   ==========

Selected Data:
EBITDA (a)                                            $    137.3   $    125.6   $    133.4
EBITDA margin                                               23.4%        21.6%       23.1%
Number of centers, end of period                           539          525         517
Number of lanes, end of period                          18,654       18,228      18,180

</TABLE>

-----------------------
(a)  EBITDA represents earnings before net interest expense, income taxes,
     depreciation and amortization, restructuring and asset impairment charges,
     refinancing charges and reorganization items, net.

     2001 Compared to 2000. Centers operating revenue decreased $3.3 million, or
0.6%. U.S. bowling center revenue increased $0.1 million and international
bowling center revenue, impacted primarily by negative trends in foreign
currency exchange rates and the loss of league bowlers in Australia, decreased
$3.4 million, or 3.1%. An increase of $13.4 million was attributable to new
centers, of which $2.6 million was from U.S. centers, and $10.8 million was from
international centers. Constant center operating revenue decreased $7.3 million,
or 1.3%. U.S. constant center operating revenue increased $5.6 million, or 1.2%,
primarily as a result of increases in open play revenue and Ancillary Sources
associated with open play. International constant center revenue decreased $12.9
million, or 11.5%, primarily as a result of the negative impact of changes in
foreign currency exchange rates and the

                                       20

<PAGE>

loss of league bowlers in Australia. A decrease in operating revenue of $9.4
million was attributable to the closing of 8 U.S. centers and one international
center in 2001.

     Centers cost of goods sold decreased $2.2 million, or 3.7%. Constant
centers cost of goods sold decreased $2.7 million, or 4.7%. U.S. constant
centers cost of goods sold decreased $1.2 million, or 2.7%, primarily as a
result of a decrease in food revenue offset by an improved margin on alcohol
sales. International constant centers cost of goods sold decreased $1.5 million,
or 12.8%. A decrease in cost of goods sold of $1.1 million was associated with
the centers closed in 2001. An increase of $1.6 million was attributable to new
centers, primarily international.

     Centers operating expenses decreased $10.2 million, or 2.6%. An increase of
$10.4 million was attributable to new centers and a decrease of $8.2 million was
attributable to constant centers. A decrease of $3.6 million was attributable to
lower regional and district operating expenses resulting from position
eliminations in 2000. An additional decrease of $8.8 million was attributable to
centers closed in 2001. As a percentage of revenue, Centers operating expenses
were 65.5% for 2001 compared with 66.9% for 2000.

     Centers selling, general and administrative expenses increased $1.3
million. As a percentage of revenue, Centers selling, general and administrative
expenses were 1.4% for 2001 and 1.2% for 2000.

     2000 Compared to 1999. Centers operating revenue decreased $5.3 million, or
0.9%, U.S. bowling center revenue increased $5.7 million, or 1.2%, and
international bowling center revenue, substantially impacted by negative trends
in foreign currency exchange rates, decreased $11.0 million, or 8.8%. An
increase of $2.5 million was attributable to new centers, of which $2.4 million
was from U.S. centers, and $0.1 million was from international centers. Constant
center operating revenue increased $1.4 million, or 0.2%. U.S. constant center
operating revenue increased $9.7 million, or 2.2%, primarily as a result of
increases in open play revenue, and food and beverage and Ancillary Sources
associated with open play. International constant center revenue decreased $8.3
million, or 6.9%, almost entirely caused by the negative impact of changes in
foreign currency exchange rates. A decrease in operating revenue of $9.2 million
was attributable to the closing of 12 U.S. centers and two international centers
and the sale of two international centers all in 2000.

     Centers cost of goods sold decreased $1.0 million, or 1.6%. Constant
centers cost of goods sold decreased $0.5 million, or 0.8%. U.S. constant
centers cost of goods sold increased $0.3 million, or 0.7%, primarily as a
result of costs associated with the increase in food and beverage and Ancillary
Sources discussed above. International constant centers cost of goods sold
decreased $0.8 million, or 6.7%. A decrease in cost of goods sold of $0.9
million was associated with the centers closed or sold in 2000. An increase of
$0.4 million was attributable to new centers, primarily in the U.S.

     Centers operating expenses increased $13.5 million, or 3.6%. An increase of
$2.0 million was attributable to new centers and an increase of $15.9 million
was attributable to constant centers. An increase of $3.2 million was
attributable to higher regional and district operating expenses resulting from
new field level positions that were added in 1999 and national advertising
campaigns. These increases were partially offset by a decrease of $7.6 million
attributable to centers closed or sold in 2000. As a percentage of revenue,
Centers operating expenses were 66.9% for 2000 compared with 63.9% for 1999. In
the fourth quarter of 2000, Centers recorded charges totaling $12.0 million to
reflect: (i) the net present value of leases related to centers scheduled to be
closed ($2.8 million), (ii) the write down of U.K. property, equipment and
goodwill no longer in service ($6.2 million), (iii) the increase in insurance
claims experience that resulted from the enhancement of benefits to U.S. bowling
center employees and the occurrence of certain unusual claims ($2.2 million) and
(iv) statutory audit adjustments to the French bowling centers results ($0.8
million). Without these additional fourth quarter charges, Centers operating
expenses were $376.0 million, or 64.8% of its revenue.

     Centers selling, general and administrative expenses decreased $6.1
million, or 47.7%. Constant centers selling, general and administrative expenses
were lower in 2000 by $6.0 million primarily attributable to charges recorded in
1999 related to center closures in the U.S. As a percentage of revenue, Centers
selling, general and administrative expenses were 1.2% for 2000 and 2.2% for
1999.

                                       21

<PAGE>

Products

     Products' EBITDA included charges of $14.7 million in 2001 primarily
related to the write down of the carrying value of certain inventory and an
increased allowance for doubtful accounts related to accounts receivable and
$0.5 million recorded for prepetition expenses incurred but not yet invoiced as
of June 30, 2001 as a result of filing the petitions commencing the Chapter 11
proceeding. Products' EBITDA included charges of $26.5 million in 2000 primarily
related to the write-off of inventory and accounts receivable, including the
effects of closing an international sales office and termination of certain
distribution agreements. Products' EBITDA included charges of $19.7 million in
1999 primarily related to the write-off of accounts receivable and inventory.
See "Note 8. Reorganization Items, Net and Other Charges" in the Notes to
Consolidated Financial Statements and "--Consolidated Items" for additional
information on these charges.

<TABLE>
<CAPTION>
                                                                         For the year ended December 31,
                                                                   ------------------------------------------------
                                                                      1999                2000              2001
                                                                   ----------           ---------        ----------
                                                                                 (dollars in millions)
<S>                                                                <C>                  <C>              <C>
Products (before intersegment eliminations)
Operating revenue                                                  $    169.3           $   151.3        $    136.4
Cost of goods sold                                                      137.0               128.3             113.7
                                                                   ----------           ---------        ----------
     Gross profit                                                        32.3                23.0              22.7
Selling, general and administrative expenses                             44.0                41.6              38.0
Restructuring and asset impairment charges                                8.2                 2.3               1.8
Refinancing charges                                                       -                   0.2               0.6
Depreciation and amortization                                            23.6                24.8              24.8
                                                                   ----------           ---------        ----------
     Operating loss                                                $    (43.5)          $   (45.9)       $    (42.5)
                                                                   ===========          ==========       ===========

Selected Data:
Gross profit margin                                                      19.1%               15.2%             16.6%
EBITDA (a)                                                         $    (11.7)          $   (18.6)       $    (15.3)
EBITDA margin                                                            -6.9%              -12.3%            -11.2%
</TABLE>

-----------------------
(a)  EBITDA represents earnings before net interest expense, income taxes,
     depreciation and amortization, restructuring and asset impairment charges,
     refinancing charges and reorganization items, net.

     2001 Compared to 2000. Products operating revenue decreased $14.9 million,
or 9.8%. The absence of a strong market, such as the Asia Pacific region in the
mid-1990's, increased price and competition from smaller manufacturers in
certain product lines, competition in general and the lingering effects of
technical difficulties in the scoring and back office systems introduced in 1998
also continued to adversely impact results. Management believes the Chapter 11
proceeding may have adversely impacted some sales opportunities. During 2001,
Products recorded NCP shipments of 847 units compared to shipments of 1,513
units in 2000.

     Gross profit decreased $0.3 million, or 1.3%. Gross profit margin was 16.6%
in 2001 and 15.2% in 2000. In 2001 and 2000, charges of $5.1 million and $2.2
million, respectively, were recorded to reflect a revaluation of inventory in
the context of current market conditions. See "--International Operations."

     Products' selling, general and administrative expenses decreased $3.6
million, or 8.7%, compared with 2000. In 2001, Products recorded charges of $6.8
million reflecting increased reserves for accounts receivable. In 2000, $11.5
million of charges were recorded.

     2000 Compared to 1999. Products operating revenue decreased $18.0 million,
or 10.6%. This decline is composed of decreases of $8.6 million, or 16.3%, in
NCP revenue, and $9.4 million, or 8.1%, in Modernization and Consumer Products
revenue. Among other things, the absence of a strong market, such as the Asia
Pacific region, and increased competition in general continued to adversely
impact results. Additionally, sales to North American customers and Centers
decreased. In Europe, NCP and Modernization equipment sales improved and more
than

                                       22

<PAGE>

offset a decrease in Consumer Product sales in that region. During 2000,
Products recorded NCP shipments of 1,513 units compared to shipments of 1,343
units for 1999. See "Item 1. Business--International Operations."

     Gross profit decreased $9.3 million, or 28.8%. Gross profit margin was
15.2% in 2000 and 19.1% in 1999. In 1999 and 2000, charges were recorded to
reflect a revaluation of inventory levels in the context of current market
conditions. See "--International Operations."

     Products selling, general and administrative expenses decreased $2.4
million, or 5.5%, compared with 1999 results. In the fourth quarter of 2000,
Products recorded charges of $5.0 million reflecting write-offs of bad debts
that were impacted by decisions to exit certain distributor arrangements or
markets in South America and the People's Republic of China, $5.3 million
reflecting the reconciliation of certain intercompany differences and other
charges of $1.2 million. In 1999, $10.8 million of special charges were
recorded. Savings of approximately $3.1 million achieved through cost reductions
in 2000 were partially offset by the increase in charges discussed above.

Consolidated Items

Restructuring, Asset Impairment, Refinancing and Special Charges

     2001. In 2001, the Company recorded approximately $13.0 million of
refinancing charges related to the proposed restructuring of indebtedness. The
charges primarily included amounts paid prior to the Petition Date for legal and
advisory services and certain payments made in connection with employee
retention programs. In addition, the Company recorded $2.1 million in
restructuring charges and asset impairment charges of $3.5 million representing
the difference between the fair market value and carrying value of impaired
assets of one closed bowling center. See "Note 1. Business Description -
Organization and Restructuring" in the Notes to the Consolidated Financial
Statements for a description of the Chapter 11 activities.

     2000. In 2000, the Company recorded restructuring charges of approximately
$3.4 million related to a plan to close Products' Korean operations and sales
office. The restructuring charges related primarily to employee termination
benefits, asset write-offs and contract cancellations.

     In 2000, Worldwide recorded $6.5 million of refinancing charges related to
the restructuring of its long-term debt. The charges primarily included amounts
paid to legal and financial advisors representing the Company and informal
committees of the Former Secured Creditors and certain of the Former Unsecured
Creditors. The Company also recorded asset impairment charges of approximately
$1.6 million representing the difference between the fair market value and
carrying value of impaired assets of five bowling centers. The asset impairment
charges related to these under-performing bowling centers which were closed in
2001. Fair market value was generally determined based on the average sales
proceeds from previous sales of idle bowling centers.

     1999. The Company recorded restructuring charges of approximately $8.5
million related primarily to a plan to reorganize and downsize the Products
business in response to market weakness in the Asia Pacific region and increased
competition that negatively and materially impacted sales and profitability. The
restructuring plan was developed in conjunction with a strategic business
assessment designed to reduce the overall volatility of the Products business.
The restructuring charges related primarily to employee termination benefits,
asset write-offs and contract cancellations. The Company also recorded asset
impairment charges of $8.1 million representing the difference between the fair
market value and carrying value of impaired assets. The asset impairment charges
related to under-performing bowling centers that were closed.

     A strategic assessment led to programs designed to improve product line
profitability and quality in the Company. This assessment was a catalyst to the
Company recording certain charges and recording additional reserves
(collectively, the "Special Charges"). These totaled $26.5 million. The Special
Charges were non-cash, related primarily to accounts receivable and inventory
write-offs and were included within selling, general and administrative expenses
and cost of goods sold.

     See "Note 8. Reorganization Items, Net and Other Charges" in the Notes to
Consolidated Financial Statements for additional discussion of these charges.

                                       23

<PAGE>

Depreciation and Amortization

     For 2001, depreciation and amortization decreased $6.0 million, or 4.4%
compared with 2000. The decrease in 2001 was primarily a result of the impact of
foreign currency exchange rates that reduced the U.S. dollar amount of
depreciation of international assets. For 2000, depreciation and amortization
increased by $3.3 million, or 2.5%, compared with 1999, and for 1999,
depreciation and amortization increased by $12.4 million, or 10.3%, compared
with 1998. The increases in 2000 and 1999 were primarily attributable to
incremental depreciation expense as a result of capital expenditures.

Interest Expense

     Gross interest expense decreased $16.6 million, or 13.7% in 2001 compared
with 2000. Interest incurred on the Bank Debt increased by approximately $7.5
million primarily due to higher average borrowing rates. As a result of the
default under the Old Credit Agreement, the Company paid interest to the Former
Secured Creditors at Citibank N.A.'s ("Citibank") customary base rate plus a
margin ranging from 2.75% to 3.75% and a 2% increment for default interest rates
until the Petition Date. From the Petiton Date to the Effective Date, the unpaid
2% increment for default interest rate was included in the Former Secured
Creditors' allowed claim and satisfied under the Plan. The Old Senior
Subordinated Discount Notes began to accrue cash interest on March 16, 2001.
Non-cash interest on the Old Senior Subordinated Discount Notes totaled $6.5
million for 2001. As of the Petition Date, Worldwide discontinued accruing
interest on its prepetition subordinated debt since management believed that the
debt would be materially reduced or discharged in the Chapter 11. If such
interest had continued to be accrued, interest expense for 2001 would have been
approximately $30.6 million higher than the reported amount.

     During the first quarter of 2001, the Company paid approximately $11.7
million of interest that was accrued under the Old Credit Agreement in 2000.

     Gross interest expense increased by $10.2 million, or 9.2%, in 2000
compared with 1999. Interest under the Old Credit Agreement increased as the
impact of higher average borrowing rates more than offset the effect of a
decrease in certain average amounts outstanding. Cash interest expense for 2000
totaled $89.0 million and included $13.6 million not paid on the Old Senior
Subordinated Notes on September 15, 2000. Non-cash interest in 2000 on the Old
Senior Subordinated Discount Notes amortization totaled $30.4 million.

Reorganization Items, Net

     Reorganization items, net for the year ended December 31, 2001 consist of
the following:

                                                      (dollars in thousands)
      Provision for center closings (a)                     $    22,396
      Professional fees                                          19,783
      Write off deferred financing costs (b)                      9,068
      Employee retention program (c)                              2,447
      Other                                                       3,037
                                                            -----------
           Total                                            $    56,731
                                                            ===========

-----------------------
        (a) During the Chapter 11 proceeding, the Company decided to close
            13 U.S. bowling centers (12 of which were premises subject to
            leases rejected in the Chapter 11 proceeding) and two other
            operating locations and to dispose of 12 bowling centers in
            Brazil and Argentina. This reserve also includes the closing or
            disposition of one center in Germany, two centers in Spain and
            two golf practice ranges in 2001 and early 2002.
        (b) Represents financing costs associated with the Old Credit
            Agreement and with the issuance of the Old Subordinated Notes.
        (c) Represents a bonus, severance and retention program approved by
            the Bankruptcy Court to ensure the retention of certain
            employees who were actively involved in, and essential to, the
            restructuring.

     The reorganization items above include cash paid in the year ended December
31, 2001 for professional fees, the employee retention program and other of $8.6
million, $1.2 million, and $0.4 million, respectively.

                                       24

<PAGE>

Provision for Income Taxes

     As of December 31, 2001, the Company had net operating losses of
approximately $434.7 million and foreign tax credits of $7.0 million. Absent the
effects of the Plan, these losses would carry over to future years to offset
U.S. income taxes. The foreign tax credits began to expire in 2001 and the net
operating losses will begin to expire in 2011. The Company recorded a valuation
reserve as of December 31, 2001 for $268.9 million related to net operating
losses, foreign tax credits and other deferred tax assets that the Company may
not utilize prior to their expirations. The tax provision recorded for 2001 and
2000 primarily reflects certain international taxes. The utilization of the net
operating losses was significantly limited by the operating losses incurred by
the Company. See "Note 9. Income Taxes" in the Notes to the Consolidated
Financial Statements.

Net Loss

     Net loss in 2001 totaled $217.0 million compared with a net loss of $181.5
million in 2000, a change of $35.5 million primarily related to the items
discussed above.

     Net loss in 2000 totaled $181.5 million, compared with a net loss of $201.0
million in 1999, a change of $19.5 million primarily related to the items
discussed above and an equity in loss of joint venture of $0.5 million in 2000
compared with $18.6 million in 1999.

Liquidity - Capital Resources - Capital Expenditures

     General

     The Company's indebtedness under the Old Credit Agreement consisted of a
$255.0 million senior secured revolving credit facility (the "Bank Facility")
and $365.1 million senior secured term loan facilities (the "Term Facilities").
This indebtedness was discharged and eliminated in the Chapter 11 proceeding.

     During the Chapter 11 proceeding, the Company had a $75.0 million DIP Loan.
On the Effective Date, there were no amounts outstanding under the DIP Loan and
it was discharged and terminated on the Effective Date.

     The New Credit Agreement provides for a $290.0 million Term Facility and a
$60.0 million Revolver that were made available to the Company on the Effective
Date. The proceeds of the Term Facility and approximately $10.0 million of the
Revolver were used to make cash payments to satisfy certain claims and expenses
required to be paid in cash under the Plan. Subsequent to the Effective Date,
the outstanding $10.0 million borrowing under the Revolver was repaid. As of
March 15, 2002, there were no outstanding borrowings under the Revolver. The
Revolver continues to be available for the Company's working capital and general
corporate needs, subject to customary borrowing conditions.

     Based on the amounts outstanding under the New Credit Agreement at March
17, 2002 ($290.0 million under the Term Facility and nothing under the Revolver)
and assuming interest accrues under the Eurodollar borrowing option based on
3-month LIBOR of 2.03%, the Company expects that the interest payable under the
New Credit Agreement (excluding amortization of deferred financing costs and
commitment fees and letter of credit fees payable under the Revolver) and the
New Subordinated Notes, will be approximately $39.0 million annually, assuming
interest rates and applicable margins remain at current levels.

     Both the New Credit Agreement and the New Indenture contain certain
restrictive covenants, including the achievement of certain financial covenants
and maximum levels of capital expenditures. See "Note 6. Long-Term Debt" in the
Notes to the Consolidated Financial Statements and the New Credit Agreement and
the New Indenture filed as exhibits to this Form 10-K.

     The Company generally relies on cash flow from operations and borrowings
under the Revolver to fund its liquidity and capital expenditure needs. The
Company's ability to repay its indebtedness will depend on its future
performance, which is subject to general economic, financial, competitive,
legislative, regulatory and other factors.

                                       25

<PAGE>

Management believes that available cash flow from operations and borrowings
under the Revolver will be sufficient to fund its liquidity and capital
expenditure needs.

     Liquidity

     2001 Compared to 2000. Working capital as of December 31, 2001 was ($613.4)
million compared with ($1,105.1) million on December 31, 2000, an increase of
$491.7 million. As a result of a default under the Old Credit Agreement, the
Company's debt was reclassified as current at December 31, 2000. Decreases in
working capital were attributable to a decrease of $17.0 million in inventory, a
decrease of $15.7 million in accounts receivable and a decrease of $21.5 million
in cash. These decreases in working capital were offset by an increase in
working capital attributable to a decrease of $522.5 million in current portion
of long-term debt resulting primarily from the reclassification of certain
prepetition long-term debt to liabilities subject to resolution in accordance
with SOP 90-7 and a decrease of $26.2 million in accounts payable and accrued
expenses resulting primarily from the reclassification of certain prepetition
amounts to liabilities subject to resolution in accordance with SOP 90-7 and an
increase of $1.5 million in other current assets.

     Net cash provided by operating activities was $27.6 million in 2001 as
compared with $28.7 million in 2000, a difference of $1.1 million. Decreases
resulted from: (i) $35.5 million attributable to a net loss of $217.0 million
recorded in 2001 compared with the net loss of $181.5 million in 2000, (ii) $0.5
million due to the change in equity of joint ventures, (iii) $6.0 million
attributable to the change in depreciation and amortization, (iv) $14.0 million
attributable to increased other assets, (v) $1.0 million due to the change in
levels of accounts and notes receivable and (vi) $23.8 million due to lower bond
amortization. These decreases were partially offset by increases of: (i) $17.6
million attributable to lower levels of inventory, (ii) $46.6 million
attributable to reorganization items, net described in "Note 8. Reorganization
Items, Net and Other Charges," (iii) $3.4 million attributable to changes in
accounts payable and accrued expenses, (iv) $2.0 million due to increased losses
on sale of property and equipment and (v) $10.1 million attributable to changes
in other operating activities.

     Net cash used in investing activities was $49.2 million for 2001 compared
with $65.6 million in 2000, a difference of $16.5 million. Purchases of property
and equipment decreased by $17.1 million in 2001. Proceeds from the sale of
property and equipment decreased by $9.1 million in 2001. Acquisitions of
operating units, net of cash acquired decreased $8.5 million. See "--Capital
Expenditures" for additional discussion of purchases of property and equipment.

     No net cash was provided by financing activities in 2001 compared with net
cash provided of $64.6 million in 2000, a difference of $64.6 million. Proceeds
from long-term debt decreased $82.0 million. Payments on long-term debt
decreased $24.4 million. During 2001, Worldwide borrowed and repaid $5.0 million
under the DIP Loan. In 2001, the Company made no principal payments under the
Term Facilities or Bank Facility.

     As a result of the aforementioned, cash decreased by $21.5 million in 2001
compared with an increase of $26.2 million in 2000.

     2000 Compared to 1999. Working capital on December 31, 2000 was $(1,105.1)
million compared with $7.1 million as of December 31, 1999, a decrease of
$1,112.2 million. In 2000, long-term debt of $1,134.6 million was classified as
current and reduced working capital accordingly. Additional decreases in working
capital were attributable to a decrease of $20.1 million in accounts receivable
balances, a decrease of $1.7 million in deferred taxes and other current assets,
and an increase of $20.6 million in accounts payable and accrued expenses that
primarily reflect higher accrued interest. These decreases in working capital
were partially offset by increases in working capital attributable to an
increase of $26.2 million in cash, an increase of $2.2 million in inventory and
a decrease of $2.1 million in income taxes payable.

     Net cash flows provided by operating activities were $28.7 million for 2000
compared with net cash flows provided of $40.1 million for 1999, a decrease of
$11.4 million. A decrease of $18.1 million was attributable to a decrease in the
equity in loss of joint ventures, a decrease of $15.2 million was attributable
to higher Products inventory balances, loss on impairment of assets decreased
$6.6 million, a decrease of $4.1 million was associated with loss on the sale of
property and equipment, and a net decrease of $2.9 million was attributable to
changes in other operating activities. These decreases were partially offset by
an increase of $19.8 million attributable to lower

                                       26

<PAGE>

levels of accounts receivable, an increase of $19.5 million was attributable to
the net loss of $181.5 million recorded in 2000 compared with a net loss of
$201.0 million in 1999, an increase of $9.8 million was caused by increased
levels of accounts payable and accrued expenses, bond amortization increased
$3.5 million, and depreciation and amortization increased $3.4 million.
Additionally, in 1999, the Company recorded a valuation allowance of $19.5
million against its net deferred tax assets.

     Net cash flows used in investing activities were $65.6 million for 2000
compared with net cash flows used of $51.5 million for 1999, an increase of
$14.1 million. Centers' acquisition spending increased by $7.1 million and
purchases of property and equipment increased by $14.4 million in 2000 compared
with 1999. In 2000, the Company purchased four centers (excluding the 13 joint
venture centers acquired in December 2000) compared with one center in 1999.
These increases were partially offset by an increase in proceeds from the sale
of property and equipment of $7.4 million in 2000 compared with 1999.

     Net cash provided by financing activities was $64.3 million for 2000
compared to the net cash provided of $9.1 million for 1999, an increase of $55.2
million. Proceeds from long-term debt, all borrowings under the Old Credit
Agreement, increased $6.0 million. Payments on long-term debt decreased $77.0
million. In accordance with the terms of the Old Credit Agreement, scheduled
principal payments in 2000 were $1.9 million higher than payments made in 1999.
Worldwide did not pay $12.8 million in principal due December 29, 2000.
Additionally, in 1999, $74.0 million was paid against amounts outstanding under
the Bank Facility. In 2000, AMF Bowling, the Company's former parent,
contributed $7.0 million as capital to Worldwide in accordance with the cure
provisions of the Old Credit Agreement. In 1999, $34.7 million was provided by
additional capital contributions from AMF Bowling from part of the net proceeds
of a rights offering by AMF Bowling.

     As a result of the aforementioned, cash increased by $26.2 million in 2000
compared with a decrease of $1.3 million in 1999.

     Capital Resources

     As of December 31, 2001, the Company's debt consisted primarily of $616.4
million of borrowings under the Old Credit Agreement, $3.1 million represented
by one mortgage note and one capitalized equipment lease, $250.0 million of Old
Senior Subordinated Notes and $277.0 million of Old Senior Subordinated Discount
Notes. As of December 31, 2001, the borrowings outstanding under the Old Credit
Agreement consisted of $365.1 million under the Term Facilities and $251.3
million under the Bank Facility.

     As of December 31, 2001, the Company had no ability to borrow under the Old
Credit Agreement. As of December 31, 2001, the Company had $70.9 million
available for borrowing under the DIP Loan, with no outstanding borrowings and
$4.1 million of standby letters of credit.

     During 2001, the Company funded its cash needs primarily through cash flows
from operations. Worldwide incurred cash interest expense of $93.9 million in
2001, including $13.6 million not paid on the Old Senior Subordinated Notes due
on March 15, 2001 and representing 91.3% of EBITDA of $102.9 million for the
year. Worldwide incurred cash interest expense of $89.0 million in 2000,
representing 98.3% of EBITDA of $90.5 million for the year.

     As of the Petition Date, Worldwide discontinued accruing interest on the
Old Subordinated Notes due to management's belief that the debt would be
materially reduced or discharged in the Chapter 11 proceeding. If such interest
had continued to be accrued, interest expense for 2001 would have been
approximately $30.6 million higher than the reported amount. During 2001, no
principal payments were made under the Old Credit Agreement.

     Capital Expenditures

     The Company's capital expenditures were $49.5 million in 2001 compared with
$66.5 million for 2000, a decrease of $17.0 million. Products expenditures
decreased $4.2 million. Company-wide information systems expenditures decreased
$4.0 million. Centers' maintenance and modernization expenditures decreased $8.8
million primarily as a result of the completion in 2000 of a program to install
Xtreme(TM) bowling equipment at most of its U.S. bowling centers.

                                       27

<PAGE>

     The Company's capital expenditures were $66.5 million in 2000 compared with
$52.1 million in 1999, an increase of $14.4 million. Centers' maintenance and
modernization expenditures increased $12.8 million. Products expenditures
increased $3.4 million. Company-wide information systems expenditures decreased
$6.9 million. Investments in Xtreme(TM) bowling equipment at various bowling
centers increased by $5.7 million. Capital expenditures for new centers
decreased $0.6 million.

Seasonality and Market Development Cycles

     The following table sets forth the Company's U.S. constant center revenue
for the four quarters of 2001:

<TABLE>
<CAPTION>
                                                    Quarter ended (dollars in millions)
                              -----------------------------------------------------------------------------------
                              March 31, 2001       June 30, 2001       September 30, 2001       December 31, 2001
                              --------------       -------------       ------------------       -----------------
<S>                             <C>                  <C>                   <C>                     <C>
Total Revenue                 $       142.3        $      95.1         $         95.1           $      125.6
% of Total                             31.1%              20.8%                  20.8%                  27.3%

</TABLE>

     Centers' business is seasonal. Cash flows typically peak in the winter and
are lower in the summer.

     Products' sales are also seasonal. The beginning of league play in the fall
of each year drives the U.S. market, which is primarily a market for
Modernization and Consumer Products and with the decline in demand for NCPs, is
the largest market for Products. While bowling center proprietors purchase
consumer products throughout the year, they often place larger orders during the
summer in preparation for the start of league play in the fall. Summer is also
generally the peak period for installation of modernization equipment.
Proprietors typically sign purchase orders for modernization equipment during
the spring after they have indications of fall league sign ups. Modernization
equipment is then shipped and installed during the summer when bowling centers
have generally fewer bowlers.

International Operations

     The Company's international operations are subject to the usual risks
inherent in operating internationally, including, but not limited to, currency
exchange rate fluctuations, economic and political instability, other disruption
of markets, restrictive laws, tariffs and other actions by foreign governments
(such as restrictions on transfer of funds, import and export duties and quotas,
foreign customs, tariffs and value added taxes and unexpected changes in
regulatory environments), difficulty in obtaining distribution and support for
products, the risk of nationalization, the laws and policies of the U.S.
affecting trade, international investment and loans, and foreign tax law
changes. As is the case of other U.S.-based manufacturers with export sales,
local currency devaluation increases the cost of Products' bowling equipment in
that market. As a result, a strengthening U.S. dollar exchange rate may
adversely impact sales volume and profit margins during such periods.

     Foreign currency exchange rates also impact the translation of operating
results from international bowling centers. Revenue and EBITDA of international
bowling centers represented 15.9% and 23.5% of consolidated revenue and EBITDA,
respectively, in 2001. Revenue and EBITDA of international bowling centers
represented 15.9% and 25.4% of consolidated revenue and EBITDA, respectively, in
2000.

Impact of Inflation

     The Company historically offsets the impact of inflation through price
increases. Periods of high inflation could have a material adverse impact on the
Company to the extent that increased borrowing costs for floating rate debt may
not be offset by increases in cash flow. There was no significant impact on the
Company's operations as a result of inflation during 2001, 2000 and 1999.

                                       28

<PAGE>

Recent Accounting Pronouncements

     Effective January 1, 2002, the Company adopted SFAS 142 that specifies that
goodwill and some intangible assets will no longer be amortized, but instead
will be subject to periodic impairment testing. The Company will write-off all
of its goodwill effective January 1, 2002 in connection with the adoption of
SFAS 142.

Certain Critical Accounting Policies

     The Company's significant accounting policies are summarized in Note 2 to
the Consolidated Financial Statements, which have been prepared in accordance
with generally accepted accounting principles ("GAAP"). In preparing the
consolidated financial statements, GAAP requires management to select and apply
accounting policies that involve estimates and judgement. The following
accounting policies may require a higher degree of judgement or involve amounts
that could have the greatest impact on the consolidated financial statements.

         Allowance for Doubtful Accounts

     Products maintains an allowance for doubtful accounts for estimated losses
resulting from the failure of customers to make payment. Management determines
the allowance based upon an evaluation of individual accounts, any issues raised
by the customer that relate to non payment, historical experience and the
current economic environment. A substantial portion of the allowance relates to
the sale of NCP packages to customers internationally. If the financial
condition of individual customers or countries in which Products operates or the
general worldwide economy were to vary materially from the assumptions made by
management, the allowance may require adjustment in the future. Products
evaluates the adequacy of the allowance on a regular basis, modifying, as
necessary, its assumptions, updating its record of historical experience and
adjusting reserves as appropriate.

     Inventory Obsolescence

     Products evaluates the levels, composition and salability of its inventory
on a regular basis. The evaluations include assumptions regarding potential
further sales of such inventory, estimated time periods over which such sales
might take place and assessment of the potential usability of such inventory in
future production. Products modifies, as necessary, its assumptions, updates its
record of historical experience and adjusts its reserves as appropriate.

     Equipment Warranties

     Generally, Products warrants all new products for periods of approximately
one year. Products charges to expense an estimated amount for future warranty
obligations. The reserve is determined based on an evaluation of prior warranty
expenses with similar equipment. If future warranty experience were to vary
materially from the assumptions, management would review the reserve and make
any appropriate adjustment. Products evaluates the adequacy of the reserve on a
regular basis, modifying as necessary, its assumptions, updating its record of
historical experience and adjusting its reserves as appropriate.

     Self Insurance of Benefit Programs

     The Company is self-insured up to certain amounts for general and product
liability, workers compensation, certain health care coverage, and property
damage. The reserves related to these programs are determined based on estimates
of settlements and costs of known and anticipated claims as well as the current
economic environment. If actual results were to vary materially from the
assumptions, management would review the reserve and make any appropriate
adjustment. The Company evaluates the adequacy of these reserves on a regular
basis, modifying, as necessary, its assumptions, updating its records of
historical experience and adjusting its reserves as appropriate.

                                       29

<PAGE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The Company is exposed to market risk from changes in foreign currency
exchange rates and interest rates, which could impact its results of operations
and financial condition. The Company manages its exposure to these risks through
its normal operating and financing activities and through the use of interest
rate cap agreements with respect to interest rates. At December 31, 2001, there
were no interest rate cap agreements outstanding and there were no other
material derivative instrument transactions during any of the periods presented.
Under the New Credit Agreement, the Company may be required to enter into
interest rate cap agreements. In addition, management periodically reviews its
exposure to changes in interest rates and may enter into interest rate cap
agreements as it deems appropriate.

     The Company has not hedged against exchange rate movements relative to its
investment in foreign operations. As in the case of other U.S.-based
manufacturers with export sales, local currency devaluation increases the cost
of the Company's bowling equipment in that market. As a result, a strengthening
U.S. dollar exchange rate may adversely impact sales volume and profit margins
during such periods. Foreign currency exchange rates can also impact the
translation of operating results from international bowling centers. Revenue and
EBITDA of international bowling centers represented 15.9% and 23.5% of
consolidated revenue and EBITDA, respectively, in 2001. Revenue and EBITDA of
international bowling centers represented 15.9% and 25.4% of consolidated
revenue and EBITDA, respectively, in 2000.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The financial statements and schedules listed in Item 14 are included in
this Annual Report on Form 10-K beginning on page F-1.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

     None.

                                       30

<PAGE>

                                    PART III

ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS

DIRECTORS

     Immediately prior to the Effective Date, Worldwide's Board of Directors
consisted of seven members, the majority of whom were affiliated with the former
investor group which acquired the Company in 1996 (the "Old Board"). As of the
Effective Date and pursuant to the Plan, the Old Board ceased to serve and the
New Board consisting of seven members was appointed. Each of the current
directors is elected to serve a one-year term or until his or her successor is
duly elected and qualified or until his or her earlier death, resignation or
removal. The Amended and Restated Bylaws of Worldwide, which became effective
pursuant to the Plan on the Effective Date, provide that Worldwide will not be
required to hold a meeting of stockholders to elect directors during 2002.

     The following persons are Worldwide's current directors. Mr. Smith is the
only director who served on the Old Board. He has been a director since April
1999. Each of the other directors began serving on the Effective Date.

     Roland C. Smith, 47, has been President and Chief Executive Officer of
Worldwide since joining the Company in April 1999. He was elected Chairman of
the New Board on March 20, 2002. Prior to joining the Company, he was President
and Chief Executive Officer of the Triarc Restaurant Group ("Triarc"), a
restaurant franchiser which conducts its business through Arby's, Inc., from
February 1997 to April 1999. He joined Triarc in 1994 as vice president of
international marketing.

     Frederick G. Kraegel, 53, has been Senior Vice President and Chief
Administrative Officer of Worldwide since joining the Company in August 2001. He
became an Executive Vice President in December 2001. Prior to joining the
Company, from April 2000 to August 2001, he was President of AREIL, Inc., the
successor company to Acme Markets of Virginia, Inc., a retail supermarket
company. From November 1998 to March 2000, he was Senior Vice President and
Chief Financial Officer of Factory Card Outlet Corp., a chain of retail party
goods stores. From February 1997 to March 1998, he was President of First North
American National Bank, a national bank subsidiary of Circuit City Stores, Inc.,
a chain of consumer electronics retail stores.

     Thomas M. Fuller, 36, has been a Director with Angelo Gordon & Co., L.P.
since 2000. From 1993 to 2000 he was a Vice President with Nomura Holdings
America Inc. where he was a member of the Special Situations Investment Group.
Mr. Fuller also serves as a director of ESP Holdings, an environmental testing
company.

     Philip L. Maslowe, 55, has been Executive Vice President and Chief
Financial Officer with The Wackenhut Corporation since March 2000. Mr. Maslowe
joined The Wackenhut Corporation in August 1997 as Senior Vice President and
Chief Financial Officer. Prior to joining The Wackenhut Corporation, Mr. Maslowe
was employed by KinderCare Learning Centers, Inc., as Executive Vice President
and Chief Financial Officer since 1993. Mr. Maslowe also serves on the Board of
Directors of The Wackenhut Corporation.

     Meridee A. Moore, 44, has been a managing member of Farallon Capital
Management, L.L.C. ("FCM") and Farallon Partners, L.L.C. ("FP") since 1996. FP
is the general partner of certain investment funds and FCM is a registered
investment advisor to certain managed accounts.

     Mark D. Sonnino, 41, has been a Principal with Satellite Asset Management,
LLP since 1999. Mr. Sonnino was previously employed at Soros Fund Management LLC
from 1988 through 1999, most recently as Managing Director and Head of Research
for the Arbitrage, High Yield and Distressed Securities Department. Mr. Sonnino
also serves on the Board of Directors of The Penn Traffic Company, a grocery
store chain.

     George W. Vieth, Jr., 46, has been a consultant with Chrysalis Venture, a
venture capital firm, since October, 2001. Mr. Vieth was Vice
President of Strategy and Systems at Humana, a group health insurance carrier
from August 1996 to August 1997 and became Senior Vice President in August 1997
until he resigned in October, 2001.

                                       31

<PAGE>

Committees of the Board

     Prior to the Effective Date, the Old Board did not have separate
committees; the Board of Directors of AMF Bowling, the Company's former parent,
had three standing committees - Audit, Compensation and Executive - which
functioned in accordance with their purposes for both AMF Bowling and Worldwide.

     The New Board created three separate standing committees at its March 20,
2002 meeting. The committees have not yet met.

     Audit Committee. The Audit Committee is composed entirely of independent
directors. It will recommend to the New Board the engagement of the independent
auditors of the Company and review with the independent auditors the scope and
results of the Company's audits, the Company's internal accounting controls and
the professional services furnished by the independent auditors to the company.
The members of the Audit Committee are Mr. Maslowe (Chair), Mr. Sonnino and Mr.
Fuller.

     Compensation Committee. The Compensation Committee is composed entirely of
independent directors. The Compensation Committee will be responsible for
reviewing and approving the amount and type of consideration to be paid to
senior management. The Compensation Committee will be authorized, among other
things, to grant awards under and to administer the Company's new 2002 Stock
Option Plan, which was adopted by the Company as of the Effective Date, pursuant
to the terms of the Plan. The members of the Compensation Committee are Mr.
Vieth (Chair), Ms. Moore and Mr. Maslowe.

     Executive Committee. The Executive Committee may exercise all the powers
and authority of the New Board, subject to applicable restrictions under
Delaware law that prohibit the Executive Committee from approving, adopting or
recommending to stockholders any action or matter expressly required by the
Delaware General Corporation Law to be submitted to stockholders for approval or
from adopting, amending or repealing any bylaws of the Company and subject to
the provision in the Amended and Restated Certificate of Incorporation that
requires that 80% of the entire Board of Directors must approve a shareholder
rights plan before it can be adopted. The members of the Executive Committee are
Ms. Moore (Chair), Mr. Smith and Mr. Vieth.

EXECUTIVE OFFICERS

     The following table sets forth information concerning the executive
officers of Worldwide as of March 29, 2002.

<TABLE>
<CAPTION>
       Name                          Age                            Position
       ---------------------------  ----           -------------------------------------------------------
<S>                                  <C>      <C>
       Roland C. Smith.............  47       Chairman of the New Board; President and Chief Executive Officer
       Frederick G. Kraegel........  53       Director; Executive Vice President and Chief Administrative Officer
       John H. Smith...............  59       Executive Vice President, Chief Operating Officer U.S. Centers
       John B. Suddarth............  42       Executive Vice President, Chief Operating Officer Products
       Christopher F. Caesar.......  37       Senior Vice President, Chief Financial Officer and Treasurer
       Timothy N. Scott............  42       Senior Vice President, Marketing and Chief Operating Officer
                                                International Centers
</TABLE>

     Roland C. Smith has been President and Chief Executive Officer of Worldwide
since joining the Company in April 1999. He was elected Chairman of the New
Board on March 20, 2002. Prior to joining the Company, he was President and
Chief Executive Officer of the Triarc Restaurant Group ("Triarc"), a restaurant
franchiser which conducts its business through Arby's, Inc., from February 1997
to April 1999. He joined Triarc in 1994 as Vice President of international
marketing, a business systems provider.

     Frederick G. Kraegel has been Senior Vice President and Chief
Administrative Officer of Worldwide since joining the Company in August 2001. He
became Executive Vice President in December 2001. Prior to joining the Company,
from April 2000 to August 2001, he was President of AREIL, Inc., the successor
company to Acme Markets of Virginia, Inc., a retail supermarket company. From
November 1998 to March 2000, he was Senior Vice

                                       32

<PAGE>

President and Chief Financial Officer of Factory Card Outlet Corp., a chain of
retail party goods stores. From February 1997 to March 1998, he was President of
First North American National Bank, a national bank subsidiary of Circuit City
Stores, Inc., a chain of consumer electronics retail stores.

     John H. Smith has been Executive Vice President and Chief Operating Officer
- U.S. Centers of Worldwide since joining the Company in March 2002. Prior to
joining the Company, he was Zone Vice President of Business Alliance Starbucks
Coffee, a coffee and coffee products retailer, from July 2000 to March 2002.
From September 1997 to July 2000, he was Regional Vice President, Midwest Retail
Division for Starbucks Coffee. From February 1993 to September 1997, he was
Divisional Vice President of Wendy's Restaurants Inc. Midwest Division, a fast
food retailer.

     John B. Suddarth has been Senior Vice President and Chief Operating Officer
- Bowling Products of Worldwide since joining the Company in March 2001 and
became an Executive Vice President in March 2002. Prior to joining the Company,
he was President and Chief Operating Officer of Morse Controls, a privately held
controls company, from November 1997 to February 2001. From May 1994 to October
1997, he was President of AMF Reece, Inc., a privately held industrial sewing
machine company.

     Christopher F. Caesar has been Vice President and Treasurer of Worldwide
since returning to the Company in January 1999. He became Senior Vice President,
Chief Financial Officer and Treasurer in September 2001. He joined the Company
in 1996 as Director of Financial Planning and Investor Relations. In July 1998,
he resigned from the Company. From July 1998 to January 1999, he was Vice
President of Corporate Strategy for Danka Business Systems, Plc., a business
systems provider.

     Timothy N. Scott has been Senior Vice President, Marketing of Worldwide
since joining the Company in November 1999. Prior to joining the Company, he
served as Vice President, Marketing and Advertising, from January 1999 to
October 1999, and Vice President, Creative Services, from January 1997 to
January 1998, of Long John Silver's Restaurants, a restaurant franchiser.

Section 16(a) Beneficial Ownership Reporting Compliance

     Prior to the Effective Date, the former shares of Worldwide were wholly
owned by Group Holdings and were not subject to the reporting requirements of
Section 16(a) under the Exchange Act. None of the shares of New AMF Common Stock
or Warrants are registered pursuant to Section 12 of the Exchange Act.

                                       33

<PAGE>

ITEM 11.   EXECUTIVE COMPENSATION

Summary Compensation Table

     The following table shows for each of the three years in the three year
period ended December 31, 2001, compensation for the Chief Executive Officer,
each of the four other most highly compensated executive officers of the Company
who were serving as executive officers at December 31, 2001 and the Company's
former Executive Vice President and Chief Financial Officer, who left the
Company in September 2001 (the "Named Executive Officers").

<TABLE>
<CAPTION>

                                                                                                Long-Term
                                                                                               Compensation
                                                          Annual Compensation                     Awards
                                              ----------------------------------------------    Securities          All Other
                                                                            Other Annual      Underlying Stock     Compensation
   Name and Principal Position       Year     Salary($)     Bonus($)     Compensation ($)(a)    Options($)(b)         ($)(c)
   ----------------------------      ----     ----------    ----------   -------------------  ---------------     --------------
<S>                                  <C>      <C>          <C>                <C>              <C>
Roland C. Smith (d)                  2001     621,923      1,101,625                --           --                  1,580
  Chairman, President and Chief      2000     599,997        224,999                --           --                 --
    Executive Officer                1999     387,019 (e)    931,250 (f)            --         1,000,000           231,148

Stephen E. Hare (g)                  2001     306,119        630,652                --           --                  3,438
  Former Executive Vice President,   2000     370,805        112,700                --           --                  8,446
    Chief Financial Officer          1999     360,000        108,000                --           150,000            10,000

Frederick G. Kraegel                 2001     105,770 (h)        --                 --           --                  1,430
  Executive Vice President, Chief
    Administrative Officer

John B. Suddarth                     2001     193,845 (i)     30,000              6,456          --                 10,085
  Executive Vice President,
    Chief Operating Officer
     Products

Timothy N. Scott                     2001     215,381        208,653              6,456          --                  9,226
  Senior Vice President, Marketing   2000     207,836         57,959                --           --                 66,435
    and Chief of Operating Officer   1999      38,923 (j)        --                 --           100,000             1,604
     International Centers

Christopher F. Caesar (k)            2001     168,495        136,576              6,456          --                  8,374
  Senior  Vice President, Chief      2000     132,857         34,375                --           --                  3,790
    Financial Officer
     and Treasurer                   1999     115,384         25,000                --            37,000             2,740
</TABLE>

--------------------
(a)  Represents amounts paid to reimburse executives for the taxes payable on
     matching contributions made by Worldwide under a variable annuity matching
     plan.
(b)  Options to purchase shares of common stock of AMF Bowling, the Company's
     former indirect parent. These options will expire 90 days after the
     Effective Date, except in the case of Mr. Hare, whose options expired 90
     days after his termination of employment in September 2001.
(c)  Represents for the fiscal year ended December 31, 2001 matching
     contributions made by Worldwide under a variable annuity matching plan of
     $7,875 for each of Mr. Suddarth, Mr. Scott and Mr. Caesar and premiums paid
     by Worldwide for term life insurance in the amounts of $1,580 for Mr.
     Smith, $3,438 for Mr. Hare, $1,430 for Mr. Kraegel, $2,210 for Mr.
     Suddarth, $1,351 for Mr. Scott and $499 for Mr. Caesar.
(d)  Mr. Smith was elected Chairman of the New Board on March 20, 2002.
(e)  Mr. Smith's employment with the Company began in April 1999. His annualized
     rate of salary for 1999 was $575,000.
(f)  Represents a signing bonus of
     $500,000 and a $431,250 bonus for 1999. See "--Employment Agreements."
(g)  Mr. Hare served as Executive Vice President, Chief Financial Officer until
     September 2001, when he left the Company.
(h)  Mr. Kraegel's employment with the Company began in August 2001. His
     annualized rate of salary for 2001 was $275,000.
(i)  Mr. Suddarth's employment with the Company began in March 2001. His
     annualized rate of salary for 2001 was $240,000.
(j)  Mr. Scott's employment with the Company began in November 1999. His
     annualized rate of salary for 1999 was $200,000.
(k)  Mr. Caesar was elected Chief Financial Officer in September 2001.

                                       34

<PAGE>

Aggregated Stock Option Exercises and Fiscal Year-End Option Values

     The following table provides information regarding the number and value of
unexercised stock options of Worldwide's former indirect parent, AMF Bowling, at
December 31, 2001 for the Named Executive Officers. These options were awarded
to the Named Executive Officers as compensation for services rendered to AMF
Bowling. No Named Executive Officer exercised any stock options in fiscal year
2001. These options will expire 90 days after the Effective Date, except in the
case of Mr. Hare, whose options expired 90 days after his termination of
employment in September 2001. Management of the Company believes that AMF
Bowling, which is the subject of a Chapter 11 proceeding, will not make a
distribution with respect to its equity and that the options are therefore
worthless.

<TABLE>
<CAPTION>
                                         Number of Securities Underlying         Value of Unexercised In-the
                                          Unexercised Stock Options at              Money Stock Options at
                                              December 31, 2001 (#)                 December 31, 2001 ($)
                                              ---------------------                 ---------------------
               Name                      Exercisable       Unexercisable        Exercisable       Unexercisable
----------------------------------       -----------       -------------        -----------       -------------
<S>                                         <C>              <C>                <C>                 <C>
Roland C. Smith ..................          400,000          600,000            $   0               $    0
Stephen E. Hare...................                0                0                0                    0
Frederick G. Kraegel..............                0                0                0                    0
John B. Suddarth..................                0                0                0                    0
Timothy N. Scott..................           20,000           80,000                0                    0
Christopher F. Caesar.............           19,000           18,000                0                    0

</TABLE>

     Prior to the Effective Date, certain of the Company's employees were
eligible to participate in AMF Bowling's 1996 Stock Incentive Plan and 1998
Stock Incentive Plan (collectively, the "AMF Bowling Stock Incentive Plans").
AMF Bowling is a debtor in a Chapter 11 proceeding and the Company believes that
AMF Bowling's stock and outstanding options are worthless. As of December 31,
2001, 3,386,770 options remained outstanding under the AMF Bowling Stock
Incentive Plans. For the year ended 2001, no options were issued under the AMF
Bowling Stock Incentive Plans. Options to acquire a total of 107,500 and
1,523,000 shares of AMF Bowling were issued in 2000 and 1999, respectively,
under the AMF Bowling Stock Incentive Plans. The option agreements generally
provided that options issued under these plans will be cancelled 90 days after
the affiliation between AMF Bowling and the Company ends. Such affiliation ended
on the Effective Date.

     Worldwide adopted a 2002 Stock Option Plan (the "2002 Stock Option Plan")
that became effective pursuant to the Plan on the Effective Date. Worldwide is
authorized to issue up to 1,839,388 shares of New AMF Common Stock under the
terms of the 2002 Stock Option Plan (subject to adjustments for capital
adjustments as provided under the 2002 Stock Option Plan) pursuant to stock
options to be granted to certain officers, employees, consultants, and
non-employee directors of Worldwide and its affiliates. Shares allocated to
stock options granted under the 2002 Stock Option Plan that are later forfeited,
expire or otherwise terminate may again be used for grants under the 2002 Stock
Option Plan. The Compensation Committee is authorized to make grants and various
other decisions under the 2002 Stock Option Plan and to make determinations as
to a number of the terms of awards granted under the 2002 Stock Option Plan. As
of the Effective Date, the Company granted stock options under the 2002 Stock
Option Plan covering a total of 919,282 shares of New AMF Common Stock, of which
the Named Executive Officers received the following amounts: Mr. Smith
(153,282), Mr. Kraegel (75,000), Mr. Suddarth (75,000), Mr. Scott (50,000) and
Mr. Caesar (50,000). The options were granted at an exercise price of $21.19 per
share, vest over a three year period beginning on the first anniversary of the
Effective Date and expire on the seventh anniversary of the Effective Date.

     The 2002 Stock Option Plan will terminate ten years after the Effective
Date. However, awards outstanding as of that date will not be affected or
impaired by the termination. The New Board and the Compensation Committee have
authority to amend the 2002 Stock Option Plan and awards granted thereunder,
subject to the terms of the 2002 Stock Option Plan.

                                       35

<PAGE>

Employment Agreements

     Mr. Smith entered into an employment agreement dated April 28, 1999 with
AMF Bowling for an employment period ending April 29, 2002 (the "Prior Smith
Employment Agreement"). Under the Prior Smith Employment Agreement, Mr. Smith
held the positions of President and Chief Executive Officer of AMF Bowling and
Worldwide. His annual base salary under the Prior Smith Employment Agreement was
$630,000 for 2001. He received bonuses totaling $1,101,625 in 2001.

     Mr. Hare entered into an employment agreement dated August 4, 1999 (the
"Hare Employment Agreement") with AMF Bowling for an employment period ending on
August 4, 2002. Under the Hare Employment Agreement, he held the positions of
Executive Vice President and Chief Financial Officer of AMF Bowling. Mr. Hare's
annual base salary under the Hare Employment Agreement was $394,451 in 2001. He
received bonuses totaling $630,652 in 2001. Under the Hare Employment Agreement,
AMF Bowling was to grant 100,000 restricted shares of AMF Bowling's common stock
(the "Restricted Stock") at a cost of $1,000 to Mr. Hare. No Restricted Stock
was ever granted under the Hare Employment Agreement. Under the Hare Employment
Agreement, Mr. Hare was granted options to purchase 150,000 shares of AMF
Bowling's common stock. In September 2001, Mr. Hare voluntarily terminated his
employment with the Company and therefore Mr. Hare did not receive the remainder
of his cash retention bonus. He was not entitled to and did not receive any
severance payment or any other special payment. The options granted to Mr. Hare
expired 90 days after the termination of his employment.

     The Prior Smith Employment Agreement and the Hare Employment Agreement were
assigned to and assumed by Worldwide in December 2000.

     Pursuant to a resolution of the Old Board dated November 9, 2000, the Old
Board approved a Senior Executives Retention Plan (the "Senior Executives Plan")
covering Mr. Smith and Mr. Hare. In addition to providing for the assumption of
the Prior Smith Employment Agreement and the Hare Employment Agreement, the
Senior Executives Plan provided for a fiscal year 2000 bonus to be paid on March
31, 2001 in a fixed amount equal to 50% of the year 2000 bonus target; a cash
payment equal to 25% of annual base salary in lieu of stock option grants for
calendar year 2000, also to be paid on March 31, 2001; and a cash retention
bonus equal to 200% of base annual salary. Half of the payment was made on June
1, 2001, and the remainder was to be paid upon approval of the Plan. All
payments were conditioned upon employment at the date of the payment.

     The Prior Smith Employment Agreement was superseded by an amended and
restated employment agreement dated February 1, 2002 with Worldwide (the "New
Smith Employment Agreement"). The Bankruptcy Court approved the New Smith
Employment Agreement on February 1, 2002 and it became effective on the
Effective Date. Under the New Smith Employment Agreement, Mr. Smith continues to
serve as President and Chief Executive Officer of Worldwide. The New Smith
Employment Agreement has an initial term of three years and will automatically
extend on its third anniversary for consecutive periods of one year, unless
either party gives notice at least 180 days before the end of the initial
three-year term or the applicable one-year anniversary date. Mr. Smith's annual
base salary in 2002 under the New Smith Employment Agreement is $700,000. His
salary may be increased from time to time at the discretion of the Board, but
may not be decreased. He is eligible to receive an annual bonus of up to 150% of
his base salary. The annual bonus is based on the attainment of qualitative and
quantitative performance goals established by the Board each year.

     The New Smith Employment Agreement provides for payment of all earned but
unpaid compensation and benefits, and certain severance benefits if Mr. Smith's
employment is terminated by Worldwide without Cause (as defined in the
agreement) or if Mr. Smith terminates his employment for Good Reason (as also
defined in the agreement). Severance benefits are a pro-rated annual bonus based
on actual performance and achievement of individual and company performance
objectives through the end of the year, a lump sum payment equal to two times
his then annual base salary and target annual bonus for that year, and
continuation of medical plan coverage for two years following termination.
Payment of the severance benefits is conditioned on Mr. Smith executing a
release of claims against Worldwide and certain affiliated parties and are in
lieu of severance benefits to which Mr. Smith could become entitled under any
other arrangement.

     If Mr. Smith's employment is terminated due to his death or disability,
Worldwide will pay Mr. Smith's earned but unpaid compensation and benefits, a
pro-rated annual bonus based on actual performance and achievement of

                                       36

<PAGE>

individual and company performance objectives through the end of the year, and
continuation of medical plan coverage for Mr. Smith and his dependents for two
years following termination of his employment. If Mr. Smith is terminated for
Cause or if he terminates his employment for a reason other than Good Reason, he
will be entitled to payment of his earned but unpaid compensation and benefits.
If Mr. Smith gives notice of resignation, and Worldwide terminates his
employment before the end of the 60-day notice period, Worldwide will continue
to pay Mr. Smith's base salary and provide benefits until the end of the notice
period.

     Under the New Smith Employment Agreement, as of the Effective Date, Mr.
Smith was granted stock options to purchase 153,282 shares of New AMF Common
Stock at an exercise price equal to $21.19 per share. Mr. Smith's stock options
will generally expire on March 8, 2009, although they may expire before that
date if Mr. Smith's employment terminates under certain circumstances. One-third
of the options vest after each of the first, second and third anniversaries of
the Effective Date, subject to Mr. Smith's continued employment with Worldwide.
In the event of a Change in Control (as such term is defined in the New Smith
Employment Agreement), or if Worldwide terminates Mr. Smith's employment without
Cause or if Mr. Smith terminates his employment for Good Reason before a Change
of Control occurs, any unvested stock options will immediately vest. Mr. Smith
was also granted a restricted stock award of 153,282 shares of New AMF Common
Stock. The grant is subject to the terms of a Restricted Stock Award Agreement
dated February 1, 2002. One-third of the restricted shares vest after each of
the first, second and third anniversaries of the Effective Date, subject to his
employment with Worldwide on such date. If Mr. Smith's employment is terminated
by Worldwide other than for Cause (as defined in the restricted stock award
agreement) or he terminates his employment for Good Reason (as also defined in
the agreement) before the first anniversary of the Effective Date, he will
become immediately vested in one-third of the shares subject to the award. If
such termination occurs after the first anniversary of the Effective Date but
before all of the shares have become vested, he will become vested in a
pro-rated portion of one-third of the shares subject to the award (based on the
number of days that have elapsed since the most recent anniversary of the
Effective Date).

     Under the New Smith Employment Agreement, Mr. Smith will also be eligible
to receive a lifetime nonqualified supplemental retirement benefit beginning at
age 65. This annual supplemental retirement benefit will equal 2% of his average
annual base salary (as described below) over the highest three years during the
ten years before his retirement, multiplied by his years of service with
Worldwide since May 1, 1999; provided, however, that this benefit will be offset
by any benefit payable from any tax-qualified retirement plan maintained by
Worldwide. This supplemental retirement benefit will vest ratably over 84 months
of service beginning on May 1, 1999. The compensation taken into account in
determining Mr. Smith's retirement benefit is the salary amount disclosed under
"Annual Compensation" in the Summary Compensation Table. Mr. Smith completed 2.6
years of service as of the fiscal year ended December 31, 2001. The retirement
benefit is payable in the form of a single life annuity beginning at Mr. Smith's
attainment of age 65. The benefit may begin to be paid prior to Mr. Smith's
attainment of age 65 under certain circumstances, and may, at Mr. Smith's
election, be paid in the form of an actuarially equivalent lump sum or a 50%
joint and survivor annuity instead of in the form of a single life annuity.

     If any payment or distribution required to be made to or for the benefit of
Mr. Smith (either under the New Smith Employment Agreement or otherwise) would
be subject to the tax imposed under Section 4999 of the Code on "excess
parachute payments" as defined under Section 280G of the Code, Mr. Smith will be
entitled to receive an additional payment or payments sufficient to pay the tax
imposed under Section 4999 of the Code (and any taxes on that additional payment
or payments). However, no payments will be made unless the "excess parachute
payments" paid to or for the benefit of Mr. Smith are greater than $50,000. If
the "excess parachute payments" paid to Mr. Smith are below $50,000, payments
otherwise due Mr. Smith will be reduced so that no payments will be subject to
the excise tax of Section 4999 of the Code.

     Mr. Scott has an employment agreement dated November 12, 1999 with
Worldwide and receives compensation consisting of salary and an annual bonus of
up to 50% of base salary if certain targets based on annual performance
objectives are attained. Mr. Scott's annual base salary is currently $217,083.
For 2001, 50% of the bonus was guaranteed if Mr. Scott remained employed through
the first quarter of 2002. In accordance with his employment agreement, Mr.
Scott was also granted stock options on November 12, 1999, to purchase 100,000
shares of AMF Bowling's common stock. Twenty percent of these options vest on
each anniversary of the November 12, 1999 grant date. The employment agreement
provides for payment of accrued compensation, an allocable portion of bonus (if
applicable objectives are later met), and continued payment of annual base
salary for 12 months following termination of his employment by Bowling
Worldwide for any reason other than death, disability or cause.

                                       37

<PAGE>

     Mr. Suddarth entered into an employment agreement with AMF Products on
March 15, 2001 (the "Suddarth Employment Agreement"). Mr. Suddarth is employed
as the Chief Operating Officer of AMF Products and serves as a Senior Vice
President of Worldwide. Mr. Suddarth's employment may be terminated by AMF
Products or by Mr. Suddarth at any time. During his employment, Mr. Suddarth is
entitled to an annual base salary of not less than $240,000 (which may be
increased by the Chief Executive Officer of Worldwide), an annual bonus of up to
50% of his annual base salary based on the attainment of certain performance
objectives approved by the Board of Worldwide, and a special bonus for 2001,
2002 and 2003 equal to 5% of Worldwide's earnings before interest, taxes,
depreciation and amortization that exceeds $45 million during those years. Mr.
Suddarth is also entitled to such benefits as may generally be available to
other senior executives of Worldwide.

     If Mr. Suddarth's employment is terminated by AMF Products for Cause (as
defined in the agreement) or if Mr. Suddarth terminates his employment for Good
Reason (as also defined in the agreement), AMF Products will pay Mr. Suddarth
any accrued but unpaid salary and vacation pay, severance in an amount equal to
his then current base salary (payable in 12 monthly installments following
termination of his employment), a pro-rated annual bonus equal to the annual
bonus that he would have become entitled to receive had he continued in
employment to the date on which the bonus would otherwise have been awarded, and
a pro-rated bonus equal to the special bonus that he would have become entitled
to receive if he had worked to the end of 2003. Payment of the severance,
pro-rated annual bonus and pro-rated special bonus is conditioned on Mr.
Suddarth executing a release of any claims against the Company and its officers,
directors and employees, and complying with certain confidentiality,
non-disparagement and non-competition requirements following termination of his
employment. If Mr. Suddarth's employment terminates on account of his voluntary
resignation, he is only entitled to receive accrued but unpaid salary and
vacation pay. If his employment terminates on account of his death or
disability, AMF Products will pay accrued but unpaid salary and vacation pay and
a pro-rated annual bonus, if any, as may be applicable at that time.

     During 2000, the Company adopted a Bonus, Severance and Retention Program
for Certain Employees (the "Retention Program") containing several separate
provisions. The Retention Program covered each of the executive officers listed
in the Summary Compensation Table except for Mr. Kraegel and Mr. Suddarth, who
were not employees at the time. This Retention Program implemented an enhanced
severance plan (the "Severance Plan") for certain executives providing for a
payment of up to 12 months of annual base salary following termination of
employment by the Company under certain circumstances. This Severance Plan will
remain in effect for one year following the Effective Date. In addition to the
Retention Program, the Company has a severance plan for its senior managers that
provides managers with severance benefits of 3 to 12 months depending on their
position. This plan will continue after the expiration of the Retention Program.
Managers may not receive benefits under both the Retention Program and the
severance plan.

     The Retention Program also changed the target for payment of fiscal year
2000 bonuses for all bonus eligible employees and provided for cash payments in
lieu of calendar year 2000 stock option grants for all option eligible
employees. Payments in each case were to be made on March 31, 2001 to eligible
employees who were employed on that date. Mr. Scott was covered by these
provisions.

     In addition, the Retention Program implemented a key management retention
bonus plan for certain senior managers selected by the Chief Executive Officer.
The amount of the retention payment for each executive was based on a percentage
of the executive's annual base salary and was payable upon the approval of a
restructuring plan. Because the Plan was not approved by June 1, 2001, 50% of
the payment was made on June 1, 2001, and the remainder was paid upon approval
of the Plan. All payments were conditioned upon employment at the date of the
payment.

Compensation of Directors

     Prior to the Effective Date, each director of Worldwide who was also a
director of AMF Bowling received compensation as discussed below. Directors who
were officers or employees of AMF Bowling, Worldwide or affiliated with Goldman
Sachs received no compensation for service as members of the Old Board or the
Board of Directors of AMF Bowling or committees thereof. Directors who were not
officers or employees of AMF Bowling or Worldwide or affiliated with Goldman
Sachs received a $2,000 fee for attending each meeting of the Board of Directors
of AMF Bowling and a $1,000 fee for attending each committee meeting. All
directors' reasonable

                                       38

<PAGE>

expenses for attending those board and committee meetings and related duties
were reimbursed by AMF Bowling or Worldwide.

     The Company is studying whether to make any changes to its compensation and
expense reimbursement policies for directors as a result of the appointment of
the New Board under the Plan.

Compensation Committee Interlocks and Insider Participation

     During 2001, Worldwide did not have a compensation committee. The
compensation committee of AMF Bowling, the Company's former indirect parent, set
the compensation for the executive officers of Worldwide. The compensation
committee of AMF Bowling consisted of certain representatives of former owners
of AMF Bowling and another individual, none of whom were employees of the
Company.

                                       39

<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The table below reflects the number of shares of New AMF Common Stock
beneficially owned as of March 8, 2002 by each person who is known by Worldwide
to own beneficially more than 5% of New AMF Common Stock. The information set
forth below was provided to the Company by the beneficial owners named below,
without any independent vertification by the Company. No director or executive
officer owns any New AMF Common Stock except that Named Executive Officers hold
options to acquire New AMF Common Stock under the 2002 Stock Option Plan
described above. Unless indicated otherwise, each beneficial owner is deemed to
have sole voting and investment power with respect to all shares beneficially
owned. Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission.

<TABLE>
<CAPTION>
                                                               Number of Shares
                                                               Beneficially
                                                                Owned as of         Percent of
  Name of Beneficial Owner and Address                        March 8, 2002 (4)     Class (5)
  --------------------------------------                     ------------------     ---------
<S>                                                              <C>                    <C>
AMF Debt Investors, L.L.C. (1)                                   1,898,102              20.5
     c/o Farallon Capital Management, L.L.C.
     One Maritime Plaza, Suite 1325
     San Francisco, California 94111
AMF Debt Investors II, L.L.C. (1)                                  350,433               3.8
     c/o Farallon Capital Management, L.L.C.
     One Maritime Plaza, Suite 1325
     San Francisco, California 94111
Oaktree Capital Management, LLC                                  1,845,180              19.9
     333 South Grand Avenue, 28th Floor
     Los Angeles, California 90071
Satellite Asset Management, L.P. (2)                             1,442,974              15.6
     10 East 50th Street, 21st Floor
     New York, New York 10022
AG Capital Funding Partners, L.P. (3)                              104,020               1.1
     c/o Angelo Gordon & Co., L.P.
     245 Park Avenue, 26th Floor
     New York, New York 10167
Silver Oaks Capital, L.L.C. (3)                                  1,733,647              18.7
     c/o Angelo Gordon & Co., L.P.
     245 Park Avenue, 26th Floor
     New York, New York 10167

</TABLE>

-----------

(1)   Each of AMF Debt Investors, L.L.C. ("Debt Investors I") and AMF Debt
      Investors II, L.L.C. ("Debt Investors II") holds directly in its name the
      number of shares listed above. The sole manager of Debt Investors I and
      Debt Investors II is Farallon Capital Management, L.L.C. ("FCM"), a
      registered investment advisor. FCM, as manager of Debt Investors I and
      Debt Investors II, and each managing member of FCM, may be deemed to be
      the beneficial owner, for purposes of Rule 13d-3 of the Exchange Act, of
      the shares held by Debt Investors I and Debt Investors II. Meridee Moore,
      a director of Worldwide, is one of the managing members of FCM. FCM, and
      each managing member of FCM, disclaims any beneficial ownership of such
      shares. Such entities and persons may be deemed to share voting and
      dispositive power with respect to the shares, but they disclaim group
      attribution.
(2)   Affiliated with Mr. Sonnino.
(3)   Affiliated with Mr. Fuller.
(4)   Does not give effect to any distributions of New AMF Common Stock or
      Warrants that such beneficial owners may receive as a result of
      distributions with respect to unsecured claims that any such owner may
      receive as a Former Unsecured Creditor.
(5)   For purposes of calculation, does not give effect to the issuance of New
      AMF Common Stock or Warrants to Former Unsecured Creditors or the issuance
      of stock options under the 2002 Stock Option Plan.

                                       40

<PAGE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Former Stockholders Agreement

     Under the prior ownership of Worldwide's parent, there was a stockholders
agreement that governed certain matters relating to AMF Bowling, certain of its
stockholders and certain of AMF Bowling's former subsidiaries, including
Worldwide. That stockholders agreement expired as to Worldwide as of the
Effective Date.

Registration Rights Agreement

     On the Effective Date, pursuant to the Plan, Worldwide entered into a
registration rights agreement (the "Registration Rights Agreement"), which
provides holders of 10 percent or more of the New AMF Common Stock as of the
Effective Date (the "Principal Holders") with certain rights to require
Worldwide to register their shares of New AMF Common Stock, including shares
issuable upon the exercise of their Warrants. No registration rights are
provided with respect to the Warrants or the New Subordinated Notes or to
holders of New AMF Common Stock other than the Principal Holders. The following
summary is qualified in its entirety by reference to the Registration Rights
Agreement, which is filed as an Exhibit to this Annual Report on Form 10-K.

     Under the Registration Rights Agreement, Worldwide will use its reasonable
best efforts to (a) register the New AMF Common Stock held by a Principal Holder
upon a request by one or more Principal Holders to register New AMF Common Stock
held by the Principal Holders with a market value generally of at least $25.0
million in the aggregate and (b) in connection with any registered offering of
the New AMF Common Stock by Worldwide, register the New AMF Common Stock of
Principal Holders that wish to sell their New AMF Common Stock in the offering.
Under the terms of the Registration Rights Agreement, each Principal Holder is
limited to a specified number of "demand" registrations under clause (a) above.
In addition, the requests for registration are subject to other limitations and
cut-backs, as set forth in the Registration Rights Agreement.

     The registration rights will not apply to New AMF Common Stock to the
extent that: (a) a registration statement with respect to the sale of New AMF
Common Stock has been declared effective under the Securities Act and the
holders' shares of New AMF Common Stock have been disposed of under that
registration statement; (b) the holders' shares of New AMF Common Stock have
been disposed of under Securities Act Rule 144 or another exemption from the
registration requirements of the Securities Act under which the shares of New
AMF Common Stock are thereafter freely tradable without restriction under the
Securities Act; or (c) the holders' shares of New AMF Common Stock may be
disposed of under Rule 144 within Rule 144's volume limitations within a 90 day
period or under Securities Act Rule 144(k).

Transactions with Management and Others; Certain Business Relationships

     Prior to the Effective Date, several members of the Old Board, who do not
serve as members of the New Board, were affiliated with Goldman Sachs and
related entities. Goldman Sachs and/or related entities were the initial
purchasers of the debt issued by Worldwide in connection with financing the 1996
acquisition by the investor group led by Goldman Sachs; served as financial
advisor to the owners of AMF Bowling's predecessor in connection with that
acquisition; acted as lead underwriter in AMF Bowling's initial public offering
of common stock and as an initial purchaser of zero coupon convertible
debentures of AMF Bowling; acted as Syndication Agent or Arrangers under the Old
Credit Agreement; acted as the financial advisor for AMF Bowling and the
Company; and were counterparties to several interest rate hedging agreements to
which the Company was a party. For all of these services over the years, Goldman
Sachs and affiliates were paid substantial fees and expenses. The Company no
longer has an affiliation with Goldman Sachs.

     Certain members of the New Board are affiliated with or are serving as
designated representatives of the Principal Holders that are parties to the
Registration Rights Agreement.

     "Note 16. Related Parties" in the Notes to the Consolidated Financial
Statements sets forth additional information about certain relationships former
affiliates and current owners have had or currently have with the Company.

                                       41

<PAGE>

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

   (A)   Financial Statements and Schedules

     Financial Statements

     Report of Independent Public Accountants
     Consolidated Balance Sheets as of December 31, 2001 and 2000
     Consolidated Statements of Operations for the years ended December 31,
     2001, 2000 and 1999
     Consolidated Statements of Cash Flows for the years ended December 31,
     2001, 2000 and 1999
     Consolidated Statements of Stockholder's Equity for the years ended
     December 31, 2001 2000 and 1999
     Consolidated Statements of Comprehensive Loss for the years ended
     December 31, 2001, 2000 and 1999
     Notes to Consolidated Financial Statements
     Selected Quarterly Financial Data (unaudited)

   (B)   Reports on Form 8-K

1.   An amendment to the current report filed on September 5, 2001 was filed
     October 9, 2001, in which Worldwide reported that, on October 4, 2001, it,
     and certain of its direct and indirect subsidiaries, filed an Amended Joint
     Plan of Reorganization of Debtor under Chapter 11 with the United States
     Bankruptcy Court for the Eastern District of Virginia, Richmond Division.

2.   A current report was filed February 5, 2002, in which Worldwide announced
     confirmation of its plan of reorganization.

3.   A current report was filed March 8, 2002, in which Worldwide announced that
     it emerged from Chapter 11 under the United States Bankruptcy Code.

   (C)   Exhibits

2.1      Order Confirming Second Amended Second Modified Joint Plan of
         Reorganization of AMF Bowling Worldwide, Inc. and certain of its direct
         and indirect subsidiaries. (filed herewith)
2.2      Second Amended Second Modified Joint Plan of Reorganization of AMF
         Bowling Worldwide, Inc. and certain of its direct and indirect
         subsidiaries. (1)
3.1      Amended and Restated Certificate of Incorporation of AMF Bowling
         Worldwide, Inc. (2)
3.2      Amended and Restated By-Laws of AMF Bowling Worldwide, Inc. (3)
4.1      Indenture dated as of March 8, 2002 by and among AMF Bowling Worldwide,
         Inc., certain subsidiaries of AMF Bowling Worldwide, Inc., as
         Guarantors, and Wilmington Trust Company, as Trustee, with respect to
         13.00% Senior Subordinated Notes due 2008. (4)
4.2      Form of Senior Subordinated Note (attached as exhibit to Exhibit 4.1).
4.3      Registration Rights Agreement dated as of March 8, 2002 by and among
         AMF Bowling Worldwide, Inc. and certain holders of common stock. (5)
4.4      Series A Warrant Agreement dated as of March 8, 2002 between AMF
         Bowling Worldwide, Inc. and Mellon Investor Services LLC, as Warrant
         Agent. (6)
4.5      Series B Warrant Agreement dated as of March 8, 2002 between AMF
         Bowling Worldwide, Inc. and Mellon Investor Services LLC, as Warrant
         Agent. (7)
10.1     Employment Agreement, dated as of April 28, 1999, between AMF Bowling,
         Inc. and Roland Smith. (8)*
10.2     Stock Option Agreement, dated as of April 28, 1999, between AMF
         Bowling, Inc. and Roland Smith. (9)*
10.3     Employment Agreement, effective November 12, 1999, between AMF Bowling
         Worldwide, Inc. and Timothy N. Scott. (10)*

                                       42

<PAGE>

10.4     AMF Bowling Worldwide, Inc. Bonus, Severance and Retention Program for
         Certain Employees, approved November 9, 2000. (11)*
10.5     Assumption Agreement, dated as of November 9, 2000, by and between AMF
         Bowling Worldwide, Inc. and Roland C. Smith. (12)*
10.6     Form of Employment Retention Agreement, effective November 9, 2000,
         among AMF Bowling Worldwide, Inc., AMF Bowling Products, Inc., AMF
         Bowling Centers, Inc., AMF Bowling Centers (Aust.) International, Inc.
         and AMF Worldwide Bowling Centers Holdings, Inc. and certain
         executives. (13)*
10.7     Employment Agreement, effective March 15, 2001, between AMF Bowling
         Products, Inc. and John Suddarth. (14)*
10.8     Senior Secured Credit Agreement, dated as of February 28, 2002 among
         AMF Bowling Worldwide, Inc., certain of its subsidiaries as borrowers,
         the financial institutions listed on the signature pages thereto, and
         Bankers Trust Company, as Documentation Agent, Syndication Agent and
         Administrative Agent (without exhibits). (15)
10.9     AMF Bowling Worldwide, Inc. 2002 Stock Option Plan. (16)*
10.10    Amended and Restated Employment Agreement, dated as of February 1,
         2002, between AMF Bowling Worldwide, Inc. and Roland Smith. (filed
         herewith)*
10.11    Restricted Stock Award Agreement, dated February 1, 2002, between AMF
         Bowling Worldwide, Inc. and Roland Smith. (filed herewith)*
10.12    Employment Letter, dated as of January 22, 2002, between AMF Bowling
         Worldwide, Inc. and John H. Smith. (filed herewith)*
10.13    Employment Letter, dated as of January 24, 2002, between AMF Bowling
         Worldwide, Inc. and Wayne T. Tennent. (filed herewith)*
21.1     Subsidiaries of the Company. (filed herewith)
99.1     Letter from AMF Bowling Worldwide, Inc. to the Securities and Exchange
         Commission dated March 29, 2002 regarding the statement of assurances
         obtained from Arthur Andersen LLP. (filed herewith)

Notes to Exhibits:

   * Management contract or compensatory plan or arrangement.

(1)      Incorporated by reference to Exhibit 4.6 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form8-K dated March 8, 2002 (File No.
         001-12131).
(2)      Incorporated by reference to Exhibit 3.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(3)      Incorporated by reference to Exhibit 3.2 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(4)      Incorporated by reference to Exhibit 4.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(5)      Incorporated by reference to Exhibit 4.3 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(6)      Incorporated by reference to Exhibit 4.4 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(7)      Incorporated by reference to Exhibit 4.5 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(8)      Incorporated by reference to Exhibit 10.1 to Quarterly Report on
         Form 10-Q of AMF Bowling, Inc. for the quarterly period ended March
         31, 1999 (File No. 001-13539).
(9)      Incorporated by reference to Exhibit 10.2 to Quarterly Report on
         Form 10-Q of AMF Bowling, Inc. for the quarterly period ended March
         31, 1999 (File No. 001-13539).
(10)     Incorporated by reference to Exhibit 10.36 to the Annual Report on
         Form 10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended
         December 31, 2000 (File No. 001-12131).
(11)     Incorporated by reference to Exhibit 10.38 to the Annual Report on
         Form 10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended
         December 31, 2000 (File No. 001-12131).
(12)     Incorporated by reference to Exhibit 10.39 to the Annual Report on
         Form 10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended
         December 31, 2000 (File No. 001-12131).
(13)     Incorporated by reference to Exhibit 10.41 to the Annual Report on
         Form 10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended
         December 31, 2000 (File No. 001-12131).
(14)     Incorporated by reference to Exhibit 10.43 to the Annual Report on
         Form 10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended
         December 31, 2000 (File No. 001-12131).

                                       43

<PAGE>

(15)     Incorporated by reference to Exhibit 10.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(16)     Incorporated by reference to Exhibit 10.2 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).

                                       44

<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15 (d) the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, as of the 29th day of
March, 2002.

                                       AMF BOWLING WORLDWIDE, INC.


                                       By:      /s/ ROLAND C. SMITH
                                          --------------------------------------
                                          Roland C. Smith
                                          Chairman, President and Chief
                                          Executive Officer


                                POWER OF ATTORNEY

     Each individual whose signature appears below hereby authorizes Roland C.
Smith, Frederick G. Kraegel and Christopher F. Caesar, and each of them, to sign
this Annual Report on Form 10-K and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, and appoints each such person as
attorney-in-fact to sign on his or her behalf individually and in each capacity
stated below.

                          ----------------------------

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated, as of the 29th day of March, 2002.


        Signature                                 Title
---------------------------      -----------------------------------------------
/s/ ROLAND C. SMITH              Director, Chairman, President and Chief
---------------------------      Executive Officer (principal executive officer)
     Roland C. Smith


/s/ FREDERICK G. KRAEGEL         Director, Executive Vice President and Chief
---------------------------      Administrative Officer
     Frederick G. Kraegel        (principal accounting officer)


/s/ CHRISTOPHER F. CAESAR        Senior Vice President, Chief Financial Officer
---------------------------      and Treasurer
     Christopher F. Caesar       (principal financial officer)


/s/ THOMAS M. FULLER             Director
---------------------------
     Thomas M. Fuller


/s/ PHILIP L. MASLOWE            Director
---------------------------
     Philip L. Maslowe


/s/ MERIDEE A. MOORE             Director
---------------------------
     Meridee A. Moore

                                       45

<PAGE>


/s/ MARK D. SONNINO              Director
---------------------------
     Mark D. Sonnino


/s/ GEORGE W. VIETH, JR.         Director
---------------------------
     George W. Vieth, Jr.

                                       46

<PAGE>


                   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                           ANNUAL REPORT ON FORM 10-K

                      FOR THE YEAR ENDED DECEMBER 31, 2001

                           AMF BOWLING WORLDWIDE, INC.

                                      INDEX

                                                                            Page
                                                                            ----
Financial Statements
    Report of Independent Public Accountants.............................    F-2
    Consolidated Balance Sheets as of December 31, 2001 and 2000.........    F-3
    Consolidated Statements of Operations for the years ended
     December 31, 2001, 2000 and 1999....................................    F-4
    Consolidated Statements of Cash Flows for the years ended
     December 31, 2001, 2000 and 1999 ...................................    F-5
    Consolidated Statements of Stockholder's Equity for the years
     ended December 31, 2001, 2000 and 1999..............................    F-6
    Consolidated Statements of Comprehensive Loss for the years
     ended December 31, 2001, 2000 and 1999..............................    F-7
    Notes to Consolidated Financial Statements...........................    F-8
    Selected Quarterly Financial Data (unaudited)........................   F-31

                                      F-1

<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors
AMF BOWLING WORLDWIDE, INC.:

     We have audited the accompanying consolidated balance sheets of AMF Bowling
Worldwide, Inc. (a Delaware corporation) and subsidiaries as of December 31,
2001 and 2000, and the related consolidated statements of operations,
stockholder's equity, cash flows and comprehensive loss for each of the three
years in the period ended December 31, 2001. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
an audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of AMF Bowling Worldwide, Inc.
and subsidiaries as of December 31, 2001 and 2000, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2001, in conformity with accounting principles generally accepted
in the United States.

     As described more fully in Note 1 to the consolidated financial statements,
effective March 8, 2002, the Company was reorganized under a plan of
reorganization confirmed by the United States Bankruptcy Court for the Eastern
District of Virginia. The accompanying consolidated financial statements do not
reflect the effects of fresh start accounting which will be applied in
connection with the Company's emergence from Chapter 11.


ARTHUR ANDERSEN LLP

Richmond, Virginia
March 8, 2002

                                      F-2

<PAGE>

<TABLE>
<CAPTION>

                           AMF BOWLING WORLDWIDE, INC.

                           CONSOLIDATED BALANCE SHEETS
                        (in thousands, except share data)

                                                                            December 31,
                                                                     --------------------------
                                                                         2001           2000
                                                                     -----------    -----------
<S>                                                                  <C>            <C>
Assets
Current assets:
 Cash and cash equivalents                                           $    25,291    $    46,759
 Accounts and notes receivable, net of allowance for doubtful
   accounts of $11,543 and $9,608, respectively                           27,381         43,070
 Inventories, net                                                         38,732         55,697
 Advances and deposits                                                    14,337         12,789
                                                                     -----------    -----------
   Total current assets                                                  105,741        158,315
 Property and equipment, net                                             685,154        755,588
 Leasehold interests and other                                            40,138         66,331
 Goodwill, net                                                           718,414        746,050
                                                                     -----------    -----------
   Total assets                                                      $ 1,549,447    $ 1,726,284
                                                                     ===========    ===========

Liabilities and Stockholder's Equity
Current Liabilities:
 Accounts payable                                                    $    24,246    $    26,215
 Accrued expenses and other                                               78,450        102,643
 Current portion of long-term debt                                       616,395      1,134,565
                                                                     -----------    -----------
   Total current liabilities                                             719,091      1,263,423
Other long-term debt                                                       3,107          1,993
Liabilities subject to resolution                                        595,463            -
Other long-term liabilities                                                2,252          6,963
                                                                     -----------    -----------
   Total liabilities                                                   1,319,913      1,272,379
                                                                     -----------    -----------
Commitments and contingencies
Stockholder's equity:
 Common stock (par value $.01 per share, 100 shares authorized,
   issued and outstanding)                                                   -              -
 Paid-in capital                                                       1,047,529      1,047,529
 Deficit                                                                (781,991)      (565,030)
 Accumulated other comprehensive loss                                    (36,004)       (28,594)
                                                                     -----------    -----------
   Total stockholder's equity                                            229,534        453,905
                                                                     -----------    -----------
   Total liabilities and stockholder's equity                        $ 1,549,447    $ 1,726,284
                                                                     ===========    ===========

</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

                                      F-3

<PAGE>
<TABLE>
<CAPTION>

                           AMF BOWLING WORLDWIDE, INC.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (in thousands)

                                                                   Year ended December 31,
                                                           ----------------------------------------
                                                              2001            2000           1999
                                                           ----------     ----------     ----------
<S>                                                        <C>            <C>            <C>
Operating revenue                                          $  694,878     $  715,001     $  732,752
                                                           ----------     ----------     ----------
Operating expenses:
 Cost of goods sold                                           154,619        173,098        177,204
 Bowling center operating expenses                            376,591        386,944        373,434
 Selling, general, and administrative expenses                 60,803         64,461         71,561
 Restructuring, refinancing and asset impairment
   charges                                                     18,636         11,585         16,658
 Depreciation and amortization                                130,043        136,001        132,647
                                                           ----------     ----------     ----------
   Total operating expenses                                   740,692        772,089        771,504
                                                           ----------     ----------     ----------
   Operating loss                                             (45,814)       (57,088)       (38,752)
Nonoperating expenses (income):
 Interest expense (a)                                         104,876        121,499        111,237
 Other expenses, net                                            5,910          1,623          6,640
 Interest income                                               (1,136)        (1,514)        (1,889)
                                                           ----------     ----------     ----------
   Total nonoperating expenses                                109,650        121,608        115,988
Reorganization items, net                                      56,731            -              -
                                                           ----------     ----------     ----------
   Net loss before provision for income taxes                (212,195)      (178,696)      (154,740)
Provision for income taxes                                      4,766          2,256         27,625
                                                           ----------     ----------     ----------
   Net loss before equity in loss of joint ventures          (216,961)      (180,952)      (182,365)
Equity in loss of joint ventures                                  -             (524)       (18,648)
                                                           ----------     ----------     ----------
   Net loss                                                $ (216,961)    $ (181,476)    $ (201,013)
                                                           ==========     ==========     ==========
</TABLE>

---------------------------------
(a)  From July 2, 2001 through December 31, 2001, the Company did not accrue
     approximately $30,560 of interest on its prepetition subordinated debt
     since management believed that the debt would be materially reduced or
     discharged in the Chapter 11. See "Note 7. Liabilities Subject to
     Resolution."

The accompanying notes are an integral part of these consolidated financial
statements.

                                      F-4

<PAGE>
<TABLE>
<CAPTION>

                           AMF BOWLING WORLDWIDE, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

                                                                   Year ended December 31,
                                                           ----------------------------------------
                                                              2001            2000           1999
                                                           ----------     ----------     ----------
<S>                                                        <C>            <C>            <C>
Cash flows from operating activities:
 Net loss                                                  $ (216,961)    $ (181,476)    $ (201,013)
 Adjustments to reconcile net loss to net cash
  provided by operating activities:
   Depreciation and amortization                              130,043        136,001        132,647
   Reorganization items non cash, net                          46,570            -              -
   Equity in loss of joint ventures                               -              524         18,648
   Deferred income taxes                                          -              -           20,467
   Amortization of bond discount                                6,525         30,352         26,874
   (Gain) loss on the sale of property and equipment,
    net                                                           417         (1,601)         2,561
   Impairment of assets                                         3,500          1,559          8,118
   Changes in assets and liabilities:
   Accounts and notes receivable, net                          16,826         17,863         18,950
   Inventories                                                 13,268         (4,312)        10,912
   Other assets                                                 1,082         15,108         (5,105)
   Accounts payable and accrued expenses                       23,322         19,892         10,115
   Other long-term liabilities                                  2,997         (5,203)        (3,053)
                                                           ----------     ----------     ----------
    Net cash provided by operating activities                  27,589         28,707         40,121
                                                           ----------     ----------     ----------
Cash flows from investing activities:
 Acquisitions of operating units, net of cash acquired            -           (8,477)        (1,414)
 Purchases of property and equipment                          (49,462)       (66,545)       (52,087)
 Proceeds from the sale of property and equipment                 300          9,400          2,028
                                                           ----------     ----------     ----------
    Net cash used in investing activities                     (49,162)       (65,622)       (51,473)
                                                           ----------     ----------     ----------

Cash flows from financing activities:
 Proceeds from long-term debt, net of deferred
  financing costs                                               5,000         87,000         81,000
 Payment on long-term debt                                     (5,000)       (29,407)      (106,373)
 Capital contributions from parent                                -            7,000         34,731
                                                           ----------     ----------     ----------
    Net cash provided by financing activities                     -           64,593          9,358
Effect of exchange rates on cash                                  105         (1,434)           662
                                                           ----------     ----------     ----------
    Net increase (decrease) in cash                           (21,468)        26,244         (1,332)
Cash and cash equivalents at beginning of period               46,759         20,515         21,847
                                                           ----------     ----------     ----------
    Cash and cash equivalents at end of period             $   25,291     $   46,759     $   20,515
                                                           ==========     ==========     ==========

Cash interest paid                                         $   81,465     $   75,426     $   81,779
Cash income taxes paid                                     $    1,537     $    4,318     $    5,495

</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

                                      F-5

<PAGE>
<TABLE>
<CAPTION>

                           AMF BOWLING WORLDWIDE, INC.

                 CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
                                 (in thousands)

                                                                                     Accumulated
                                                                                       Other         Total
                                                Common        Paid-in               Comprehensive  Stockholder's
                                                Stock         Capital      Deficit      Loss        Equity
                                               ---------     ----------  ---------- ------------  ----------
<S>                                            <C>           <C>         <C>         <C>          <C>
Balance, December 31, 1998                     $     -       $1,005,798  $ (182,541) $  (19,325)  $  803,932
  Capital contribution by stockholder                -           34,731         -           -         34,731
  Net loss                                           -              -      (201,013)        -       (201,013)
  Foreign currency translation adjustment            -              -           -         4,001        4,001
                                               ---------     ----------  ----------  ----------   ----------
Balance, December 31, 1999                           -        1,040,529    (383,554)    (15,324)     641,651
                                               ---------     ----------  ----------  ----------   ----------

  Capital contribution by stockholder                -            7,000         -           -          7,000
  Net loss                                           -              -      (181,476)        -       (181,476)
  Foreign currency translation adjustment            -              -           -       (13,270)     (13,270)
                                               ---------     ----------  ----------  ----------   ----------
Balance, December 31, 2000                           -        1,047,529    (565,030)    (28,594)     453,905
                                               ---------     ----------  ----------  ----------   ----------

  Net loss                                           -              -      (216,961)        -       (216,961)
  Foreign currency translation adjustment            -              -           -        (7,410)      (7,410)
                                               ---------     ----------  ----------  ----------   ----------
Balance, December 31, 2001                     $     -       $1,047,529  $ (781,991) $  (36,004)  $  229,534
                                               =========     ==========  ==========  ==========   ==========

</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

                                      F-6

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

                  CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
                                 (in thousands)

                                                 Year ended December 31,
                                            ---------------------------------
                                               2001        2000        1999
                                            ---------   ---------   ---------

Net loss                                    $(216,961)  $(181,476)  $(201,013)
Foreign currency translation adjustment        (7,410)    (13,270)      4,001
                                            ---------   ---------   ---------

Total comprehensive loss                    $(224,371)  $(194,746)  $(197,012)
                                            =========   =========   =========

The accompanying notes are an integral part of these consolidated financial
statements.

                                      F-7

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  (in thousands, except share data and Note 15)

NOTE 1.  BUSINESS DESCRIPTION - ORGANIZATION AND RESTRUCTURING

Basis of Presentation

     All significant intercompany balances and transactions have been eliminated
in the accompanying consolidated financial statements. All dollar amounts are in
thousands, except when otherwise noted.

Organization

     AMF Bowling Worldwide, Inc., a Delaware corporation ("Worldwide" and,
together with its subsidiaries, the "Company"), is principally engaged in two
business segments: (i) the operation of bowling centers throughout the United
States ("U.S.") and internationally ("Centers") and (ii) the manufacture and
sale of bowling equipment such as automatic pinspotters, automatic scoring
equipment, bowling pins, lanes, ball returns, lane machines, bowling center
supplies and the resale of other allied products, including bowling balls, bags
and shoes ("Products"). The principal customers for bowling equipment are
bowling center operators. Products' revenue consists of two major sales
categories: (a) New Center Packages ("NCPs") (all of the equipment necessary to
outfit a new bowling center or expand an existing bowling center) and (b)
Modernization and Consumer Products (modernization equipment used to upgrade an
existing center, spare parts, supplies and consumable products used in the
operation of a bowling center and resale products for bowlers). In addition,
Products refurbishes and sells used pinspotters. Combined with new automatic
scoring, lanes, bowler seating and other components, these used pinspotters are
sold as Factory Certified Packages ("FCPs"). FCP revenue is included in the NCP
category. The Company also manufactures and sells the PlayMaster, Highland and
Renaissance brands of billiards tables.

     Worldwide serves as the corporate headquarters of the Company. Its
employees provide certain management and administrative services for Centers and
Products. All of Worldwide's business operations are conducted through, and its
operating assets are held in, subsidiaries. The Centers business in the U.S. is
primarily owned and operated in AMF Bowling Centers, Inc. ("AMF Centers"), a
wholly owned, indirect subsidiary of Worldwide. The Centers business outside of
the U.S. is owned and operated in separate, indirect subsidiaries of Worldwide
that own and operate bowling centers in various countries. The Products business
is owned and operated in AMF Bowling Products, Inc. ("AMF Products"), which is a
wholly owned, indirect subsidiary of Worldwide.

Background

     In May 1996, an investor group led by Goldman, Sachs & Co. ("Goldman
Sachs") acquired the Company. At the time, the Company operated approximately
200 U.S. and 79 international bowling centers and also owned Products. In
connection with the acquisition, the Company became a wholly owned subsidiary of
AMF Group Holdings Inc. ("Group Holdings"), which was in turn a wholly owned
subsidiary of AMF Bowling, Inc. ("AMF Bowling").

     The Company soon announced and began to aggressively pursue a business
strategy that included: (i) acquiring bowling centers, (ii) building a
recognized national brand of bowling and entertainment centers and (iii)
capitalizing on demand for bowling equipment in certain international markets.
To facilitate the Company's strategy, AMF Bowling completed an initial public
offering of common stock in 1997 and a sale of zero coupon convertible
debentures in 1998 (the "AMF Bowling Financings"), a portion of the proceeds of
each of which was used to fund the acquisition program.

                                      F-8

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     In mid-1998, after acquiring approximately 260 bowling centers that were
financed through borrowings and the AMF Bowling Financings, management
recognized that Centers revenue and cash flow from operations (as measured on a
constant center basis) were generally declining below the levels in prior years.
Moreover, the rapid growth through acquisitions led to problems in integrating
new centers and managing the expanded base of operations. At the same time,
management also recognized that Products revenue and operating cash flow were
declining as demand for bowling equipment dropped dramatically following
economic difficulties in the Asia Pacific region, Products' largest growth
market, and as product quality issues and order fulfillment problems began to
adversely impact sales. These financial and operational problems caused the
Company to curtail its acquisition program and focus on improving operations
rather than building a national brand.

     During 1998, the Company negotiated amendments to modify its senior secured
credit agreement dated May 1, 1996, as amended and restated (the "Old Credit
Agreement") to relax certain of its financial covenants. As part of these
amendments, certain restrictions on acquisitions were put in place. In mid-1999,
management of the Company implemented a number of initiatives designed to
improve the Company's performance. Shortly thereafter, AMF Bowling, the
Company's former parent, issued common stock in a rights offering to raise
capital, a portion of which was contributed to Worldwide, as part of a
recapitalization plan designed to provide further financial flexibility. At the
same time, the Company also negotiated further amendments to the Old Credit
Agreement.

     In 2000, the Company recognized that its 1999 recapitalization plan had not
succeeded, that the initiatives to improve the Company's performance would take
additional time to implement and that current and expected levels of cash flow
were insufficient to service long term debt obligations. The Company engaged a
financial advisor in mid-2000 to evaluate options, including assisting the
Company in developing and negotiating with the appropriate parties, a plan to
restructure its indebtedness. In August 2000, the Company entered into
discussions and negotiations with informal committees of both its lenders under
the Old Credit Agreement and the holders of its subordinated debt and publicly
disclosed that it would not make scheduled interest payments on its subordinated
indebtedness. During December 2000, the Company failed to make scheduled
principal payments and delayed scheduled interest payments under the Old Credit
Agreement. While discussions and negotiations continued with the various
creditor groups, it became apparent that the filing of a voluntary petition for
relief under Chapter 11 ("Chapter 11"), Title 11 of the United States Bankruptcy
Code (the "Bankruptcy Code") was a potential option for the Company.

Chapter 11 and Emergence

     General

     On July 2, 2001 (the "Petition Date"), Worldwide and certain of its U.S.
subsidiaries (collectively, the "Debtors") filed voluntary petitions for relief
under Chapter 11 with the United States Bankruptcy Court for the Eastern
District of Virginia, Richmond Division (the "Bankruptcy Court"). During the
Chapter 11 proceeding, the Debtors managed and operated their assets and
businesses as debtors-in-possession subject to the supervision and orders of the
Bankruptcy Court. The international subsidiaries of the Company did not file for
relief under Chapter 11. Subsequent to the Petition Date, AMF Bowling, the
Company's former indirect parent, filed a separate petition for relief under
Chapter 11.

     On the Petition Date, the Company was in default on approximately $622,300
of indebtedness under the Old Credit Agreement and approximately $573,800 of
principal and accrued and unpaid interest under the Company's 12 1/4% Series B
Senior Subordinated Discount Notes due 2006 (the "Old Senior Subordinated
Discount Notes") and its 10 7/8% Series B Senior Subordinated Notes due 2006
(the "Old Senior Subordinated Notes" and collectively with the Old Senior
Subordinated Discount Notes, the "Old Subordinated Notes").

                                      F-9

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     On August 8, 2001, the Bankruptcy Court approved the Company's motion to
obtain a debtor-in-possession financing in an aggregate amount up to $75,000
(the "DIP Loan") from a syndicate of banks. The DIP Loan was available to
provide financing for working capital, letters of credit, capital expenditures
and general corporate purposes.

     On February 1, 2002, the Bankruptcy Court confirmed the Second Amended
Second Modified Joint Plan of Reorganization (the "Plan") of the Debtors. The
Plan became effective March 8, 2002 (the "Effective Date"), which is the date on
which the Debtors formally emerged from Chapter 11. As part of the Plan,
Worldwide entered into a senior secured credit agreement with Bankers Trust
Company, as Administrative Agent, and certain other lenders dated as of February
28, 2002 (the "New Credit Agreement"). Worldwide also entered into an indenture
dated as of March 8, 2002 (the "New Indenture") providing for the issuance of
$150.0 million aggregate principal amount of 13.00% Senior Subordinated Notes
due 2008 (the "New Subordinated Notes"). Pursuant to the Plan, as of the
Effective Date, the Old Credit Agreement, the Old Subordinated Notes and
substantially all of the Company's other pre-petition indebtedness were
discharged and terminated.

     On the Effective Date, the Company borrowed $290,000 under a term facility
(the "Term Facility") and $10,000 under a $60,000 revolving credit facility (the
"Revolver" and, collectively with the Term Facility, the "Exit Facility")
provided by the New Credit Agreement. These funds were used to make cash
payments to satisfy certain claims and expenses required to be paid in cash
under the Plan. Subsequent to the Effective Date, the outstanding $10,000
borrowing under the Revolver was repaid. The Revolver continues to be available
for the Company's working capital and general corporate needs, subject to
customary borrowing conditions.

     Pursuant to the Plan, on the Effective Date, the shares of common stock of
Worldwide formerly held by its parent, AMF Group Holdings Inc. ("Group
Holdings"), were cancelled. Worldwide issued 9,250,000 shares of new common
stock, $0.01 par value (the "New AMF Common Stock"), and $150,000 in New
Subordinated Notes and paid $286,700 in cash to Worldwide's former senior
secured creditors (the "Former Secured Creditors") in full satisfaction of their
claims. In addition, Worldwide will distribute to the Debtors' unsecured
creditors (the "Former Unsecured Creditors") up to 750,000 shares of New AMF
Common Stock, 1,764,706 Series A Warrants (the "Series A Warrants") and
1,724,138 Series B Warrants (the "Series B Warrants" and collectively with the
Series A Warrants, the "Warrants") in full satisfaction of their claims.
Distributions of these securities will occur from time to time pursuant to and
in accordance with the terms of the Plan. See "Note 12. Equity" for additional
information regarding the New AMF Common Stock and the Warrants.

     Worldwide is obligated to distribute shares of New AMF Common Stock and the
Warrants to the Former Unsecured Creditors, but is not required to make any cash
distribution to the Former Unsecured Creditors. The number of shares of New AMF
Common Stock and Warrants to be distributed to individual Former Unsecured
Creditors is contingent on the resolution of their individual claims.

     AMF Bowling, the indirect parent of Worldwide prior to the Effective Date,
did not receive any distribution based upon its equity interest in Group
Holdings. The Company no longer has any affiliation with either AMF Bowling or
Group Holdings and the New AMF Common Stock, which represents the equity
ownership of Worldwide, is distinct from the shares of common stock of AMF
Bowling that remain outstanding at this time. Management of the Company
understands that AMF Bowling plans to file a liquidating Chapter 11 plan.

     The Company's consolidated financial statements for 2001 have been prepared
in accordance with the American Institute of Certified Public Accountant's
Statement of Position 90-7, "Financial Reporting by Entities in Reorganization
under the Bankruptcy Code" ("SOP 90-7") which provides guidance for financial
reporting by entities that have filed petitions under the Bankruptcy Code and
expect to reorganize under Chapter 11. Under SOP 90-7, the financial statements
of an entity in a Chapter 11 proceeding distinguish transactions and events
directly associated with the reorganization from those of operations of the
ongoing business. Revenue and expenses,

                                      F-10

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

realized gains and losses, and provisions for losses resulting from the
reorganization and restructuring of the business are reported in the statement
of operations separately as reorganization items, net. See "Note 7. Liabilities
Subject to Resolution" and "Note 8. Reorganization Items, Net and Other Charges"
for further discussion.

     In connection with the Company's emergence from Chapter 11, the Company
will apply fresh start accounting in accordance with SOP 90-7. Under SOP 90-7,
the reorganization value of the Company will be allocated to the Company's
assets in accordance with Statement of Financial Accounting Standards ("SFAS")
141 "Business Combinations" and the liabilities will be stated at their present
values. See "Note 17. Pro Forma Reorganized Balance Sheet (unaudited)" for an
unaudited pro forma reorganized balance sheet of the Company. The Company will
also write-off all of its goodwill effective January 1, 2002 in accordance with
SFAS 142. The application of SOP 90-7 will result in the write down of certain
long lived assets.

Historical Financial Statements

     These historical consolidated financial statements do not reflect the
effects resulting from the Company's emergence from the Chapter 11 proceeding
and represent the financial position and capital structure on December 31, 2001
and 2000. As such, among other things, the historical consolidated financial
statements do not reflect the effects of the cancellation of indebtedness that
resulted from the Chapter 11 proceeding, fresh start accounting or the write-off
of goodwill. These historical consolidated financial statements should be read
with the understanding that the reorganization significantly altered the
historical capital structure reflected in the accompanying historical balance
sheet as of December 31, 2001. The application of fresh start accounting will
result in the write-off of leasehold interests and the revaluation of the
Company's tangible non current assets. This will result in depreciation and
amortization expense being lower in periods subsequent to the Effective Date
compared with historical accounting periods prior to such date. In addition, the
write-off of goodwill will significantly reduce amortization expense in periods
subsequent to December 31, 2001.

NOTE 2.  SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

     The preparation of financial statements in conformity with accounting
principles generally accepted in the U.S. requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the dates of the financial
statements and the reported amounts of revenue and expenses during the reporting
periods. The more significant estimates made by management include allowances
for obsolete inventory, uncollectible accounts receivable, realization of
goodwill, long-lived assets, deferred taxes and other deferred assets, and
reserves for litigation and claims, product warranty costs, and self-insurance
costs. Actual results could differ from those estimates.

Cash and Cash Equivalents

     All highly liquid fixed-income investments purchased with an original
maturity of three months or less are classified as cash equivalents.

Revenue Recognition

     Generally, Products' revenue is recognized at the time the products are
shipped. If payment is contingent upon installation, Products recognizes revenue
upon the completion of installation.

     Centers' revenue is recognized at the time the service is provided.

                                      F-11

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Inventories

     Products' inventory is valued at the lower of cost or market, using the
first-in, first-out method. Centers' inventory is valued at the lower of cost or
market, with cost using an average cost method.

Long Lived Assets

     The carrying value of long lived assets and certain identifiable
intangibles is reviewed for impairment whenever events or changes in
circumstances indicate the carrying amount of an asset may not be recoverable,
and an estimate of future undiscounted cash flows is less than the carrying
amount of the asset.

Property and Equipment

     Property and equipment are stated at cost less accumulated depreciation.
Expenditures for maintenance and repairs which do not improve or extend the life
of an asset are charged to expense as incurred; major renewals or improvements
are capitalized. Upon retirement or sale of an asset, its cost and related
accumulated depreciation are removed from property and equipment and any gain or
loss is recognized.

     Property and equipment are depreciated over the estimated useful lives
using the straight-line method. Estimated useful lives of property and equipment
are as follows:

     Buildings and improvements            5-40 years
     Leasehold improvements                lesser of the estimated useful life
                                            or term of the lease
     Bowling and related equipment         5-10 years
     Manufacturing equipment               2-7 years
     Furniture and fixtures                3-8 years

Goodwill

     Goodwill represents the excess of the purchase price of acquisitions over
the allocation among the acquired assets and liabilities in accordance with
estimates of fair market value on the dates of acquisition. Goodwill was being
amortized over 40 years through December 31, 2001. Amortization expense was
$20,888 in 2001, $20,861 in 2000 and $21,384 in 1999. Accumulated amortization
of goodwill was $116,433 and $95,545, respectively, at December 31, 2001 and
2000.

     Effective January 1, 2002, the Company adopted SFAS 142, which specifies
goodwill and certain intangible assets will no longer be amortized but instead
will be subject to periodic impairment testing. The Company will write-off all
of its goodwill effective January 1, 2002 in connection with SFAS 142.

Warranty Costs

     Generally, Products warrants all new products for periods of approximately
one year. Products charges to expense an estimated amount for future warranty
obligations, and also offers customers the option to purchase extended
warranties on certain products. Warranty expense, which aggregated $3,340 in
2001, $1,386 in 2000 and $5,681 in 1999, is included in cost of goods sold.

                                      F-12

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Leasehold Interests

     Leasehold interests, net of accumulated amortization, are $26,496 and
$31,448 as of December 31, 2001 and 2000, respectively. Leasehold interests
represent favorable lease terms, which are comprised of the difference between
amounts due under the contractual lease rate compared with the market rate for
that lease. Leasehold interests are amortized over the life of each lease.
Amortization expense was $4,230 in 2001, $5,577 in 2000 and $4,976 in 1999. It
is expected that these amounts will be written off in conjunction with fresh
start accounting.

Income Taxes

     Worldwide and its subsidiaries are taxable corporations under the Internal
Revenue Code of 1986, as amended (the "Code"). Income taxes are accounted for
using the asset and liability method under which deferred income taxes are
recognized for the tax consequences in future years of temporary differences
between the financial statement carrying amounts and the tax bases of assets and
liabilities.

Advertising Costs

     Costs incurred for advertising are expensed when incurred. The amounts
expensed were approximately $22,556 in 2001, $26,898 in 2000 and $27,291 in
1999, with $19,547, $20,873 and $20,756, respectively, included in bowling
center operating expenses for Centers, and $3,009, $6,025 and $6,535,
respectively, included in selling, general and administrative expenses for
Products and corporate.

Foreign Currency Translation

     All assets and liabilities of the international operations are translated
from foreign currencies into U.S. dollars at year-end exchange rates.
Adjustments resulting from the translation of financial statements of
international operations into U.S. dollars are included in the foreign currency
translation adjustment in the accompanying consolidated balance sheets,
statements of stockholders' equity and statements of comprehensive loss. Revenue
and expenses of international operations are translated using average exchange
rates that existed during the year and reflect currency exchange gains and
losses resulting from transactions conducted in other than local currencies.
Transactions in foreign currencies resulted in net losses of $4,185 in 2001,
$2,338 in 2000 and of $2,432 in 1999, and are included in other expenses.

Fair Value of Financial Instruments

     The carrying value of financial instruments, including cash and cash
equivalents and short-term debt, approximate fair value at December 31, 2001 and
2000, because of the short maturity of these instruments. The fair value of the
term facilities under the Bank Debt, as defined in "Note 6. Long-Term Debt," at
December 31, 2001 and 2000, was approximately $357,425 and $284,772,
respectively, based on the estimated recovery due to the holders of the Term
Facilities, as defined in "Note 6. Long-Term Debt," under the Plan at December
31, 2001 and the trading value at December 31, 2000. The fair value of the Old
Subordinated Notes at December 31, 2001 and 2000 was approximately $28,985 and
$90,575, respectively, based on the estimated recovery due to the holders of the
Old Subordinated Notes under the Plan at December 31, 2001 and the trading value
at December 31, 2000.

Self-Insurance Programs

     The Company is self-insured up to certain amounts for general and product
liability, workers' compensation, certain health care coverage, and property
damage. The cost of these self-insurance programs is accrued based upon
estimates of settlements and costs for known and anticipated claims. The Company
recorded an estimated amount to cover known claims and claims incurred but not
reported as of December 31, 2001 and 2000, which is included in accrued
expenses.

                                      F-13

<PAGE>
<TABLE>
<CAPTION>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Accumulated Other Comprehensive Loss

     Accumulated other comprehensive loss consists of the foreign currency
translation adjustment on the accompanying consolidated balance sheets and
statements of stockholder's equity.

Reclassifications

     Certain previously reported amounts have been reclassified to conform to
the current year presentation.

NOTE 3.  INVENTORIES, NET

     Inventories, net at December 31, 2001 and 2000, consist of the following:

                                                              2001            2000
                                                           -----------    -----------
<S>                                                        <C>            <C>
         Products, at FIFO:
           Raw materials                                   $     7,648    $    13,142
           Work in progress                                      1,943            821
           Finished goods and spare parts                       20,351         32,824
         Centers, at average cost:
           Merchandise and spare parts                           8,790          8,910
                                                           -----------    -----------
                                                           $    38,732    $    55,697
                                                           ===========    ===========

</TABLE>
<TABLE>
<CAPTION>

NOTE 4.   PROPERTY AND EQUIPMENT

     Property and equipment, net at December 31, 2001 and 2000, consist of the
following:

                                                              2001            2000
                                                           -----------    -----------
<S>                                                        <C>            <C>
         Land                                              $   131,188    $   132,041
         Buildings and improvements                            376,958        374,081
         Equipment, furniture and fixtures                     627,605        623,096
         Other                                                   2,863          7,821
                                                           -----------    -----------
                                                             1,138,614      1,137,039
         Less accumulated depreciation and amortization       (453,460)      (381,451)
                                                           -----------    -----------
                                                           $   685,154    $   755,588
                                                           ===========    ===========

</TABLE>

     Depreciation and amortization expense related to property and equipment was
$101,184 in 2001, $104,608 in 2000 and $99,934 in 1999.

     The Company has not completed its assessment of the impact of fresh start
accounting on property and equipment, but believes the net book value of
property and equipment will be reduced.

                                      F-14

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 5.  ACCRUED EXPENSES AND OTHER LIABILITIES

     Accrued expenses and other liabilities at December 31, 2001 and 2000,
consist of:

                                                    2001           2000
                                                 ---------      ---------
         Accrued compensation                    $  18,142      $  13,142
         Accrued interest                              -           32,858
         League bowling accounts                       -           14,972
         Accrued professional fees                  14,442          1,170
         Accrued taxes and licenses                  8,707          7,853
         Accrued center closing costs                5,413            -
         Accrued warranty expense                    2,861          3,075
         Other                                      28,885         29,573
                                                 ---------      ---------
                                                 $  78,450      $ 102,643
                                                 =========      =========

     Subsequent to December 31, 2000, the Company segregated all funds related
to league bowling accounts in a separate account. As a result of this
segregation, the funds and the corresponding liability are no longer considered
to be assets and liabilities of the Company. The account had funds and a related
liability of approximately $12,448 at December 31, 2001.

NOTE 6.  LONG-TERM DEBT

     As discussed in "Note 1. Business Description - Organization and
Restructuring," on the Petition Date the Debtors filed voluntary petitions for
relief under Chapter 11. As further discussed in Note 1, upon emergence from
Chapter 11, the debt that the Company had in place at December 31, 2001 was
terminated, discharged or re-instated.

New Credit Agreement

     As of February 28, 2002, the Company entered into the New Credit Agreement
that consists of the $290,000 Term Facility maturing in February, 2008 and the
$60,000 Revolver maturing in February, 2007. On the Effective Date, the Company
borrowed $10,000 under the Revolver, which amount has been repaid. Outstanding
borrowings under the Term Facility bear interest equal to either the London
Interbank Offered Rate ("LIBOR") plus the applicable margin (4.00% to 4.50%) or
the Base Rate (as defined in the New Credit Agreement) plus the applicable
margin (3.00% to 3.50%) at the Company's option depending on certain financial
ratios. Outstanding borrowings under the Revolver bear interest equal to LIBOR
plus the applicable margin (3.25% to 4.00%) or the Base Rate plus the applicable
margin (2.25% to 3.00%) at the Company's option depending on certain financial
ratios. The Company pays a commitment fee of 0.50% on the unused portion of the
Revolver. Drawings under the Revolver are subject to the fulfillment of certain
conditions. The New Credit Agreement contains certain restrictive covenants,
including the achievement of certain financial covenants and maximum levels of
capital expenditures. The principal amount of the Term Facility must be repaid
on a quarterly basis in the amounts and at the times specified in the New Credit
Agreement, with a final principal payment of $150,000 due on February 28, 2008.
The New Credit Agreement also requires interest payments not less than quarterly
and an annual mandatory prepayment based on a percentage of free cash flow
ranging from 25-75%, as specified in the agreement. Repayment is also required
in amounts specified in the agreement for certain events including unreinvested
asset sale proceeds and equity and debt offering proceeds. The obligations of
Worldwide under the New Credit Agreement are secured by substantially all of the
Company's U.S. assets and a 66% pledge of the capital stock of certain first
tier foreign subsidiaries. Certain of the Company's U.S. subsidiaries have
guaranteed, or are directly obligated on, the New Credit Agreement. The New
Credit Agreement contains certain events of default including cross default
provisions.

                                      F-15

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

New Subordinated Notes

     As of the Effective Date and pursuant to the Plan, the Company issued
$150,000 aggregate principal amount of 13.00% Senior Subordinated Notes due
September 2008 with interest payable semi-annually. The New Subordinated Notes
were issued pursuant to the New Indenture. The New Subordinated Notes are not
generally subject to mandatory redemption or sinking fund payments; are
expressly subordinated to the payment of the New Credit Agreement and any other
senior indebtedness of the Company; contain affirmative and negative covenants
generally no more restrictive than those contained in the New Credit Agreement;
contain certain events of default including cross default provisions; are
unsecured; and have the benefit of guarantees of certain of the U.S.
subsidiaries of the Company. Subject to certain exceptions, the New Subordinated
Notes may not be redeemed at the Company's option before March 1, 2005.
Thereafter, the New Subordinated Notes are redeemable in the manner provided in
the New Indenture at redemption prices equal to 106.50% during the 12 month
period beginning March 1, 2005, 103.25% during the 12 month period beginning
March 1, 2006 and 100.00% beginning on March 1, 2007 and thereafter. Upon the
occurrence of both a change of control of the Company (as defined in the New
Indenture) and a ratings decline (as defined in the New Indenture), the Company
is required to offer to purchase the New Subordinated Notes at 101.00% of their
principal amount, plus accrued interest, and has the option to redeem the New
Subordinated Notes at 110.00% of their principal amount, plus accrued interest.

DIP Loan

     On July 5, 2001, the Debtors obtained a DIP Loan from a syndicate of banks,
including Citibank N.A. ("Citibank"), as Collateral Agent and Administrative
Agent. The DIP Loan permitted the Debtors to borrow up to $75,000 from time to
time for general corporate and business purposes, subject to satisfaction of
customary drawing conditions and the existence of no events of default. There
were no amounts outstanding under the DIP Loan on the Effective Date and it was
terminated. Borrowings under the DIP Loan bore interest at a rate of 1.5% over
Citibank's customary base rate or, at the Company's option, 2.5% over LIBOR. As
of December 31, 2001, the Company had $70,925 available for borrowing, with no
outstanding borrowings and $4,075 of standby letters of credit.

Prepetition Bank Debt

     The Company's indebtedness under the Old Credit Agreement consisted of a
$255,000 senior secured revolving credit facility (the "Bank Facility") and
$365,100 senior secured term loan facilities (the "Term Facilities" and
collectively with the Bank Facility, the "Bank Debt").

     The Old Credit Agreement was terminated and the Bank Debt was satisfied
upon the Company's emergence from Chapter 11. As a result of the default under
the Bank Debt that existed prior to the Petition Date, the Company paid interest
to the Former Secured Creditors at Citibank's customary base rate plus a margin
ranging from 2.75% to 3.75%. The interest rates included a 2% increment for
default interest rate from January 1, 2001 until the Petition Date. After the
Petition Date, the Company did not pay the 2% increment for default interest
rate. From the Petition Date to the Effective Date, the unpaid 2% increment for
default interest rate was included in the Former Secured Creditors' allowed
claim and satisfied under the Plan. At December 31, 2001, the interest rates on
the components of the Bank Debt ranged from 7.50% to 8.50%. During 2001, no
principal payments were made on the Bank Debt.

                                      F-16

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The Company's debt at December 31, 2001 and 2000, consists of:

                                                           December 31,
                                                   --------------------------
                                                       2001           2000
                                                   -----------    -----------

    Prepetition Bank Debt outstanding (b)          $   616,395    $   614,093
    Old Senior Subordinated Notes (a)                      -          250,000
    Old Senior Subordinated Discount Notes (a)             -          270,472
    Mortgage and equipment notes (c)                     3,107          1,993
                                                   -----------    -----------
         Total Debt                                    619,502      1,136,558
    Current maturities                                (616,395)    (1,134,565)
                                                   -----------    -----------
         Total Long-Term Debt                      $     3,107    $     1,993
                                                   ===========    ===========

------------------------

(a)  Amount included in liabilities subject to resolution as of December 31,
     2001. See "Note 7. Liabilities Subject to Resolution.
(b)  The Bank Debt represents the amount owed under the Old Credit Agreement.
     The Bank Debt was fully secured, was satisfied for the amount reported, and
     therefore reported separately and not included in liabilities subject to
     resolution.
(c)  Represents debt under one mortgage note and one capitalized equipment
     lease. The amounts were fully secured and reinstated as senior debt under
     the Plan.

Old Subordinated Notes

     Under the Plan, claims of holders of the Old Subordinated Notes were
satisfied in full by a pro rata distribution of New AMF Common Stock and
Warrants to be made as the amount of their claims is resolved by the Bankruptcy
Court. The Old Senior Subordinated Notes accrued interest at 10.875% and the Old
Senior Subordinated Discount Notes accrued interest at 12.25%. As discussed
below, in connection with the Chapter 11, the Company discontinued accruing
interest under the Old Subordinated Notes during 2001.

Interest Expense

     From January 1, 2001 until the Petition Date, the Company paid interest
under the Old Credit Agreement at the default rate. During Chapter 11, the
Company accrued interest at the default rate and paid interest at the contract
rate under the Old Credit Agreement. As of the Petition Date, the Company
stopped accruing interest on certain prepetition debt obligations that
management believed would receive little, if any, distribution under the Plan
(primarily the Old Subordinated Notes). If such interest had continued to be
accrued, interest expense for the year ended December 31, 2001 would have been
approximately $30,560 higher than the reported amount.

NOTE 7.  LIABILITIES SUBJECT TO RESOLUTION

     Liabilities subject to resolution in the Chapter 11 at December 31, 2001
consist of the following:

    Old Senior Subordinated Notes                  $   250,000
    Old Senior Subordinated Discount Notes             277,000
    Unpaid interest                                     45,014
    Accounts payable and other                          23,449
                                                   -----------
                                                   $   595,463
                                                   ===========

                                      F-17

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 8.  REORGANIZATION ITEMS, NET AND OTHER CHARGES

Reorganization Items, Net

     Reorganization items, net for the year ended December 31, 2001 consist of
the following:

         Provision for center closings (a)            $22,396
         Professional fees                             19,783
         Write off deferred financing costs (b)         9,068
         Employee retention program (c)                 2,447
         Other                                          3,037
                                                      -------
              Total                                   $56,731
                                                      =======
-----------
(a)  During the Chapter 11 proceeding, the Company decided to close 13 U.S.
     bowling centers (of which 12 were premises subject to leases rejected in
     the Chapter 11 proceeding) and two other operating locations and to dispose
     of 12 bowling centers in Brazil and Argentina. This reserve also includes
     the closing or disposition of one center in Germany, two centers in Spain
     and two golf practice ranges in 2001 and early 2002.
(b)  Represents financing costs associated with the Old Credit Agreement and the
     issuance of the Old Subordinated Notes.
(c)  Represents a bonus, severance and retention program approved by the
     Bankruptcy Court to ensure the retention of certain employees who were
     actively involved in, and essential to, the restructuring.

     The reorganization items above include cash paid in the year ended December
31, 2001 for professional fees, the employee retention program and other of
$8,600, $1,200 and $400 respectively.

Refinancing Costs

     In 2001, the Company recorded approximately $12,970 of refinancing charges
related to the proposed restructuring of debt. The charges primarily included
amounts paid prior to the Petition Date for legal and advisory services and
certain payments made in connection with employee retention programs.

     In 2000, the Company recorded $6,500 of refinancing charges related to
proposed restructuring of long-term debt. The charges primarily include amounts
paid for legal and advisory services.

Restructuring Charges

     In 2001, the Company recorded restructuring charges of approximately $2,100
related primarily to severance and other employee expenses.

     In 2000, the Company recorded restructuring charges of approximately $3,400
primarily related to a plan to close the Products Korean operations and sales
office. The restructuring charges related primarily to employee termination
benefits and contract cancellations. As of December 31, 2001, the Company had no
remaining payments related to these restructuring charges.

                                      F-18

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     In 1999, the Company recorded restructuring charges of approximately $8,500
related primarily to a plan to reorganize and downsize the Products business in
response to market weakness in the Asia Pacific region and increased competition
which negatively impacted sales and profitability. Actions taken included
closing one plant in the U.S., one plant in Korea, three warehouses in the
People's Republic of China, one warehouse in Taiwan, four sales offices in China
and one sales office in Belgium. Additionally, sales offices were downsized in
four other countries. The restructuring charges related primarily to employee
termination benefits, asset write-offs and contract cancellations.

Asset Impairment Charges

     In 2001, 2000 and 1999, the Company recorded asset impairment charges of
approximately $3,500, $1,600 and $8,100, respectively, representing the
difference between the fair market value and carrying value of impaired assets.
The asset impairment charges relate to under-performing bowling centers which
were subsequently closed. Fair market value is generally determined based on the
average sales proceeds from previous sales of idle bowling centers.

Special Charges and Other

     In 2000, the Company recorded certain charges totaling $39,200 to reflect:
(i) revaluation of inventory levels in the context of Products business
conditions ($12,000), (ii) the write down of U.K. property and equipment no
longer in service ($6,200), (iii) reconciliation of certain intercompany
differences ($5,300), (iv) costs associated with the exit of certain distributor
arrangements or markets ($5,000), (v) the impact of the net present value of
leases related to centers scheduled to be closed ($2,800) (vi) the increase in
insurance claims experience that resulted from the enhancement of benefits to
U.S. bowling center employees and the occurrence of certain unusual incidents at
some bowling centers ($2,200) and (vii) other charges ($5,700).

     In 1999, a strategic assessment led to programs designed to improve product
line profitability and quality in the Company. This assessment was a catalyst to
recording certain charges. These charges, along with additional reserves
(collectively, the "Special Charges") totaled $26,500. The Special Charges were
non-cash, related primarily to receivables and inventory and were included in
operating expenses.

NOTE 9.  INCOME TAXES

     The Company will be included in the consolidated federal and certain
consolidated state income tax returns of its former parent, AMF Bowling, through
the Effective Date. There are uncertainties with respect to the application of
certain elections to be made in conjunction with such returns. These elections
will be made at the time such tax returns are filed. There can be no assurances
that the Internal Revenue Service or state taxing authorities will agree with
the elections made. Accordingly, the net operating losses ("NOLs") and tax
credits may be substantially reduced or even eliminated by these circumstances.
The income tax attributes of other assets may also be reduced. To the extent
asset basis is reduced for income tax purposes, depreciation or amortization of
assets will also be reduced and, as a result, a gain recognized (and, therefore,
more tax imposed) in conjunction with such disposition of assets may be
incurred.

     In addition, the Company must generally reduce its tax attributes, such as
NOLs, tax credits, capital loss carryforwards and tax basis in its assets, by
any cancellation of indebtedness ("COI") income realized. COI income is the
amount by which the indebtedness discharged in the Chapter 11 proceeding exceeds
the cost and the fair market value of property assigned.

                                      F-19

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     Loss before income taxes for the years ended December 31, 2001, 2000 and
1999, consists of the following:

                                     2001           2000            1999
                                  ----------     ----------     ----------

    U.S                           $ (174,256)    $ (141,319)    $ (142,747)
    International                    (37,939)       (37,377)       (11,993)
                                  ----------     ----------     ----------
                                  $ (212,195)    $ (178,696)    $ (154,740)
                                  ==========     ==========     ==========

     The income tax provision for the years ended December 31, 2001, 2000 and
1999, consist of the following:

                                         2001         2000       1999
                                       --------    --------    --------
    Current income tax provision
    U.S. Federal                       $    -      $    -      $    -
    State and local                         -           -           -
    International                         4,766       2,256       6,209
                                       --------    --------    --------
         Total current provision          4,766       2,256       6,209
                                       --------    --------    --------

    Deferred tax provision
    U.S. Federal                            -           -        18,861
    State and local                         -           -         2,555
    International                           -           -           -
                                       --------    --------    --------
         Total deferred provision           -           -        21,416
                                       --------    --------    --------
         Total provision               $  4,766    $  2,256    $ 27,625
                                       ========    ========    ========

     The provision for income taxes differs from the amount computed by applying
the statutory rate of 35 percent for 2001, 2000 and 1999 to the loss before
income taxes primarily due to valuation allowances, state taxes and other
permanent adjustments.

     The tax effects of temporary differences and carryforwards that give rise
to deferred tax assets and liabilities at December 31, 2001 and 2000, consist of
the following:

                                                          2001          2000
                                                      ----------     ----------
    Deferred income tax assets
    Current assets
      Reserves not deductible for tax purposes        $   37,959     $   14,183
                                                      ----------     ----------

    Noncurrent assets
      Net operating losses                               169,134        159,042
      Foreign tax credits                                  7,010         11,487
      Interest expense                                    47,432         44,907
      Depreciation on property and equipment              37,463          2,323
      Other                                               26,070          8,411
                                                      ----------     ----------
    Noncurrent deferred tax assets                       287,109        226,170
                                                      ----------     ----------
    Deferred tax assets before valuation allowance       325,068        240,353
    Valuation allowance                                 (268,873)      (194,153)
                                                      ----------     ----------
    Deferred tax assets                                   56,195         46,200
                                                      ----------     ----------
    Deferred income tax liabilities
    Goodwill amortization                                 56,195         46,200
                                                      ----------     ----------
    Net deferred tax assets                           $      -       $      -
                                                      ==========     ==========

                                      F-20

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     Realization of deferred tax assets associated with the NOLs and foreign tax
credit carryforwards is dependent upon generating sufficient taxable income
prior to their expiration. Management believes there is risk that certain of
these NOLs and foreign tax credit carryforwards may expire unused and,
accordingly, has established a valuation allowance. As discussed above, such
deferred tax assets will be substantially reduced due to the income tax
implications of the Chapter 11 process.

     For financial statement purposes, valuation reserves as of December 31,
2001 and 2000 offset all future tax benefits related to the recognition of net
operating losses. However, certain carryforwards may be substantially reduced or
eliminated upon emergence from Chapter 11 due to adjustments required by the
Code related to cancellation of indebtedness income.

     Until the Effective Date, the Company was included in the consolidated
federal income tax return filed by AMF Bowling. As of December 31, 2001, the
Company had net operating losses of approximately $434,793 and foreign tax
credits of approximately $7,010 that, absent the effects of the Plan, would
carry over to future years to offset U.S. taxes. The foreign tax credits began
to expire in 2001 and the NOLs would have begun to expire in 2011. The Company
recorded a valuation reserve as of December 31, 2001 for $268,873 related to net
operating losses, foreign tax credits and other deferred tax assets the Company
may not utilize prior to their expirations. As of the Effective Date, Worldwide
became the parent company of a new consolidated group for U.S. income tax return
purposes.

     The NOLs would have expired as follows:

                           Year                        NOLs
                           ----                        ----
                           2011                    $     13,635
                           2012                          79,796
                           2018                          87,327
                           2019                          69,719
                           2020                         119,155
                           2021                          65,161
                                                   ------------
                                                   $    434,793
                                                   ============

     Since the Plan provides for substantial changes in Worldwide's ownership,
there will also be annual limitations on the amount of federal and certain state
carryforwards at the Effective Date that the Company may be able to utilize on
the income tax returns filed after emergence from Chapter 11. This annual
limitation is estimated to be $10,600. The annual limitation may be increased or
decreased by certain transactions which result in recognition of either
"built-in" gains or losses which are unrecognized gains or losses for income tax
purposes existing as of the date the Company emerges from Chapter 11.

NOTE 10. COMMITMENTS AND CONTINGENCIES

Leases

     Centers and Products lease certain facilities and equipment under operating
leases, which expire at various dates. Centers has certain ground leases,
associated with several centers, which expire at various dates. These leases
generally contain renewal options and require payments of taxes, insurance,
maintenance, and other expenses in addition to the minimum annual rentals.
Certain leases require contingent payments based on usage of equipment above
certain specified levels. Such contingent rentals amounted to $471 in 2001,
$1,838 in 2000 and $2,430 in 1999. Total rent expense under operating leases was
approximately $31,030 in 2001, $34,384 in 2000 and $32,892 in 1999.

                                      F-21

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     Future minimum rental payments under the operating lease agreements as of
December 31, 2001 are as follows:

                        Year ending
                       December 31,
                       ------------
                           2002                    $      25,374
                           2003                           23,028
                           2004                           20,256
                           2005                           18,975
                           2006                           17,283
                        Thereafter                       129,787
                                                   -------------
                                                   $     234,703
                                                   =============

     In 2001, the Company recorded a capital lease in the amount of $1,116.

Equipment Sale Buyback Agreements and Operating Lease Guarantees

     In connection with certain equipment sales, Products offers to lenders and
leasing companies outside of the U.S. a contingent buyback agreement on a
portion of the debt incurred by customers to finance the purchase of the
equipment. The amount outstanding related to such buyback agreements,
substantially all of which were entered into prior to the Petition Date, is
approximately $19,002 at February 28, 2002. If a customer defaults under an
equipment loan or lease, Products may be requested to repurchase the equipment
from the lender or leasing company.

     In addition, in connection with two equipment sales prior to the Petition
Date, Products guaranteed the operating real estate leases for the bowling
centers where the equipment was installed. The Company disputes its obligation
under these arrangements. The amount to be paid during the lease periods related
to such guarantees is approximately $5,100 at February 28, 2002. Should either
of the guarantees be invoked, the Company has the right to take over the
operation of the bowling center.

     The obligations under the buyback agreements and the operating real estate
lease guarantees that were incurred prior to the Petition Date were impaired
under the Plan. Therefore, the beneficiaries of such agreements are only
entitled to their distributions as unsecured creditors of the Company under the
Plan.

Litigation and Claims

     The Company emerged from Chapter 11 on March 8, 2002 and accordingly no
longer operates under the constraints of Chapter 11. Under the Plan, however,
the Bankruptcy Court retained jurisdiction over certain matters, including
matters relating to claims objections, executory contracts and unexpired leases,
litigation pending in the Bankruptcy Court at the time of confirmation,
litigation the Company or other parties may commence relating to the Chapter 11
proceeding, and specific matters relating to the implementation and consummation
of the Plan.

     In June 1998, Harbin Hai Heng Bowling Entertainment Co. Ltd. ("Hai Heng")
filed an action against AMF Products, in the Harbin Intermediate People's Court
in Heilongjing, the People's Republic of China. Hai Heng sought to recover
$3,000 to $4,000 in damages relating to equipment purchased from AMF Products.
Hai Heng asserted the poor quality of the equipment entitled Hai Heng to recover
the purchase price and damages for lost profits and the cost of storing the
equipment.

                                      F-22

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     In November 1998, the Intermediate Court awarded Hai Heng approximately
$3,500. AMF Products appealed the award to the High People's Court of
Heilongjing Province (the "People's Court"). Prior to completion of the appeal
review, the President of the People's Court in February 1999 issued a judgment
in favor of Hai Heng for approximately $2,800 and ordered Hai Heng to return a
portion of the equipment to AMF Products. AMF Products filed an appeal to the
Supreme People's Court in Beijing, the People's Republic of China (the "Supreme
Court"). The Supreme Court declined to review the case and the People's Court
judgment is now final.

     AMF Products and Hai Heng have signed a settlement agreement under which
the judgment of the People's Court against AMF Products will be satisfied in
full by AMF Products paying Hai Heng $150 and not disputing Hai Heng's seizure
of approximately $940 formerly on deposit in AMF Products' Beijing bank account.
The Company has recently learned that Hai Heng has refused to complete the terms
of the settlement.

     On January 19, 2001, AMF Products entered into an administrative Consent
Order with the New York State Department of Environmental Conservation ("DEC"),
whereby AMF Products agreed to submit an approvable engineering report and
implement a schedule for installation of new control equipment and boiler
upgrades and perform stacks tests to ensure compliance of its 22.8 MBtu per hour
wood fired boiler with New York State air emission requirements. AMF Products
also agreed to pay a $15,000 penalty of which $5,000 was suspended. AMF Products
is presently negotiating an Amended Consent Order relating to the same matter,
which arises from allegations by DEC that AMF Products did not comply with the
schedule under the Consent Order.

     The Company currently and from time to time is subject to claims and
actions arising in the ordinary course of its business, including environmental
claims, employee and workers' compensation claims and personal injury claims
from customers of Centers. In some actions, plaintiffs request punitive or other
damages that may not be covered by insurance. In management's opinion, the
claims and actions in which the Company is involved are not expected to have a
material adverse impact on its financial position or results of operations.
However, it is not possible to predict the outcome of such claims and actions.

NOTE 11. EMPLOYEE BENEFIT PLANS

     The Company has a defined contribution 401(k) plan to which certain U.S.
employees may make voluntary contributions based on their compensation. Under
the provisions of the plan, the Company matches 100% of the first 3% and 50% of
the next 2% of employee contributions. Employer contributions made prior to
January 1, 1999 vest on the fifth anniversary of employment. Employer
contributions made subsequent to December 31, 1998 vested immediately. The
amounts charged to expense under this plan were $1,927 in 2001, $1,948 in 2000
and $2,174 in 1999.

     Certain of the Company's international operations have employee benefit
plans covering selected employees. These plans vary as to the funding, including
local government, employee, and employer funding. Each international operation
has provided for pension expense and made contributions to these plans in
accordance with the requirements of the plans and local country practices. The
amounts charged to expense under these plans aggregated $871 in 2001, $884 in
2000 and $875 in 1999.

NOTE 12. EQUITY

General

     Prior to the Effective Date, Worldwide was authorized to issue 100 shares
of common stock, par value $0.01 per share, and all of such shares were issued
and outstanding and owned by Worldwide's immediate parent, Group Holdings. On
the Effective Date, such shares were cancelled and the Company's affiliation
with Group Holdings ceased.

                                      F-23

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The authorized capital stock of Worldwide, as of the Effective Date,
consists of 20,000,000 shares of New AMF Common Stock and 5,000,000 shares of
voting preferred stock (the "Preferred Stock"), par value $0.01 per share, as
reflected in the Amended and Restated Certificate of Incorporation of Worldwide.

     Under the Plan, an aggregate of 9,250,000 shares of New AMF Common Stock
were issued as of the Effective Date to the Former Secured Creditors. Up to an
additional 750,000 shares of New AMF Common Stock, 1,764,706 Series A Warrants
and 1,724,138 Series B Warrants will be issued after the Effective Date from
time to time in accordance with the terms of the Plan to the Former Unsecured
Creditors in full satisfaction of their claims.

     Holders of New AMF Common Stock are entitled to one vote for each share
held of record on all matters submitted to a vote of the stockholders. Holders
do not have cumulative voting rights. Therefore, holders of a majority of shares
of New AMF Common Stock entitled to vote in any election of directors may elect
all directors standing for election. Holders of New AMF Common Stock have no
preemptive rights to subscribe for additional shares of New AMF Common Stock and
no right to convert New AMF Common Stock into any other securities. New AMF
Common Stock is not redeemable.

     The Board of Directors of Worldwide may issue the Preferred Stock and
designate the terms thereof (including with respect to voting rights, dividends,
liquidation preferences and conversion rights), without the need for shareholder
approval. No shares of Preferred Stock are issued and outstanding.

     The Amended and Restated Certificate of Incorporation of Worldwide provides
that Worldwide will not issue non-voting equity securities, as and to the extent
required by Section 1123(a) and (b) of the Bankruptcy Code.

Warrants

     The Series A Warrants are intended to represent 15% of the fully diluted
equity of Worldwide, giving effect to the shares issuable on the exercise of the
Series A Warrants but without giving effect to the options available to be
granted under Worldwide's 2002 Stock Option Plan (the "2002 Stock Option Plan").
Holders of the Series A Warrants will have the right to purchase an aggregate of
1,764,706 shares of New AMF Common Stock at an exercise price of $21.19 per
share, subject to adjustment in the event of the issuance of New AMF Common
Stock as a dividend or distribution on New AMF Common Stock or certain
subdivisions, reclassifications and combinations of the New AMF Common Stock.
The Series A warrants also will have the benefit of an adjustment mechanism
designed to prevent the dilutive effect of the Series B Warrants. Through this
adjustment mechanism, the number of shares of New AMF Common Stock issuable
under the Series A Warrants will be increased pursuant to a formula to the
extent of the shares issued under the Series B Warrants and the number of
"in-the-money" Series B Warrants. The determination of whether Series B Warrants
are "in-the-money" will be based solely on, and to the extent there is, the
trading price of the shares as reported on a national securities exchange, the
Nasdaq National Market or any comparable system on which shares of New AMF
Common Stock are listed or admitted to trading. The Series A Warrants will also
benefit from limited protection in connection with certain cash sales of the
Company that occur within three years after the Effective Date. To qualify for
this limited change of control protection, the transaction must entitle the
holders of the New AMF Common Stock to receive consideration consisting of at
least 95% cash, where the total consideration equals at least $625,000 minus the
amount of the Company's indebtedness for borrowed money and capitalized leases
outstanding immediately prior to the consummation of the transaction. If a
transaction qualifies for this protection, the holders of the Series A Warrants
will have the right to require Worldwide to repurchase such holders' Series A
Warrants at fixed decreasing prices as specified in the Series A Warrant
Agreement. The Series A Warrants will expire on March 9, 2009.

                                      F-24

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The Series B Warrants are intended to represent 12.5% of the fully diluted
equity of Worldwide, giving effect to the issuance of the Warrants but without
giving effect to the options available to be granted under the 2002 Stock Option
Plan. Holders of the Series B Warrants will have the right to purchase an
aggregate of 1,724,138 shares of New AMF Common Stock at an exercise price of
$27.19 per share, subject to adjustment in the event of the issuance of New AMF
Common Stock as a dividend or distribution on New AMF Common Stock or certain
subdivisions, reclassifications and contributions of the New AMF Common Stock.
The Series B Warrants will not have the benefit of any adjustment mechanism for
the dilutive effect of the Series A Warrants comparable to the "in-the-money
"protection provided to the Series A Warrants or any protection in the event of
a change of control of the Company. The Series B Warrants will expire on March
9, 2009.

Stock Option Plans

     Prior to the Effective Date, certain of the Company's employees were
eligible to participate in AMF Bowling's 1996 Stock Incentive Plan and 1998
Stock Incentive Plan (collectively, the "AMF Bowling Stock Incentive Plans").
AMF Bowling is a debtor in a Chapter 11 proceeding and the Company believes that
AMF Bowling's stock and outstanding options are worthless. As of December 31,
2001, 3,386,770 options remained outstanding under the AMF Bowling Stock
Incentive Plans. For the year ended 2001, no options were issued under the AMF
Bowling Stock Incentive Plans. Options to acquire a total of 107,500 and
1,523,000 shares of AMF Bowling were issued in 2000 and 1999, respectively,
under the AMF Bowling Stock Incentive Plans. The option agreements generally
provided that options issued under these plans will be cancelled within 90 days
after employment by AMF Bowling or an affiliate terminates. The employment of
all employees participating in the plans terminated for purposes of these
agreements on the Effective Date.

     In 1996, the Company adopted SFAS 123, "Accounting for Stock-Based
Compensation," and elected to account for its stock options under Accounting
Principles Board Opinion No. 25, under which no compensation cost has been
recognized. Had compensation cost for stock options granted under AMF Bowling's
option plans been determined consistent with SFAS 123, the Company's net losses
for 2001, 2000 and 1999 would have been increased to $217,883, $185,609 and
$203,029, respectively.

     The 2002 Stock Option Plan became effective pursuant to the Plan on the
Effective Date. Worldwide is authorized to issue up to 1,839,388 shares of New
AMF Common Stock under the terms of the 2002 Stock Option Plan (subject to
adjustments for capital adjustments as provided under the 2002 Stock Option
Plan) pursuant to stock options to be granted to certain officers, employees,
consultants, and non-employee directors of Worldwide and its affiliates. Shares
allocated to stock options granted under the 2002 Stock Option Plan that are
later forfeited, expire or otherwise terminate may again be used for grants
under the 2002 Stock Option Plan. The Compensation Committee is authorized to
make grants and various other decisions under the 2002 Stock Option Plan and to
make determinations as to a number of the terms of awards granted under the 2002
Stock Option Plan. As of the Effective Date, the Company granted 919,282 stock
options under the 2002 Stock Option Plan. The options were granted at an
exercise price of $21.19 per share, vest over a three year period beginning on
the first anniversary of the Effective Date and expire on the seventh
anniversary of the Effective Date.

     The 2002 Stock Option Plan will terminate ten years after the Effective
Date. However, awards outstanding as of that date will not be affected or
impaired by the termination. The Board of Directors and the Compensation
Committee have authority to amend the 2002 Stock Option Plan and awards granted
thereunder, subject to the terms of the 2002 Stock Option Plan.

                                      F-25

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 13. JOINT VENTURES

     During 2000, the Company purchased the remaining 50% interest in one joint
venture which it had previously accounted for under the equity method and sold
the assets of another joint venture. The Company has no remaining joint venture
investments at December 31, 2001. The Company recorded losses on these joint
ventures of $524 and $18,648 as equity in the loss of such joint ventures during
the years ended December 31, 2000 and 1999, respectively.

NOTE 14. GEOGRAPHIC SEGMENTS

     Information about operations for the years ended December 31, 2001, 2000
and 1999 and identifiable assets at December 31, 2001 and 2000 is presented
below:
<TABLE>
<CAPTION>
                                       Operating Revenues                                Identifiable Assets
                        ----------------------------------------------------      ---------------------------------
                            2001                2000               1999                2001               2000
                       -------------      -------------       --------------      -------------       -------------
<S>                    <C>                <C>                 <C>                 <C>                 <C>
United States          $     535,700      $     547,400       $      547,400      $   1,227,800       $   1,363,900
Australia                     40,300             44,400               54,800             90,300              98,100
Japan                         25,000             26,600               22,400             15,600              23,400
United Kingdom                50,000             52,500               54,200            144,200             147,800
Other European                39,400             39,000               36,900             30,500
Other                         23,100             21,800               39,300             35,000              88,200

Eliminations                 (18,600)           (16,700)             (22,300)             6,000               4,900
                       -------------      -------------       --------------      -------------       -------------
                       $     694,900      $     715,000       $      732,700      $   1,549,400       $   1,726,300
                       =============      =============       ==============-     =============       =============

</TABLE>

NOTE 15. BUSINESS SEGMENTS

     The Company operates in two business segments: operation of bowling centers
and manufacturing and sale of bowling and related products. Information
concerning operations in these business segments for the years ended December
31, 2001, 2000 and 1999 is presented below:
<TABLE>
<CAPTION>
                                         Bowling Centers             Bowling Products
                                   --------------------------  ---------------------------
                                            Inter-     Sub-               Inter-    Sub-               Elim-
                                    U.S.   national   Total      U.S.    National   total  Corporate  inations    Total
                                  -------  -------- ---------  -------   -------- -------- --------  ---------  ---------
                                                                        (in millions)
<S>                               <C>      <C>      <C>        <C>       <C>      <C>       <C>     <C>        <C>
Year ended December 31, 2001
  Revenue from unaffiliated
   customers                      $ 466.8  $ 110.3  $   577.1  $  55.2   $  62.6  $  117.8  $  -    $    -     $   694.9
  Intersegment sales                 -        -          -        13.7       4.9      18.6     -       (18.6)       -
  Operating income (loss)            18.0      4.6       22.6    (32.1)    (10.4)    (42.5)   (26.9)     1.1       (45.7)
  Identifiable assets               696.7    278.9      975.6    531.1      36.7     567.8     -         6.0     1,549.4
  Depreciation and amortization      86.5     18.9      105.4     23.9       0.9      24.8      1.3     (1.5)      130.0
  Capital expenditures               35.8      8.3       44.1      2.6       0.3       2.9      2.5      -          49.5

Year ended December 31, 2000:
  Revenue from unaffiliated
   customers                      $ 466.7  $ 113.7  $   580.4  $  68.0   $  66.6  $  134.6  $  -    $    -     $   715.0
  Intersegment sales                 -        -          -        12.7       4.0      16.7     -       (16.7)       -
  Operating income (loss)            10.4      0.1       10.5    (35.5)    (10.4)    (45.9)   (23.0)     1.4       (57.0)
  Identifiable assets               781.5    296.8    1,078.3    574.1      60.7     634.8      8.3      4.9     1,726.3
  Depreciation and amortization      88.8     22.9      111.7     23.7       1.1      24.8      1.2     (1.7)      136.0
  Capital expenditures               42.7     11.7       54.4      9.5       1.1      10.6      1.5      -          66.5

Year ended December 31, 1999:
  Revenue from unaffiliated
   customers                      $ 461.0  $ 124.7  $   585.7  $  68.1   $  78.9  $  147.0  $  -     $   -     $   732.7
  Intersegment sales                 -        -          -        18.1       4.2      22.3     -       (22.3)       -
  Operating income (loss)            11.0      8.6       19.6    (33.4)    (10.1)    (43.5)   (16.1)     1.3       (38.7)
  Identifiable assets               810.4    315.8    1,126.2    607.6      64.3     671.9      3.8      3.5     1,805.4
  Depreciation and amortization      84.2     25.2      109.4     22.2       1.4      23.6      1.3     (1.6)      132.7
  Capital expenditures               34.1      9.4       43.5      7.9       0.4       8.3      0.3      -          52.1
</TABLE>

                                      F-26

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 16. RELATED PARTIES

     Prior to the Effective Date, Goldman Sachs and its affiliates had certain
interests in the Company. Goldman Sachs and its affiliates together currently
beneficially own a majority of the outstanding voting equity of AMF Bowling.
Goldman Sachs also owns 870,000 warrants to purchase shares of common stock of
AMF Bowling. The warrants were issued in connection with the Acquisition at an
exercise price of $0.01 per share and expire in May 2006. In addition, Goldman
Sachs was the initial purchaser of the Old Subordinated Notes. Richard A.
Friedman and Terence M. O'Toole, each of whom is a Managing Director of Goldman
Sachs, and Peter M. Sacerdote, who is a limited partner of The Goldman Sachs
Group, L.P., are directors of AMF Bowling. Prior to the Effective Date, Goldman
Sachs, was deemed to be an "affiliate" of the Company. Goldman Sachs received an
underwriting discount of approximately $19,000 in connection with the purchase
and resale of the Old Subordinated Notes in 1996. In addition, Goldman Sachs was
reimbursed its expenses and is indemnified in connection with its services. The
Company no longer has an affiliation with Goldman Sachs.

     Under the Old Credit Agreement, Goldman Sachs Credit Partners, L.P., acted
as Syndication Agent; Goldman Sachs Credit Partners, L.P., and Citicorp
Securities, Inc., acted as Arrangers; Citibank, N.A. is acting as Administrative
Agent and Citicorp USA, Inc. is acting as Collateral Agent. Goldman Sachs Credit
Partners, L.P., was also a lender under the Old Credit Agreement. Total fees and
reimbursable expenses payable to Goldman Sachs Credit Partners, L.P. in
connection with its services under the Old Credit Agreement aggregated
approximately $10,700, and such entity was reimbursed for expenses in connection
with such services.

     Prior to the Petition Date, The Blackstone Group, L.P. ("Blackstone") was
the beneficial owner of approximately 10% of AMF Bowling's common stock.
Blackstone acted as the Company's financial adviser during Chapter 11. The
Company paid Blackstone monthly retainer fees totaling approximately $4,100
during the course of its engagement and a transaction fee of $5,600 on or about
March 8, 2002. In May or June, 2002, upon Bankruptcy Court approval, the Company
expects to pay Blackstone approximately $1,700, which is the balance of the
agreed upon transaction fee and the remaining holdback of monthly retainer fees.
These amounts also include reimbursement for Blackstone's expenses incurred in
connection with such services. The Company no longer has an affiliation with
Blackstone.

                                      F-27

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     On the Effective Date, pursuant to the Plan, Worldwide entered into a
registration rights agreement (the "Registration Rights Agreement"), which
provides holders of 10 percent or more of the New AMF Common Stock as of the
Effective Date (the "Principal Holders") with certain rights to require
Worldwide to register their shares of New AMF Common Stock, including shares
issuable upon the exercise of their Warrants. No registration rights are
provided with respect to the Warrants or the New Subordinated Notes or to
holders of New AMF Common Stock other than the Principal Holders.

     Under the Registration Rights Agreement, Worldwide will use its reasonable
best efforts to (a) register the New AMF Common Stock held by a Principal Holder
upon a request by one or more Principal Holders to register New AMF Common Stock
held by the Principal Holders with a market value generally of at least $25.0
million in the aggregate and (b) in connection with any registered offering of
the New AMF Common Stock by Worldwide, register the New AMF Common Stock of
Principal Holders that wish to sell their New AMF Common Stock in the offering.
Under the terms of the Registration Rights Agreement, each Principal Holder is
limited to a specified number of "demand" registrations under clause (a) above.
In addition, the requests for registration are subject to other limitations and
cut-backs, as set forth in the Registration Rights Agreement.

     The registration rights will not apply to New AMF Common Stock to the
extent that: (a) a registration statement with respect to the sale of New AMF
Common Stock has been declared effective under the Securities Act and the
holders' shares of New AMF Common Stock have been disposed of under that
registration statement; (b) the holders' shares of New AMF Common Stock have
been disposed of under Securities Act Rule 144 or another exemption from the
registration requirements of the Securities Act under which the shares of New
AMF Common Stock are thereafter freely tradable without restriction under the
Securities Act; or (c) the holders' shares of New AMF Common Stock may be
disposed of under Rule 144 within Rule 144's volume limitations within a 90 day
period or under Securities Act Rule 144(k).

                                      F-28

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 17. PRO FORMA REORGANIZED BALANCE SHEET (UNAUDITED)

     The following unaudited pro forma reorganized balance sheet of the Company
as of December 31, 2001 is presented for informational purposes only. It
reflects the pro forma effect of the cancellation of indebtedness that resulted
from the Chapter 11 proceeding, fresh start accounting, the closing of the Exit
Facility, the issuance of the New Subordinated Notes and the write-off of
goodwill in accordance with SFAS 142 as if each had occurred on such date. The
unaudited pro forma reorganized balance sheet should be reviewed in conjunction
with the notes set forth below it. This presentation has not been audited and
does not necessarily reflect the actual adjustments that will be made as of the
Effective Date.

                           AMF Bowling Worldwide, INC.
                       Pro Forma Reorganized Balance Sheet
                                December 31, 2001
                                   (Unaudited)
                                 (In thousands)

<TABLE>
<CAPTION>
                                                                                                           Pro Forma
                                                December 31,     Reorganization         Other              December 31,
                                                  2001 (a)        Adjustments        Adjustments              2001
                                              -------------      --------------      -----------           ------------
<S>                                           <C>                <C>                 <C>                   <C>
ASSETS
Cash and cash equivalents                     $      25,291      $                   $                     $     25,291
Accounts and notes receivable, net                   27,381                                                      27,381
Inventories                                          38,732                                                      38,732
Advances and deposits                                14,337                                                      14,337
Property and equipment, net                         685,154                              (46,293) (b)           638,861
Leasehold interests and other                        40,138            13,725 (c)        (28,510) (b)            25,353
Goodwill, net                                       718,414                             (718,414) (d)               -
                                              -------------      ------------        -----------           ------------
         Total assets                         $   1,549,447      $    $13,725        $  (793,217)          $    769,955
                                              =============      ============        ============          =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable                              $      24,246                                                $     24,246
Accrued expenses and other                           78,450                                                      78,450
Old Credit Agreement                                616,395          (616,395)(e)                                   -
Revolver                                                               10,000 (f)                                 10,000
Term Facility                                                         290,000 (f)                                290,000
New Subordinated Notes                                                150,000 (g)                                150,000
Liabilities subject to resolution                   595,463                              (595,463)(b)                -
Other long-term debt                                  3,107                                                        3,107
Other long-term liabilities                           2,252                                                        2,252
                                              -------------      ------------        -----------           ------------
         Total liabilities                        1,319,913          (166,395)           (595,463)               558,055

Total stockholders' equity                          229,534           180,120            (197,754)               211,900
                                              -------------      ------------        -----------           ------------
Total liabilities and stockholders'
equity                                        $   1,549,447      $     13,725        $   (793,217)         $     769,955
                                              =============      ============        ============          =============

</TABLE>

                                      F-29

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Notes to Pro Forma Reorganized Balance Sheet
--------------------------------------------
(a)  The historical balance sheet and the other historical financial statements
     and data included in these notes to Consolidated Financial Statements do
     not reflect the effects of fresh start accounting or SFAS 142.
(b)  Reflects the application of SOP 90-7, including the write down of certain
     long lived assets to reflect the reorganization value upon emergence from
     Chapter 11.
(c)  Reflects expected fees and expenses associated with the Exit Facility.
(d)  Reflects the write-off of goodwill of $718,414 in January 2002 upon
     application of SFAS 142.
(e)  Reflects the exchange of debt outstanding under the Old Credit Agreement
     pursuant to the Plan.
(f)  Reflects amounts borrowed under the Exit Facility as of the Effective Date.
(g)  Reflects the issuance of the New Subordinated Notes.

                                      F-30

<PAGE>

                           AMF BOWLING WORLDWIDE, INC.

                        SELECTED QUARTERLY FINANCIAL DATA
                                 (in thousands)

<TABLE>
<CAPTION>
                                                           Quarter ended
                                       -----------------------------------------------------------
                                        March 31        June 30     September 30      December 31
                                       ----------      ---------    ------------     -------------
                                                              (unaudited)
<S>                                    <C>             <C>          <C>              <C>
Operating Revenue               2001   $  205,700      $ 151,400    $    156,200     $     181,600
                                2000      209,500        160,700         162,100           182,700
                                1999      202,600        161,100         182,800           186,200

Operating income (loss)         2001   $   15,800      $ (34,300)   $    (32,400)    $       5,200
                                2000       23,900        (14,400)        (17,900)          (48,600)
                                1999       23,300        (13,500)        (53,500)            5,000

Net loss                        2001   $  (29,200)     $ (69,200)   $    (64,100)    $     (54,500)
                                2000       (5,600)       (46,300)        (52,200)          (77,400)
                                1999      (12,100)       (46,500)       (103,700)          (38,700)

</TABLE>

                                      F-31

<PAGE>

                                  EXHIBIT INDEX

 2.1     Order Confirming Second Amended Second Modified Joint Plan of
         Reorganization of AMF Bowling Worldwide, Inc. and certain of its direct
         and indirect subsidiaries. (filed herewith)
 2.2     Second Amended Second Modified Joint Plan of Reorganization of AMF
         Bowling Worldwide, Inc. and certain of its direct and indirect
         subsidiaries. (1)
 3.1     Amended and Restated Certificate of Incorporation of AMF Bowling
         Worldwide, Inc. (2)
 3.2     Amended and Restated By-Laws of AMF Bowling Worldwide, Inc. (3)
 4.1     Indenture dated as of March 8, 2002 by and among AMF Bowling Worldwide,
         Inc., certain subsidiaries of AMF Bowling Worldwide, Inc., as
         Guarantors, and Wilmington Trust Company, as Trustee, with respect to
         13.00% Senior Subordinated Notes due 2008. (4)
 4.2     Form of Senior Subordinated Note (attached as exhibit to Exhibit 4.1).
 4.3     Registration Rights Agreement dated as of March 8, 2002 by and among
         AMF Bowling Worldwide, Inc. and certain holders of common stock. (5)
 4.4     Series A Warrant Agreement dated as of March 8, 2002 between AMF
         Bowling Worldwide, Inc. and Mellon Investor Services LLC, as Warrant
         Agent. (6)
 4.5     Series B Warrant Agreement dated as of March 8, 2002 between AMF
         Bowling Worldwide, Inc. and Mellon Investor Services LLC, as Warrant
         Agent. (7)
10.1     Employment Agreement, dated as of April 28, 1999, between AMF Bowling,
         Inc. and Roland Smith. (8)*
10.2     Stock Option Agreement, dated as of April 28, 1999, between AMF
         Bowling, Inc. and Roland Smith. (9)*
10.3     Employment Agreement, effective November 12, 1999, between AMF Bowling
         Worldwide, Inc. and Timothy N. Scott. (10)*
10.4     AMF Bowling Worldwide, Inc. Bonus, Severance and Retention Program for
         Certain Employees, approved November 9, 2000. (11)*
10.5     Assumption Agreement, dated as of November 9, 2000, by and between AMF
         Bowling Worldwide, Inc. and Roland C. Smith. (12)*
10.6     Form of Employment Retention Agreement, effective November 9, 2000,
         among AMF Bowling Worldwide, Inc., AMF Bowling Products, Inc., AMF
         Bowling Centers, Inc., AMF Bowling Centers (Aust.) International, Inc.
         and AMF Worldwide Bowling Centers Holdings, Inc. and certain
         executives. (13)*
10.7     Employment Agreement, effective March 15, 2001, between AMF Bowling
         Products, Inc. and John Suddarth. (14)*
10.8     Senior Secured Credit Agreement, dated as of February 28, 2002 among
         AMF Bowling Worldwide, Inc., certain of its subsidiaries as borrowers,
         the financial institutions listed on the signature pages thereto, and
         Bankers Trust Company, as Documentation Agent, Syndication Agent and
         Administrative Agent (without exhibits). (15)
10.9     AMF Bowling Worldwide, Inc. 2002 Stock Option Plan. (16)*
10.10    Amended and Restated Employment Agreement, dated as of February 1,
         2002, between AMF Bowling Worldwide, Inc. and Roland Smith. (filed
         herewith)*
10.11    Restricted Stock Award Agreement, dated February 1, 2002, between AMF
         Bowling Worldwide, Inc. and Roland Smith. (filed herewith)*
10.12    Employment Letter, dated as of January 22, 2002, between AMF Bowling
         Worldwide, Inc. and John H. Smith. (filed herewith)*
10.13    Employment Letter, dated as of January 24, 2002, between AMF Bowling
         Worldwide, Inc. and Wayne T. Tennent. (filed herewith)*
21.1     Subsidiaries of the Company. (filed herewith)
99.1     Letter from AMF Bowling Worldwide, Inc. to the Securities and Exchange
         Commission dated March 29, 2002 regarding the statement of assurances
         obtained from Arthur Andersen LLP. (filed herewith)

Notes to Exhibits:

   * Management contract or compensatory plan or arrangement.

                                      E-1

<PAGE>

 (1)     Incorporated by reference to Exhibit 4.6 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (2)     Incorporated by reference to Exhibit 3.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (3)     Incorporated by reference to Exhibit 3.2 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (4)     Incorporated by reference to Exhibit 4.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (5)     Incorporated by reference to Exhibit 4.3 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (6)     Incorporated by reference to Exhibit 4.4 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (7)     Incorporated by reference to Exhibit 4.5 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
 (8)     Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form
         10-Q of AMF Bowling, Inc. for the quarterly period ended March 31, 1999
         (File No. 001-13539).
 (9)     Incorporated by reference to Exhibit 10.2 to Quarterly Report on Form
         10-Q of AMF Bowling, Inc. for the quarterly period ended March 31, 1999
         (File No. 001-13539).
(10)     Incorporated by reference to Exhibit 10.36 to the Annual Report on Form
         10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended December
         31, 2000 (File No. 001-12131).
(11)     Incorporated by reference to Exhibit 10.38 to the Annual Report on Form
         10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended December
         31, 2000 (File No. 001-12131).
(12)     Incorporated by reference to Exhibit 10.39 to the Annual Report on Form
         10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended December
         31, 2000 (File No. 001-12131).
(13)     Incorporated by reference to Exhibit 10.41 to the Annual Report on Form
         10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended December
         31, 2000 (File No. 001-12131).
(14)     Incorporated by reference to Exhibit 10.43 to the Annual Report on Form
         10-K of AMF Bowling Worldwide, Inc. for the fiscal year ended December
         31, 2000 (File No. 001-12131).
(15)     Incorporated by reference to Exhibit 10.1 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).
(16)     Incorporated by reference to Exhibit 10.2 to AMF Bowling Worldwide,
         Inc.'s Current Report on Form 8-K dated March 8, 2002 (File No.
         001-12131).

                                      E-2