Williams Emerges as WilTel

TULSA, Okla. -- Williams Communications Group, Inc. announced today that it has completed its financial restructuring and has emerged from Chapter 11 proceedings as WilTel Communications Group, Inc., a Nevada corporation. Its Plan of Reorganization, which was confirmed by the United States Bankruptcy Court for the Southern District of New York on September 30, 2002, became effective on October 15, 2002. The Company will continue to operate from its Tulsa headquarters.The Company emerges with a new $375 million credit facility and no other substantial debt obligations other than those related to its headquarters building. Under the Company’s Plan of Reorganization, existing shares of WCG stock (OTCBB: WCGRQ) have been cancelled. The Company has issued 50,000,000 WilTel Communications shares for distribution, approximately 54 percent of which have been issued for distribution to unsecured creditors and 44 percent of which have been issued to Leucadia National Corporation (NYSE:LUK). Leucadia has invested $150 million in the Company and purchased the claims of The Williams Companies for $180 million, which funds will be released to the Company and The Williams Companies upon receipt of requisite FCC regulatory approvals which are expected to be obtained in the fourth quarter of 2002. The remaining two percent of the new equity has been set aside for potential recovery by holders of securities-related claims through a channeling injunction approved by the Court. Separately, the Company announced that Howard Janzen has resigned as president, CEO and as a director. The WilTel Board of Directors expressed its appreciation to Mr. Janzen: "Today WilTel emerges as a financially healthy, industry leader. This is a testament to the foundation created by Howard and the outstanding leadership provided by him during the Company’s recent restructuring. Howard is a major reason for the Company’s rapid emergence from Chapter 11 and for the seamless management of operations and customer care since the company’s founding and over these difficult past six months. We thank him for his commitment and hard work on behalf of the Company as the Board begins the search for the next leader to continue WilTel’s growth and industry leadership."In a separate release:NEW YORK -- Leucadia National Corporation (NYSE and PCX:LUK) announced today that it has acquired 44% of the outstanding equity of WilTel Communications Group, Inc., a newly formed Nevada corporation that emerged today from the chapter 11 bankruptcy proceedings of Williams Communications Group, Inc. ("Old WCG"). The aggregate purchase price of $330 million, in the form of irrevocable letters of credit, has been deposited into escrow pending receipt of requisite regulatory approval from the Federal Communications Commission ("FCC").The WilTel stock was acquired by Leucadia under Old WCG's chapter 11 Restructuring Plan pursuant to a claims purchase agreement with The Williams Companies, Inc. and an investment agreement with Old WCG. The Plan, which became effective on October 15, 2002, was consummated under special temporary authority granted by the FCC. WilTel expects requisite approvals will be received from the FCC prior to the end of this year; at such time the purchase price will be released from escrow. Upon receipt of requisite approvals from the FCC, Leucadia will account for this investment under the equity method of accounting.Leucadia has appointed four members (including Ian M. Cumming and Joseph S. Steinberg, Leucadia's Chairman and President, respectively) to the newly constituted board of directors of WilTel and has entered into a stockholders agreement with WilTel pursuant to which Leucadia has agreed to certain restrictions on its ability to acquire or sell WilTel stock.WilTel Communications Group Inc.