PERINI CORP, DEF 14A, 1999-04-07

PERINI CORP
DEF 14A, 1999-04-07
GENERAL BLDG CONTRACTORS - NONRESIDENTIAL BLDGS

Previous: OHIO POWER CO, S-3, 1999-04-07

Next: PUBLIX SUPER MARKETS INC, DEF 14A, 1999-04-07

Perini Corporation
73 Mt. Wayte Avenue
Framingham, Massachusetts 01701

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 13, 1999

TO THE STOCKHOLDERS OF PERINI CORPORATION:

NOTICE IS HEREBY GIVEN that the annual meeting of the stockholders of
PERINI CORPORATION will be held at State Street Bank and Trust Company,
Enterprise Room, 5th Floor, 225 Franklin Street, Boston, Massachusetts, on
Thursday, May 13, 1999, at 9:00 a.m., for the following purposes:

1. Holders of Common Stock, $1.00 par value, of the Company (the "Common
Stock") and holders of Series B Cumulative Convertible Preferred Stock,
$1.00 par value, of the Company (the "Series B Preferred Stock") voting
together as a class, will:

A. Elect three (3) Class III Directors, to hold office for a
three-year term, expiring in 2002 and until their successors are
chosen and qualified.

B. Consider and ratify the selection of Arthur Andersen LLP,
independent public accountants, as auditors for the fiscal year
ending December 31, 1999.

C. Transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.

2. Holders of the Company's $21.25 Convertible Exchangeable Preferred Stock
(the "Preferred Stock") will:

A. Elect two (2) Preferred Directors, to hold office until the
earlier of (i) a one-year term, expiring in 2000 and until their
successors are chosen and qualified or (ii) until all dividends
in arrears on the Preferred Stock have been paid or declared and
funds therefor set apart for payment.

The Board of Directors has fixed the close of business on March 23,
1999, as the record date for the determination of the stockholders entitled to
vote at the meeting.

A WHITE form of proxy is being solicited from holders of the Common
Stock and the Series B Preferred Stock. A BLUE Instruction Card is being
solicited from holders of the Preferred Stock. Whether or not you plan to attend
the meeting, please fill in, sign, date and return the enclosed WHITE proxy card
or BLUE Instruction Card in the enclosed envelope, which requires no postage if
mailed in the United States. It is important that these cards be returned. If
you receive more than one card because your shares are registered in different
names, or because you own both Common Stock and Preferred Stock, please execute
each such card and return it promptly to assure that all your shares will be
voted.

By order of the Board of Directors,
Robert E. Higgins, Secretary
April 7, 1999

The Annual Report of the Company, including financial statements for the
year 1998, is being sent to stockholders concurrently with this Notice.

<PAGE>

Perini Corporation
73 Mt. Wayte Avenue
Framingham, Massachusetts 01701

PROXY STATEMENT

ANNUAL MEETING OF THE STOCKHOLDERS
OF PERINI CORPORATION

This statement is furnished in connection with the solicitation of
proxies by the Board of Directors of PERINI CORPORATION (hereinafter called the
"Company") to be used at the annual meeting of the stockholders (the "Annual
Meeting") of the Company to be held at State Street Bank and Trust Company, 225
Franklin Street, Boston, Massachusetts, on Thursday, May 13, 1999, at 9:00 a.m.,
and at any adjournment or adjournments thereof, for the purposes set forth in
the accompanying Notice of Annual Meeting of Stockholders. A WHITE proxy card is
being sent to holders of the Company's Common Stock, $1.00 par value (the
"Common Stock") and Series B Cumulative Convertible Preferred Stock, $1.00 par
value (the "Series B Preferred Stock"). If the accompanying WHITE form of proxy
is executed and returned, it may nevertheless be revoked at any time insofar as
it has not been exercised either by notice to the Secretary of the Company, the
subsequent execution and delivery of another Proxy, or by voting in person at
the Annual Meeting. A BLUE Instruction Card is being sent to holders of the
Company's $21.25 Convertible Exchangeable Preferred Stock (the "Preferred
Stock"). If the accompanying BLUE Instruction Card is executed and returned, it
may nevertheless be revoked at any time up until 5:00 p.m. on May 12, 1999
either by filing a written revocation or a duly executed Instruction Card
bearing a later date. It is anticipated that the Proxy Statement and the
enclosed Proxy or Instruction Card, as applicable, will be mailed to the
stockholders of record on or about April 7, 1999.

The Board of Directors has fixed the close of business on March 23,
1999, as the record date for the determination of the stockholders entitled to
vote at the Annual Meeting. As of March 23, 1999, the Company had outstanding
5,444,010 shares of Common Stock. Each share is entitled to one vote. In
addition, the holders of 185,891 shares of Series B Preferred Stock (150,150
shares issued at the closing on January 17, 1997 plus in-kind dividends of
35,741 shares paid through March 15, 1999) have the same voting rights as
holders of Common Stock, equal to the number of shares of Common Stock into
which the Series B Preferred Stock can be converted (or 3,839,845 shares of
Common Stock). Therefore, the maximum aggregate number of votes of holders of
Common Stock and Series B Preferred Stock available as of the record date and
entitled to vote at the Annual Meeting is 9,283,855.

The terms of the Company's Preferred Stock provide that as a result of
dividends on the Preferred Stock being in arrears for at least six quarters, the
holders of the Preferred Stock are entitled, voting as a separate class, to
elect two (2) Directors (the "Preferred Directors") to the Company's Board of
Directors, to hold office until the earlier of (i) the date upon which their
elected term expires and until their successors are chosen and qualified or (ii)
until all dividends in arrears on the Preferred Stock have been paid or declared
and funds therefor set apart for payment. As of March 23, 1999, the Company had
outstanding 99,900 shares of Preferred Stock. Each share is entitled to one
vote. Bank Boston, N.A., as the Depositary for the Preferred Stock (the
"Depositary"), is the holder of all of the issued and outstanding Preferred
Stock. The terms of the Deposit Agreement by and among the Company, the
Depositary and the holders of Depositary Shares representing the Preferred Stock
provide that the holders of Depositary Shares are entitled to instruct the
Depositary to vote the shares of Preferred Stock

-1-

<PAGE>

represented by their respective Depositary Shares. Each Depositary Share
represents ownership of 1/10th of a share of Preferred Stock. Therefore, as of
March 23, 1999, there were outstanding 999,000 Depositary Shares. The holders of
Depositary Shares should forward their instruction cards to the Depositary
instructing the Depositary how to vote the Preferred Stock.

STOCKHOLDER VOTE REQUIRED

Common Stock Nominees

The presence, in person or by proxy, of at least a majority in interest
of the total number of outstanding shares of Common Stock on a fully diluted
basis (or 9,283,855 voting rights) is necessary to constitute a quorum for
transaction of business at the Annual Meeting. Abstentions and "broker
non-votes" will be counted as present for determining the presence or absence of
a quorum for the transaction of business at the Annual Meeting. A "broker
non-vote" is a proxy from a broker or other nominee indicating that such person
has not received instructions from the beneficial owner or other person entitled
to vote the shares on a particular matter with respect to which the broker or
other nominee does not have discretionary voting power.

A quorum being present, the vote of a plurality of the votes cast at the
Annual Meeting is necessary to elect each of the nominees for director. The vote
of a majority of the votes cast at the Annual Meeting by holders of the
Company's Common Stock is required to ratify the selection of Arthur Andersen
LLP as auditors for the fiscal year ending December 31, 1999. Abstentions and
broker non-votes will not be counted as voting at the Annual Meeting and,
therefore, will not have an effect on the election of Directors or ratification
of auditors.

Preferred Stock Nominees

Assuming a quorum is present, the Depositary will vote the number of
shares of the Preferred Stock for the Preferred Directors represented by the
number of Depositary Shares instructed to be voted for the Preferred Directors.
Under the terms of the Deposit Agreement, in the absence of specific
instructions from a holder of Depositary Shares the Depositary will abstain from
voting to the extent of the Preferred Stock represented by the Depositary Shares
of such holder of Depositary Shares. The two Preferred Director nominees for
whom the greatest number of shares of Preferred Stock is voted by the Depositary
will be elected as the Preferred Directors.

A holder of Depositary Shares may revoke an Instruction Card given with
respect to the Election of Preferred Directors by filing with the Depositary no
later than 5:00 p.m. on Wednesday, May 12, 1999, a written revocation or a duly
executed Instruction Card bearing a later date.

STOCKHOLDER PROPOSALS FOR 2000 ANNUAL MEETING

Any proposal of a stockholder intended to be presented at the Company's
2000 Annual Meeting of Stockholders must be received by the Company for
inclusion in the proxy statement and form of proxy for that meeting no later
than December 7, 1999. In addition, stockholder proposals and director
nominations must comply with the requirements of the Company's By-Laws.

-2-
<PAGE>

1A. and 2A.

ELECTION OF DIRECTORS

Common Stock Nominees

In accordance with the Company's By-Laws and Massachusetts law, the
Board of Directors is divided into three approximately equal classes, with each
Director serving for a term of three years. As a consequence, the term of only
one class of Directors expires each year, and their successors are elected for
terms of three years. The Board of Directors is presently comprised of 11
members; 9 Directors (as follows) and 2 Preferred Directors:

Class I: Marshall M. Criser, Arthur J. Fox, Jr., and Michael R.
Klein were elected as Directors at the 1997 Annual
Meeting to serve until the 2000 Annual Meeting of
Stockholders and until their successors are chosen and
qualified.

Class II: Richard J. Boushka, Jane E. Newman and Ronald N. Tutor
were elected as Directors at the 1998 Annual Meeting to
serve until the 2001 Annual Meeting of Stockholders and
until their successors are chosen and qualified.

Class III: Nancy Hawthorne, Douglas J. McCarron and David B.
Perini are the three nominees for election as Directors
at this Annual Meeting to serve until the 2002 Annual
Meeting of Stockholders and until their successors are
chosen and qualified.

The Nominating Committee of the Board of Directors of the Company has
nominated Nancy Hawthorne, Douglas J. McCarron and David B. Perini for election
as Directors. Unless otherwise noted thereon, proxies solicited hereby will be
voted for the election of Ms. Hawthorne and Messrs. McCarron and Perini as
Directors to hold office until the 2002 Annual Meeting of Stockholders and until
their successors are chosen and qualified. The Board of Directors does not
contemplate that any nominee will be unable to serve as a Director for any
reason, but, if that should occur prior to the meeting, the proxy holders will
select another person in his or her place and stead. Information regarding these
nominees for election as Directors, as well as each Director whose term is not
scheduled to expire until the 2000 or 2001 Annual Meeting of Stockholders, is
set forth in "Ownership of Common Stock by Directors and Officers" on pages 5
through 9.

The Board recommends a vote FOR the election of each of the nominees for
election as Directors.

Preferred Stock Nominees

The terms of the Company's Preferred Stock provide that as a result of
dividends on the Preferred Stock being in arrears for at least six quarters, the
holders of the Preferred Stock are entitled, voting as a separate class, to
elect two (2) Directors (the "Preferred Directors") to the Company's Board of
Directors, to hold office until the earlier of (i) the date upon which their
elected term expires and until their successors are chosen and qualified or (ii)
until all dividends in arrears on the Preferred Stock have been paid or declared
and funds therefor set apart for payment. Since the dividend on the Preferred
Stock had not been paid since December 1995, the holders of the Preferred Stock
elected Arthur I. Caplan and Frederick Doppelt at the May 14, 1998 Annual
Meeting of Stockholders to serve as the Preferred Directors until the earlier of
(i) the
-3-
<PAGE>

next annual meeting of stockholders and until their successors were chosen and
qualified or (ii) payment in full by the Company of any dividends owed on the
Preferred Stock. The Company has continued to not pay any dividends on the
Preferred Stock throughout 1998 and 1999 to date. Accordingly, the holders of
the Preferred Stock, voting as a separate class, remain entitled to elect two
(2) Preferred Directors to the Company's Board of Directors.

Preferred Stock Arthur I. Caplan and Frederick Doppelt are the two
Nominees: nominees for election as Preferred Directors at this
Annual Meeting to serve until the earlier of (i) the
2000 Annual Meeting of Stockholders and until their
successors are chosen and qualified or (ii) all
dividends in arrears on the Preferred Stock have been
paid or declared and funds therefor set apart for
payment.

Unless otherwise noted thereon, Instruction Cards solicited hereby will
be voted by the Depositary for the election of Messrs. Caplan and Doppelt as
Preferred Directors to hold office until the earlier of (i) the 2000 Annual
Meeting of Stockholders and until their successors are chose and qualified or
(ii) all dividends in arrears on the Preferred Stock have been paid or declared
and funds therefor set apart for payment. The Board of Directors does not
contemplate that either nominee will be unable to serve as a Preferred Director
for any reason but, if that should occur prior to the meeting, the Depositary
will select another person in his place and stead. Information regarding these
nominees for election as Directors is set forth in "Ownership of Common Stock by
Directors and Officers" on page 5 through 9.

The Board recommends a vote FOR the election of each of the nominees for
election as Preferred Directors.
-4-
<PAGE>

OWNERSHIP OF COMMON STOCK BY DIRECTORS AND OFFICERS

The following table sets forth certain information received by the
Company from the individuals listed below concerning their respective beneficial
ownership as of March 1, 1999 of the Common Stock of the Company by each
Director and named Executive Officer of the Company, and by all Directors and
Executive Officers of the Company as a group. Also, included in the table with
respect to each Director is principal occupation or employment during the past
five years, age and the period served as a Director of the Company.

Number of Shares of Common Stock of the
Company Beneficially Owned
On March 1, 1999(1)(2)
--------------------------------------------
Served Sole Voting
as a and
Name and Principal Occupation for The Director Investment Percentage
Past Five Years Age Since Power Shared Aggregate of Class
- ------------------------------------------ ------ --------- ------------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
David B. Perini (3)(6)(10) 61 1970 161,315 (7) 168,849 (8) 330,164 6.03%
Chairman and Chairman of the
Board of Directors

Ronald N. Tutor (3)(6)(10) 58 1997 351,318 (9) 0 351,318 6.45%
Director, Vice Chairman, formerly
Acting Chief Operating Officer since
January 17, 1997, and Chairman,
President and Chief Executive
Officer, Tutor-Saliba Corporation

Roger J. Ludlam (10) 56 1997 100 0 100 *
Formerly President and Chief Executive
Officer

John J. McHale (5) 77 1962 9,582 (11) 0 9,582 *
Director; formerly Deputy Chairman,
Montreal Baseball Club Ltd.

Richard J. Boushka (5)(6) 64 1975 12,366 (12) 0 12,366 *
Director; Principal, Boushka
Properties, a private investment firm

Marshall M. Criser (3)(4)(5) 70 1985 11,366 (12) 200 (13) 11,566 *
Director; Of Counsel, Law firm of
McGuire, Woods Battle & Boothe, LLP,
formerly Chairman, Law firm of
Mahoney Adams and Criser and formerly
President, University of Florida

Arthur J. Fox, Jr. (5)(6) 75 1989 11,729 (14) 0 11,729 *
Director; Self-employed consultant,
formerly Managing Director, Construction
Industry Presidents Forum; Editor
Emeritus, Engineering News-Record

Jane E. Newman (4) 53 1992 9,745 (15) 0 9,745 *
Director; Managing Director and
Partner, The Commerce Group since
January 1, 1999, formerly Interim Dean,
Whittemore School of Business & Economics,
University of New Hampshire, and
formerly Executive Vice President,
Exeter Trust Company

Albert A. Dorman (4)(5) 72 1993 8,684 (16) 0 8,684 *
Director; Founding Chairman AECOM
Technology Corporation

Nancy Hawthorne (4)(6) 47 1993 10,361 (17) 0 10,361 *
Director; Self-employed financial
strategy consultant since mid-1998,
formerly Chief Executive Officer
& Managing Partner, Hawthorne, Krauss
& Associates, and formerly Executive Vice
President, Media One
</TABLE>

-5-
<PAGE>
<TABLE>
<CAPTION>

Michael Klein (3)(4) 56 1997 7,261 (18) 0 7,261 *
Director; Chairman, Realty Information
Group, Inc. and Partner, Law Firm of
Wilmer, Cutler & Pickering

Douglas J. McCarron (3)(5) 48 1997 0 0 0 -
Director; General President, United
Brotherhood of Carpenters and
Joiners of America

Arthur I. Caplan 78 1998 4,776 (19) 0 4,776 *
Director; President of HWC-Ltd., an
automobile sales, leasing and
financing organization

Frederick Doppelt 80 1998 41,921 (20) 0 41,921 *
Director; Self-employed attorney
specializing in trust and estate matters

Robert Band 51 - 15,039 (21) - 15,039 *
Executive Vice President, Chief
Financial Officer since December
1997

All Directors and Executive Officers as 655,563 169,049 824,612 15.15%
a group (15 persons)

</TABLE>
- ------------------------------------------
* Less than one percent

(1) Beneficial ownership is the direct or indirect ownership of Common Stock
of the Company including the right to control the vote or investment of
or acquire such Common Stock (for example, through the conversion of
shares of the Company's Series B Preferred Stock or $2.125 Depositary
Convertible Exchangeable Preferred Shares, exercise of options or
various trust arrangements) within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934. The shares owned by each person or by
the group, and the shares included in the total number of shares
outstanding have been adjusted in accordance with said Rule 13d-3. Any
securities not outstanding but which are subject to options, warrants,
rights or conversion privileges shall be deemed to be outstanding for
the purpose of computing the percentage of outstanding securities of the
class owned by such person but shall not be deemed to be outstanding for
the purpose of computing the percentage of the class by any other
person. Since the holders of the Series B Preferred Stock have the same
voting rights as holders of Common Stock, equal to the number of shares
of Common Stock into which the Series B Preferred Stock can be
converted, the aggregate percentage owned for each holder has been
determined by dividing the aggregate total of shares beneficially owned,
including the assumed conversion of the Series B Preferred Stock, by
such holder, by the number of shares of Common Stock of the Company
outstanding on March 1, 1999 plus the number of shares of Common Stock
into which the Series B Preferred Stock held by such holder could be
converted at that date.

(2) The table does not include an aggregate of 10,868 shares allocated to
named executive officers under the terms of the Perini Corporation
Employee Stock Ownership Plan.

(3) Member of the Executive Committee.
-6-
<PAGE>

(4) Member of the Audit Committee.

(5) Member of the Compensation Committee.

(6) Member of the Nominating Committee.

(7) Includes 6,460 shares, and 132 shares of Common Stock (resulting from
the assumed conversion of 200 depositary shares of Preferred Stock at a
conversion rate of .662 shares of Common Stock for each depositary
share) in his children's names for which he has Power of Attorney giving
him voting power. Includes 32,500 shares for which Mr. Perini holds
options. Includes 66 shares of Common Stock resulting from the assumed
conversion of 100 depositary shares of Preferred Stock. Includes 56,499
shares held in testamentary trust established under the will of Louis R.
Perini, Sr. David Perini is one of four trustees of such trust and is
one of the beneficiaries of such trust. Includes 3,029 shares, and 66
shares of Common Stock (resulting from the assumed conversion of 100
depositary shares of Preferred Stock) in his wife's name as to which Mr.
Perini disclaims any beneficial ownership.

(8) Includes 168,849 shares, as to which Mr. Perini disclaims any beneficial
ownership, held by the Charles B. and Louis R. Perini Family Foundation,
Inc., formerly The Perini Memorial Foundation, Inc., a Massachusetts
charitable corporation of which David B. Perini is one of three officers
and seven directors.

(9) Includes 351,318 shares held in the name of Tutor-Saliba Corporation, a
company in which Mr. Tutor is the sole stockholder and Chief Executive
Officer.

(10) Mr. Ludlam resigned from the Company effective January 31, 1999. Since
that date, David B. Perini and Ronald N. Tutor have shared the
responsibilities of President and Chief Executive Officer of the Company
pending the appointment of a new Chief Executive Officer.

(11) Includes 2,349 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
7,033 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,756 shares (1996), 2,285 shares (1997),
1,855 shares (1998) and 1,137 shares (1999). See "Directors'
Compensation" on page 22.

(12) Includes 2,349 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,756 shares (1996), 2,285 shares (1997),
1,855 shares (1998) and 3,121 shares (1999). See "Directors'
Compensation" on page 22.

(13) Includes 200 shares which Mr. Criser owns jointly with his wife.

(14) Includes 2,197 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,756 shares (1996), 2,285 shares (1997),
1,855 shares (1998) and 3,121 shares (1999). See "Directors'
Compensation" on page 22.

(15) Includes 1,148 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
8,597 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,336 shares
-7-
<PAGE>

(1996), 2,285 shares (1997), 1,855 shares (1998) and 3,121 shares
(1999). See "Directors' Compensation" on page 22.

(16) Includes 1,451 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
7,033 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,756 shares (1996), 2,285 shares (1997),
1,855 shares (1998) and 1,137 shares (1999). All of these shares are in
a Family Trust in which Mr. Dorman is one of two Trustees. See
"Directors' Compensation" on page 22.

(17) Includes 1,344 shares awarded in prior years pursuant to the 1988 Perini
Corporation Restricted Stock Plan for Outside Directors. Also includes
9,017 shares of Common Stock received in payment of the director's
annual retainer, as follows: 1,756 shares (1996), 2,285 shares (1997),
1,855 shares (1998) and 3,121 shares (1999). See "Directors'
Compensation" on page 22.

(18) Includes 7,261 shares of Common Stock received in payment of the
director's annual retainer, as follows: 2,285 shares (1997), 1,855
shares (1998) and 3,121 shares (1999). See "Directors' Compensation" on
page 22.

(19) Includes 3,121 shares of Common Stock received in payment of the 1999
director's annual retainer. See "Directors' Compensation" on page 22.
Also includes 1,655 shares of Common Stock resulting from the assumed
conversion of 2,500 depositary shares of Preferred Stock at a conversion
rate of .662 shares of Common Stock for each depositary share. The
percentage of Preferred Stock beneficially owned by Mr. Caplan to the
total number of shares of Preferred Stock outstanding is less than 1%.

(20) Includes 3,121 shares of Common Stock received in payment of the 1999
director's annual retainer. See "Directors' Compensation" on page 22.
Also includes 37,800 shares of Common Stock resulting from the assumed
conversion of 57,100 depositary shares of Preferred Stock at a
conversion rate of .662 shares of Common Stock for each depositary
share. Of the 57,100 depositary shares of Preferred Stock, 2,000
depositary shares are owned by Mr. Doppelt's wife. The percentage of
Preferred Stock beneficially owned by Mr. Doppelt to the total number of
shares of Preferred Stock outstanding is 5.72%.

(21) Includes 5,500 shares for which Mr. Band holds options.

-8-
<PAGE>
The Board of Directors met eight times during 1998. The Board of
Directors has a Compensation Committee, the duties of which are summarized in
"The Compensation Committee Report" on pages 14 to 16 herein. The Compensation
Committee held six meetings during 1998. The Board also has an Audit Committee,
the duties of which are to oversee the audit function of the Company's
independent certified public accountants, to review periodically significant
financial information relating to the Company and to act as a communication link
between the Board of Directors and such certified public accountants. The Audit
Committee met four times during 1998. The Board of Directors has a Nominating
Committee which met twice during 1998. The Board of Directors has an Executive
Committee, the duties of which are to give final approval of certain decisions
(generally financial in nature) and to give overall direction to the Company's
Chief Executive Officer. This Committee met four times during 1998. The members
of each such committee are identified in the above table. During 1998 all of the
Directors of the Company attended at least 75% of the meetings of the Board of
Directors and its committees of which they are members, except for Messrs.
Douglas J. McCarron and Frederick Doppelt who attended approximately 60% of such
meetings.

Except as set forth below, none of the Directors is a director of any
company which is subject to the reporting requirements of the Securities
Exchange Act of 1934 or which is a registered investment company under the
Investment Company Act of 1940.

Name of Director Director of
- ---------------- -----------

Richard J. Boushka...........................................Tremont Corporation

Marshall M. Criser...............................................FPL Group, Inc.

Nancy Hawthorne..................................................Avid Technology

Michael R. Klein..................................Realty Information Group, Inc.

Jane E. Newman...........................................Consumers Water Company
Public Service Co. of NH

David B. Perini .......................................State Street Boston Corp.
GZA GeoEnvironmental Technologies, Inc.

CERTAIN OTHER BENEFICIAL HOLDERS

The following table sets forth certain information concerning beneficial
ownership as of March 1, 1999 of the Common Stock of the Company by certain
other holders of in excess of 5% of the Common Stock of the Company.

According to the information available to the Board of Directors no
person owns of record or beneficially more than 5% of the outstanding Common
Stock of the Company except as set forth below and except for David B. Perini
and Ronald N. Tutor as set forth in "Ownership of Common Stock by Directors and
Officers" on pages 5 through 9:

-9-

<PAGE>
<TABLE>
Amount and
Nature of
Beneficial Percentage of
Name and Address Ownership (1) Class
- ------------------------------------------------------------- ------------------ ---------------
<S> <C> <C>

Richard C. Blum & Associates, L.P. 2,939,483 (2) 35.06% (2)
909 Montgomery Street, Suite 400
San Francisco, CA 94133

PB Capital Partners, L.P. 2,358,156 (2) 30.22% (2)
909 Montgomery Street, Suite 400
San Francisco, CA 94133

The Common Fund for Non-Profit Organizations 581,327 (2) 9.65% (2)
c/o Richard C. Blum & Associates, L.P.
909 Montgomery Street, Suite 400
San Francisco, CA 94133

The Union Labor Life Insurance Company Separate Account P 860,763 (3) 13.65% (3)
111 Massachusetts Avenue, NW
Washington, DC 20001

Franklin Resources, Inc. 394,400 (4) 7.24%
777 Mariners Island Blvd.
San Mateo, CA 94403

Perini Corporation 365,030 (6) 6.71%
Employee Stock Ownership Trust ("ESOT") (5)
73 Mt. Wayte Avenue
Framingham, MA 01701

Tutor-Saliba Corporation 351,318 (7) 6.45%
15901 Olden Street
Sylmar, CA 91342

Quest Advisory Corp. 327,000 (8) 6.00%
1414 Avenue of the Americas
New York, NY 10019

Dimensional Fund Advisors, Inc. 288,900 (9) 5.31%
1299 Ocean Avenue
Santa Monica, CA 90401
</TABLE>
- -------------------------------------------------------------

(1) See Footnote (1) on Page 6.

(2) Richard C. Blum & Associates, L.P. ("RCBA"), is the sole general partner
of PB Capital Partners, L.P. ("PB Capital") which directly owns 54,055
shares of Common Stock and beneficially has shared voting and investing
power in 111,544 shares of Series B Preferred Stock (voting power equal
to 2,304,101 shares of Common Stock). In addition, RCBA is an investment
adviser to The Common Fund for Non-Profit Organizations for the account
of its Equity Fund ("The Common Fund") which beneficially has shared
voting and investing power in 28,143 shares of Series B Preferred Stock
(voting power equal to 581,327 shares of Common Stock). Richard C. Blum
& Associates, Inc. ("RCBA Inc."), also at 909 Montgomery Street, Suite
400, San Francisco, California 94133, is the sole general partner of
RCBA. Richard C. Blum is the Chairman of the Board and a substantial
shareholder of RCBA Inc. Mr. Blum disclaims beneficial ownership of all

-10-
<PAGE>

securities reported in the table except to the extent of his pecuniary
interest therein. The Common Fund expressly disclaims membership in any
group with RCBA, Richard C. Blum or any other related entity and
disclaims beneficial ownership of securities owned directly or
indirectly by any other person or entity.

(3) In December 1996, PB Capital and the Company entered into a stock
assignment and assumption agreement whereby PB Capital assigned its
right to purchase 34,500 shares of the Series B Preferred Stock to The
Union Labor Life Insurance Company Separate Account P ("Union") which
beneficially has sole voting and investing power in the initial 34,500
shares of Series B Preferred Stock and additional in-kind dividends
representing 7,170 shares of Series B Preferred Stock (combined voting
power equal to 860,763 shares of Common Stock). The Company has been
further advised that PB Capital entered into an agreement with Union
pursuant to which Union agreed to refrain from disposing of its interest
in the Company until the earlier of five years after its acquisition or
the dissolution of PB Capital. Union also has the right to make earlier
dispositions on a pro rata basis to the extent PB Capital disposes of
its shares.

(4) Represents sole voting power for 188,000 shares and sole investing power
for 394,400 shares based upon information contained in Schedule 13G
dated January 29, 1999. Franklin Resources, Inc. ("FRI") is deemed to
have beneficial ownership of 394,400 shares of Perini Corporation stock
as of December 31, 1998, all of which shares are held by one or more
open or closed-end investment companies or other managed accounts which
are advised by Franklin Advisory Services, Inc. and Franklin Advisors,
Inc. (the "Adviser Subsidiaries"), investment adviser subsidiaries of
FRI. Separate Schedule 13G's were simultaneously filed on behalf of Mr.
Charles B. Johnson and Mr. Rupert H. Johnson, Jr. (the "Principal
Shareholders"), the principal shareholders of FRI, and on behalf of
Franklin Advisory Services, Inc. FRI, the Principal Shareholders and
each of the Adviser Subsidiaries disclaim beneficial ownership of all
such shares.

(5) Robert E. Higgins, John E. Chiaverini and Robert J. Howard are Trustees
of the Perini Corporation ESOT and are members of the Committee
empowered to administer the Perini Corporation Employee Stock Ownership
Plan ("ESOP") under the terms thereof.

(6) The ESOT has sole voting and investing power for 77,797 shares. In
addition, there are 287,233 shares held by the Trust that have been
allocated to the accounts of participants in the Perini Corporation
Employee Stock Ownership Plan.

(7) Represents sole voting and investing power based on information
contained in Schedule 13D of Tutor-Saliba Corporation dated March 9,
1995 and subsequent direct communications by the Company with the
appropriate representatives of Tutor-Saliba Corporation. Ronald N.
Tutor, a Director and current Vice Chairman, is also the sole
stockholder and Chief Executive Officer of Tutor-Saliba Corporation.

(8) Represents sole voting and investing power based on information
contained in Schedule 13G of Quest Advisory Corp. ("Quest"), a New York
Corporation, dated February 14, 1996. A separate Schedule 13G was
simultaneously filed on behalf of Mr. Charles M. Royce, an individual
who may be deemed to be a controlling person of Quest. Mr. Royce
disclaims beneficial ownership of the shares held by Quest.

-11-

<PAGE>

(9) Represents sole voting and investing power based on information
contained in Schedule 13G dated February 11, 1999. Dimensional Fund
Advisors, Inc. ("Dimensional"), a registered investment advisor, is
deemed to have beneficial ownership of 288,900 shares of Perini
Corporation stock as of December 31, 1998, all of which shares are held
in portfolios of DFA Investment Dimensions Group, Inc., a registered
open-end investment company, or in series of the DFA Investment Trust
Company, a Delaware business trust, or the DFA Group Trust and DFA
Participation Group Trust, investment vehicles for qualified employee
benefit plans, all of which Dimensional Fund Advisors, Inc. serves as
investment manager. Dimensional disclaims beneficial ownership of all
such shares.

-12-
<PAGE>

Change In Control

The Company is a party to the Shareholder Rights Agreement dated as of
September 23, 1988, as amended and restated as of May 17, 1990 and as amended
and restated as of January 17, 1997, with The State Street Bank and Trust
Company as Rights Agent (the "Rights Agreement"). Under the Rights Agreement,
the Company issued a dividend distribution of one Preferred Stock Purchase Right
(a "Right") for each outstanding share of Common Stock of the Company. Each
Right entitles the holder thereof to purchase one one-hundredth of a share (a
"Unit") of the Company's Series A Junior Participating Cumulative Preferred
Stock at a cash exercise price of $100.00 per Unit. The Rights Agreement
initially was scheduled to expire on September 23, 1998.

The purpose of the Rights Agreement is to prevent hostile attempts to
acquire control of the Company by making such attempts prohibitively expensive
unless the Board of Directors acts to redeem the Rights. Under the Rights
Agreement, certain anti-takeover provisions become operative in the event a
person or group acquires beneficial ownership of (i) 20% or more of the then
outstanding shares of Common Stock (the date of such announcement of such
acquisition being the "Stock Acquisition Date" or (ii) 10% or more of the then
outstanding shares of Common Stock if the Board of Directors determines that
such person or group is adverse to the interest of the Company (an "Adverse
Person").

On January 17, 1997, the Company sold and issued 150,150 shares of the
Series B Preferred Stock to an investor group led by Richard C. Blum &
Associates, L.P., for $30 million. The Series B Preferred Stock was convertible
into 3,101,571 shares of Common Stock or approximately 39% of the outstanding
Common Stock at that time on a diluted basis. The issuance and sale of the
Series B Preferred Stock with its conversion right may be deemed to have
constituted a "Change of Control" for purposes of disclosure under the
Securities Exchange Act of 1934. In addition, to the extent the Company elects
to pay dividends in the form of additional Series B Preferred Stock, the
investor group will be able to acquire additional shares of Common Stock upon
conversion. But for the amendment of the Rights Agreement as discussed below,
the issuance of the Series B Preferred Stock would have triggered the
anti-takeover provisions of the Rights Agreement.

Concurrently with the issuance of the Series B Preferred Stock, the
Company amended the Rights Agreement to provide that the issuance of the Series
B Preferred Stock and the Common Stock, upon conversion of the Series B
Preferred Stock, will not give rise to a Stock Acquisition Date and that none of
the holders thereof will be deemed to be an Adverse Person, thereby avoiding the
triggering of the anti-takeover provisions of the Rights Agreement. Included in
the amendment were additional provisions to lower the threshold for the
occurrence of a Stock Acquisition Date from 20% to 10%, effective until January
21, 2007 and to extend the expiration of the Rights Agreement to January 21,
2007. The primary purpose of the additional provisions is to maintain the
availability of certain net operating losses for the Company's use in the
future; however, it may also be deemed to have an "anti-takeover" effect as any
acquisition of 10% or more of the Company's Common Stock could result in the
loss of the Company's tax benefits, thus making the Company less attractive in
any possible takeover.

Holders of the Series B Preferred Stock have the right to elect three of
the five members of the Executive Committee. Thus, the members of the Executive
Committee nominated by the Series B Preferred Stockholders have an effective
veto over certain major decisions of the Company and provide oversight to the
Company's Chief Executive Officer.

-13-

<PAGE>
THE COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Company consists of six Directors,
none of whom is an employee or an officer of the Company. The principal powers
and duties of the Compensation Committee as established by the Board of
Directors are:

1. To review the Executive Compensation programs and policies and
to employ outside expert assistance, if required, to analyze
Company compensation practices to assure that they are
consistent with corporate goals and objectives, and competitive
with those of comparable firms in the construction industry.

2. To recommend to the Board of Directors for its approval the base
salary of the Chairman and of the President and Chief Executive
Officer and to review and approve the salary recommendations of
the President and Chief Executive Officer with respect to other
members of top management;

3. To recommend to the Board of Directors annual profit and other
targets for the Company for the purpose of determining incentive
compensation awards under the provisions of the Amended and
Restated General Incentive Compensation Plan, for those included
in the Company pool; and

4. To administer the Amended and Restated General and Construction
Business Unit Incentive Compensation Plans; such administration
shall include the power to (i) approve Participants'
participation in the Plans, (ii) establish performance goals,
(iii) determine if and when any bonuses shall be paid, (iv) pay
out any bonuses, in cash or stock or a combination thereof, as
the Committee shall determine from year to year, (v) construe
and interpret the Plans, and (vi) establish rules and
regulations and perform all other acts it believes reasonable
and proper.

Compensation Policy

The Compensation Committee strives to maintain corporate base salaries
and the total compensation package appropriate to attract and retain highly
qualified executives. This results in base salaries that generally are at the
median range of those of other construction companies but allows executives to
substantially exceed the median compensation levels when incentive compensation
is earned. While recognizing that it may be difficult to find other companies
with the same mix of business as the Company, the Committee, nevertheless,
believes that a comparison with other construction companies is appropriate
because the most substantial portion of the business of the Company is in the
construction area. The construction companies used for comparison for
compensation purposes include but are not limited to the same companies which
make up the construction peer group shown in the Performance Graph set forth in
this proxy statement.

The compensation program for executive officers is composed of three
elements: base salaries, annual incentive bonuses and long term incentive stock
awards. These elements of compensation are designed to provide incentives to
achieve both short-term and long-term objectives and to reward exceptional
performance. Salaries and annual incentive compensation bonuses result in
payment for performance and are tied to the achievement of profit and/or cash
flow targets. The value of the incentive stock awards depends upon the
appreciation in market value of the Company's Common Stock.

-14-

<PAGE>

Executive Salary Increases in 1998

Roger J. Ludlam resigned as the President and Chief Executive Officer of
the Company effective January 31, 1999. The Chairman of the Company and the Vice
Chairman have jointly assumed the responsibilities of Chief Executive Officer
pending the appointment of a new Chief Executive Officer.

The last salary increase for the Chairman was as of December 1994. As of
December 31, 1998 there has been no increase for the Chairman and the majority
of senior officers' salaries remained unchanged throughout 1998.

Section 162 (m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to public companies for compensation over $1,000,000
paid to the Company's Chief Executive Officer and four other most highly
compensated executive officers. The Compensation Committee has not established
any policy regarding annual compensation to such executive officers in excess of
$1,000,000. However, to date, no officer of the company has received
compensation in excess of $1,000,000 for any annual period.

Compensation of the Chairman and the Chief Executive Officer

The base salary of the Chairman remained throughout 1998 at $412,000
which has not changed since 1994. The Chairman was not awarded incentive
compensation for 1998. The former President and Chief Executive Officer received
a bonus of $162,500 for 1998 pursuant to a 1997 hire agreement.

The Incentive Compensation Plan of the Company

The Incentive Compensation Plan is an integral part of the total
compensation package of the Chairman and the President and Chief Executive
Officer, as well as the 10 executives whose salaries were reviewed by the
Compensation Committee in 1998, and approximately 50 other employees of the
Company. Eligibility and designated levels of participation are determined by
the Chief Executive Officer subject to Compensation Committee approval.
Eligibility to participate under the Plan is limited to individuals who are
executives, managers and key employees of the Company and its wholly-owned
subsidiaries, whose duties and responsibilities provide them the opportunity to
(i) make a material and significant impact to the financial performance of the
Company; (ii) have major responsibility in the control of the corporate assets;
and (iii) provide critical staff support necessary to enhance operating
profitability.

Participants can achieve incentive compensation awards ranging from zero
to as much as 100% of base salary, part of which depends on the achievement of
business unit goals and part on the achievement of corporate goals. Each of the
business unit presidents has the opportunity to earn up to an additional 50% of
base salary for performance which is substantially above pre-established
targets. The mechanisms of the Plan are expressed in terms of levels of
participation, points deriving therefrom calculated on base salary, and
achievement of goals such as net income, cash flow, and pre-tax construction
profits on a unit by unit basis and on an overall corporate basis. The members
of the senior management group, corporate officers and key corporate staff earn
incentive compensation solely with reference to overall corporate goals.

No sums attributed to a participant in the Incentive Compensation Plan
become vested until the Compensation Committee approves the payment, usually in
March following the year earned. At the discretion of the Committee, payment can
be made in cash, stock or a combination of cash and stock.

-15-
<PAGE>

In 1999, the Committee authorized the payment of $2,850,544 of Incentive
Compensation payments for 1998 operations, to 52 participants, excluding
participants in the real estate group. The Incentive Compensation Plan for the
real estate group is based on cash flow of the unit. The real estate group has
been downsized and one of its primary goals is to achieve cash flow so that debt
may be serviced or extinguished. In 1999, 4 employees in the real estate group
will receive $124,282 on account of 1998 operations. Payment of incentive
compensation awards for 1998 performance will be paid 60% in cash and 40% in
common stock (valued at fair market value, as defined).

COMPENSATION COMMITTEE
John J. McHale, Chairman Albert A. Dorman
Richard J. Boushka Arthur J. Fox, Jr.
Marshall M. Criser Douglas J. McCarron

-16-
<PAGE>

EXECUTIVE COMPENSATION AND OTHER INFORMATION

Summary of Cash and Certain Other Compensation

The following table sets forth the cash compensation paid by the Company
and its subsidiaries, as well as certain other compensation paid or accrued for
those years, to the Chief Executive Officer and each of the three other most
highly compensated Executive Officers of the Company whose salary and bonus
exceeded $100,000 (the "Named Executive Officers") for the years ended December
31, 1998, 1997 and 1996, or for each year in which the Named Executive Officers
served as such.

Summary Compensation Table

Annual Compensation Long-Term Compensation
--------------------------------------------------- ------------------------------
Awards Payouts
------------ --------------

Number of
Securities Long-Term
Underlying Performance All other
Name and Principal Bonus Other Options Units - Compensation
Position Year Salary (1) (2) Granted Payout (3)
- -------------------------- ------- ---------- ---------- --------- ------------ -------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
David B. Perini (4) 1998 $412,000 $ - $ - 37,500 $ - $1,800
Chairman 1997 412,000 - - - - 1,700
1996 412,000 136,000 - - - 1,100

Ronald N. Tutor (4) 1998 - - 150,000 (5) 45,000 - -
Vice Chairman 1997 - - - - - -
1996 - - - - - -

Roger J. Ludlam (4) 1998 325,000 162,500 (6) - 102,500 - 1,800
President & Chief 1997 - - - - - -
Executive Officer 1996 - - - - - -

Robert Band 1998 230,000 207,000 - 37,500 - 1,800
Executive Vice 1997 - - - - - -
President, Chief 1996 - - - - - -
Financial Officer
</TABLE>
- --------------------------

(1) Of the total bonus (or incentive compensation) reported for each of the
Named Executive Officers, 40% of the 1998 bonus amount and 59% of the
1996 bonus amount have been paid in shares of the Company's Common
Stock. The remaining amounts were paid in cash.

(2) Other annual compensation does not include a dollar amount which the
Company is unable to quantify, but which is estimated at not more than
the lesser of $50,000 or 10% of the compensation reported for each Named
Executive Officer, resulting from executive perquisites which may be of
personal benefit to such individuals.

(3) All other compensation represents estimated annual Company 401(k) and
ESOP retirement contributions and in 1998 consists of $1,000 of 401(k)
and $800 of ESOP contributions for each of the Named Executive Officers,
except for Mr. Tutor.

(4) Effective January 31, 1999, Mr. Ludlam resigned from the Company. Since
that date, David B. Perini and Ronald N. Tutor have shared the
responsibilities of President and Chief Executive Officer of the Company
pending the appointment of a new Chief Executive Officer.

-17-

<PAGE>

(5) Represents a management services fee paid to Tutor-Saliba Corporation of
which Mr. Tutor is the Chairman, President, Chief Executive Officer and
sole stockholder. See "Certain Transactions" on page 23.

(6) Represents a guaranteed bonus amount due Mr. Ludlam pursuant to a 1997
hire agreement.

Stock Options

The following table contains information concerning the stock options
granted during the year ended December 31, 1998 to the Company's Named Executive
Officers:

Option Grants in the Last Fiscal Year (1)
Individual Grants
-----------------------------------------------------------------------------------
Number of % of Total
Securities Options
Underlying Granted To Grant Date
Date of Options Employees In Exercise Expiration Present
Name Grant Granted (2) Fiscal Year Price (3) Date Value (4)
- --------------------- ----------- ------------- --------------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>

David B. Perini 01/19/98 25,000 6.5% $ 8.66 01/18/2006 $114,250
12/10/98 12,500 3.2% 5.29 12/09/2006 30,750

Ronald N. Tutor 12/10/98 45,000 11.6% 5.29 12/09/2006 110,700

Roger J. Ludlam (5) 01/19/98 65,000 16.8% 8.66 01/18/2006 297,050
12/10/98 37,500 9.7% 5.29 12/09/2006 92,250

Robert Band 01/19/98 25,000 6.5% 8.66 01/18/2006 114,250
12/10/98 12,500 3.2% 5.29 12/09/2006 30,750
</TABLE>
- --------------------------------------------------------------------------------

(1) No SARS were granted to any of the Named Executive Officers during the
last fiscal year.

(2) Options granted in 1998 become exercisable in two equal annual
installments on the second and third anniversary of the date of grant.

(3) The exercise price and tax withholding obligations related to exercise
may be paid by delivery of already owned shares or by offset of the
underlying shares, subject to certain conditions.

(4) The grant date present value was calculated using the Black-Scholes
option pricing model. All stock option valuation models, including the
Black-Scholes model, require a prediction about the future movement of
the Company's stock price based on past performance. The Company's use
of this model should not be construed in any way as an endorsement of
its accuracy at valuing options or as a forecast of the future
performance of the Company's stock price. The following assumptions were
made for the purpose of calculating the Grant Date Present Value: option
term is eight years, volatility at 37.32% and 38.69% for those options
granted on January 19, 1998 and December 10, 1998, respectively,
dividend yield at 0% and interest rate at 5.57% and 4.63% for those
options granted on January 19, 1998 and December 10, 1998, respectively.
The real value of the options in this table depends upon the actual
performance of the Company's stock price during the applicable period.

-18-

<PAGE>

(5) All options granted to Mr. Ludlam were cancelled as of January 31, 1999,
the effective date of his resignation from the Company.

Option Exercises and Holdings

The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during the year December
31, 1998 and unexercised options held as of December 31, 1998:

Aggregated Option Exercises in the Last Fiscal Year
and Fiscal Year-End Option Values

Number of
Securities
Underlying
Shares
Acquired on Value Number of Unexercised Options Value of Unexercised In-the-Money
Name Exercise Realized at Fiscal Year-End Options at Fiscal Year-End (1)
- ---------------------- ------------- ---------- --------------------------------- ----------------------------------
Exercisable Unexercisable Exercisable Unexercisable
-------------- --------------- ------------- -----------------
<S> <C> <C> <C> <C> <C> <C>

David B. Perini - $ - 32,500 50,000 $ - $ -
Ronald N. Tutor - - - 195,000 - -
Roger J. Ludlam - - - 112,500 - -
Robert Band - - 5,500 42,500 - -
</TABLE>
- ----------------------

(1) At December 31, 1998, all options listed had exercise prices in excess
of the quoted market value.

Long-Term Performance Units

Under the Performance Unit award feature of the 1982 Long-Term Plan, key
employees may be contingently awarded a number of units which will be earned if
specified financial performance goals are attained. A Performance Unit will give
an employee the right to receive up to a maximum of 200% of the amount of the
Performance Unit (nominally valued at $100) at the end of a specified period
depending on the level of achievement of the specified financial performance
goals.

No awards were made under the terms of this Plan in 1996, 1997 and 1998
and the Company has no current plans to award such performance units in the
future.
-19-
<PAGE>

Pension Plan Disclosure

The following table sets forth pension benefits payable based on an
employee's remuneration ("final average earnings") and "years of service" as
defined under the Company's non-contributory Retirement Plan ("the Plan") for
all its full-time employees and to the extent covered remuneration is limited by
the Internal Revenue Code of 1986, as amended, pension benefits payable have
been augmented based on the Company's Benefit Equalization Plan:

Pension Plan Table -
Estimated Annual Pension Benefits (2) for
Years of Service Indicated (3)
-----------------------------------------------------------------------------
Remuneration (1) 15 Years 20 Years 25 Years 30 Years 35 Years
---------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000 $26,623 $32,831 $ 41,039 $41,039 $ 41,039
150,000 30,248 40,331 50,414 50,414 50,414
175,000 35,873 47,831 59,789 59,789 59,789
200,000 41,498 55,331 69,164 69,164 69,164
225,000 47,123 62,831 78,539 78,539 78,539
250,000 52,748 70,331 87,914 87,914 87,914
300,000 63,998 85,331 106,664 106,664 106,664
400,000 86,498 115,331 144,164 144,164 144,164
500,000 108,998 145,331 181,664 181,664 181,664
</TABLE>
_______________

(1) Remuneration covered by the Plan and the Benefit Equalization Plan is
limited to an employee's annual salary and for the Named Executive
Officers is limited to the amounts in the Annual Salary column included
in the Summary Compensation Table on page 17.

(2) The estimated annual benefits are calculated on a straight-line annuity
basis and are not subject to any further deductions for social security
since the Plan formula integrates the calculation of the benefits with
certain adjustments for Social Security, as defined.

(3) The years of service for the Named Executive Officers are as follows:
D.B. Perini (36 years), R.J. Ludlam (1 year) and R. Band (25 years).

-20-
<PAGE>

Performance Graph

Comparison of 5-year Cumulative Total Return
Among Perini Corporation, AMEX Market Value Index,
And Selected Construction and Real Estate Peer Groups

[GRAPHIC OMITTED]

- --------------------------------------------------------------------------------
1994 1995 1996 1997 1998
- --------------------------------------------------------------------------------
Perini $100 81 71 67 77 44
AMEX 100 88 114 120 145 143
Construction 100 75 100 113 140 219
Real Estate 100 100 115 155 200 172
- --------------------------------------------------------------------------------

(1) The above graph compares the performance of Perini Corporation
("Perini") with that of the American Stock Exchange Market Value Index
("AMEX") and selected Construction and Real Estate Peer Groups.
Companies in the Construction Peer Group Index ("Construction") are as
follows: BFC Construction Corp., Granite Construction, Inc., Morrison
Knudsen Corporation and Turner Corporation. Companies in the Real Estate
Peer Group Index ("Real Estate") are as follows: Newhall Land and
Farming Company, AMREP Corporation, Major Realty Corporation, Christiana
Companies, Inc., Rouse Company, and Mission West Properties.

(2) The comparison of total return on investment (change in year end stock
price plus reinvested dividends) for each of the periods assumes that
$100 was invested on January 1, 1994, in each of Perini Corporation, the
American Stock Exchange Market Value Index and selected Construction and
Real Estate Peer Groups, with investment weighted on the basis of market
capitalization.

-21-
<PAGE>

Directors' Compensation

Fees for outside Directors of the Company currently consist of an annual
retainer fee of $16,000, plus $900 per Board meeting attended, as well as $900
per Committee meeting attended by members of the Audit, Compensation and
Nominating Committees, and $4,000 per meeting attended by members of the
Executive Committee. Mr. Ronald N. Tutor, Vice Chairman of the Company since
January 1998 and currently sharing the responsibilities of President and Chief
Executive Officer of the Company since January 31, 1999 pending the appointment
of a new Chief Executive Officer, has opted to receive no Director fees since he
is party to a Management Agreement described in "Certain Transactions" on page
23. During 1998, the Directors received payment of their annual retainer fee of
$16,000 in shares of the Company's Common Stock on March 11, 1998. The number of
shares was based on a price equivalent to the fair market value, as defined, of
prices prevailing on the American Stock Exchange on the date issued and
aggregated 1,855 shares of Common Stock for each Director, except for Mr. Tutor
and Mr. McCarron, the latter of which requested that his fees be paid directly
to the United Brotherhood of Carpenters Pension Fund, a pension fund of which he
is a Trustee. During 1999, the Directors received payment of their annual
retainer fee of $16,000 in shares of the Company's Common Stock on January 4,
1999. The number of shares was based on a price equivalent to the fair market
value, as defined, of prices prevailing on the American Stock Exchange on the
date issued and aggregated 3,121 shares of Common Stock for each Director,
except for Mr. Dorman and Mr. McHale who each received 1,137 shares of Common
Stock on a pro rated basis through May 13, 1999, and except for Mr. Tutor and
Mr. McCarron, for the reasons stated above. Meeting fees are paid on a quarterly
basis in cash.

On January 17, 1997, the four non-employee Directors on the redefined
Executive Committee were granted options to purchase shares of the Company's
Common Stock, $1.00 par value, at fair market value at the date of grant. The
terms of these options, which expire on January 16, 2005, are generally similar
to those granted under the 1982 Stock Option Plan, except as to the timing of
their exercisability which is May 17, 2000. Messrs. Criser, Klein and McCarron
each received options to purchase 25,000 shares, the latter of which assigned
his options to the United Brotherhood of Carpenters Pension Fund, a pension fund
of which he is a Trustee, and Mr. Tutor received options to purchase 150,000
shares (see "Certain Transactions" on page 23).

On December 10, 1998, Mr. Tutor was granted options to purchase 45,000
shares effective December 10, 1998, and 30,000 shares effective January 4, 1999,
of the Company's Common Stock, $1.00 par value, at fair market value, as
defined, on the effective dates of grant (see "Certain Transactions" on page
23). The terms of these options, which expire eight years from the date of
grant, are generally similar to options granted on December 10, 1998 to other
Executive Officers and other key employees under the 1982 Stock Option Plan.

Employment Agreement

In connection with the closing of the Series B Preferred Stock purchase
transaction on January 17, 1997, the Company entered into separate employment
agreement with David B. Perini. Under the terms of Mr. Perini's agreement, as
amended, Mr. Perini will continue as Chairman of the Company and Chairman of the
Board of Directors of the Company (subject to election by the Board of
Directors) for a period of three years. The agreement provides that Mr. Perini
will receive his current salary, which will continue to be reviewed by the Board
of Directors, and certain benefits, including, but not limited to, health and
life insurance and pension accrual. In addition, Mr. Perini will continue to
receive incentive compensation under the Company's current plans and pursuant to
any plans which are in effect thereafter. Mr. Perini's agreement provides that
he may voluntarily terminate his employment for any reason with 60 days notice
to the Company. In such event, Mr. Perini would be entitled to receive his
accrued salary and his

-22-
<PAGE>

accrued bonus up to the date of such termination. Mr. Perini's agreement also
provides that, during the 90-day period following the first anniversary of the
agreement, Mr. Perini may voluntarily terminate his employment for any reason
with 90 days notice to the Company. In such event, Mr. Perini would be entitled
to receive his salary and benefits for the balance of the contract term. In the
event of termination of Mr. Perini's employment by the Company without cause or
termination by Mr. Perini following a reduction in Mr. Perini's salary, as
defined, a reduction in other benefits, a material change in his
responsibilities at the Company or certain other events deemed to be a
"Constructive Termination", Mr. Perini would be entitled to receive his base
compensation and benefits for up to three years, depending on when the
termination of employment occurred. In the event Mr. Perini's employment was
terminated in accordance with any of the above provisions, his stock options
would become fully exercisable and/or vested and could be exercised at any time
during the salary continuation period (but not beyond the applicable option
term).

Certain Transactions

Effective with the issuance of the Series B Preferred Stock on January
17, 1997, the Company entered into an agreement with Tutor-Saliba Corporation
("TSC"), a California corporation engaged in the construction industry, and
Ronald N. Tutor, Chief Executive Officer and sole stockholder of TSC, to provide
certain management services, as defined. During 1998, the agreement between the
Company, TSC and Mr. Tutor was extended through December 31, 1999 under the same
terms and conditions as the initial agreement. TSC currently holds a 6.45%
interest in the Company's $1.00 par value Common Stock (see "Certain Other
Beneficial Holders" table on page 10), and currently participates in active
joint ventures with the Company with a total contract value of approximately
$300 million. Mr. Tutor was appointed as one of the three new Directors in
accordance with the terms of the Series B Preferred Stock transaction, a member
of the Executive Committee of the Board and, during 1997, acting Chief Operating
Officer of the Company. Effective January 1, 1998, Mr. Tutor was appointed Vice
Chairman of the Board of Directors and since January 31, 1999 has shared the
responsibilities of President and Chief Executive Officer of the Company with
Mr. Perini pending the appointment of a new Chief Executive Officer.
Compensation for the management services consists of a monthly payment of
$12,500 to TSC and options granted to Mr. Tutor to purchase 150,000 shares of
the Company's $1.00 par value Common Stock at fair market value, as defined on
the date of grant. While these options vest immediately, they are not
exercisable until forty months from date of grant and expire after eight years.
In addition, on December 10, 1998, Mr. Tutor was granted options to purchase
45,000 shares effective December 10, 1998, and 30,000 shares effective January
4, 1999, of the Company's $1.00 par value Common Stock at fair market value, as
defined, on the effective dates of grant. The terms of these options, which
expire eight years from the date of grant, are generally similar to options
granted on December 10, 1998 to other Executive Officers and other key employees
under the 1982 Stock Option Plan.

The Company utilized the services of the law firm of Wilmer, Cutler &
Pickering (of which Michael R. Klein is a Partner), among other firms, during
the last fiscal year and it is anticipated that the Company will continue to do
so during the current year. During 1998, the Company paid Wilmer, Cutler &
Pickering approximately $864,000 for legal services and related expenses.

During 1984 the Company transferred certain income-producing real estate
properties and joint venture interests to a new company, Perini Investment
Properties, Inc. and distributed the Common Stock of that company to the
Company's shareholders on a share-for-share basis. In 1992, that company changed
its name to "Pacific Gateway Properties, Inc." ("PGP"), reflecting PGP's West
Coast focus and minimal ongoing interdependence with the Company.

The Company, through its wholly-owned subsidiary Perini Land and
Development Company ("PL&D"), and PGP are general partners in a real estate
joint venture known as Rincon

-23-
<PAGE>

Center Associates (a California limited partnership). PL&D is the managing
general partner with a 46% interest and PGP is the other general partner with a
23% interest. Other than Rincon Center, where the two parties have an ongoing
relationship in a specific project (see Note 11 to Notes to Consolidated
Financial Statements where PGP is the other general partner referred to in the
disclosure relating to the Rincon Center joint venture for additional
information on this relationship), there are no longer any material business
relationships between the Company and PGP.

1B.

RATIFICATION OF APPOINTMENT OF AUDITORS

Upon recommendation of the Audit Committee, the Board has appointed the
firm of Arthur Andersen LLP, independent public accountants, as its auditors for
the fiscal year ending December 31, 1999. Although stockholder ratification is
not required, the Board has determined that it would be desirable to request an
expression from the stockholders as to whether or not they concur with the
foregoing appointment.

Arthur Andersen LLP has audited the accounts of the Company and its
subsidiaries since 1960. Representatives of Arthur Andersen LLP will be present
at the Annual Meeting of Stockholders of the Company and will be available to
respond to appropriate questions and to make a statement if they desire to do
so.

The Board recommends a vote FOR ratification of the appointment of
Arthur Andersen LLP as independent auditors for the Company for the fiscal year
ending December 31, 1999.

-24-

<PAGE>

1C.

OTHER MATTERS

Except for the election of the Preferred Directors discussed on pages 1
through 4 and elsewhere in this Proxy Statement, the Board of Directors knows of
no other matters which are likely to be brought before the meeting. However, if
any other matters, of which the Board of Directors is not aware, are presented
to the meeting for action, it is the intention of the persons named in the
accompanying form of proxy to vote said proxy in accordance with their judgement
on such matters.

The Company will bear the cost of solicitation of proxies. The
solicitation of proxies by mail may be followed by telephone or oral
solicitation of certain stockholders and brokers.

IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS ARE
URGED TO FILL IN, SIGN, DATE AND RETURN THE ACCOMPANYING FORM OF PROXY IN THE
ENCLOSED ENVELOPE.

By order of the Board of Directors,
Robert E. Higgins, Secretary

Framingham, Massachusetts
April 7, 1999

-25-