1. In a shallow bowl, beat egg and water. In another shallow bowl, combine the bread crumbs, soup mix and pepper. Dip chicken in egg mixture, then coat with crumb mixture.

2. Place in a greased 13-in X9-in baking dish. Bake uncovered, at 400 for 22-25 minutes or until juice runs clear.

3. In a small bowl, combine spaghetti sauce and mushrooms; spoon over chicken. Sprinkle with cheese. Bake 5-7 minutes longer or until sauce is bubbly and cheese is melted.