Pooling And Servicing Agreement - FEDERAL MOGUL CORP - 5-14-1997

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Pooling And Servicing Agreement - FEDERAL MOGUL CORP - 5-14-1997 Powered By Docstoc
					SERIES 1997-1 SUPPLEMENT dated as of February 1, 1997 (the "Series Supplement"), among FEDERALMOGUL FUNDING CORPORATION, a Michigan corporation, as Seller, FEDERAL-MOGUL CORPORATION, a Michigan corporation, as Servicer, and THE CHASE MANHATTAN BANK, a New York banking corporation, as Trustee. Pursuant to Section 6.03 of the Amended and Restated Pooling and Servicing Agreement, dated as of February 1, 1997 (as amended and supplemented, the "Agreement"), among the Seller, the Servicer and the Trustee, the Seller may from time to time direct the Trustee to issue, on behalf of the Trust, one or more new Series of Investor Certificates representing fractional undivided interests in the Trust. The Principal Terms of any new Series are to be set forth in a Supplement to the Agreement. Pursuant to this Series Supplement, the Seller shall create a new Series of Investor Certificates and specify the Principal Terms thereof. ARTICLE I Creation of the Series 1997-1 Certificates SECTION 1.01. Designation. (a) There is hereby created a Series of Investor Certificates to be issued pursuant to the Agreement and this Series Supplement to be known as the "Floating Rate Trade Receivables Asset Backed Certificates, Series 1997-1, Class A" and "Trade Receivables Asset Backed Certificates, Series 19971, Class B." (b) In the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Agreement, with respect to the Series of Investor Certificates created hereby, the terms and provisions of this Series Supplement shall govern. (c) The parties hereto intend that to the extent that the payment of all amounts due to be paid to the Holders of the Series 1992-1 Certificates (as defined herein) and Series 1993-1 Certificates (as defined herein) are held in escrow and paid in accordance with the terms of the Escrow Deposit Agreement, the Invested Amount of the Series 1992-1 Certificates and the Series 1993-1 Certificates shall each be zero and all Collections received by the Trustee shall be allocated and applied solely in accordance with the terms of this Series Supplement.

ARTICLE II Definitions SECTION 2.01. Definitions. (a) Whenever used in this Series Supplement the following words and phrases shall have the following meanings. "Additional Early Amortization Event" shall have the meaning specified in Section 6.01. "Administration Fee" shall have the meaning specified in the Fee Letter. "Agent" shall mean, with respect to Series 1997-1, the Program Agent. "Aggregate Reserves" shall equal, as of any Determination Date, the product of (a) the Aggregate Reserve Percentage and (b) Available Receivables. "Aggregate Reserve Percentage" shall mean, as of any Determination Date, the sum of (a) the Loss Reserve Percentage, (b) the Floating Dilution Reserve Percentage, (c) the Discount/Fees Reserve Percentage and (d) the Servicing Reserve Percentage.

ARTICLE II Definitions SECTION 2.01. Definitions. (a) Whenever used in this Series Supplement the following words and phrases shall have the following meanings. "Additional Early Amortization Event" shall have the meaning specified in Section 6.01. "Administration Fee" shall have the meaning specified in the Fee Letter. "Agent" shall mean, with respect to Series 1997-1, the Program Agent. "Aggregate Reserves" shall equal, as of any Determination Date, the product of (a) the Aggregate Reserve Percentage and (b) Available Receivables. "Aggregate Reserve Percentage" shall mean, as of any Determination Date, the sum of (a) the Loss Reserve Percentage, (b) the Floating Dilution Reserve Percentage, (c) the Discount/Fees Reserve Percentage and (d) the Servicing Reserve Percentage. "Amortization Commencement Date" shall occur on the earliest of the following events: (a) 364 days from the Closing Date, (b) five Business Days after written notice from Federal-Mogul to the Program Agent and the Trustee of the intent to commence the Amortization Period and (c) the occurrence of an Early Amortization Event. "Amortization Period" shall mean the period beginning on the Amortization Commencement Date and ending upon the earliest to occur of (a) the payment in full of the Invested Amount, all Class A Monthly Interest and all other Class A Additional Interest and all other amounts owed to Certificateholders hereunder and under any other Transaction Document, (b) the Early Amortization Commencement Date or (c) the Termination Date. "Available Collections" shall have the meaning set forth in Section 4.01(b). "Available Receivables" shall equal, as of any Determination Date, the excess of the Net Receivables Balance over the Contractual Dilution Balance.

"Breakage Costs" shall mean (a) with respect to Falcon and for each Collection Period during which the Class A Invested Amount is reduced, the amount, if any, by which (i) the additional interest at the Class A Certificate Rate (calculated without taking into account any Breakage Costs), which would have accrued on that portion of the Class A Invested Amount that was reduced, through the last day of such Collection Period exceeds (ii) the income received by Falcon from investing the proceeds of such reductions of Class A Invested Amount; or (b) with respect to a Liquidity Provider and for each Collection Period during which the Class A Invested Amount is reduced, the amount, if any, by which (i) the additional interest at the Class A Certificate Rate (calculated without taking into account any Breakage Costs), which would have accrued on that portion of the Class A Invested Amount that was reduced or its pro rata portion thereof, through the last day of the period for which the LIBO Rate has been set exceeds (ii) the income received by such Liquidity Provider from investing the proceeds of such reductions of Class A Invested Amount, or its pro rata portion of such Class A Invested Amount. "Canadian Receivables" shall mean Receivables which are payable in Canadian Dollars and generated from sales to Obligors located in Canada. "Certificate Purchase Agreement" shall mean the agreement, dated February 28, 1997, by and among the Seller, Falcon, the Program Agent and the Liquidity Providers named therein.

"Breakage Costs" shall mean (a) with respect to Falcon and for each Collection Period during which the Class A Invested Amount is reduced, the amount, if any, by which (i) the additional interest at the Class A Certificate Rate (calculated without taking into account any Breakage Costs), which would have accrued on that portion of the Class A Invested Amount that was reduced, through the last day of such Collection Period exceeds (ii) the income received by Falcon from investing the proceeds of such reductions of Class A Invested Amount; or (b) with respect to a Liquidity Provider and for each Collection Period during which the Class A Invested Amount is reduced, the amount, if any, by which (i) the additional interest at the Class A Certificate Rate (calculated without taking into account any Breakage Costs), which would have accrued on that portion of the Class A Invested Amount that was reduced or its pro rata portion thereof, through the last day of the period for which the LIBO Rate has been set exceeds (ii) the income received by such Liquidity Provider from investing the proceeds of such reductions of Class A Invested Amount, or its pro rata portion of such Class A Invested Amount. "Canadian Receivables" shall mean Receivables which are payable in Canadian Dollars and generated from sales to Obligors located in Canada. "Certificate Purchase Agreement" shall mean the agreement, dated February 28, 1997, by and among the Seller, Falcon, the Program Agent and the Liquidity Providers named therein. "Class" shall mean either the Class A Certificates or the Class B Certificates, as applicable. "Class A Additional Interest" shall have the meaning specified in Section 4.02(a). "Class A Certificate" shall mean any one of the Series 1997-1 Class A Certificates executed and authenticated by the Trustee, substantially in the form attached as Exhibit A-1. "Class A Certificateholders' Interest" shall mean that portion of the Certificateholder's Interest evidenced by the Class A Certificate. "Class A Certificate Rate" shall mean the CP Rate, LIBO Rate or Base Rate, each as defined in the Certificate Purchase Agreement. "Class A Controlled Amortization Amount" shall mean an amount equal to the Class A Invested Amount as of the last day of the Revolving Period divided by three.

"Class A Interest Shortfall" shall have the meaning specified in Section 4.02(a). "Class A Invested Amount" shall mean, when used with respect to any date, an amount equal to (a) $0 plus (b) the aggregate amount of the Purchase of the Class A Certificates on the Closing Date plus (c) the aggregate amount of Increases made under any Class A Certificate after the Closing Date minus (d) the aggregate amount of the Class A Monthly Principal, any Optional Repayment Amount, any Coverage Amount and any Escrow Account Amount received and distributed to Class A Certificateholders in reduction of the Class A Invested Amount from time to time on or prior to such date; provided, however, that the Class A Invested Amount shall not be reduced by any amount of Series 1997-1 Collections so received and distributed if at any time such distribution of such amount of Series 1997-1 Collections is rescinded or must be returned for any reason; and provided, further, that on any date of determination, the Class A Invested Amount shall not exceed the Class A Purchase Limit. "Class A Monthly Interest" shall have the meaning specified in Section 4.02. "Class A Monthly Principal" shall have the meaning specified in Section 4.03(a). "Class A Purchase Limit" shall mean, on any date of determination, $100,000,000 as such amount may be reduced pursuant to Section 2.04 of the Certificate Purchase Agreement. "Class B Certificate" shall mean any one of the Series 1997-1 Class B Certificates executed and authenticated by

"Class A Interest Shortfall" shall have the meaning specified in Section 4.02(a). "Class A Invested Amount" shall mean, when used with respect to any date, an amount equal to (a) $0 plus (b) the aggregate amount of the Purchase of the Class A Certificates on the Closing Date plus (c) the aggregate amount of Increases made under any Class A Certificate after the Closing Date minus (d) the aggregate amount of the Class A Monthly Principal, any Optional Repayment Amount, any Coverage Amount and any Escrow Account Amount received and distributed to Class A Certificateholders in reduction of the Class A Invested Amount from time to time on or prior to such date; provided, however, that the Class A Invested Amount shall not be reduced by any amount of Series 1997-1 Collections so received and distributed if at any time such distribution of such amount of Series 1997-1 Collections is rescinded or must be returned for any reason; and provided, further, that on any date of determination, the Class A Invested Amount shall not exceed the Class A Purchase Limit. "Class A Monthly Interest" shall have the meaning specified in Section 4.02. "Class A Monthly Principal" shall have the meaning specified in Section 4.03(a). "Class A Purchase Limit" shall mean, on any date of determination, $100,000,000 as such amount may be reduced pursuant to Section 2.04 of the Certificate Purchase Agreement. "Class B Certificate" shall mean any one of the Series 1997-1 Class B Certificates executed and authenticated by the Trustee, substantially in the form attached as Exhibit A-2. "Class B Certificateholders' Interest" shall mean that portion of the Certificateholders Interest evidenced by the Class B Certificate. "Class B Certificate Rate" shall be 0%. "Class B Invested Amount" shall mean, when used with respect to any date, an amount equal to the Pool Balance minus the Class A Invested Amount. "Class B Monthly Principal" shall have the meaning specified in Section 4.03(b). "Closing Date" shall mean February 28, 1997. "Collections" shall have the meaning designated in the

Agreement; provided, however, that for the purposes of this Series Supplement, and as long as no allocations of Collections need to be made among Series, no distinction will be made between Discount Collections and Principal Collections. "Confidential Information" shall mean, in relation to any Person, any written information delivered or made available by or on behalf of Federal-Mogul (or its Affiliates or subsidiaries) or the Seller to such Person in connection with or pursuant to this Agreement or the transactions contemplated hereby which is proprietary in nature and clearly marked or identified in writing as being confidential information, other than information (i) which was publicly known, or otherwise known to such Person, at the time of disclosure (except pursuant to disclosure in connection with this Agreement), (ii) which subsequently becomes publicly known through no act or omission by such Person, or (iii) which otherwise becomes known to such Person other than through disclosure by Federal-Mogul or the Seller. "Contractual Dilution Balance" shall mean, as of any Determination Date, the sum of (a) 2% of North American Aftermarket sales during the immediately preceding Collection Period, (b) the greater of (i) the accrual for obsolescence and (ii) two times the aggregate amount of Credit Memos issued during such Collection Period due to obsolescence, (c) 1.5 times the aggregate amount of Credit Memos issued during such Collection Period due to stock lifts and

Agreement; provided, however, that for the purposes of this Series Supplement, and as long as no allocations of Collections need to be made among Series, no distinction will be made between Discount Collections and Principal Collections. "Confidential Information" shall mean, in relation to any Person, any written information delivered or made available by or on behalf of Federal-Mogul (or its Affiliates or subsidiaries) or the Seller to such Person in connection with or pursuant to this Agreement or the transactions contemplated hereby which is proprietary in nature and clearly marked or identified in writing as being confidential information, other than information (i) which was publicly known, or otherwise known to such Person, at the time of disclosure (except pursuant to disclosure in connection with this Agreement), (ii) which subsequently becomes publicly known through no act or omission by such Person, or (iii) which otherwise becomes known to such Person other than through disclosure by Federal-Mogul or the Seller. "Contractual Dilution Balance" shall mean, as of any Determination Date, the sum of (a) 2% of North American Aftermarket sales during the immediately preceding Collection Period, (b) the greater of (i) the accrual for obsolescence and (ii) two times the aggregate amount of Credit Memos issued during such Collection Period due to obsolescence, (c) 1.5 times the aggregate amount of Credit Memos issued during such Collection Period due to stock lifts and (d) the total rebates and adjustments currently owed to Obligors as of the end of such Collection Period (as reflected in the Customer Program Balances in the books and records of the Servicer). "Coverage Amount" shall mean, as of any Determination Date, the deficiency, if any, in an amount equal to (a) the Class A Invested Amount as of such Determination Date minus the Funding Adjustment determined as of such Determination Date minus (b) the Primary Funding determined as of such Determination Date. "CP Note" shall mean any commercial paper note issued by Falcon. "Credit Memo" shall mean any credit memo relating to (a) the North American Aftermarket obsolescence, (b) the North American Aftermarket stock lifts, (d) the North American Aftermarket core deposits, (e) the North American Aftermarket billing adjustments, (f) the North American Aftermarket customer accommodation returns, (g) the North American Aftermarket other and (h) Original Equipment Manufacturers. "Delinquency Ratio" shall mean, as of any Determination Date, the percentage equivalent of a fraction, the numerator of

which is the aggregate amount of Receivables as of the last Business Day of the immediately preceding Collection Period that are 61 or more days past due and the denominator of which is the Pool Balance as of such Business Day. "Determination Date" shall mean the fifteenth day of each month, or if such day is not a Business Day, the next succeeding Business Day. "Dilution Horizon Ratio" or "DHR" shall mean, for any Determination Date, a fraction, the numerator of which is the sum of the aggregate amounts of all new Receivables generated during the two immediately preceding Collection Periods and the denominator of which is the Available Receivables as of such Determination Date. "Dilution Ratio" shall mean, as of any Determination Date, the percentage equivalent of a fraction, the numerator of which is all non-cash reductions to the Pool Balance, not related to the credit-worthiness of the Obligor, including, but not limited to, the aggregate amount of Credit Memos issued during the immediately preceding Collection Period, adjustments related to 2/10 discounts made during the immediately preceding Collection Period, and other adjustments made during the immediately preceding Collection Period and the denominator of which is the Pool Balance as of such Business Day. "Discount/Fees Reserve Percentage" shall mean, as of any Determination Date:

which is the aggregate amount of Receivables as of the last Business Day of the immediately preceding Collection Period that are 61 or more days past due and the denominator of which is the Pool Balance as of such Business Day. "Determination Date" shall mean the fifteenth day of each month, or if such day is not a Business Day, the next succeeding Business Day. "Dilution Horizon Ratio" or "DHR" shall mean, for any Determination Date, a fraction, the numerator of which is the sum of the aggregate amounts of all new Receivables generated during the two immediately preceding Collection Periods and the denominator of which is the Available Receivables as of such Determination Date. "Dilution Ratio" shall mean, as of any Determination Date, the percentage equivalent of a fraction, the numerator of which is all non-cash reductions to the Pool Balance, not related to the credit-worthiness of the Obligor, including, but not limited to, the aggregate amount of Credit Memos issued during the immediately preceding Collection Period, adjustments related to 2/10 discounts made during the immediately preceding Collection Period, and other adjustments made during the immediately preceding Collection Period and the denominator of which is the Pool Balance as of such Business Day. "Discount/Fees Reserve Percentage" shall mean, as of any Determination Date: the greater of (i) 1% and 2 x TD/365 x [PL x AF + (H.15 + 50 bps + PF) x IA] + accrued and unpaid interest/fees
Available Receivables where, PL AF H.15 = = = Class A Purchase Limit 27.5 bps 30 day H.15 rate, as of the last day of the preceding Collection Period, on an interestbearing basis 15 bps Class A Invested Amount as of the last day of the second immediately preceding Collection Period Turnover Days

PF IA

= =

TD

=

"Discount Rate" shall mean zero. "Distribution Date" shall be the twentieth day of each month or, if such day is not a Business Day, the next succeeding Business Day. "Early Amortization Commencement Date" shall mean the date on which an Early Amortization Event is deemed to have occurred. "Early Amortization Event" shall mean any Early Amortization Event specified in Section 9.01 of the Agreement, together with any Additional Early Amortization Event specified in Section 6.01 of this Series Supplement. "Early Amortization Period" shall mean the period from and including the Early Amortization Commencement Date to and including the earlier of (a) the date of the final distribution to Investor Certificateholders of this Series and (b) the Termination Date. "Eligible Receivables" shall mean each Receivable which meets the following characteristics:

"Discount Rate" shall mean zero. "Distribution Date" shall be the twentieth day of each month or, if such day is not a Business Day, the next succeeding Business Day. "Early Amortization Commencement Date" shall mean the date on which an Early Amortization Event is deemed to have occurred. "Early Amortization Event" shall mean any Early Amortization Event specified in Section 9.01 of the Agreement, together with any Additional Early Amortization Event specified in Section 6.01 of this Series Supplement. "Early Amortization Period" shall mean the period from and including the Early Amortization Commencement Date to and including the earlier of (a) the date of the final distribution to Investor Certificateholders of this Series and (b) the Termination Date. "Eligible Receivables" shall mean each Receivable which meets the following characteristics: (i) the obligation is denominated and payable in U.S. dollars in the United States, or, if a Canadian Receivable, is denominated and payable in Canadian dollars; or is related to an Original Equipment Manufacturer export and is denominated in U.S. dollars; (ii) the related Obligor is a resident of the United States or Canada or is an Original Equipment Manufacturer; (iii) the related Obligor is not an Affiliate of any of the parties hereto; (iv) the contract terms of the Receivables call for payment within 90 days of original billing date, except for up to 3% of the Pool Balance which may have terms that call for payment within 91 to 180 days of original billing date, and except that any Receivables purchased on or before the Closing Date may have contract terms that call for payment on or before December 31, 1997, subject to the preceding 3% limitation; (v) the Receivable is not more than 90 days past due; (vi) the purchase of the Receivable is a "current transaction" within Section 3(a)(3) of the Securities Act;

(vii) the Receivable is an "account" under Section 9-106 of the Uniform Commercial Code; (viii) the Receivable is a legal, valid and binding obligation of the related Obligor; (ix) the terms of the contract for the Receivable do not require the consent of the Obligor to sell or assign such Receivable; (x) the Program Agent has not notified the Seller that the Receivable is not acceptable; (xi) the Receivable was generated in the ordinary course of business of the Receivables Seller; (xii) the Receivable satisfies all applicable requirements of the credit and collection policies of the Receivables Sellers and the Seller; (xiii) There are no offset arrangements with the related Obligor; (xiv) the contract for the Receivable represents all or a part of the sales price of merchandise, insurance and services within the meaning of the Investment Company Act, Section 3(c)(5); provided, however, if, as of any Determination Date, the aggregate amount of Receivables for an Obligor represent 2.00% or more of the Pool Balance and 30.00% or more of such Receivables are 91 days or more past due, all Receivables relating to such Obligor shall not constitute "Eligible Receivables" for purposes of the

(vii) the Receivable is an "account" under Section 9-106 of the Uniform Commercial Code; (viii) the Receivable is a legal, valid and binding obligation of the related Obligor; (ix) the terms of the contract for the Receivable do not require the consent of the Obligor to sell or assign such Receivable; (x) the Program Agent has not notified the Seller that the Receivable is not acceptable; (xi) the Receivable was generated in the ordinary course of business of the Receivables Seller; (xii) the Receivable satisfies all applicable requirements of the credit and collection policies of the Receivables Sellers and the Seller; (xiii) There are no offset arrangements with the related Obligor; (xiv) the contract for the Receivable represents all or a part of the sales price of merchandise, insurance and services within the meaning of the Investment Company Act, Section 3(c)(5); provided, however, if, as of any Determination Date, the aggregate amount of Receivables for an Obligor represent 2.00% or more of the Pool Balance and 30.00% or more of such Receivables are 91 days or more past due, all Receivables relating to such Obligor shall not constitute "Eligible Receivables" for purposes of the Agreement and this Series Supplement. "Escrow Account" shall mean the escrow account established pursuant to the Escrow Deposit Agreement. "Escrow Deposit Agreement" shall mean the escrow deposit agreement, dated February 28, 1997, by and among the Seller, Federal-Mogul Corporation, the Trustee, The Chase Manhattan Bank, as Escrow Agent and The Chase Manhattan Bank, in its individual capacity. "Escrow Account Amount" shall mean the amount, if any, transferred to the Series 1997-1 Trustee's Account from the Escrow Account pursuant to paragraph 9 of the Escrow Deposit Agreement. "Expected Floating Dilution Ratio" or "EFD" shall mean, as of any Determination Date, the average of the Floating Dilution Ratios for the twelve immediately preceding Collection Periods.

"Falcon" shall mean Falcon Asset Securitization Corporation, a corporation organized and existing under the laws of the State of Delaware, and any successor or assignee of Falcon and that is a receivables investment company which in the ordinary course of its business issues commercial paper or other securities to fund its acquisition and maintenance of receivables. "Fee Letter" shall mean that certain letter agreement dated as of the date hereof between the Seller, Falcon and the Program Agent, as it may be amended or modified and in effect from time to time. "Floating Dilution Ratio" shall mean, as of any Determination Date, the percentage equivalent of a fraction, the numerator of which shall be the Floating Dilution determined as of such Determination Date and the denominator of which shall be the aggregate amount of new Receivables transferred to the Trust during the second immediately preceding Collection Period. "Floating Dilution" shall mean, as of any Determination Date, the aggregate amount of Credit Memos issued during the immediately preceding Collection Period relating to the (i) North American Aftermarket core deposits, (ii) the North American Aftermarket billing adjustments, (iii) the North American Aftermarket customer accommodation returns, (iv) the North American Aftermarket other and (v) Original Equipment Manufacturers. "Floating Dilution Reserve Percentage" or "FDRP" shall equal, as of any Determination Date:

"Falcon" shall mean Falcon Asset Securitization Corporation, a corporation organized and existing under the laws of the State of Delaware, and any successor or assignee of Falcon and that is a receivables investment company which in the ordinary course of its business issues commercial paper or other securities to fund its acquisition and maintenance of receivables. "Fee Letter" shall mean that certain letter agreement dated as of the date hereof between the Seller, Falcon and the Program Agent, as it may be amended or modified and in effect from time to time. "Floating Dilution Ratio" shall mean, as of any Determination Date, the percentage equivalent of a fraction, the numerator of which shall be the Floating Dilution determined as of such Determination Date and the denominator of which shall be the aggregate amount of new Receivables transferred to the Trust during the second immediately preceding Collection Period. "Floating Dilution" shall mean, as of any Determination Date, the aggregate amount of Credit Memos issued during the immediately preceding Collection Period relating to the (i) North American Aftermarket core deposits, (ii) the North American Aftermarket billing adjustments, (iii) the North American Aftermarket customer accommodation returns, (iv) the North American Aftermarket other and (v) Original Equipment Manufacturers. "Floating Dilution Reserve Percentage" or "FDRP" shall equal, as of any Determination Date: the greater of (a) 15% and (b) 1.75 X EFD X DHR + [ (FDS - EFD) x FDS ] EFD
where, FDR EFD FDS DHR = = = = Floating Dilution Ratio Expected Floating Dilution Ratio Floating Dilution Spike Ratio Dilution Horizon Ratio

"Floating Dilution Spike Ratio" or "FDS" shall mean, as of any Determination Date, the highest average of the Floating Dilution Ratio for any two consecutive Collection Periods that occurred during the twelve immediately preceding Collection Periods.

"Funding Adjustment" shall mean, (a) as of the Determination Dates occurring in March 1997, April 1997 and May 1997, an amount equal to the lesser of (w) $25,000,000, (x) an amount equal to $95,400,000 minus Primary Funding determined as of the applicable Determination Date, and (y) the Contractual Dilution Balance determined as of the applicable Determination Date, and (b) as of any Determination Date occurring after the month of May 1997, $0. "Guaranty" shall mean any guaranty by any Person of Indebtedness or other obligations of any other Person that is not a consolidated subsidiary of such Person or any assurance with respect to the financial condition of any other Person that is not a consolidated subsidiary of such Person (including, without limitation, any purchase or repurchase agreement, any indemnity or any keep-well, take-or-pay, through-put or other arrangement having the effect of assuring or holding harmless any third Person against loss with respect to any Indebtedness or other obligation of such other Person) except endorsements of negotiable instruments for collection in the ordinary course of business. "Increase" shall mean the amount of each increase in the Class A Invested Amount funded by CP Notes or the Liquidity Providers and paid to the Seller by the Program Agent pursuant to the terms of the Certificate Purchase Agreement. "Indebtedness" shall mean any (a) indebtedness for borrowed money or for the deferred purchase price of

"Funding Adjustment" shall mean, (a) as of the Determination Dates occurring in March 1997, April 1997 and May 1997, an amount equal to the lesser of (w) $25,000,000, (x) an amount equal to $95,400,000 minus Primary Funding determined as of the applicable Determination Date, and (y) the Contractual Dilution Balance determined as of the applicable Determination Date, and (b) as of any Determination Date occurring after the month of May 1997, $0. "Guaranty" shall mean any guaranty by any Person of Indebtedness or other obligations of any other Person that is not a consolidated subsidiary of such Person or any assurance with respect to the financial condition of any other Person that is not a consolidated subsidiary of such Person (including, without limitation, any purchase or repurchase agreement, any indemnity or any keep-well, take-or-pay, through-put or other arrangement having the effect of assuring or holding harmless any third Person against loss with respect to any Indebtedness or other obligation of such other Person) except endorsements of negotiable instruments for collection in the ordinary course of business. "Increase" shall mean the amount of each increase in the Class A Invested Amount funded by CP Notes or the Liquidity Providers and paid to the Seller by the Program Agent pursuant to the terms of the Certificate Purchase Agreement. "Indebtedness" shall mean any (a) indebtedness for borrowed money or for the deferred purchase price of property or services, (b) obligations under leases which, in accordance with generally accepted accounting principles, are to be recorded as capital leases, (c) obligations which are evidenced by notes, acceptances or other instruments, (d) net liabilities under interest rate swap, foreign currency swap, commodity swap, exchange or cap agreements and (e) obligations, whether or not assumed, secured by Liens or payable out of proceeds or production from property now or hereafter owned or acquired; provided, however, that the term "Indebtedness" shall not include short-term obligations payable to suppliers incurred in the ordinary course of business. "Initial Class A Invested Amount" shall equal $95,400,000. "Interest Period" shall mean, with respect to any Distribution Date, the period from and including the Distribution Date immediately preceding such Distribution Date (or, in the case of the first Distribution Date, from and including the Closing Date) to but excluding such Distribution Date.

"Invested Amount" shall mean, when used with respect to any date, the sum of the Class A Invested Amount and the Class B Invested Amount. "Investment Proceeds" shall mean, with respect to any Determination Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Series 1997-1 Trustee's Account, together with an amount equal to all interest and other investment earnings on funds held in the Collection Account. "LIBO Rate" is the rate specified in the Certificate Purchase Agreement. "Liquidity Providers" shall mean the banks and financial institutions defined in the Certificate Purchase Agreement. "Loss Reserve Percentage" shall mean, as of any Determination Date, the greater of (a) 5% and (b) 3 times the Loss-to-Liquidation Ratio. "Loss-to-Liquidation Ratio" shall mean, as of any Determination Date, a fraction, the numerator of which equals the sum of (a) the aggregate of Receivables that were 61 to 90 days past due as of the last day of the immediately preceding Collection Period and (b) the excess, if any, of (i) the aggregate amount of placed accounts balance during the immediately preceding Collection Period over (ii) the aggregate amount of placed accounts balance during the second immediately preceding Collection Period, and the denominator of which is Collections received during the immediately preceding Collection Period. "Minimum Enhancement Amount" shall mean, as of any Determination Date, an amount equal to the greater of (i)

"Invested Amount" shall mean, when used with respect to any date, the sum of the Class A Invested Amount and the Class B Invested Amount. "Investment Proceeds" shall mean, with respect to any Determination Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Series 1997-1 Trustee's Account, together with an amount equal to all interest and other investment earnings on funds held in the Collection Account. "LIBO Rate" is the rate specified in the Certificate Purchase Agreement. "Liquidity Providers" shall mean the banks and financial institutions defined in the Certificate Purchase Agreement. "Loss Reserve Percentage" shall mean, as of any Determination Date, the greater of (a) 5% and (b) 3 times the Loss-to-Liquidation Ratio. "Loss-to-Liquidation Ratio" shall mean, as of any Determination Date, a fraction, the numerator of which equals the sum of (a) the aggregate of Receivables that were 61 to 90 days past due as of the last day of the immediately preceding Collection Period and (b) the excess, if any, of (i) the aggregate amount of placed accounts balance during the immediately preceding Collection Period over (ii) the aggregate amount of placed accounts balance during the second immediately preceding Collection Period, and the denominator of which is Collections received during the immediately preceding Collection Period. "Minimum Enhancement Amount" shall mean, as of any Determination Date, an amount equal to the greater of (i) an amount equal to the product of (w) the Aggregate Reserve Percentage as of such Determination Date and (x) a fraction the numerator of which is equal to the Class A Invested Amount as of such Determination Date minus the Funding Adjustment as of such Determination Date and the denominator of which is 1 minus such Aggregate Reserve Percentage plus (y) the Contractual Dilution as of such Determination Date and (ii) $5,000,000. "Monthly Servicing Fee" shall have the meaning specified in Section 3.01. "Net Receivables Balance" shall equal, as of any Determination Date, (a) the aggregate outstanding balance of all Eligible Receivables minus (b) the Overconcentration Amount at such time.

"Obligor Overconcentration" shall mean, as of any Determination Date, the excess of (a) the aggregate of all amounts of Eligible Receivables owned by the Trust and generated under accounts receivable with any one Obligor or type of Receivable as of the last day of the Collection Period immediately preceding such Determination Date over (b) 2% of the Eligible Receivables on the last day of such immediately preceding Collection Period; provided, that the Obligor Overconcentration with respect to the following Obligors or types of Receivables, shall be the applicable amount described in clause (a) in excess of the following percentages respectively, of the Eligible Receivables on the last day of such immediately preceding Collection Period:
Obligor/Receivable Type Chrysler Ford General Motors Genuine Parts Caterpillar Canadian Receivables OEM Export Receivables Percentage 4% 7% 7% 4% 3% 6% 5%

"Optional Repayment Amount" shall mean with respect to any Distribution Date, the amount, if any, of Series

"Obligor Overconcentration" shall mean, as of any Determination Date, the excess of (a) the aggregate of all amounts of Eligible Receivables owned by the Trust and generated under accounts receivable with any one Obligor or type of Receivable as of the last day of the Collection Period immediately preceding such Determination Date over (b) 2% of the Eligible Receivables on the last day of such immediately preceding Collection Period; provided, that the Obligor Overconcentration with respect to the following Obligors or types of Receivables, shall be the applicable amount described in clause (a) in excess of the following percentages respectively, of the Eligible Receivables on the last day of such immediately preceding Collection Period:
Obligor/Receivable Type Chrysler Ford General Motors Genuine Parts Caterpillar Canadian Receivables OEM Export Receivables Percentage 4% 7% 7% 4% 3% 6% 5%

"Optional Repayment Amount" shall mean with respect to any Distribution Date, the amount, if any, of Series 1997-1 Collections which the Seller directs the Trustee to deposit into the Series 1997-1 Trustee's Account pursuant to Section 4.07 for distribution on such Distribution Date in reduction of the Class A Invested Amount. "Other Fees" shall have the meaning specified in the Fee Letter. "Overconcentration Amount" shall mean, as of any Determination Date, the sum of the Obligor Overconcentrations on such date. "Primary Funding" shall mean, as of any Determination Date, an amount equal to the Available Receivables determined as of such Determination Date minus the Aggregate Reserves determined as of such Determination Date.

"Prior Series Deficiency" shall have the meaning specified in Section 4.01(c). "Program Agent" shall mean The First National Bank of Chicago and its successors , in its capacity as agent for Falcon and the Liquidity Providers. "Program Fee" shall have the meaning specified in the Fee Letter. "Purchase" shall mean, with respect to the Class A Certificates, the amount of the initial purchase of the Class A Certificates paid to the Seller by the Program Agent pursuant to the terms of the Certificate Purchase Agreement. "Purchaser" shall have the meaning assigned to such term in the Certificate Purchase Agreement. "Reassignment Amount" shall mean, with respect to any Distribution Date, after giving effect to any deposits and distributions otherwise to be made on such Distribution Date, the sum of (i) the Invested Amount on such Distribution Date, (ii) the Class A Monthly Interest relating to such Distribution Date and any Class A Monthly Interest previously due and unpaid, (iii) the Class A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest previously due and unpaid and (iv) the amount of any accrued and unpaid Program Fees, Administration Fees, Other Fees and Breakage Costs. "Receivables Seller" shall mean one of the Sellers listed in the Receivables Purchase Agreements. "Related Documents" shall mean the Transaction Documents.

"Prior Series Deficiency" shall have the meaning specified in Section 4.01(c). "Program Agent" shall mean The First National Bank of Chicago and its successors , in its capacity as agent for Falcon and the Liquidity Providers. "Program Fee" shall have the meaning specified in the Fee Letter. "Purchase" shall mean, with respect to the Class A Certificates, the amount of the initial purchase of the Class A Certificates paid to the Seller by the Program Agent pursuant to the terms of the Certificate Purchase Agreement. "Purchaser" shall have the meaning assigned to such term in the Certificate Purchase Agreement. "Reassignment Amount" shall mean, with respect to any Distribution Date, after giving effect to any deposits and distributions otherwise to be made on such Distribution Date, the sum of (i) the Invested Amount on such Distribution Date, (ii) the Class A Monthly Interest relating to such Distribution Date and any Class A Monthly Interest previously due and unpaid, (iii) the Class A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest previously due and unpaid and (iv) the amount of any accrued and unpaid Program Fees, Administration Fees, Other Fees and Breakage Costs. "Receivables Seller" shall mean one of the Sellers listed in the Receivables Purchase Agreements. "Related Documents" shall mean the Transaction Documents. "Repurchase Price" shall have the meaning specified in Section 8.01. "Revolving Period" shall mean the period beginning at the close of business on the Business Day immediately preceding February 28, 1997 and ending on the earlier of (a) the last day of the Collection Period ending on the Business Day immediately preceding the Amortization Commencement Date, and (b) the Business Day immediately preceding the Early Amortization Commencement Date; provided, however, that, if any Early Amortization Period ends as described in the definition thereof, the Revolving Period will recommence as of the close of business on the day such Early Amortization Period ends.

"Series 1992-1 Certificates" shall mean the Investor Certificates issued pursuant to the Agreement and the Series 1992-1 Supplement. "Series 1992-1 Supplement" shall mean the Series 1992-1 Supplement to the Agreement, dated as of June 1, 1992, among the Seller, the Servicer and the Trustee. "Series 1993-1 Certificates" shall mean the Investor Certificates issued pursuant to the Agreement and the Series 1993-1 Supplement. "Series 1993-1 Supplement" shall mean the Series 1993-1 Supplement to the Agreement, dated as of March 1, 1993, among the Seller, the Servicer and the Trustee. "Series 1997-1" shall mean the Series of Investor Certificates, the terms of which are specified in this Series Supplement. "Series 1997-1 Certificateholders" shall mean the Holders of Series 1997-1 Certificates. "Series 1997-1 Certificateholders' Interest" shall mean that portion of the Certificateholders' Interest evidenced by the Series 1997-1 Certificates. "Series 1997-1 Certificates" shall mean any one of the Class A Certificates and Class B Certificates executed and authenticated by the Trustee, substantially in the form of Exhibits A-1 and A-2.

"Series 1992-1 Certificates" shall mean the Investor Certificates issued pursuant to the Agreement and the Series 1992-1 Supplement. "Series 1992-1 Supplement" shall mean the Series 1992-1 Supplement to the Agreement, dated as of June 1, 1992, among the Seller, the Servicer and the Trustee. "Series 1993-1 Certificates" shall mean the Investor Certificates issued pursuant to the Agreement and the Series 1993-1 Supplement. "Series 1993-1 Supplement" shall mean the Series 1993-1 Supplement to the Agreement, dated as of March 1, 1993, among the Seller, the Servicer and the Trustee. "Series 1997-1" shall mean the Series of Investor Certificates, the terms of which are specified in this Series Supplement. "Series 1997-1 Certificateholders" shall mean the Holders of Series 1997-1 Certificates. "Series 1997-1 Certificateholders' Interest" shall mean that portion of the Certificateholders' Interest evidenced by the Series 1997-1 Certificates. "Series 1997-1 Certificates" shall mean any one of the Class A Certificates and Class B Certificates executed and authenticated by the Trustee, substantially in the form of Exhibits A-1 and A-2. "Series 1997-1 Collections" shall have the meaning specified in Section 4.01(a). "Series 1997-1 Trustee's Account" shall have the meaning specified in Section 4.04(a). "Servicing Fee Rate" shall mean, with respect to Series 1997-1, 0.50% per annum. "Servicing Reserve Percentage" shall mean, as of any Determination Date, the percentage of equivalent of a fraction, the numerator of which shall be an amount equal to the product of (i) the Servicing Fee Rate, (ii) the Pool Balance as of the last day of the immediately preceding Collection Period, (iii) 2, (iv) Turnover Days divided by 365, and the denominator of which shall be the Available Receivables determined as of such Determination Date.

"Subsidiary" shall mean, at any particular time, any Person which could be included as a consolidated subsidiary of Federal-Mogul in the financial statements prepared and filed with Federal-Mogul's annual reports on Form 10K under the Securities Exchange Act of 1934, as amended, if such financial statements were prepared at, and as of, such time. Unless otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in this Series Supplement shall refer to a Subsidiary or Subsidiaries of Federal-Mogul. "Termination Date" shall mean February 28, 2000, which is the date on which the last payment of principal and interest on the Series 1997-1 Certificates will be due and payable. "Termination Proceeds" shall mean any termination proceeds arising out of a sale of Receivables (or interests therein) pursuant to Section 12.02(c) of the Agreement with respect to Series 1997-1. "Transaction Documents" shall mean the Fee Letter, the Agreement, this Series Supplement, the Class A Certificates, the Receivable Purchase Agreement, the Escrow Deposit Agreement and the Certificate Purchase Agreement. "Turnover Days" shall mean, as of any Determination Date, an amount equal to the Pool Balance as of the last day of the immediately preceding Collection Period divided by Collections relating to the immediately preceding Collection Period times 30.

"Subsidiary" shall mean, at any particular time, any Person which could be included as a consolidated subsidiary of Federal-Mogul in the financial statements prepared and filed with Federal-Mogul's annual reports on Form 10K under the Securities Exchange Act of 1934, as amended, if such financial statements were prepared at, and as of, such time. Unless otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in this Series Supplement shall refer to a Subsidiary or Subsidiaries of Federal-Mogul. "Termination Date" shall mean February 28, 2000, which is the date on which the last payment of principal and interest on the Series 1997-1 Certificates will be due and payable. "Termination Proceeds" shall mean any termination proceeds arising out of a sale of Receivables (or interests therein) pursuant to Section 12.02(c) of the Agreement with respect to Series 1997-1. "Transaction Documents" shall mean the Fee Letter, the Agreement, this Series Supplement, the Class A Certificates, the Receivable Purchase Agreement, the Escrow Deposit Agreement and the Certificate Purchase Agreement. "Turnover Days" shall mean, as of any Determination Date, an amount equal to the Pool Balance as of the last day of the immediately preceding Collection Period divided by Collections relating to the immediately preceding Collection Period times 30. "Undivided Fractional Interest" shall mean the undivided fractional interest in the Class A or Class B Invested Amount, as applicable, evidenced by a Class A or Class B Certificate, the numerator being the principal amount of such Class A or Class B Certificate at the time of determination and the denominator being the Class A or Class B Invested Amount at such time. (b) All capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in the Agreement. Each capitalized term defined herein shall relate only to the Series 1997-1 Certificates and no other Series of Certificates issued by the Trust. The definitions in Section 2.01 are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms. (c) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Series Supplement shall refer to this Series Supplement as a whole and not to any particular provision of this Series Supplement; references to any Article, Section or Exhibit are references to Articles, Sections and Exhibits in or to this Series Supplement unless otherwise specified; and the term "including" means "including without limitation".

(d) As used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly defined in this Agreement or in any such certificate or other document to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles. To the extent that the definitions of accounting terms in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under generally accepted accounting principles, the definitions contained in this Agreement or in any such certificate or other document shall control. ARTICLE III Servicing Fee SECTION 3.01 Servicing Compensation. The monthly servicing fee (the "Monthly Servicing Fee") shall be payable to the Servicer, either (a) through withdrawals from Collections as provided in Section 4.03(b) of the Agreement or (b) shall be payable in arrears, on each Distribution Date in respect of any Collection Period (or portion thereof) occurring prior to the earlier of the first Distribution Date following the Termination Date and the first Distribution Date on which the Invested Amount is zero. The Monthly Servicing Fee shall be an amount equal to the product of (a) the Servicing Fee Rate and (b) the Pool Balance and (c) a fraction, the numerator of which is the actual number of days in the preceding Collection Period and the denominator of which is 360; provided, however, that with respect to the first Distribution Date, the Monthly Servicing Fee shall be equal to $67,160.00.

(d) As used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly defined in this Agreement or in any such certificate or other document to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles. To the extent that the definitions of accounting terms in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under generally accepted accounting principles, the definitions contained in this Agreement or in any such certificate or other document shall control. ARTICLE III Servicing Fee SECTION 3.01 Servicing Compensation. The monthly servicing fee (the "Monthly Servicing Fee") shall be payable to the Servicer, either (a) through withdrawals from Collections as provided in Section 4.03(b) of the Agreement or (b) shall be payable in arrears, on each Distribution Date in respect of any Collection Period (or portion thereof) occurring prior to the earlier of the first Distribution Date following the Termination Date and the first Distribution Date on which the Invested Amount is zero. The Monthly Servicing Fee shall be an amount equal to the product of (a) the Servicing Fee Rate and (b) the Pool Balance and (c) a fraction, the numerator of which is the actual number of days in the preceding Collection Period and the denominator of which is 360; provided, however, that with respect to the first Distribution Date, the Monthly Servicing Fee shall be equal to $67,160.00. The Monthly Servicing Fee shall be payable to the Servicer solely to the extent amounts are available for distribution in accordance with the terms of this Series Supplement.

ARTICLE IV Rights of Series 1997-1 Certificateholders and Allocation and Application of Collections SECTION 4.01 Allocations; Payments to Seller. (a) So long as no amounts are allocable to the Series 1992-1 or the Series 1993-1 Certificates, as hereinafter described, all Collections, Adjustment Payments, any payment by the Seller pursuant to Section 2.03 of the Agreement, any Transfer Deposit Amount, any Insolvency Proceeds, any Termination Proceeds and any other amount received in connection with the Receivables by any party or Person (collectively, the "Series 1997-1 Collections") shall be allocated to the Series 1997-1 Certificates. (b) The Servicer shall (a) instruct the Trustee and the Trustee shall withdraw from the Collection Account and pay to the Seller on the dates set forth below the following amounts and (b) on each Distribution Date notify the Trustee of the applicable Class A Certificate Rate for the next succeeding Distribution Date; provided, that in so instructing the Trustee, the Servicer shall satisfy itself that funds on deposit in the Collection Account following any such payments will be sufficient to pay the Class A Monthly Interest, the Class B Monthly Interest, Class A Additional Interest, Optional Repayment Amount, Coverage Amount, Escrow Account Amount and Class A Monthly Principal on the next succeeding Distribution Date: (i) On each Deposit Date with respect to the Revolving Period, the Servicer shall instruct the Trustee in writing to withdraw from the Collection Account and pay to the Seller certain amounts on deposit in the Collection Account ("Available Collections"); provided, however, that no Early Amortization Event has occurred and no event or condition has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event; provided, further, that in so instructing the Trustee, the Servicer shall satisfy itself that funds on deposit in the Collection Account following any such payment of Available Collections to the Seller will be sufficient to pay, on the next succeeding Distribution Date, the sum of (a) Class A Monthly Interest, any Class A Monthly Interest previously due but not paid and any Class A Additional Interest and (b) all accrued and unpaid fees, as specified in the Fee Letter, that are due on such Distribution Date; provided, further, if the report delivered pursuant to paragraphs 5 and 11 of the Escrow Deposit Agreement indicates that there will be a Prior Series Deficiency on such succeeding Distribution Date, Available Collections in an amount up to the full amount of such Prior Series Deficiency shall be retained in the Collection Account to pay the Prior Series Deficiency. During the Revolving Period, funds on deposit

ARTICLE IV Rights of Series 1997-1 Certificateholders and Allocation and Application of Collections SECTION 4.01 Allocations; Payments to Seller. (a) So long as no amounts are allocable to the Series 1992-1 or the Series 1993-1 Certificates, as hereinafter described, all Collections, Adjustment Payments, any payment by the Seller pursuant to Section 2.03 of the Agreement, any Transfer Deposit Amount, any Insolvency Proceeds, any Termination Proceeds and any other amount received in connection with the Receivables by any party or Person (collectively, the "Series 1997-1 Collections") shall be allocated to the Series 1997-1 Certificates. (b) The Servicer shall (a) instruct the Trustee and the Trustee shall withdraw from the Collection Account and pay to the Seller on the dates set forth below the following amounts and (b) on each Distribution Date notify the Trustee of the applicable Class A Certificate Rate for the next succeeding Distribution Date; provided, that in so instructing the Trustee, the Servicer shall satisfy itself that funds on deposit in the Collection Account following any such payments will be sufficient to pay the Class A Monthly Interest, the Class B Monthly Interest, Class A Additional Interest, Optional Repayment Amount, Coverage Amount, Escrow Account Amount and Class A Monthly Principal on the next succeeding Distribution Date: (i) On each Deposit Date with respect to the Revolving Period, the Servicer shall instruct the Trustee in writing to withdraw from the Collection Account and pay to the Seller certain amounts on deposit in the Collection Account ("Available Collections"); provided, however, that no Early Amortization Event has occurred and no event or condition has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event; provided, further, that in so instructing the Trustee, the Servicer shall satisfy itself that funds on deposit in the Collection Account following any such payment of Available Collections to the Seller will be sufficient to pay, on the next succeeding Distribution Date, the sum of (a) Class A Monthly Interest, any Class A Monthly Interest previously due but not paid and any Class A Additional Interest and (b) all accrued and unpaid fees, as specified in the Fee Letter, that are due on such Distribution Date; provided, further, if the report delivered pursuant to paragraphs 5 and 11 of the Escrow Deposit Agreement indicates that there will be a Prior Series Deficiency on such succeeding Distribution Date, Available Collections in an amount up to the full amount of such Prior Series Deficiency shall be retained in the Collection Account to pay the Prior Series Deficiency. During the Revolving Period, funds on deposit

in the Collection Account following payments of Available Collections to the Seller should include the amounts, if any, specified in Section 5.01(a)(i), Breakage Costs, and amounts specified in Section 5.01(iii)(A) and (B) and during the Amortization Period, the amounts specified in Sections 5.01(b)(i), 5.01(b)(ii), 5.01(b)(iii)(B), 5.01(b) (iv) and 5.01(b)(v). On each Deposit Date on which Available Collections are paid to the Seller, the Seller shall be deemed to have represented and warranted to the Trustee and the Class A Certificateholders that no Early Amortization Event has occurred and no condition or event has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event. (ii) On each Transfer Date, the Seller may use Available Collections to purchase Receivables pursuant to the Receivables Purchase Agreement. In connection with any such purchase of Receivables on a Transfer Date, the Seller is hereby deemed to represent to the Trust and the Trustee that: (A) No Early Amortization Event has occurred and no event or condition has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event. (B) With respect to the Receivables purchased, the representations and warranties set forth in Section 2.04 of the Agreement are true and correct as of such Transfer Date. (iii) In allocating and distributing Collections on any Deposit Date pursuant to this Section 4.01(b), the Trustee conclusively may rely on the information and direction received from the Servicer delivered to it by the Servicer, and the Trustee shall not under any circumstance be required or obligated to verify the information set forth therein or to make inquiry of the Servicer as to the continued accuracy thereof.

in the Collection Account following payments of Available Collections to the Seller should include the amounts, if any, specified in Section 5.01(a)(i), Breakage Costs, and amounts specified in Section 5.01(iii)(A) and (B) and during the Amortization Period, the amounts specified in Sections 5.01(b)(i), 5.01(b)(ii), 5.01(b)(iii)(B), 5.01(b) (iv) and 5.01(b)(v). On each Deposit Date on which Available Collections are paid to the Seller, the Seller shall be deemed to have represented and warranted to the Trustee and the Class A Certificateholders that no Early Amortization Event has occurred and no condition or event has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event. (ii) On each Transfer Date, the Seller may use Available Collections to purchase Receivables pursuant to the Receivables Purchase Agreement. In connection with any such purchase of Receivables on a Transfer Date, the Seller is hereby deemed to represent to the Trust and the Trustee that: (A) No Early Amortization Event has occurred and no event or condition has occurred that with notice or the lapse of time or both would constitute an Early Amortization Event. (B) With respect to the Receivables purchased, the representations and warranties set forth in Section 2.04 of the Agreement are true and correct as of such Transfer Date. (iii) In allocating and distributing Collections on any Deposit Date pursuant to this Section 4.01(b), the Trustee conclusively may rely on the information and direction received from the Servicer delivered to it by the Servicer, and the Trustee shall not under any circumstance be required or obligated to verify the information set forth therein or to make inquiry of the Servicer as to the continued accuracy thereof. (c) On any Distribution Date, if amounts due to the Holders of the Series 1992-1 Certificates and Holders of the Series 1993-1 Certificates pursuant to the Series 1992-1 Supplement and the Series 1993-1 Supplement, respectively, exceed the amounts on deposit in the Escrow Account and available for distribution (a "Prior Series Deficiency"), the Trustee shall, prior to making any payments pursuant to Article V, withdraw funds from the Series 1997-1 Trustee's Account up to the amount of such Prior Series Deficiency and apply such amounts to the payment of such Prior Series Deficiency in the manner provided in the Series 1992-1 Supplement or Series 1993-1 Supplement, as applicable. If on any Distribution Date, amounts on deposit in the Series 1997-1 Trustee's Account are not sufficient to reduce any Prior Series Deficiency to zero, all such amounts will be allocated, first, to

pay in full all outstanding amounts then owed to the Holders of the Series 1992-1 Certificates and Holders of the Series 1993-1 Certificates for all amounts due and owing under the Series 1992-1 Supplement and Series 19931 Supplement, respectively, and then shall be paid to the Holders of the Series 1997-1 Certificates as provided in Section 5.01 herein. (d) If, on any Distribution Date, there are no funds available in the Escrow Account to pay amounts then due and owing to the Holders of the Series 1992-1 and Holders of the Series 1993-1 Certificates, all amounts on deposit in the Series 1997-1 Trustee's Account will be allocated, first, to pay in full all outstanding amounts then owed to the Holders of the Series 1992-1 Certificates and the Holders of the Series 1993-1 Certificates for all amounts due and owing under the Series 1992-1 Supplement and Series 1993-1 Supplement, respectively, and then shall be paid to the Series 1997-1 Certificateholders as provided in Section 5.01 herein. (e) Notwithstanding any provision in this Series Supplement or the Agreement to the contrary, upon the occurrence of an Early Amortization Event or any event or condition that with notice or the lapse of time or both would constitute an Early Amortization Event and provided that all amounts due to the Holders of the Series 1992-1 Certificates and the Series 1993-1 Certificates have been paid in full in accordance with the terms of the Series 1992-1 Supplement and the Series 1993-1 Supplement, respectively, upon written notice delivered by the Program Agent to the Seller, the Servicer and the Trustee, the Program Agent, and not the Servicer, shall be authorized to direct the Trustee to make withdrawals and payments from the Collection Account and the Series 1997 Trustee's Account and to give directions to the Trustee to invest funds in Eligible Investments.

pay in full all outstanding amounts then owed to the Holders of the Series 1992-1 Certificates and Holders of the Series 1993-1 Certificates for all amounts due and owing under the Series 1992-1 Supplement and Series 19931 Supplement, respectively, and then shall be paid to the Holders of the Series 1997-1 Certificates as provided in Section 5.01 herein. (d) If, on any Distribution Date, there are no funds available in the Escrow Account to pay amounts then due and owing to the Holders of the Series 1992-1 and Holders of the Series 1993-1 Certificates, all amounts on deposit in the Series 1997-1 Trustee's Account will be allocated, first, to pay in full all outstanding amounts then owed to the Holders of the Series 1992-1 Certificates and the Holders of the Series 1993-1 Certificates for all amounts due and owing under the Series 1992-1 Supplement and Series 1993-1 Supplement, respectively, and then shall be paid to the Series 1997-1 Certificateholders as provided in Section 5.01 herein. (e) Notwithstanding any provision in this Series Supplement or the Agreement to the contrary, upon the occurrence of an Early Amortization Event or any event or condition that with notice or the lapse of time or both would constitute an Early Amortization Event and provided that all amounts due to the Holders of the Series 1992-1 Certificates and the Series 1993-1 Certificates have been paid in full in accordance with the terms of the Series 1992-1 Supplement and the Series 1993-1 Supplement, respectively, upon written notice delivered by the Program Agent to the Seller, the Servicer and the Trustee, the Program Agent, and not the Servicer, shall be authorized to direct the Trustee to make withdrawals and payments from the Collection Account and the Series 1997 Trustee's Account and to give directions to the Trustee to invest funds in Eligible Investments. SECTION 4.02. Monthly Interest. The amount of monthly interest ("Class A Monthly Interest") with respect to the Class A Certificates on any Distribution Date shall be an amount determined by the Program Agent in accordance with the Certificate Purchase Agreement and the Program Agent shall give notice thereof to the Seller and the Servicer at least two Business Days prior to the related Determination Date. On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "Class A Interest Shortfall"), of (x) the aggregate Class A Monthly Interest for the Interest Period applicable to such Distribution Date over (y) the amount that will be available in the Series 1997-1 Trustee's Account on such Distribution Date in respect thereof pursuant to this Series Supplement. If, on any Distribution Date there exists a Class A Interest Shortfall, then

an additional amount ("Class A Additional Interest") determined by the Program Agent in accordance with the Certificate Purchase Agreement shall be payable as provided herein with respect to the Class A Certificates on each Distribution Date following such Distribution Date to and including the Distribution Date on which such Class A Interest Shortfall is paid or deposited in the Series 1997-1 Trustee's Account. Notwithstanding anything to the contrary herein, the Servicer shall instruct the Trustee to pay Class A Additional Interest to Class A Certificateholders only to the extent permitted by applicable law. SECTION 4.03. Determination of Monthly Principal. (a) The amount of monthly principal ("Class A Monthly Principal") distributable with respect to the Class A Certificates on each Distribution Date (i) with respect to the Revolving Period shall be equal to 0, (ii) with respect to an Early Amortization Period shall be equal to the Class A Invested Amount with respect to such Distribution Date; and (iii) with respect to the Controlled Amortization Period, Class A Monthly Principal shall be an amount equal to the Class A Controlled Distribution Amount for such Distribution Date; provided, however, that Class A Monthly Principal shall not exceed the outstanding principal balance of the Class A Certificates. (b) The amount of monthly principal ("Class B Monthly Principal") distributable with respect to the Class B Certificates on each Distribution Date, (i) with respect to the Revolving Period shall be equal to 0 and (ii) beginning with the Distribution Date on which the Class A Invested Amount is paid in full with respect to the Amortization Period or an Early Amortization Period, shall be equal to all amounts on deposit in the Series 19971 Trustee's Account with respect to such Distribution Date. SECTION 4.04. Establishment of Series Accounts. (a) The Servicer, for the benefit of the Series 1997-1 Certificateholders, shall establish and maintain an Eligible Deposit Account in the name of the Trustee, on behalf

an additional amount ("Class A Additional Interest") determined by the Program Agent in accordance with the Certificate Purchase Agreement shall be payable as provided herein with respect to the Class A Certificates on each Distribution Date following such Distribution Date to and including the Distribution Date on which such Class A Interest Shortfall is paid or deposited in the Series 1997-1 Trustee's Account. Notwithstanding anything to the contrary herein, the Servicer shall instruct the Trustee to pay Class A Additional Interest to Class A Certificateholders only to the extent permitted by applicable law. SECTION 4.03. Determination of Monthly Principal. (a) The amount of monthly principal ("Class A Monthly Principal") distributable with respect to the Class A Certificates on each Distribution Date (i) with respect to the Revolving Period shall be equal to 0, (ii) with respect to an Early Amortization Period shall be equal to the Class A Invested Amount with respect to such Distribution Date; and (iii) with respect to the Controlled Amortization Period, Class A Monthly Principal shall be an amount equal to the Class A Controlled Distribution Amount for such Distribution Date; provided, however, that Class A Monthly Principal shall not exceed the outstanding principal balance of the Class A Certificates. (b) The amount of monthly principal ("Class B Monthly Principal") distributable with respect to the Class B Certificates on each Distribution Date, (i) with respect to the Revolving Period shall be equal to 0 and (ii) beginning with the Distribution Date on which the Class A Invested Amount is paid in full with respect to the Amortization Period or an Early Amortization Period, shall be equal to all amounts on deposit in the Series 19971 Trustee's Account with respect to such Distribution Date. SECTION 4.04. Establishment of Series Accounts. (a) The Servicer, for the benefit of the Series 1997-1 Certificateholders, shall establish and maintain an Eligible Deposit Account in the name of the Trustee, on behalf of the Trust (the "Series 1997-1 Trustee's Account"), which shall be identified as the "Series 1997-1 Trustee's Account for the Federal-Mogul Trade Receivables Master Trust, Series 1997-1" and shall bear a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 1997-1 Certificateholders. The Series 1997-1 Trustee's Account initially shall be established as a segregated trust account at The Chase Manhattan Bank. (b) At the direction of the Servicer (which may be a standing direction), funds on deposit in the Series 1997-1 Trustee's Account shall be invested by the Trustee in Eligible

Investments selected by the Servicer. All such Eligible Investments shall be held by the Trustee for the benefit of the Series 1997-1 Certificateholders. On each Distribution Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Series 1997-1 Trustee's Account shall be applied as set forth in Section 4.05 of this Series Supplement. Funds on deposit in the Series 1997-1 Trustee's Account shall be invested at the written direction of the Servicer in Eligible Investments that will mature so that such funds will be available on or before the close of business on the Business Day next preceding the following Distribution Date. Funds deposited in the Series 1997-1 Trustee's Account on a Business Day which immediately precedes a Distribution Date upon the maturity of any Eligible Investments are not required to be invested overnight. (c) (i) The Trustee shall possess all right, title and interest in and to all funds on deposit from time to time in, and all Eligible Investments credited to, the Series 1997-1 Trustee's Account and in all proceeds thereof. The Series 1997-1 Trustee's Account shall be under the sole dominion and control of the Trustee for the benefit of the Series 1997-1 Certificateholders. If, at any time, the Series 1997-1 Trustee's Account is held by an institution other than an Eligible Institution, the Trustee (or the Servicer, at the direction of the Trustee and on its behalf) shall within 10 Business Days establish a new Series 1997-1 Trustee's Account meeting the conditions specified in paragraph (a) above, as applicable, and shall transfer any cash and/or any investments to such new Series 1997-1 Trustee's Account. Neither the Seller, the Servicer nor any Person or entity claiming by, through or under the Seller, the Servicer or any such Person or entity shall have any right, title or interest in, or any right to withdraw any amount from, the Series 1997-1 Trustee's Account, except as expressly provided herein. Schedule I attached hereto identifies the Series 1997-1 Trustee's Account by setting forth the account number of such account, the account designation of such account and the name and location of the institution with which such account has been established. If a substitute Series 1997-1 Trustee's Account is established pursuant to this Section 4.04, the party establishing such substitute Series 1997-1 Trustee's Account shall promptly provide to the Servicer or the Trustee, as applicable, an amended Schedule I, setting forth the relevant information for such substitute Series

Investments selected by the Servicer. All such Eligible Investments shall be held by the Trustee for the benefit of the Series 1997-1 Certificateholders. On each Distribution Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Series 1997-1 Trustee's Account shall be applied as set forth in Section 4.05 of this Series Supplement. Funds on deposit in the Series 1997-1 Trustee's Account shall be invested at the written direction of the Servicer in Eligible Investments that will mature so that such funds will be available on or before the close of business on the Business Day next preceding the following Distribution Date. Funds deposited in the Series 1997-1 Trustee's Account on a Business Day which immediately precedes a Distribution Date upon the maturity of any Eligible Investments are not required to be invested overnight. (c) (i) The Trustee shall possess all right, title and interest in and to all funds on deposit from time to time in, and all Eligible Investments credited to, the Series 1997-1 Trustee's Account and in all proceeds thereof. The Series 1997-1 Trustee's Account shall be under the sole dominion and control of the Trustee for the benefit of the Series 1997-1 Certificateholders. If, at any time, the Series 1997-1 Trustee's Account is held by an institution other than an Eligible Institution, the Trustee (or the Servicer, at the direction of the Trustee and on its behalf) shall within 10 Business Days establish a new Series 1997-1 Trustee's Account meeting the conditions specified in paragraph (a) above, as applicable, and shall transfer any cash and/or any investments to such new Series 1997-1 Trustee's Account. Neither the Seller, the Servicer nor any Person or entity claiming by, through or under the Seller, the Servicer or any such Person or entity shall have any right, title or interest in, or any right to withdraw any amount from, the Series 1997-1 Trustee's Account, except as expressly provided herein. Schedule I attached hereto identifies the Series 1997-1 Trustee's Account by setting forth the account number of such account, the account designation of such account and the name and location of the institution with which such account has been established. If a substitute Series 1997-1 Trustee's Account is established pursuant to this Section 4.04, the party establishing such substitute Series 1997-1 Trustee's Account shall promptly provide to the Servicer or the Trustee, as applicable, an amended Schedule I, setting forth the relevant information for such substitute Series 1997-1 Trustee's Account. (ii) Notwithstanding anything herein to the contrary, the Servicer shall have the power, revocable by the Trustee at the direction of Investor Certificateholders evidencing more than 50% of the aggregate principal amount of the Holders of the Series 1997-1 Certificates, to instruct the Trustee to make

withdrawals and payments from the Series 1997-1 Trustee's Account for the purposes of carrying out the Servicer's or Trustee's duties hereunder. (d) Any request by the Servicer to invest funds on deposit in the Series 1997-1 Trustee's Account shall be in writing, or by telephone, confirmed promptly in writing, and shall certify that the requested investment is an Eligible Investment which matures at or prior to the time required hereby. (e) The Trustee is hereby authorized, unless otherwise directed by the Servicer, to effect transactions in Eligible Investments through a capital markets affiliate of the Trustee. SECTION 4.05. Application of Series 1997-1 Collections and Investment Proceeds. The Servicer shall instruct the Trustee by a Distribution Date Statement delivered to the Trustee, on each Determination Date, to withdraw from the Collection Account an amount equal to the amount to be distributed on the next Distribution Date pursuant to Section 5.01 with respect to such Distribution Date and deposit such amount into the Series 1997-1 Trustee's Account. SECTION 4.06. Distributions to Series 1997-1 Certificateholders. (a) The Servicer shall instruct the Trustee in writing, together with each Distribution Date Statement delivered to the Trustee, to distribute from the Series 1997-1 Trustee's Account on each Distribution Date all amounts on deposit in the Series 1997-1 Trustee's Account pursuant to Section 5.01. (b) The distributions to be made pursuant to this Section are subject to the provisions of Sections 2.03, 9.02 and 12.02 of the Agreement and Sections 9.01 and 9.02 of this Series Supplement. SECTION 4.07. Payment of Optional Repayment Amount.

withdrawals and payments from the Series 1997-1 Trustee's Account for the purposes of carrying out the Servicer's or Trustee's duties hereunder. (d) Any request by the Servicer to invest funds on deposit in the Series 1997-1 Trustee's Account shall be in writing, or by telephone, confirmed promptly in writing, and shall certify that the requested investment is an Eligible Investment which matures at or prior to the time required hereby. (e) The Trustee is hereby authorized, unless otherwise directed by the Servicer, to effect transactions in Eligible Investments through a capital markets affiliate of the Trustee. SECTION 4.05. Application of Series 1997-1 Collections and Investment Proceeds. The Servicer shall instruct the Trustee by a Distribution Date Statement delivered to the Trustee, on each Determination Date, to withdraw from the Collection Account an amount equal to the amount to be distributed on the next Distribution Date pursuant to Section 5.01 with respect to such Distribution Date and deposit such amount into the Series 1997-1 Trustee's Account. SECTION 4.06. Distributions to Series 1997-1 Certificateholders. (a) The Servicer shall instruct the Trustee in writing, together with each Distribution Date Statement delivered to the Trustee, to distribute from the Series 1997-1 Trustee's Account on each Distribution Date all amounts on deposit in the Series 1997-1 Trustee's Account pursuant to Section 5.01. (b) The distributions to be made pursuant to this Section are subject to the provisions of Sections 2.03, 9.02 and 12.02 of the Agreement and Sections 9.01 and 9.02 of this Series Supplement. SECTION 4.07. Payment of Optional Repayment Amount. At least five Business Days prior to any Distribution Date during the Revolving Period, the Seller may direct the Trustee to use funds on deposit in the Series 1997-1 Trustee's Account, after payment of amounts due pursuant to Sections 5.01(a)(i) through 5.01 (a)(iii)(A) on such Distribution Date, as an Optional Repayment Amount. The Seller shall provide the Program Agent with ten Business Days prior written notice of the payment of any Optional Repayment Amount on a Distribution Date; provided, however, if the Series 1992-1 Certificates or the Series 1993-1 Certificates are outstanding, the Seller may not direct the Trustee to make an Optional Repayment Amount pursuant to this Section 4.07.

ARTICLE V Distributions and Reports to Series 1997-1 Certificateholders SECTION 5.01. Distributions. (a) During the Revolving Period, on the Distribution Date with respect to each Collection Period, the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account (including amounts deposited pursuant to Section 4.07 and Section 8.01) on such Distribution Date, in the following order of priority, in accordance with the Distribution Date Statement delivered pursuant to Section 5.02 (a): (i) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and any Service Transfer expenses incurred by a Successor Servicer which have not been paid by FederalMogul as the initial Servicer; (ii) to the Class A Certificateholders, ratably in accordance with their respective Undivided Fractional Interests: (A) for payment of accrued and unpaid Program Fees, Administration Fees and Other Fees other than Breakage Costs;

ARTICLE V Distributions and Reports to Series 1997-1 Certificateholders SECTION 5.01. Distributions. (a) During the Revolving Period, on the Distribution Date with respect to each Collection Period, the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account (including amounts deposited pursuant to Section 4.07 and Section 8.01) on such Distribution Date, in the following order of priority, in accordance with the Distribution Date Statement delivered pursuant to Section 5.02 (a): (i) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and any Service Transfer expenses incurred by a Successor Servicer which have not been paid by FederalMogul as the initial Servicer; (ii) to the Class A Certificateholders, ratably in accordance with their respective Undivided Fractional Interests: (A) for payment of accrued and unpaid Program Fees, Administration Fees and Other Fees other than Breakage Costs; (B) for payment of the Class A Monthly Interest, any Class A Monthly Interest previously due but not paid and any Class A Additional Interest; and (C) for payment of accrued and unpaid Breakage Costs; provided, however, if remaining funds on deposit in the Series 1997-1 Trustee's Account are not sufficient to fund all amounts due pursuant to clauses (a)(ii) (A), (B) and (C), the Class A Certificateholders shall apply such remaining funds pro rata to the amounts due pursuant to clauses (a)(ii)(A), (B) and (C); (iii) to the Class A Certificateholders: (A) for the payment of the Escrow Account Amount, if any, and the Coverage Amount, if any, and such amount shall be applied to reduce the Class A Invested Amount; (B) If the Class A Invested Amount is greater than the Class A Purchase Limit on such Distribution Date, remaining funds in the Series 1997-1 Trustee's Account shall be applied to reduce the Class A Invested Amount until the Class A Invested Amount equals the Class A Purchase Limit; and

(C) If the Seller elects to make an Optional Repayment pursuant to Section 4.07, the Optional Repayment Amount deposited to the Series 1997-1 Trustee's Account shall be applied to reduce the Class A Invested Amount. (iv) so long as Federal-Mogul is the Servicer, any remaining available funds up to the accrued and unpaid Monthly Servicing Fee to Federal-Mogul; and (v) the remainder to the Class B Certificateholders. (b) On each Distribution Date during the Amortization Period, the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account on such Distribution Date, in the following order of priority, in accordance with the Distribution Date Statement delivered pursuant to Section 5.02(a): (i) to the Class A Certificateholders any enforcement expenses due to the Class A Certificateholders; (ii) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and Service Transfer expenses incurred by a Successor Servicer which have not been paid by the initial Servicer;

(C) If the Seller elects to make an Optional Repayment pursuant to Section 4.07, the Optional Repayment Amount deposited to the Series 1997-1 Trustee's Account shall be applied to reduce the Class A Invested Amount. (iv) so long as Federal-Mogul is the Servicer, any remaining available funds up to the accrued and unpaid Monthly Servicing Fee to Federal-Mogul; and (v) the remainder to the Class B Certificateholders. (b) On each Distribution Date during the Amortization Period, the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account on such Distribution Date, in the following order of priority, in accordance with the Distribution Date Statement delivered pursuant to Section 5.02(a): (i) to the Class A Certificateholders any enforcement expenses due to the Class A Certificateholders; (ii) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and Service Transfer expenses incurred by a Successor Servicer which have not been paid by the initial Servicer; (iii) to the Class A Certificateholders ratably in accordance with their respective Undivided Fractional Interests: (A) for payment of the Class A Monthly Interest, any Class A Monthly Interest previously due but not paid and any Class A Additional Interest; (B) for payment of accrued and unpaid Breakage Costs; provided, however, if remaining funds on deposit in the Series 1997-1 Trustee's Account are not sufficient to fund all amounts due pursuant to clauses (b)(iii) (A) and (B), the Class A Certificateholders shall apply such remaining funds pro rata to the amounts due pursuant to clauses to clauses (b)(iii)(A) and (B); (iv) to the Class A Certificateholders for the payment of the Coverage Amount, if any, and such amount shall be applied to reduce the Class A Invested Amount; (v) to the Class A Certificateholders, ratably in accordance with their respective Undivided Fractional Interests, the Class A Controlled Amortization Amount in reduction of the Class A Invested Amount and any other amounts due the Class A Certificateholders under the Transaction Documents;

(vi) to the Class A Certificateholders for payment of accrued and unpaid Program Fees, Administration Fees and Other Fees (other than Breakage Costs); (vii) so long as Federal-Mogul is the Servicer, any remaining available funds up to the accrued and unpaid Monthly Servicing Fee to Federal-Mogul; and (viii) the remainder to the Class B Certificateholder. (c) On each Distribution Date during an Early Amortization Period and on the Distribution Dates referred to in Sections 9.01(b) and 9.02(a) hereof the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account on such Distribution Date in the following order of priority in accordance with the Distribution Date Statement delivered pursuant to Section 5.02(a): (i) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and any Service Transfer expenses incurred by a Successor Servicer which have not been paid by FederalMogul as the initial Servicer; (ii) to the Class A Certificateholders any enforcement expenses due to the Class A Certificateholders;

(vi) to the Class A Certificateholders for payment of accrued and unpaid Program Fees, Administration Fees and Other Fees (other than Breakage Costs); (vii) so long as Federal-Mogul is the Servicer, any remaining available funds up to the accrued and unpaid Monthly Servicing Fee to Federal-Mogul; and (viii) the remainder to the Class B Certificateholder. (c) On each Distribution Date during an Early Amortization Period and on the Distribution Dates referred to in Sections 9.01(b) and 9.02(a) hereof the Trustee shall distribute the funds on deposit in the Series 1997-1 Trustee's Account on such Distribution Date in the following order of priority in accordance with the Distribution Date Statement delivered pursuant to Section 5.02(a): (i) to the Servicer (if the Servicer is other than Federal-Mogul) the accrued and unpaid Monthly Servicing Fee and any Service Transfer expenses incurred by a Successor Servicer which have not been paid by FederalMogul as the initial Servicer; (ii) to the Class A Certificateholders any enforcement expenses due to the Class A Certificateholders; (iii) to the Class A Certificateholders, ratably in accordance with their respective Undivided Fractional Interests (A) for payment of accrued and unpaid Purchaser Fees, Administration Fees and Other Fees other than Breakage Costs, (B) for payment of Class A Monthly Interest, any Class A Monthly Interest previously due but not paid and any Class A Additional Interest; and (C) for payment of accrued and unpaid Breakage Costs;

If remaining funds on deposit in the Series 1997-1 Trustee's Account are not sufficient to fund all amounts due pursuant to clauses (c)(iii)(A), (B) and (C), the remaining funds shall be distributed to the Class A Certificateholders and the Class A Certificateholders shall apply such funds pro rata to the amounts due pursuant to clauses (c)(iii)(A), (B) and (C); (iv) to the reduction of the Class A Invested Amount until such Class A Invested Amount has been reduced to zero; and (v) the remainder, to the Class B Certificateholder until such Class B Invested Amount has been reduced to zero. Upon payment in full to all of the Series 1997-1 Certificateholders of the Invested Amount, all accrued and unpaid interest thereon and all other amounts due the Series 1997-1 Certificateholders under the Transaction Documents, payment in full to the Servicer of the Monthly Servicing Fee, and provided that no amounts are then due and unpaid to the Holders of any other outstanding Series, all amounts remaining on deposit in the Series 1997-1 Trustee's Account shall be distributed by the Trustee to the Holder of the Class B Certificate, and all amounts, if any, remaining in the Collection Account shall be distributed by the Trustee to the Holder of the Class B Certificate; provided, however, that if at any time after the payment that would have otherwise resulted in such payment in full, such payment is rescinded or must otherwise be returned for any reason, effective upon such rescission or return such payment in full shall automatically be deemed, as between the Series 1997-1 Certificateholders and the Class B Certificateholder, never to have occurred, and the Class B Certificateholder shall be required, to the extent it received any amounts under this Section 5.01, to remit to the Trustee an amount equal to the rescinded or returned payment. (d) Except as provided in Section 12.02 of the Agreement with respect to a final distribution, distributions to Series 1997-1 Certificateholders hereunder shall be made by check mailed to each Series 1997-1 Certificateholder at such Certificateholder's address appearing in the Certificate Register without presentation or surrender of any Series 1997-1 Certificate or the making of any notation thereon; provided, however, that distributions will be made by wire transfer of immediately available funds to the account of the Certificateholder

If remaining funds on deposit in the Series 1997-1 Trustee's Account are not sufficient to fund all amounts due pursuant to clauses (c)(iii)(A), (B) and (C), the remaining funds shall be distributed to the Class A Certificateholders and the Class A Certificateholders shall apply such funds pro rata to the amounts due pursuant to clauses (c)(iii)(A), (B) and (C); (iv) to the reduction of the Class A Invested Amount until such Class A Invested Amount has been reduced to zero; and (v) the remainder, to the Class B Certificateholder until such Class B Invested Amount has been reduced to zero. Upon payment in full to all of the Series 1997-1 Certificateholders of the Invested Amount, all accrued and unpaid interest thereon and all other amounts due the Series 1997-1 Certificateholders under the Transaction Documents, payment in full to the Servicer of the Monthly Servicing Fee, and provided that no amounts are then due and unpaid to the Holders of any other outstanding Series, all amounts remaining on deposit in the Series 1997-1 Trustee's Account shall be distributed by the Trustee to the Holder of the Class B Certificate, and all amounts, if any, remaining in the Collection Account shall be distributed by the Trustee to the Holder of the Class B Certificate; provided, however, that if at any time after the payment that would have otherwise resulted in such payment in full, such payment is rescinded or must otherwise be returned for any reason, effective upon such rescission or return such payment in full shall automatically be deemed, as between the Series 1997-1 Certificateholders and the Class B Certificateholder, never to have occurred, and the Class B Certificateholder shall be required, to the extent it received any amounts under this Section 5.01, to remit to the Trustee an amount equal to the rescinded or returned payment. (d) Except as provided in Section 12.02 of the Agreement with respect to a final distribution, distributions to Series 1997-1 Certificateholders hereunder shall be made by check mailed to each Series 1997-1 Certificateholder at such Certificateholder's address appearing in the Certificate Register without presentation or surrender of any Series 1997-1 Certificate or the making of any notation thereon; provided, however, that distributions will be made by wire transfer of immediately available funds to the account of the Certificateholder entitled thereto at a bank or other entity located in the United States of America having appropriate facilities therefor if such Certificateholder shall have so notified the Trustee in writing by the Record Date immediately prior to such Distribution Date and is the registered owner of Certificates in the initial aggregate principal amount equal to or in excess of $2,000,000.

SECTION 5.02. Reports and Statements to Series 1997-1 Certificateholders. (a) On or prior to the Determination Date, the Servicer will provide to the Trustee a Distribution Date Statement substantially in the form of Exhibit B and on each Distribution Date the Trustee shall forward to each Series 1997-1 Certificateholder the statement substantially in the form of Exhibit B prepared by the Servicer setting forth certain information relating to the Trust and the Series 1997-1 Certificates. (b) A copy of each statement provided pursuant to paragraph (a) will be made available for inspection at the Corporate Trust Office. (c) On or before January 31 of each calendar year, beginning with January 31, 1998, the Servicer shall provide to the Trustee and the Trustee shall forward or cause to be forwarded to each Person who at any time during the preceding calendar year was a Certificateholder, a statement prepared by the Servicer containing the information which is required to be contained in the Determination Date Statements provided to Certificateholders pursuant to Section 3.05(b) of the Agreement, aggregated for such calendar year or the applicable portion thereof during which such Person was a Certificateholder, together with other information as is required to be provided under the Internal Revenue Code and such other customary information as is necessary to enable the Certificateholders to prepare their tax returns. The obligation of the Servicer to provide such other information and such other customary information shall be deemed to have been satisfied to the extent that information substantially comparable to such other information and such other customary information shall be provided by the Trustee pursuant to any requirements of the Internal Revenue Code as from time to time in effect. SECTION 5.03. Quarterly Servicer's Certificate. The Servicer shall deliver to the Program Agent on or prior to the Determination Date occurring in the month immediately succeeding each of the first three calendar quarters of each year, an Officers' Certificate substantially in the form of Exhibit E stating that (a) a review of the activities of

SECTION 5.02. Reports and Statements to Series 1997-1 Certificateholders. (a) On or prior to the Determination Date, the Servicer will provide to the Trustee a Distribution Date Statement substantially in the form of Exhibit B and on each Distribution Date the Trustee shall forward to each Series 1997-1 Certificateholder the statement substantially in the form of Exhibit B prepared by the Servicer setting forth certain information relating to the Trust and the Series 1997-1 Certificates. (b) A copy of each statement provided pursuant to paragraph (a) will be made available for inspection at the Corporate Trust Office. (c) On or before January 31 of each calendar year, beginning with January 31, 1998, the Servicer shall provide to the Trustee and the Trustee shall forward or cause to be forwarded to each Person who at any time during the preceding calendar year was a Certificateholder, a statement prepared by the Servicer containing the information which is required to be contained in the Determination Date Statements provided to Certificateholders pursuant to Section 3.05(b) of the Agreement, aggregated for such calendar year or the applicable portion thereof during which such Person was a Certificateholder, together with other information as is required to be provided under the Internal Revenue Code and such other customary information as is necessary to enable the Certificateholders to prepare their tax returns. The obligation of the Servicer to provide such other information and such other customary information shall be deemed to have been satisfied to the extent that information substantially comparable to such other information and such other customary information shall be provided by the Trustee pursuant to any requirements of the Internal Revenue Code as from time to time in effect. SECTION 5.03. Quarterly Servicer's Certificate. The Servicer shall deliver to the Program Agent on or prior to the Determination Date occurring in the month immediately succeeding each of the first three calendar quarters of each year, an Officers' Certificate substantially in the form of Exhibit E stating that (a) a review of the activities of the Servicer during the preceding calendar quarter and of its performance under the Agreement and this Series Supplement was made under the supervision of the officer signing such certificate and (b) to the best of such officer's knowledge, based on such review, the Servicer has performed in all material respects its obligations under the Agreement and this Series Supplement throughout such quarter, or, if there has been a material default in the performance of any such obligation, specifying each such default known to such officer and the nature and status thereof.

SECTION 5.04. Weekly Report and Distribution. Notwithstanding any other provisions in the Agreement or this Series Supplement, upon the occurrence of an Early Amortization Event, the Program Agent, at its sole option, may provide a written notice to the Seller, the Servicer and the Trustee to the effect that the Servicer shall deliver a weekly report (the "Weekly Report") and distributions shall be made to the Class A Certificateholders on a weekly basis, in each case, as described below; provided, however, this Section 5.04 shall not apply if the Series 1992-1 Certificates or the Series 1993-1 Certificates are outstanding. Upon receipt of such notice, on Friday of each week, or if such day is not a Business Day, the next succeeding Business Day, the Servicer shall deliver the Weekly Report to the Trustee and the Program Agent. Each Weekly Report shall provide the following information: (i) the aggregate Collections deposited in the Collection Account during the current week, or the preceding week, as applicable, (ii) the aggregate amount of Receivables as of the date of the Weekly Report, and (iii) the amount to be distributed on the second Business Day immediately succeeding the date of such report (the "Weekly Distribution Date") for each line item in Section 5.01(c). On each Weekly Distribution Date the Trustee, in accordance with the Weekly Report delivered by the Servicer, shall make a distribution to the Class A Certificateholders pursuant to Section 5.01(c). The amounts to be distributed on each Weekly Distribution Date shall be a pro rata portion of the amounts specified in the Transaction Documents based upon the actual number of days in the preceding week and a 30-day month.

ARTICLE VI Amortization Events SECTION 6.01. Additional Early Amortization Events. The occurrence of any of the following events (each, an "Additional Early Amortization Event") and the expiration of any applicable grace period shall, immediately upon

SECTION 5.04. Weekly Report and Distribution. Notwithstanding any other provisions in the Agreement or this Series Supplement, upon the occurrence of an Early Amortization Event, the Program Agent, at its sole option, may provide a written notice to the Seller, the Servicer and the Trustee to the effect that the Servicer shall deliver a weekly report (the "Weekly Report") and distributions shall be made to the Class A Certificateholders on a weekly basis, in each case, as described below; provided, however, this Section 5.04 shall not apply if the Series 1992-1 Certificates or the Series 1993-1 Certificates are outstanding. Upon receipt of such notice, on Friday of each week, or if such day is not a Business Day, the next succeeding Business Day, the Servicer shall deliver the Weekly Report to the Trustee and the Program Agent. Each Weekly Report shall provide the following information: (i) the aggregate Collections deposited in the Collection Account during the current week, or the preceding week, as applicable, (ii) the aggregate amount of Receivables as of the date of the Weekly Report, and (iii) the amount to be distributed on the second Business Day immediately succeeding the date of such report (the "Weekly Distribution Date") for each line item in Section 5.01(c). On each Weekly Distribution Date the Trustee, in accordance with the Weekly Report delivered by the Servicer, shall make a distribution to the Class A Certificateholders pursuant to Section 5.01(c). The amounts to be distributed on each Weekly Distribution Date shall be a pro rata portion of the amounts specified in the Transaction Documents based upon the actual number of days in the preceding week and a 30-day month.

ARTICLE VI Amortization Events SECTION 6.01. Additional Early Amortization Events. The occurrence of any of the following events (each, an "Additional Early Amortization Event") and the expiration of any applicable grace period shall, immediately upon the occurrence thereof without notice or other action on the part of the Trustee or the Series 1997-1 Certificateholders, be deemed to be an Early Amortization Event solely with respect to Series 1997-1: (a) failure on the part of the Seller or the Servicer to make any transfer, deposit or payment required by the terms of the Agreement, this Series Supplement, the Certificate Purchase Agreement or any Receivables Purchase Agreement or to give notice to the Trustee to make such transfer, deposit or payment on or before the date such payment or deposit is due; (b) failure on the part of the Seller or the Servicer to observe or perform in any respect any material terms, covenants or agreements of the Seller or the Servicer under the Agreement, this Series Supplement, any Receivables Purchase Agreement, the Certificate Purchase Agreement or the Escrow Deposit Agreement, which failure continues unremedied for a period of ten Business Days after the earlier of (x) the date on which the Seller or the Servicer, as applicable, becomes aware of such failure and (y) the date on which written notice of such failure, requiring the same to be remedied, shall have been received by the Seller or the Servicer, as applicable; (c) any representation, warranty, certification or statement made by the Seller or the Servicer in the Agreement, this Series Supplement, any Receivables Purchase Agreement, the Certificate Purchase Agreement or the Escrow Deposit Agreement or which is contained in any Distribution Date Statement, certificate, document or financial or other statement furnished at any time under any of the foregoing agreements shall prove to have been incorrect in any material respect when made or deemed made and which continues for a period of 10 days; (d) [Confidential Treatment Requested]; (e) [Confidential Treatment Requested]; (f) [Confidential Treatment Requested];

(g) the Coverage Amount, if any, or the Escrow Account Amount, if any, relating to any Distribution Date is not paid to the Class A Certificateholders on the applicable Distribution Date; (h) the Class A Monthly Principal during the Amortization Period is not paid to the Class A Certificateholders on

ARTICLE VI Amortization Events SECTION 6.01. Additional Early Amortization Events. The occurrence of any of the following events (each, an "Additional Early Amortization Event") and the expiration of any applicable grace period shall, immediately upon the occurrence thereof without notice or other action on the part of the Trustee or the Series 1997-1 Certificateholders, be deemed to be an Early Amortization Event solely with respect to Series 1997-1: (a) failure on the part of the Seller or the Servicer to make any transfer, deposit or payment required by the terms of the Agreement, this Series Supplement, the Certificate Purchase Agreement or any Receivables Purchase Agreement or to give notice to the Trustee to make such transfer, deposit or payment on or before the date such payment or deposit is due; (b) failure on the part of the Seller or the Servicer to observe or perform in any respect any material terms, covenants or agreements of the Seller or the Servicer under the Agreement, this Series Supplement, any Receivables Purchase Agreement, the Certificate Purchase Agreement or the Escrow Deposit Agreement, which failure continues unremedied for a period of ten Business Days after the earlier of (x) the date on which the Seller or the Servicer, as applicable, becomes aware of such failure and (y) the date on which written notice of such failure, requiring the same to be remedied, shall have been received by the Seller or the Servicer, as applicable; (c) any representation, warranty, certification or statement made by the Seller or the Servicer in the Agreement, this Series Supplement, any Receivables Purchase Agreement, the Certificate Purchase Agreement or the Escrow Deposit Agreement or which is contained in any Distribution Date Statement, certificate, document or financial or other statement furnished at any time under any of the foregoing agreements shall prove to have been incorrect in any material respect when made or deemed made and which continues for a period of 10 days; (d) [Confidential Treatment Requested]; (e) [Confidential Treatment Requested]; (f) [Confidential Treatment Requested];

(g) the Coverage Amount, if any, or the Escrow Account Amount, if any, relating to any Distribution Date is not paid to the Class A Certificateholders on the applicable Distribution Date; (h) the Class A Monthly Principal during the Amortization Period is not paid to the Class A Certificateholders on the applicable Distribution Date; (i) if on any Distribution Date either (A) a Prior Series Deficiency exists pursuant to Section 4.01(c) hereof or (B) if there are no funds available in the Escrow Account to pay amounts then due and owing to the Series 1992-1 Certificates and Series 1993-1 Certificates as described in Section 4.01(d); (j) [Confidential Treatment Requested]; (k) for so long as the Funding Adjustment is equal to an amount greater than zero, the Servicer, for so long as Federal-Mogul is the Servicer, or any of its Subsidiaries shall (i) default in any payment or payments of principal or interest in an aggregate amount of more than $5,000,000 (or its equivalent in another currency) at any one time on any Indebtedness or in the payment of any Guaranty, beyond the period of grace (not to exceed 30 days), if any, provided in the instrument or agreement under which such Indebtedness or Guaranty was created; or (ii) default in the observance or performance of any other agreement or condition relating to any Indebtedness the principal amount of which exceeds $5,000,000 or any Guaranty guarantying Indebtedness the principal amount of which exceeds $5,000,000 or contained in any instrument or agreement evidencing, securing or relating to any such Indebtedness or Guaranty, beyond any applicable period of grace (not to exceed 30 days), or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit

(g) the Coverage Amount, if any, or the Escrow Account Amount, if any, relating to any Distribution Date is not paid to the Class A Certificateholders on the applicable Distribution Date; (h) the Class A Monthly Principal during the Amortization Period is not paid to the Class A Certificateholders on the applicable Distribution Date; (i) if on any Distribution Date either (A) a Prior Series Deficiency exists pursuant to Section 4.01(c) hereof or (B) if there are no funds available in the Escrow Account to pay amounts then due and owing to the Series 1992-1 Certificates and Series 1993-1 Certificates as described in Section 4.01(d); (j) [Confidential Treatment Requested]; (k) for so long as the Funding Adjustment is equal to an amount greater than zero, the Servicer, for so long as Federal-Mogul is the Servicer, or any of its Subsidiaries shall (i) default in any payment or payments of principal or interest in an aggregate amount of more than $5,000,000 (or its equivalent in another currency) at any one time on any Indebtedness or in the payment of any Guaranty, beyond the period of grace (not to exceed 30 days), if any, provided in the instrument or agreement under which such Indebtedness or Guaranty was created; or (ii) default in the observance or performance of any other agreement or condition relating to any Indebtedness the principal amount of which exceeds $5,000,000 or any Guaranty guarantying Indebtedness the principal amount of which exceeds $5,000,000 or contained in any instrument or agreement evidencing, securing or relating to any such Indebtedness or Guaranty, beyond any applicable period of grace (not to exceed 30 days), or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness or beneficiary or beneficiaries of such Guaranty (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or such Guaranty to become payable.

ARTICLE VII Additional Covenants SECTION 7.01. Covenants of the Servicer. The Servicer hereby covenants that, until the earlier of the termination of the Amortization Period or the Early Amortization Period: (a) The Servicer will furnish the report required pursuant to Section 5.02. (b) The Servicer will furnish to the Program Agent, for the benefit of the Class A Certificateholders and the Liquidity Providers, all other periodic reports, opinions and statements required to be delivered pursuant to the Agreement. (c) Financial Reporting. The Servicer, for so long as Federal-Mogul is the Servicer, shall maintain, for itself and each of its Subsidiaries, a system of accounting established and administered in accordance with generally accepted accounting principles, and furnish to the Program Agent: (i) Annual Reporting. Within 95 days after the close of each fiscal year of the Servicer an audit report not qualified for anything under the control of the Servicer, certified by independent public accountants acceptable to the Program Agent (which until the Program Agent notifies the Servicer in writing to the contrary may be Ernst & Young llp, public accounts), prepared in accordance with generally accepted accounting principles on a consolidated basis for the Servicer and its Subsidiaries including consolidated balance sheets as of the end of such period, and related profit and loss and reconciliation of the surplus statements. (ii) Quarterly Reporting. Within 50 days after the close of the first three quarterly periods of each fiscal year of the Servicer, for the Servicer and its Subsidiaries, consolidated unaudited balance sheets as at the close of each such period and consolidated profit and loss and reconciliation of surplus statements for the period beginning from the beginning of such fiscal year to the end of such quarter.

ARTICLE VII Additional Covenants SECTION 7.01. Covenants of the Servicer. The Servicer hereby covenants that, until the earlier of the termination of the Amortization Period or the Early Amortization Period: (a) The Servicer will furnish the report required pursuant to Section 5.02. (b) The Servicer will furnish to the Program Agent, for the benefit of the Class A Certificateholders and the Liquidity Providers, all other periodic reports, opinions and statements required to be delivered pursuant to the Agreement. (c) Financial Reporting. The Servicer, for so long as Federal-Mogul is the Servicer, shall maintain, for itself and each of its Subsidiaries, a system of accounting established and administered in accordance with generally accepted accounting principles, and furnish to the Program Agent: (i) Annual Reporting. Within 95 days after the close of each fiscal year of the Servicer an audit report not qualified for anything under the control of the Servicer, certified by independent public accountants acceptable to the Program Agent (which until the Program Agent notifies the Servicer in writing to the contrary may be Ernst & Young llp, public accounts), prepared in accordance with generally accepted accounting principles on a consolidated basis for the Servicer and its Subsidiaries including consolidated balance sheets as of the end of such period, and related profit and loss and reconciliation of the surplus statements. (ii) Quarterly Reporting. Within 50 days after the close of the first three quarterly periods of each fiscal year of the Servicer, for the Servicer and its Subsidiaries, consolidated unaudited balance sheets as at the close of each such period and consolidated profit and loss and reconciliation of surplus statements for the period beginning from the beginning of such fiscal year to the end of such quarter. (ii) Securities and Exchange Commission Filings. Promptly upon the filing thereof, copies of all registration statements and annual, quarterly, monthly or other regular reports which the Servicer or any of its Subsidiaries files with the Securities and Exchange Commission.

(d) Notices. The Servicer shall promptly notify the Program Agent and the Trustee in writing of any of the following immediately upon learning of the occurrence thereof, describing the same, and if applicable, the steps being taken with respect thereto; (i) the occurrence of each Servicer Default, or any event or condition with notice or the lapse of time or both would constitute a Servicer Default, by a statement of the corporate comptroller or senior financial officer of the Servicer, and (ii) the entry of any judgment or decree against the Servicer or any of its Subsidiaries if the aggregate amount of all judgments and decrees therein outstanding against the Servicer exceeds $1,000,000. SECTION 7.02. Confidentiality. The Seller, Federal-Mogul, the Trustee, and the Series 1997-1 Certificateholders agree to use their best efforts, and shall cause their agents or representatives to use their best efforts, to hold in confidence all Confidential Information; provided that nothing herein shall prevent the Trustee or any Series 1997-1 Certificateholder from delivering copies of any financial statements and other documents constituting Confidential Information, or disclosing any other Confidential Information, to (i) such Series 1997-1 Certificateholder's, Falcon's or any Liquidity Provider's directors, officers, employees, agents, accountants, professional consultants and enhancement providers, (ii) any other Series 1997-1 Certificateholder, (iii) Falcon, any Liquidity Provider, Enhancement Provider or any Person to which such Series 1997-1 Certificateholder offers to sell or assign or sells or assigns such Series 1997-1 Certificate or any part thereof or any rights associated therewith, provided that Falcon, such Liquidity Provider, Enhancement Provider or Person shall have agreed to hold in confidence all Confidential Information, (iv) any federal or state regulatory authority having jurisdiction over such Series 1997-1 Certificateholder, Falcon or any Liquidity Provider, (v) the National Association of Insurance Commissioners or any similar organization or any nationally recognized rating agency that requires access to such Series 1997-1 Certificateholder's investment portfolio, Falcon's investment portfolio and any Liquidity Provider's investment portfolio, or

(d) Notices. The Servicer shall promptly notify the Program Agent and the Trustee in writing of any of the following immediately upon learning of the occurrence thereof, describing the same, and if applicable, the steps being taken with respect thereto; (i) the occurrence of each Servicer Default, or any event or condition with notice or the lapse of time or both would constitute a Servicer Default, by a statement of the corporate comptroller or senior financial officer of the Servicer, and (ii) the entry of any judgment or decree against the Servicer or any of its Subsidiaries if the aggregate amount of all judgments and decrees therein outstanding against the Servicer exceeds $1,000,000. SECTION 7.02. Confidentiality. The Seller, Federal-Mogul, the Trustee, and the Series 1997-1 Certificateholders agree to use their best efforts, and shall cause their agents or representatives to use their best efforts, to hold in confidence all Confidential Information; provided that nothing herein shall prevent the Trustee or any Series 1997-1 Certificateholder from delivering copies of any financial statements and other documents constituting Confidential Information, or disclosing any other Confidential Information, to (i) such Series 1997-1 Certificateholder's, Falcon's or any Liquidity Provider's directors, officers, employees, agents, accountants, professional consultants and enhancement providers, (ii) any other Series 1997-1 Certificateholder, (iii) Falcon, any Liquidity Provider, Enhancement Provider or any Person to which such Series 1997-1 Certificateholder offers to sell or assign or sells or assigns such Series 1997-1 Certificate or any part thereof or any rights associated therewith, provided that Falcon, such Liquidity Provider, Enhancement Provider or Person shall have agreed to hold in confidence all Confidential Information, (iv) any federal or state regulatory authority having jurisdiction over such Series 1997-1 Certificateholder, Falcon or any Liquidity Provider, (v) the National Association of Insurance Commissioners or any similar organization or any nationally recognized rating agency that requires access to such Series 1997-1 Certificateholder's investment portfolio, Falcon's investment portfolio and any Liquidity Provider's investment portfolio, or (vi) any other Person to which such delivery or disclosure may be necessary or appropriate (a) in compliance with any law, rule, regulation or order applicable to such Series 1997-1 Certificateholder, Falcon or any Liquidity Provider, (b) in response to any subpoena or other legal process or (c) in connection with any litigation to which such Series 1997-1 Certificateholder, Falcon or any Liquidity Provider is a party or (vii) if any Early Amortization Event has occurred and is continuing, to the extent such Series 1997-1 Certificateholder may reasonably determine that such delivery and disclosure is necessary or appropriate in the enforcement or for the protection of the rights and remedies under the Series 1997-1 Certificates, this Series Supplement or the Agreement. The Trustee and the

Series 1997-1 Certificateholders agree to allow the Seller to inspect their security and confidentiality arrangements from time to time during normal business hours. The Trustee and the Series 1997-1 Certificateholders shall provide written notice to the Seller whenever any such disclosure is made. The Trustee and the Series 1997-1 Certificateholders shall use their best efforts to provide the Seller with five day's advance notice of any disclosure pursuant to clause (vi) of this Section 7.02. SECTION 7.03. Receivables Purchase Agreement. (a) The Seller agrees to provide the Program Agent with copies of the following documents: (i) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in Section 2.02 and 2.03(b) of each Receivables Purchase Agreement; (ii) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in Section 2.03(c) of each Receivables Purchase Agreement; (iii) the Seller shall promptly provide the Program Agent with a copy of the Officer's Certificate and the Opinion of Counsel specified in Section 5.01(b) of each Receivables Purchase Agreement; (iv) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in the penultimate sentence of Article VI of each Receivables Purchase Agreement; (v) the Seller shall promptly provide the Program Agent with a copy of the Opinion of Counsel specified in Section 7.01(a) and 7.01(b) of each Receivables Purchase Agreement;

Series 1997-1 Certificateholders agree to allow the Seller to inspect their security and confidentiality arrangements from time to time during normal business hours. The Trustee and the Series 1997-1 Certificateholders shall provide written notice to the Seller whenever any such disclosure is made. The Trustee and the Series 1997-1 Certificateholders shall use their best efforts to provide the Seller with five day's advance notice of any disclosure pursuant to clause (vi) of this Section 7.02. SECTION 7.03. Receivables Purchase Agreement. (a) The Seller agrees to provide the Program Agent with copies of the following documents: (i) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in Section 2.02 and 2.03(b) of each Receivables Purchase Agreement; (ii) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in Section 2.03(c) of each Receivables Purchase Agreement; (iii) the Seller shall promptly provide the Program Agent with a copy of the Officer's Certificate and the Opinion of Counsel specified in Section 5.01(b) of each Receivables Purchase Agreement; (iv) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in the penultimate sentence of Article VI of each Receivables Purchase Agreement; (v) the Seller shall promptly provide the Program Agent with a copy of the Opinion of Counsel specified in Section 7.01(a) and 7.01(b) of each Receivables Purchase Agreement; (vi) the Seller shall promptly give the Program Agent the notice specified in Section 7.02(b) of each Receivables Purchase Agreement and shall promptly deliver to the Program Agent copies of stamped receipt financing statements or amendments, as applicable, specified in such Section 7.02(b); and (vii) the Seller shall promptly provide the Program Agent with a copy of the written notice specified in Section 7.02(c) of each Receivables Purchase Agreement and shall promptly deliver to the Program Agent copies of the stamped receipt financing statements or amendments, as applicable, specified in such Section 7.02 (c). (b) the Seller shall not amend any Receivables Purchase Agreement without the prior written consent of the Program Agent.

(c) The Seller shall not (i) cancel or terminate any Receivables Purchase Agreement or consent to or accept any cancellation or termination thereof, (ii) give any consent, waiver or approval under any Receivables Purchase Agreement, (iii) waive any default under or breach of any Receivables Purchase Agreement or (iv) take any other action under any Receivables Purchase Agreement not required by the terms thereof, in each case, to the extent that it would impair the value of any Trust Asset or adversely affect the rights or interests of the Seller thereunder without the prior written consent of the Program Agent. (d) In connection with an amendment to any Receivables Purchase Agreement pursuant to Section 7.01(a) or 7.01(b) of each Receivables Purchase Agreement, the Seller shall promptly provide a copy of such amendment to the Program Agent. (e) The Trustee shall not consent to a Receivables Seller's assignment of its rights under any Receivables Purchase Agreement pursuant to Section 7.08 thereof without the prior written consent of the Program Agent. (f) The Seller shall not enter into any new Receivables Purchase Agreement on or after the Closing Date without the prior written consent of the Program Agent. SECTION 7.04. Pooling and Servicing Agreement. (a) The Seller agrees to promptly provide the Program Agent with the following information and copies of the following documents (all references to Sections in this

(c) The Seller shall not (i) cancel or terminate any Receivables Purchase Agreement or consent to or accept any cancellation or termination thereof, (ii) give any consent, waiver or approval under any Receivables Purchase Agreement, (iii) waive any default under or breach of any Receivables Purchase Agreement or (iv) take any other action under any Receivables Purchase Agreement not required by the terms thereof, in each case, to the extent that it would impair the value of any Trust Asset or adversely affect the rights or interests of the Seller thereunder without the prior written consent of the Program Agent. (d) In connection with an amendment to any Receivables Purchase Agreement pursuant to Section 7.01(a) or 7.01(b) of each Receivables Purchase Agreement, the Seller shall promptly provide a copy of such amendment to the Program Agent. (e) The Trustee shall not consent to a Receivables Seller's assignment of its rights under any Receivables Purchase Agreement pursuant to Section 7.08 thereof without the prior written consent of the Program Agent. (f) The Seller shall not enter into any new Receivables Purchase Agreement on or after the Closing Date without the prior written consent of the Program Agent. SECTION 7.04. Pooling and Servicing Agreement. (a) The Seller agrees to promptly provide the Program Agent with the following information and copies of the following documents (all references to Sections in this Section 7.04 refer to Sections in Agreement): (i) notice of Liens as specified to Section 2.05(c); (ii) the Termination Notice specified in Section 2.07(b)(i); (iii) the Officer's Certificate specified in Section 6.03(c)(i); (iv) the written notice specified in the first sentence of Section 9.02(a); (v) the Opinion of Counsel specified in Sections 11.01(g), 13.01(a), 13.01(b) and 13.01(g); and (vi) copies of stamped receipt financing statements or amendments, as applicable, that have been filed pursuant to Section 13.02(b) and 13.02(c).

(b) The Servicer agrees to promptly provide the Program Agent with copies of the following documents; (i) the Distribution Date Statement specified in Section 3.04(a) for each Distribution Date; (ii) the Officer's Certificate and Opinion of Counsel specified in Section 8.02(b); (iii) the Opinion of Counsel specified in Section 8.05; and (iv) copies of stamped receipt financing statements or amendments, as applicable, that have been filed pursuant to Section 13.02(b) and 13.02(c). (c) The Trustee agrees to promptly provide the Program Agent with copies of the following documents: (i) the written notice specified in Section 2.04(c), 3.03(b), 3.03(c), 9.01(c), 9.01(d), 10.01(b) and 10.01(c); and (ii) the Termination Notice specified in Section 10.01. (d) The following actions shall not be taken by the Seller, the Servicer or the Trustee, as applicable, without the prior written consent of the Program Agent:

(b) The Servicer agrees to promptly provide the Program Agent with copies of the following documents; (i) the Distribution Date Statement specified in Section 3.04(a) for each Distribution Date; (ii) the Officer's Certificate and Opinion of Counsel specified in Section 8.02(b); (iii) the Opinion of Counsel specified in Section 8.05; and (iv) copies of stamped receipt financing statements or amendments, as applicable, that have been filed pursuant to Section 13.02(b) and 13.02(c). (c) The Trustee agrees to promptly provide the Program Agent with copies of the following documents: (i) the written notice specified in Section 2.04(c), 3.03(b), 3.03(c), 9.01(c), 9.01(d), 10.01(b) and 10.01(c); and (ii) the Termination Notice specified in Section 10.01. (d) The following actions shall not be taken by the Seller, the Servicer or the Trustee, as applicable, without the prior written consent of the Program Agent: (i) engage in any activity specified in Section 2.05(e)(vi); (ii) terminate the sale to the Trust of Receivables relating to any Obligor pursuant to Section 2.07; (iii) take any of the action specified under Section 2.05(f) through 2.05(j); (iv) delegate the duties of the Servicer pursuant to Section 3.01(a); (v) surrender the FMFC Certificate in exchange for a Supplemental Certificate pursuant to Section 6.03(c); (vi) delegate the duties of the Servicer pursuant to Section 8.07;

(vii) enter into an intercreditor agreement pursuant to Section 11.01(g); and (viii) enter into any amendments pursuant to Section 13.01(a) or 13.01(b). (e) The Trustee shall promptly provide the Program Agent with a copy of any amendment entered into pursuant to Section 13.01(a) or 13.01(b). (f) For so long as Federal-Mogul is acting in its capacity as Servicer, the Servicer shall provide the Program Agent and the Trustee, promptly after the same are available, copies of all proxy statements, financial statements and reports as the Servicer shall send or make available generally to any of its public security holders, and copies of all regular and period reports and of all registration statements which the Servicer may file with the Securities and Exchange Commission or with any securities exchange. SECTION 7.05. Inspection Rights. Each of the Seller and the Servicer shall provide the Program Agent, and any of its agents and representatives, with access to (x) any books, records, files and documents (including, without limitation, computer tapes and discs) relating to the Receivables Purchase Agreement, the Receivables and the servicing of the Receivables and the Program Agent and such representatives and agents shall be permitted to make copies of and abstracts from the foregoing and (y) the officers, directors and auditors of the Seller and Servicer, as applicable, to discuss the business and operations of the Seller and the Servicer, as applicable, relating to the Receivables Purchase Agreement and the Receivables and the Seller's and Servicer's, as

(vii) enter into an intercreditor agreement pursuant to Section 11.01(g); and (viii) enter into any amendments pursuant to Section 13.01(a) or 13.01(b). (e) The Trustee shall promptly provide the Program Agent with a copy of any amendment entered into pursuant to Section 13.01(a) or 13.01(b). (f) For so long as Federal-Mogul is acting in its capacity as Servicer, the Servicer shall provide the Program Agent and the Trustee, promptly after the same are available, copies of all proxy statements, financial statements and reports as the Servicer shall send or make available generally to any of its public security holders, and copies of all regular and period reports and of all registration statements which the Servicer may file with the Securities and Exchange Commission or with any securities exchange. SECTION 7.05. Inspection Rights. Each of the Seller and the Servicer shall provide the Program Agent, and any of its agents and representatives, with access to (x) any books, records, files and documents (including, without limitation, computer tapes and discs) relating to the Receivables Purchase Agreement, the Receivables and the servicing of the Receivables and the Program Agent and such representatives and agents shall be permitted to make copies of and abstracts from the foregoing and (y) the officers, directors and auditors of the Seller and Servicer, as applicable, to discuss the business and operations of the Seller and the Servicer, as applicable, relating to the Receivables Purchase Agreement and the Receivables and the Seller's and Servicer's, as applicable, performance under this Series Supplement and the Agreement, but only (i) upon reasonable request, (ii) during normal business hours, (iii) subject to the Seller's or the Servicer's normal security and confidentiality procedures and (iv) at reasonably accessible offices designated by the Seller or the Servicer. SECTION 7.06. Final Payment with respect to Series 1997-1 Certificates. Notwithstanding any provisions in this Series Supplement or the Agreement to the contrary, the Class A Certificateholders that are the Program Agent, insurance companies or institutional investors shall not be required to present and surrender their Class A Certificates prior to receiving final payments on such Certificates; provided, however, that by acceptance of such final payment, the Class A Certificateholders shall be deemed to represent, warrant and covenant to the Seller, the Trustee and the Trust that it has not transferred, sold or assigned, and shall not transfer, sell or assign, such Class A Certificate or any interest therein to another Person and that it shall deliver such Certificate to the Trustee upon the request of the Trustee or the Seller.

SECTION 7.07. Covenants of the Seller. The Seller hereby covenants that: (a) Preservation of Corporate Existence. The Seller shall preserve and maintain its corporate existence other than as permitted in the Agreement, rights, franchises and privileges in the jurisdiction of its formation, and qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where the failure to maintain such qualification would materially adversely affect (i) the interests of the Trustee or of the Series 1997-1 Certificateholders hereunder or in the Trust Assets, (ii) the collectibility of the Receivables or (iii) the ability of the Seller to perform its obligations hereunder or under any Receivables Purchase Agreement in any material respect. (b) Keeping of Records and Books of Account. The Seller shall (i) keep proper books of record and accounts, which shall be maintained or caused to be maintained by the Seller, and in which full correct entries shall be made of all financial transactions and the assets and business of the Seller in accordance with generally accepted accounting principles consistently applied, and (ii) maintain and implement administrative and operating procedures (including, without limitation, an ability to recreate records evidencing the Receivables in the event of the destruction of the originals thereof) and keep and maintain all documents, books, records and other information reasonably necessary or advisable for the collection of all Receivables (including, without limitation, records adequate to permit the daily identification of each new Receivable and all Collections on Receivables and the monthly identification of adjustments to each existing Receivable). The Seller shall give the Program Agent notice of any material change in the administrative and operating procedures referred to in the preceding sentence.

SECTION 7.07. Covenants of the Seller. The Seller hereby covenants that: (a) Preservation of Corporate Existence. The Seller shall preserve and maintain its corporate existence other than as permitted in the Agreement, rights, franchises and privileges in the jurisdiction of its formation, and qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where the failure to maintain such qualification would materially adversely affect (i) the interests of the Trustee or of the Series 1997-1 Certificateholders hereunder or in the Trust Assets, (ii) the collectibility of the Receivables or (iii) the ability of the Seller to perform its obligations hereunder or under any Receivables Purchase Agreement in any material respect. (b) Keeping of Records and Books of Account. The Seller shall (i) keep proper books of record and accounts, which shall be maintained or caused to be maintained by the Seller, and in which full correct entries shall be made of all financial transactions and the assets and business of the Seller in accordance with generally accepted accounting principles consistently applied, and (ii) maintain and implement administrative and operating procedures (including, without limitation, an ability to recreate records evidencing the Receivables in the event of the destruction of the originals thereof) and keep and maintain all documents, books, records and other information reasonably necessary or advisable for the collection of all Receivables (including, without limitation, records adequate to permit the daily identification of each new Receivable and all Collections on Receivables and the monthly identification of adjustments to each existing Receivable). The Seller shall give the Program Agent notice of any material change in the administrative and operating procedures referred to in the preceding sentence. (c) Payment of Taxes, Etc. The Seller shall pay promptly when due all taxes, assessments and governmental charges or levies imposed upon it or any Trust Asset, or in respect of its income or profits therefrom, and any and all claims of any kind (including, without limitation, claims for labor, materials and supplies), except that no such amount need be paid if (i) such nonpayment is not reasonably likely to subject the Trustee, the Trust or any Series 1997-1 Certificateholder to civil or criminal penalty or liability or involve any material risk of the sale, forfeiture or loss of any of the property, rights or

interests covered hereunder or under any Receivables Purchase Agreement, (ii) the charge or levy is being contested in good faith and by proper proceedings and (iii) the obligation to pay such amount is adequately reserved against in accordance with and to the extent required by generally accepted accounting principles. (d) Reporting Requirements. The Seller shall furnish to the Trustee and the Program Agent: (i) as soon as possible and in any event (A) within two Business Days after becoming aware of the occurrence of each Early Amortization Event, and each event which, with the giving of notice or lapse of time or both, would constitute an Early Amortization Event, the statement of the chief administrative and credit officer of the Seller setting forth details of such Early Amortization Event commencement or event and the action which the Seller has taken and proposes to take with respect thereto, and (B) within two Business Days after the occurrence thereof, notice of any other event, development or information which is reasonably likely to materially adversely effect the ability of the Seller to perform its obligations under this Series Supplement, the Agreement or any Receivables Purchase Agreement; and (ii) promptly, from time to time, such other information, documents, records or reports with respect to the Receivables, the other Trust Assets or the condition or operations, financial or otherwise, of the Seller as the Trustee or the Program Agent may from time to time reasonably request. (e) Activities of the Seller. The Seller shall not engage in, enter into or be a party to any business, activity or transaction of any kind other than the business, activities and transactions contemplated and authorized by this Series Supplement, the Agreement or any Receivables Purchase Agreement or any document related hereto or thereto. (f) Indebtedness. Except as provided in this Series Supplement, the Agreement or in any Receivables Purchase Agreement, the Seller shall not create, incur or assume any indebtedness (other than operating expenses incurred in the performance of its obligations under this Series Supplement, the Agreement or any Receivables Purchase Agreement) or sell or transfer any receivables to a trust or other Person which issues securities in respect of any

interests covered hereunder or under any Receivables Purchase Agreement, (ii) the charge or levy is being contested in good faith and by proper proceedings and (iii) the obligation to pay such amount is adequately reserved against in accordance with and to the extent required by generally accepted accounting principles. (d) Reporting Requirements. The Seller shall furnish to the Trustee and the Program Agent: (i) as soon as possible and in any event (A) within two Business Days after becoming aware of the occurrence of each Early Amortization Event, and each event which, with the giving of notice or lapse of time or both, would constitute an Early Amortization Event, the statement of the chief administrative and credit officer of the Seller setting forth details of such Early Amortization Event commencement or event and the action which the Seller has taken and proposes to take with respect thereto, and (B) within two Business Days after the occurrence thereof, notice of any other event, development or information which is reasonably likely to materially adversely effect the ability of the Seller to perform its obligations under this Series Supplement, the Agreement or any Receivables Purchase Agreement; and (ii) promptly, from time to time, such other information, documents, records or reports with respect to the Receivables, the other Trust Assets or the condition or operations, financial or otherwise, of the Seller as the Trustee or the Program Agent may from time to time reasonably request. (e) Activities of the Seller. The Seller shall not engage in, enter into or be a party to any business, activity or transaction of any kind other than the business, activities and transactions contemplated and authorized by this Series Supplement, the Agreement or any Receivables Purchase Agreement or any document related hereto or thereto. (f) Indebtedness. Except as provided in this Series Supplement, the Agreement or in any Receivables Purchase Agreement, the Seller shall not create, incur or assume any indebtedness (other than operating expenses incurred in the performance of its obligations under this Series Supplement, the Agreement or any Receivables Purchase Agreement) or sell or transfer any receivables to a trust or other Person which issues securities in respect of any such receivables. (g) Investments. The Seller shall not make or suffer to exist any loans or advances to, or extend any credit to, or make any investments (by way of transfer of property,

contributions to capital, purchase of stock or securities or evidences of indebtedness, acquisition of the business or assets or otherwise) in, any Affiliate or any other Person except for purchase of Receivables pursuant to the terms of the Receivables Purchase Agreement and investments in Eligible Investments in accordance with the terms of the Agreement. (h) Organization. The Seller shall not amend its amended and restated articles of incorporation or bylaws without the prior written consent of the Program Agent. (i) Marking Books and Records. The Seller shall on or prior to the date hereof, at its own expense, mark its master date processing records and other books and records relating to the Receivables to indicate that the Receivables have been transferred to the Trust pursuant to the Agreement for the benefit of the Investor Certificateholders. SECTION 7.08. Credit Policies. The Seller and the Servicer shall timely and fully (i) perform and comply with all provisions and covenants and other promises required to be observed by it under terms of such Receivable and (ii) comply in all material respects with the credit and collection policies and procedures in effect on the date hereof (the "Credit Policies") with respect to the Receivables, a copy of which is attached hereto as Exhibit F. Neither the Seller nor the Servicer shall amend, modify or supplement the Credit Policies in any material adverse respect without the prior written consent of the Program Agent, which consent shall not be unreasonably withheld. Upon any amendment, modification or supplement to the Credit Policies consented to by the Program Agent, the Seller shall deliver to the parties hereto and the Class A Certificateholders such amendment, modification or supplement and Exhibit F shall be deemed to be amended by such amendment, modification or supplement.

contributions to capital, purchase of stock or securities or evidences of indebtedness, acquisition of the business or assets or otherwise) in, any Affiliate or any other Person except for purchase of Receivables pursuant to the terms of the Receivables Purchase Agreement and investments in Eligible Investments in accordance with the terms of the Agreement. (h) Organization. The Seller shall not amend its amended and restated articles of incorporation or bylaws without the prior written consent of the Program Agent. (i) Marking Books and Records. The Seller shall on or prior to the date hereof, at its own expense, mark its master date processing records and other books and records relating to the Receivables to indicate that the Receivables have been transferred to the Trust pursuant to the Agreement for the benefit of the Investor Certificateholders. SECTION 7.08. Credit Policies. The Seller and the Servicer shall timely and fully (i) perform and comply with all provisions and covenants and other promises required to be observed by it under terms of such Receivable and (ii) comply in all material respects with the credit and collection policies and procedures in effect on the date hereof (the "Credit Policies") with respect to the Receivables, a copy of which is attached hereto as Exhibit F. Neither the Seller nor the Servicer shall amend, modify or supplement the Credit Policies in any material adverse respect without the prior written consent of the Program Agent, which consent shall not be unreasonably withheld. Upon any amendment, modification or supplement to the Credit Policies consented to by the Program Agent, the Seller shall deliver to the parties hereto and the Class A Certificateholders such amendment, modification or supplement and Exhibit F shall be deemed to be amended by such amendment, modification or supplement. SECTION 7.09. New Series Issued. The Seller shall not cause to be issued any new Series of Investor Certificates pursuant to Section 6.03 of the Agreement without the prior written consent of the Program Agent. ARTICLE VIII Termination SECTION 8.01. Optional Repurchase. In addition to the payment of any Optional Repayment Amounts pursuant to Section 4.07, the Seller shall have the option, on any Distribution Date on which the Class A Invested Amount is $10,000,000 or less, to

purchase the entire Class A Certificateholders' Interest, by depositing to the Series 1997-1 Trustee's Account on such Distribution Date in immediately available funds not later than 12:00 noon, New York City time, a purchase price (determined after giving effect to any payment of principal and interest on such Distribution Date) equal to the sum of (i) the Class A Invested Amount on such Distribution Date, plus (ii) the amount of Class A Monthly Interest relating to such Distribution Date and any Class A Monthly Interest previously due and not paid and any Class A Additional Interest, plus (iii) the amount of any accrued and unpaid Program Fees, Administration Fees, Other Fees and Breakage Costs, plus (iv) the amount of accrued and unpaid Monthly Servicing Fee as of such Distribution Date, plus (v) all other amounts owing to the Class A Certificateholders under any Transaction Document (such purchase price being the "Repurchase Price"); provided, however, if the Series 1992-1 Certificates or the Series 1993-1 Certificates are outstanding, the Seller may not make such Optional Repurchase pursuant to this Section 4.07. The Seller shall give the Servicer, the Trustee and the Class A Certificateholders at least ten days prior written notice of the date on which the Seller intends to exercise such option to purchase. The funds deposited to the Series 1997-1 Trustee's Account as payment of the Repurchase Price shall be allocated and distributed pursuant to Article V with the other Series 1997-1 Collections received during the Collection Period preceding such Distribution Date. ARTICLE IX Final Distributions SECTION 9.01. Sale of Certificateholders, Interest Pursuant to Section 2.03 of the Agreement; Distributions

purchase the entire Class A Certificateholders' Interest, by depositing to the Series 1997-1 Trustee's Account on such Distribution Date in immediately available funds not later than 12:00 noon, New York City time, a purchase price (determined after giving effect to any payment of principal and interest on such Distribution Date) equal to the sum of (i) the Class A Invested Amount on such Distribution Date, plus (ii) the amount of Class A Monthly Interest relating to such Distribution Date and any Class A Monthly Interest previously due and not paid and any Class A Additional Interest, plus (iii) the amount of any accrued and unpaid Program Fees, Administration Fees, Other Fees and Breakage Costs, plus (iv) the amount of accrued and unpaid Monthly Servicing Fee as of such Distribution Date, plus (v) all other amounts owing to the Class A Certificateholders under any Transaction Document (such purchase price being the "Repurchase Price"); provided, however, if the Series 1992-1 Certificates or the Series 1993-1 Certificates are outstanding, the Seller may not make such Optional Repurchase pursuant to this Section 4.07. The Seller shall give the Servicer, the Trustee and the Class A Certificateholders at least ten days prior written notice of the date on which the Seller intends to exercise such option to purchase. The funds deposited to the Series 1997-1 Trustee's Account as payment of the Repurchase Price shall be allocated and distributed pursuant to Article V with the other Series 1997-1 Collections received during the Collection Period preceding such Distribution Date. ARTICLE IX Final Distributions SECTION 9.01. Sale of Certificateholders, Interest Pursuant to Section 2.03 of the Agreement; Distributions Pursuant to Section 2.03 or 12.02(c) of the Agreement. (a) The amount to be paid by the Seller to the Collection Account with respect to Series 1997-1 in connection with a purchase of the Certificateholders' Interest pursuant to Section 2.03 of the Agreement shall equal the Reassignment Amount for the Distribution Date on which such repurchase occurs. (b) With respect to the Reassignment Amount deposited into the Collection Account pursuant to this Section 9.01 of this Series Supplement or Section 2.03 of the Agreement or any Termination Proceeds deposited into the Collection Account pursuant to Section 12.02(c) of the Agreement, the Trustee shall, not later than 12:00 noon, New York City time, on the Distribution Date on which such amounts are deposited (or, if such date is not a Distribution Date, on the immediately following Distribution Date) (in accordance with the Distribution Date Statement delivered pursuant to Section 5.02 and in the priority set forth below) deposit the Reassignment Amount or the Termination Proceeds into the Series 1997-1 Trustee's Account and distribute such amounts on the applicable Distribution Date in accordance with Section 5.01(c) hereof

(c) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the entire amount deposited in the Series 1997-1 Trustee's Account pursuant to Section 9.01 and all other amounts on deposit therein shall be distributed in full to the Series 1997-1 Certificateholders on such date and any distribution made pursuant to paragraph (b) above shall be deemed to be a final distribution pursuant to Section 12.02 of the Agreement with respect to Series 1997-1. SECTION 9.02. Distribution of Proceeds of Sale, Disposition or Liquidation of the Receivables Pursuant to Section 9.02 of the Agreement. (a) Not later than 12:00 noon, New York City time, on the Distribution Date following the date on which the Insolvency Proceeds are deposited into the Collection Account pursuant to Section 9.02(b) of the Agreement, the Trustee shall deposit the Insolvency Proceeds into the Series 1997-1 Trustee's Account and distribute such amount on the applicable Distribution Date in accordance with Section 5.01(c) hereof. (b) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the entire amount deposited in the Series 1997-1 Trustee's Account pursuant to this Section and all other amounts on deposit therein shall be distributed in full to the Series 1997-1 Certificateholders on the Distribution Date on which funds are deposited pursuant to this Section (or, if not so deposited on a Distribution Date, on the immediately following Distribution Date) and any distribution made pursuant to this Section shall deemed to be a final distribution pursuant to

(c) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the entire amount deposited in the Series 1997-1 Trustee's Account pursuant to Section 9.01 and all other amounts on deposit therein shall be distributed in full to the Series 1997-1 Certificateholders on such date and any distribution made pursuant to paragraph (b) above shall be deemed to be a final distribution pursuant to Section 12.02 of the Agreement with respect to Series 1997-1. SECTION 9.02. Distribution of Proceeds of Sale, Disposition or Liquidation of the Receivables Pursuant to Section 9.02 of the Agreement. (a) Not later than 12:00 noon, New York City time, on the Distribution Date following the date on which the Insolvency Proceeds are deposited into the Collection Account pursuant to Section 9.02(b) of the Agreement, the Trustee shall deposit the Insolvency Proceeds into the Series 1997-1 Trustee's Account and distribute such amount on the applicable Distribution Date in accordance with Section 5.01(c) hereof. (b) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the entire amount deposited in the Series 1997-1 Trustee's Account pursuant to this Section and all other amounts on deposit therein shall be distributed in full to the Series 1997-1 Certificateholders on the Distribution Date on which funds are deposited pursuant to this Section (or, if not so deposited on a Distribution Date, on the immediately following Distribution Date) and any distribution made pursuant to this Section shall deemed to be a final distribution pursuant to Section 12.02 of the Agreement with respect to Series 1997-1.

ARTICLE X Miscellaneous Provisions SECTION 10.01. Ratification of Agreement. As supplemented by this Series Supplement, the Agreement is in all respects ratified and confirmed and the Agreement as so supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument. SECTION 10.02. Counterparts. This Series Supplement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. SECTION 10.03. GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 10.04. The Trustee. The Trustee is hereby authorized to execute and deliver the Escrow Deposit Agreement and to perform the obligations thereunder. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Series Supplement, or for or in respect of the recitals contained herein, all of which recitals are made solely by the Seller and the Servicer. SECTION 10.05. Amendment. This Supplement may be amended from time to time by the Servicer, the Seller and the Trustee, with the prior written consent of all Class A Certificateholders; provided, however, if all amounts owing to the Holders of the Series 1992-1 and the Holders of the Series 1993-1 Certificates have not been paid in full, the Rating Agency rating such Investor Certificates shall be notified of such proposed amendment and in no event shall any amendment to Articles I or IV herein that affects distributions to the Series 1992-1 or Series 1993-1 Certificateholders be entered into unless the Rating Agency Condition is satisfied. SECTION 10.06. The Certificates. Each Certificate shall be executed by manual or facsimile signature by the Trustee by an authorized officer. Certificates bearing the manual or facsimile signature of the individual who was, at the time when such signature was affixed, authorized to sign on behalf of the Trustee shall not be rendered invalid, notwithstanding that such individual ceased to be so authorized prior to the authentication and delivery of such Certificates or does not hold such office at the date of such Certificates.

ARTICLE X Miscellaneous Provisions SECTION 10.01. Ratification of Agreement. As supplemented by this Series Supplement, the Agreement is in all respects ratified and confirmed and the Agreement as so supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument. SECTION 10.02. Counterparts. This Series Supplement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. SECTION 10.03. GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 10.04. The Trustee. The Trustee is hereby authorized to execute and deliver the Escrow Deposit Agreement and to perform the obligations thereunder. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Series Supplement, or for or in respect of the recitals contained herein, all of which recitals are made solely by the Seller and the Servicer. SECTION 10.05. Amendment. This Supplement may be amended from time to time by the Servicer, the Seller and the Trustee, with the prior written consent of all Class A Certificateholders; provided, however, if all amounts owing to the Holders of the Series 1992-1 and the Holders of the Series 1993-1 Certificates have not been paid in full, the Rating Agency rating such Investor Certificates shall be notified of such proposed amendment and in no event shall any amendment to Articles I or IV herein that affects distributions to the Series 1992-1 or Series 1993-1 Certificateholders be entered into unless the Rating Agency Condition is satisfied. SECTION 10.06. The Certificates. Each Certificate shall be executed by manual or facsimile signature by the Trustee by an authorized officer. Certificates bearing the manual or facsimile signature of the individual who was, at the time when such signature was affixed, authorized to sign on behalf of the Trustee shall not be rendered invalid, notwithstanding that such individual ceased to be so authorized prior to the authentication and delivery of such Certificates or does not hold such office at the date of such Certificates.

SECTION 10.07. Indemnities by the Servicer. Without limiting any other rights which the Program Agent or any Purchaser may have hereunder or under applicable law, the Servicer hereby agrees to indemnify the Program Agent and each Purchaser and their respective officers, directors, agents and employees (each an "Indemnified Party") from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other amounts payable, including reasonable attorneys' fees (which attorneys may be employees of the Program Agent or such Purchaser) and disbursements (all of the foregoing being collectively referred to as "Indemnified Amounts") awarded against or incurred by any of them arising out of or as a result of Transaction Documents, excluding, however: (i) Indemnified Amounts to the extent that final judgment of a court of competent jurisdiction holds such Indemnified Amounts resulted from gross negligence or willful misconduct on the part of the Indemnified Party seeking indemnification; or (ii) Indemnified Amounts to the extent the same includes losses in respect of Eligible Receivables which are wholly or partially uncollectible on account of the insolvency, bankruptcy or lack of credit worthiness of the related Obligor or the failure of such Collections to cover interest and principal owed to a Class A Certificateholder; provided, however, that nothing contained in this sentence shall limit the liability of the Servicer or limit the recourse of the Purchasers to the Servicer for amounts otherwise specifically provided to be paid by the Servicer under the terms of the Transaction Documents. Without limiting the generality of the foregoing indemnification, the

SECTION 10.07. Indemnities by the Servicer. Without limiting any other rights which the Program Agent or any Purchaser may have hereunder or under applicable law, the Servicer hereby agrees to indemnify the Program Agent and each Purchaser and their respective officers, directors, agents and employees (each an "Indemnified Party") from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other amounts payable, including reasonable attorneys' fees (which attorneys may be employees of the Program Agent or such Purchaser) and disbursements (all of the foregoing being collectively referred to as "Indemnified Amounts") awarded against or incurred by any of them arising out of or as a result of Transaction Documents, excluding, however: (i) Indemnified Amounts to the extent that final judgment of a court of competent jurisdiction holds such Indemnified Amounts resulted from gross negligence or willful misconduct on the part of the Indemnified Party seeking indemnification; or (ii) Indemnified Amounts to the extent the same includes losses in respect of Eligible Receivables which are wholly or partially uncollectible on account of the insolvency, bankruptcy or lack of credit worthiness of the related Obligor or the failure of such Collections to cover interest and principal owed to a Class A Certificateholder; provided, however, that nothing contained in this sentence shall limit the liability of the Servicer or limit the recourse of the Purchasers to the Servicer for amounts otherwise specifically provided to be paid by the Servicer under the terms of the Transaction Documents. Without limiting the generality of the foregoing indemnification, the Servicer shall indemnify the Program Agent and the Purchasers for Indemnified Amounts resulting from: (i) any representation or warranty made by the Servicer (or any officers of the Servicer) under or in connection with any Transaction Document or any other information or report delivered by the Servicer pursuant thereto, having been false or incorrect in any material respect when made or deemed made; (ii) the failure by the Servicer to comply with any applicable law, rule or regulation with respect to any Receivable related thereto, or the nonconformity of any Receivable included therein with any such applicable law, rule or regulation;

(iii) any material failure of the Servicer to perform its duties or obligations in accordance with the provisions of any Transaction Document; (iv) any offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including, without limitation, a defense based on such Receivable not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any Credit Memo granted (other than for credit losses) or any products liability or warranty claim arising out of or in connection with the sale of merchandise which gave rise to the Receivable, or any other claim relating to the furnishing or failure to furnish such merchandise; (v) the commingling of Collections of Receivables at any time with other funds; (vi) any investigation, litigation or proceeding brought by a third party related to or arising from any Transaction Document and the transactions contemplated thereby, or any other investigation, litigation or proceeding brought by a third party relating to the Servicer in which any Indemnified Party becomes involved as a result of any of the transactions contemplated thereby other than any investigation or proceeding arising from (i) the gross negligence or wilful misconduct of the Program Agent and/or one or more of the Purchasers or (ii) the unlawful conduct of the Program Agent and/or one or more of the Purchasers; and (vii) any Servicer Default. Notwithstanding the foregoing, the Servicer shall not under any circumstances indemnify the Program Agent or any Purchaser for any Indemnified Amounts that result from any delay in the collection of any Receivables or any default by an Obligor with respect to any Receivables unless such delay or default is caused by the Servicer or arises by reason of any breach or alleged breach of any representation or warranty of the Servicer.

(iii) any material failure of the Servicer to perform its duties or obligations in accordance with the provisions of any Transaction Document; (iv) any offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including, without limitation, a defense based on such Receivable not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any Credit Memo granted (other than for credit losses) or any products liability or warranty claim arising out of or in connection with the sale of merchandise which gave rise to the Receivable, or any other claim relating to the furnishing or failure to furnish such merchandise; (v) the commingling of Collections of Receivables at any time with other funds; (vi) any investigation, litigation or proceeding brought by a third party related to or arising from any Transaction Document and the transactions contemplated thereby, or any other investigation, litigation or proceeding brought by a third party relating to the Servicer in which any Indemnified Party becomes involved as a result of any of the transactions contemplated thereby other than any investigation or proceeding arising from (i) the gross negligence or wilful misconduct of the Program Agent and/or one or more of the Purchasers or (ii) the unlawful conduct of the Program Agent and/or one or more of the Purchasers; and (vii) any Servicer Default. Notwithstanding the foregoing, the Servicer shall not under any circumstances indemnify the Program Agent or any Purchaser for any Indemnified Amounts that result from any delay in the collection of any Receivables or any default by an Obligor with respect to any Receivables unless such delay or default is caused by the Servicer or arises by reason of any breach or alleged breach of any representation or warranty of the Servicer. SECTION 10.08. Net Pool Balance/Required Participation Amount. The parties hereto agree that, solely for purposes of the Series 1997-1 Supplement, notwithstanding any provision in the Agreement to the contrary, any reference to the Net Pool Balance being compared to the Required Participation Amount shall be deemed to mean that the Minimum Enhancement Amount is greater than the sum of (i) Contractual Dilution and (ii) Aggregate Reserves.

IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have caused this Series Supplement to be duly executed by their respective officers as of the day and year first above written. FEDERAL-MOGUL FUNDING CORPORATION, Seller By: ------------------------------Name: Title: FEDERAL-MOGUL CORPORATION, Servicer By: ------------------------------Name: Title: THE CHASE MANHATTAN BANK, Trustee By: ------------------------------Name: Title:

IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have caused this Series Supplement to be duly executed by their respective officers as of the day and year first above written. FEDERAL-MOGUL FUNDING CORPORATION, Seller By: ------------------------------Name: Title: FEDERAL-MOGUL CORPORATION, Servicer By: ------------------------------Name: Title: THE CHASE MANHATTAN BANK, Trustee By: ------------------------------Name: Title:

This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT dated as of February 28, 1997, amends and restates the RECEIVABLES PURCHASE AGREEMENT, dated as of June 1, 1992, between FEDERAL-MOGUL FUNDING CORPORATION, a Michigan corporation, as Buyer (the "Buyer"), and FEDERAL-MOGUL CORPORATION, a Michigan corporation, as Seller (the "Seller"). WITNESSETH: WHEREAS the Seller in the ordinary course of its business manufactures and sells various types of precision parts thereby generating accounts receivable; WHEREAS the Seller wishes to sell certain of such existing and future accounts receivable from time to time to the Buyer; and WHEREAS the Buyer desires to sell such accounts receivable to the Federal-Mogul Trade Receivables Master Trust, pursuant to an Amended and Restated Pooling and Servicing Agreement dated as of February 1, 1997 (as the same may from time to time be amended, supplemented or otherwise modified, the "Pooling and Servicing Agreement"), among Federal-Mogul Funding Corporation, as seller, Federal-Mogul Corporation, as servicer, and The Chase Manhattan Bank, as trustee (the "Trustee"). NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows: ARTICLE I. Definitions Section 1.01 Definitions. Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Pooling and Servicing Agreement. In addition, the term "Agreement" means this Amended and Restated Receivables Purchase Agreement, as the same may from time to time be amended, supplemented or otherwise modified. Section 1.02. Other Definitional Provisions. (a) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular

This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT dated as of February 28, 1997, amends and restates the RECEIVABLES PURCHASE AGREEMENT, dated as of June 1, 1992, between FEDERAL-MOGUL FUNDING CORPORATION, a Michigan corporation, as Buyer (the "Buyer"), and FEDERAL-MOGUL CORPORATION, a Michigan corporation, as Seller (the "Seller"). WITNESSETH: WHEREAS the Seller in the ordinary course of its business manufactures and sells various types of precision parts thereby generating accounts receivable; WHEREAS the Seller wishes to sell certain of such existing and future accounts receivable from time to time to the Buyer; and WHEREAS the Buyer desires to sell such accounts receivable to the Federal-Mogul Trade Receivables Master Trust, pursuant to an Amended and Restated Pooling and Servicing Agreement dated as of February 1, 1997 (as the same may from time to time be amended, supplemented or otherwise modified, the "Pooling and Servicing Agreement"), among Federal-Mogul Funding Corporation, as seller, Federal-Mogul Corporation, as servicer, and The Chase Manhattan Bank, as trustee (the "Trustee"). NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows: ARTICLE I. Definitions Section 1.01 Definitions. Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Pooling and Servicing Agreement. In addition, the term "Agreement" means this Amended and Restated Receivables Purchase Agreement, as the same may from time to time be amended, supplemented or otherwise modified. Section 1.02. Other Definitional Provisions. (a) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Article, Section and Exhibit references are references to Sections and Exhibits in or to this Agreement unless otherwise specified; and the term "including" shall mean "including without limitation". (b) The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms.

ARTICLE II. Conveyance of Receivables Section 2.01. Conveyance of Receivables. By execution of this Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise convey to the Buyer on the first Closing Date all of its right, title and interest in, to and under the Receivables and all Collateral Security with respect thereto, if any, owned by the Seller at the close of business on the Cut-Off Date and all monies due or to become due and all amounts received with respect thereto and all proceeds (including "proceeds" as defined in Section 9-306 of the UCC as in effect in the State of Michigan and Recoveries) thereof. Subject to Article VI, as of each Business Day prior to the earlier of (x) the occurrence of an Early Amortization Event specified in Section 9.01(b), (c), (d), or (e) of the Pooling and Servicing Agreement and (y) the Trust Termination Date, on which Receivables are created (a "Transfer Date"), the Seller does hereby sell, transfer, assign, set over and otherwise convey to the Buyer, all of its right, title and interest in, to and under the Receivables and all Collateral Security with respect thereto, if any, owned by the Seller at the close of business on such Transfer Date and not theretofore conveyed

ARTICLE II. Conveyance of Receivables Section 2.01. Conveyance of Receivables. By execution of this Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise convey to the Buyer on the first Closing Date all of its right, title and interest in, to and under the Receivables and all Collateral Security with respect thereto, if any, owned by the Seller at the close of business on the Cut-Off Date and all monies due or to become due and all amounts received with respect thereto and all proceeds (including "proceeds" as defined in Section 9-306 of the UCC as in effect in the State of Michigan and Recoveries) thereof. Subject to Article VI, as of each Business Day prior to the earlier of (x) the occurrence of an Early Amortization Event specified in Section 9.01(b), (c), (d), or (e) of the Pooling and Servicing Agreement and (y) the Trust Termination Date, on which Receivables are created (a "Transfer Date"), the Seller does hereby sell, transfer, assign, set over and otherwise convey to the Buyer, all of its right, title and interest in, to and under the Receivables and all Collateral Security with respect thereto, if any, owned by the Seller at the close of business on such Transfer Date and not theretofore conveyed to the Buyer, all monies due or to become due and all amounts received with respect thereto and all proceeds (including "proceeds" as defined in Section 9-306 of the UCC as in effect in the State of Michigan and Recoveries) thereof. The foregoing sale, transfer, assignment, set-over and conveyance and any subsequent sales, transfers, assignments, set-overs and conveyances do not constitute, and are not intended to result in, the creation or an assumption by the Buyer of any obligation of the Servicer, the Seller or any other Person in connection with the Receivables or under any agreement or instrument relating thereto, including any obligation to any Obligors. In connection with such sales, the Seller agrees to record and file, at its own expense, a financing statement on form UCC-1 (and continuation statements when applicable) naming the Seller as "seller" and the Buyer as "buyer" thereon with respect to the Receivables now existing and hereafter created for the sale of "accounts" or "general intangibles" (as defined in Section 9-106 of the UCC as in effect in any state where the Seller's or the Servicer's chief executive offices or books and records relating to the Receivables are located) meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect the sale and assignment of the Receivables to the Buyer, and to deliver a filestamped copy of such financing statements or other evidence of such filing to the

Buyer on or prior to the first Closing Date. In addition, the Seller shall cause to be timely filed in the appropriate filing office any UCC-1 financing statement and continuation statement necessary to perfect any sale of Receivables to the Buyer. The Buyer shall be under no obligation whatsoever to file such financing statement, or a continuation statement to such financing statement, or to make any other filing under the UCC in connection with such sales. The parties hereto intend that the transfers of Receivables effected by this Agreement be sales. It is the intention of the parties hereto that the transfer (the "Transfer") of the property described in the first paragraph of this Section 2.01 be characterized as a sale. If, however, such Transfer is not characterized as a sale, the Seller hereby grants to the Buyer a security interest in the property subject to the Transfer. In connection with such sales, the Seller further agrees, at its own expense, on or prior to the first Closing Date, to cause the Seller to indicate in its computer files that the Receivables have been sold to the Buyer pursuant to this Agreement and sold to the Trust pursuant to the Pooling and Servicing Agreement for the benefit of the Certificateholders and the other Beneficiaries. In consideration for the sale of $89,045,072 of the Receivables, transferred to the Buyer on the first Closing Date, the Buyer shall pay to the Seller $42,737,177.50 in cash. The remaining $58,450,404.50 of Receivables transferred to the Buyer on the first Closing Date is a capital contribution to the Buyer. Subject to Article VI, the purchase price for the Receivables sold by the Seller to the Buyer on each Transfer Date thereafter shall be a price agreed to by the Buyer and the Seller at the time of acquisition by the Buyer, which price shall not, in the opinion of the Buyer, be materially less favorable to the Buyer than prices for transactions of a generally similar character at the time of the acquisition taking into account the quality of such Receivables and other pertinent factors; provided that such consideration shall in any event not be less than reasonably equivalent value therefor. Section 2.02. Representations and Warranties of the Seller Relating to the Seller and the Agreement. The Seller

Buyer on or prior to the first Closing Date. In addition, the Seller shall cause to be timely filed in the appropriate filing office any UCC-1 financing statement and continuation statement necessary to perfect any sale of Receivables to the Buyer. The Buyer shall be under no obligation whatsoever to file such financing statement, or a continuation statement to such financing statement, or to make any other filing under the UCC in connection with such sales. The parties hereto intend that the transfers of Receivables effected by this Agreement be sales. It is the intention of the parties hereto that the transfer (the "Transfer") of the property described in the first paragraph of this Section 2.01 be characterized as a sale. If, however, such Transfer is not characterized as a sale, the Seller hereby grants to the Buyer a security interest in the property subject to the Transfer. In connection with such sales, the Seller further agrees, at its own expense, on or prior to the first Closing Date, to cause the Seller to indicate in its computer files that the Receivables have been sold to the Buyer pursuant to this Agreement and sold to the Trust pursuant to the Pooling and Servicing Agreement for the benefit of the Certificateholders and the other Beneficiaries. In consideration for the sale of $89,045,072 of the Receivables, transferred to the Buyer on the first Closing Date, the Buyer shall pay to the Seller $42,737,177.50 in cash. The remaining $58,450,404.50 of Receivables transferred to the Buyer on the first Closing Date is a capital contribution to the Buyer. Subject to Article VI, the purchase price for the Receivables sold by the Seller to the Buyer on each Transfer Date thereafter shall be a price agreed to by the Buyer and the Seller at the time of acquisition by the Buyer, which price shall not, in the opinion of the Buyer, be materially less favorable to the Buyer than prices for transactions of a generally similar character at the time of the acquisition taking into account the quality of such Receivables and other pertinent factors; provided that such consideration shall in any event not be less than reasonably equivalent value therefor. Section 2.02. Representations and Warranties of the Seller Relating to the Seller and the Agreement. The Seller hereby represents and warrants to the Buyer as of each Closing Date that: (a) Organization and Good Standing. The Seller is a corporation duly organized and validly existing and in good standing under the law of the State of Michigan and has, in all material respects, full corporate power, authority and legal right to own its properties and conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under this Agreement.

(b) Due Qualification. The Seller is duly qualified to do business and, where necessary, is in good standing as a foreign corporation (or is exempt from such requirement) and has obtained all necessary licenses and approvals in each jurisdiction in which the conduct of its business requires such qualification except where the failure to so qualify or obtain licenses or approvals would not have a material adverse effect on its ability to perform its obligations hereunder. (c) Due Authorization. The execution and delivery of this Agreement and the consummation of the transactions provided for or contemplated by this Agreement have been duly authorized by the Seller by all necessary corporate action on the part of the Seller. (d) No Conflict. The execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof and thereof, will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which the Seller is a party or by which it or its properties are bound. (e) No Violation. The execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof and thereof applicable to the Seller, will not conflict with or violate any material Requirements of Law applicable to the Seller. (f) No Proceedings. There are no proceedings or investigations pending or, to the best knowledge of the Seller, threatened against the Seller, before any Governmental Authority (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement, (iii) seeking any determination or ruling that, in the reasonable judgment of the

(b) Due Qualification. The Seller is duly qualified to do business and, where necessary, is in good standing as a foreign corporation (or is exempt from such requirement) and has obtained all necessary licenses and approvals in each jurisdiction in which the conduct of its business requires such qualification except where the failure to so qualify or obtain licenses or approvals would not have a material adverse effect on its ability to perform its obligations hereunder. (c) Due Authorization. The execution and delivery of this Agreement and the consummation of the transactions provided for or contemplated by this Agreement have been duly authorized by the Seller by all necessary corporate action on the part of the Seller. (d) No Conflict. The execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof and thereof, will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which the Seller is a party or by which it or its properties are bound. (e) No Violation. The execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof and thereof applicable to the Seller, will not conflict with or violate any material Requirements of Law applicable to the Seller. (f) No Proceedings. There are no proceedings or investigations pending or, to the best knowledge of the Seller, threatened against the Seller, before any Governmental Authority (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement, (iii) seeking any determination or ruling that, in the reasonable judgment of the Seller, would materially and adversely affect the performance by the Seller of its obligations under this Agreement, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement or (v) seeking to affect adversely the income tax attributes of the Trust under the United States federal or any State income, single business or franchise tax systems. (g) All Consents Required. All appraisals, authorizations, consents, orders, approvals or other actions of any Person or of any governmental body or official required in connection with the execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement, and the fulfillment of the terms hereof or thereof, have been obtained.

(h) Enforceability. This Agreement constitutes a legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity). (i) Valid Transfer. This Agreement constitutes a valid sale, transfer and assignment to the Buyer of all right, title and interest of the Seller in the Receivables and the proceeds thereof. Except as otherwise provided in the Pooling and Servicing Agreement, neither the Seller nor any Person claiming through or under the Seller has any claim to or interest in the Trust Assets. (j) Investment Company Act. The Seller is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended (the "1940 Act") that is required to register under the 1940 Act. (k) Locations. The chief place of business and chief executive office of the Seller, and the office where the Seller keeps all of its books, records and documents evidencing Receivables are located at the addresses specified in Schedule I hereto (or at such other locations, identified to the Buyer in accordance with Section 7.06 hereof, in jurisdictions with respect to which all applicable action required by Section 7.02(b) or 7.02(c) hereof has been taken and completed). (l) Information. Each certificate, report, information, exhibit, financial statement, document, book, record or report furnished by the Seller to the Buyer in connection with this Agreement is accurate in all material respects as

(h) Enforceability. This Agreement constitutes a legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity). (i) Valid Transfer. This Agreement constitutes a valid sale, transfer and assignment to the Buyer of all right, title and interest of the Seller in the Receivables and the proceeds thereof. Except as otherwise provided in the Pooling and Servicing Agreement, neither the Seller nor any Person claiming through or under the Seller has any claim to or interest in the Trust Assets. (j) Investment Company Act. The Seller is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended (the "1940 Act") that is required to register under the 1940 Act. (k) Locations. The chief place of business and chief executive office of the Seller, and the office where the Seller keeps all of its books, records and documents evidencing Receivables are located at the addresses specified in Schedule I hereto (or at such other locations, identified to the Buyer in accordance with Section 7.06 hereof, in jurisdictions with respect to which all applicable action required by Section 7.02(b) or 7.02(c) hereof has been taken and completed). (l) Information. Each certificate, report, information, exhibit, financial statement, document, book, record or report furnished by the Seller to the Buyer in connection with this Agreement is accurate in all material respects as of its date, when considered as a whole with all other such documents, and no such document contains any material misstatement of fact or omits to state a material fact or any fact necessary to make the statements contained therein not materially misleading. (m) Solvency. This Seller is solvent and will not become insolvent after giving effect to the transactions contemplated by this Agreement; the Seller is currently repaying all of its indebtedness as such indebtedness becomes due; and, after giving effect to the transactions contemplated by this Agreement, the Seller will have adequate capital to conduct its business.

The representations and warranties set forth in this Section 2.02 shall survive the transfer and assignment of the Receivables to the Buyer. Upon discovery by the Seller or the Buyer of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the other party. In the event of any breach of any of the representations and warranties set forth in this Section 2.02 and if, in connection therewith, the Buyer shall be obligated to purchase the Certificateholders' Interest pursuant to Section 2.03 of the Pooling and Servicing Agreement, the Seller shall repurchase the Receivables and shall pay to the Buyer on the Business Day preceding the Distribution Date on which such purchase of the Certificateholders' Interest is to be made an amount equal to the purchase price for the Certificateholders' Interest as specified in the Pooling and Servicing Agreement. The obligation of the Seller to purchase the Receivables pursuant to this Section 2.02 shall constitute the sole remedy against the Seller respecting an event of the type specified in the first sentence of this paragraph available to the Buyer and to the Investor Certificate holders (or the Trustee on behalf of the Investor Certificateholders). Section 2.03. Representations and Warranties of the Seller Relating to the Receivables. (a) Representations and Warranties. The Seller hereby represents and warrants to the Buyer that: (i) Each Receivable existing on the first Closing Date and each Receivable on each Transfer Date, has been conveyed to the Buyer free and clear of any Lien (other than the Lien created by the Pooling and Servicing Agreement in favor of the Trustee on behalf of the Trust). (ii) With respect to each Receivable existing on the first Closing Date and on each Transfer Date, all consents, licenses, approvals or authorizations of or registrations or declarations with any Governmental Authority required

The representations and warranties set forth in this Section 2.02 shall survive the transfer and assignment of the Receivables to the Buyer. Upon discovery by the Seller or the Buyer of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the other party. In the event of any breach of any of the representations and warranties set forth in this Section 2.02 and if, in connection therewith, the Buyer shall be obligated to purchase the Certificateholders' Interest pursuant to Section 2.03 of the Pooling and Servicing Agreement, the Seller shall repurchase the Receivables and shall pay to the Buyer on the Business Day preceding the Distribution Date on which such purchase of the Certificateholders' Interest is to be made an amount equal to the purchase price for the Certificateholders' Interest as specified in the Pooling and Servicing Agreement. The obligation of the Seller to purchase the Receivables pursuant to this Section 2.02 shall constitute the sole remedy against the Seller respecting an event of the type specified in the first sentence of this paragraph available to the Buyer and to the Investor Certificate holders (or the Trustee on behalf of the Investor Certificateholders). Section 2.03. Representations and Warranties of the Seller Relating to the Receivables. (a) Representations and Warranties. The Seller hereby represents and warrants to the Buyer that: (i) Each Receivable existing on the first Closing Date and each Receivable on each Transfer Date, has been conveyed to the Buyer free and clear of any Lien (other than the Lien created by the Pooling and Servicing Agreement in favor of the Trustee on behalf of the Trust). (ii) With respect to each Receivable existing on the first Closing Date and on each Transfer Date, all consents, licenses, approvals or authorizations of or registrations or declarations with any Governmental Authority required to be obtained, effected or given by the Seller in connection with the conveyance of such Receivable to the Buyer have been duly obtained, effected or given and are in full force and effect. (iii) On the first Closing Date and on each Transfer Date, each Receivable conveyed to the Buyer on such date is an Eligible Receivable (as defined in the Series 1997-1 Supplement, dated as of February 1, 1997 (the "Series 1997-1 Supplement"), by and among Federal-Mogul Funding Corporation, as

Seller, Federal-Mogul Corporation, as Servicer, and The Chase Manhattan Bank, as trustee) or, if such Receivable is not an Eligible Receivable (as defined in the Series 1997-1 Supplement), such Receivable is conveyed to the Trust in accordance with Section 2.06 of the Pooling and Servicing Agreement. (b) Notice of Breach. The representations and warranties set forth in this Section 2.03 shall survive the transfer and assignment of the Receivables to the Buyer. Upon discovery by the Seller or the Buyer of a breach of any of the representations and warranties set forth in this Section 2.03, the party discovering such breach shall give prompt written notice to the other party. (c) Repurchase. In the event any representation or warranty under Section 2.03(a) is not true and correct as of the date specified therein with respect to any Receivable and the Buyer is, in connection therewith, required to purchase such Receivable or all Receivables pursuant to Section 2.04(c) of the Pooling and Servicing Agreement, then, within 30 days (or such longer period as may be agreed to by the Buyer) of the earlier to occur of the discovery of any such event by the Seller or the Buyer, or receipt by the Seller or the Buyer of written notice of any such event given by the Trustee or any Enhancement Providers, the Seller shall repurchase the Receivable or Receivables of which the Buyer is required to accept reassignment pursuant to the Pooling and Servicing Agreement on the Business Day preceding the Determination Date on which such reassignment is to occur. The Seller shall purchase each such Receivable by making a payment to the Buyer in immediately available funds on the Business Day preceding the Distribution Date on which such reassignment is to occur in an amount equal to the Purchase Price for such Receivable. Upon payment of the Purchase Price, the Buyer shall automatically and without further action be deemed to sell, transfer, assign, set over and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Buyer in and to such Receivable and all

Seller, Federal-Mogul Corporation, as Servicer, and The Chase Manhattan Bank, as trustee) or, if such Receivable is not an Eligible Receivable (as defined in the Series 1997-1 Supplement), such Receivable is conveyed to the Trust in accordance with Section 2.06 of the Pooling and Servicing Agreement. (b) Notice of Breach. The representations and warranties set forth in this Section 2.03 shall survive the transfer and assignment of the Receivables to the Buyer. Upon discovery by the Seller or the Buyer of a breach of any of the representations and warranties set forth in this Section 2.03, the party discovering such breach shall give prompt written notice to the other party. (c) Repurchase. In the event any representation or warranty under Section 2.03(a) is not true and correct as of the date specified therein with respect to any Receivable and the Buyer is, in connection therewith, required to purchase such Receivable or all Receivables pursuant to Section 2.04(c) of the Pooling and Servicing Agreement, then, within 30 days (or such longer period as may be agreed to by the Buyer) of the earlier to occur of the discovery of any such event by the Seller or the Buyer, or receipt by the Seller or the Buyer of written notice of any such event given by the Trustee or any Enhancement Providers, the Seller shall repurchase the Receivable or Receivables of which the Buyer is required to accept reassignment pursuant to the Pooling and Servicing Agreement on the Business Day preceding the Determination Date on which such reassignment is to occur. The Seller shall purchase each such Receivable by making a payment to the Buyer in immediately available funds on the Business Day preceding the Distribution Date on which such reassignment is to occur in an amount equal to the Purchase Price for such Receivable. Upon payment of the Purchase Price, the Buyer shall automatically and without further action be deemed to sell, transfer, assign, set over and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Buyer in and to such Receivable and all monies due or to become due with respect thereto and all proceeds thereof. The Buyer shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by the Seller to effect the conveyance of such Receivables pursuant to this Section. The obligation of the Seller to repurchase any such Receivable shall constitute the sole remedy respecting the event giving rise to such obligation available to the Buyer and to the Certificateholders (or the Trustee on behalf of Certificateholders).

(d) Adjustment Payment. In the event that the Buyer is required to make any Adjustment Payment pursuant to Section 3.09 of the Pooling and Servicing Agreement, the Seller under this Agreement shall have an obligation to make a payment to the Buyer in an amount equal to such Adjustment Payment on the Business Day on which the Seller makes such Adjustment Payment. Section 2.04. Covenants of the Seller. The Seller hereby covenants that: (a) No Liens. Except for the conveyances hereunder, the Seller will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on, any Receivable, whether now existing or hereafter created, or any interest therein, and the Seller shall defend the right, title and interest of the Buyer and the Trust in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under the Seller. (b) Delivery of Collections. In the event that the Seller receives Collections, the Seller agrees to pay the Servicer or any Successor Servicer all payments received by the Seller in respect of the Receivables as soon as practicable after receipt thereof by the Seller, but in no event later than two Business Days after the receipt by the Seller thereof. (c) Notice of Liens. The Seller shall notify the Buyer and the Trustee promptly after becoming aware of any Lien on any Receivable other than the conveyances hereunder or under the Pooling and Servicing Agreement. (d) Compliance with Law. The Seller hereby agrees to comply in all material respects with all Requirements of Law applicable to the Seller. (e) Preservation of Corporate Existence. Except as otherwise permitted by Section 5.01 hereof, the Seller shall preserve and maintain its corporate existence, rights, franchises and privileges in the jurisdiction of its

(d) Adjustment Payment. In the event that the Buyer is required to make any Adjustment Payment pursuant to Section 3.09 of the Pooling and Servicing Agreement, the Seller under this Agreement shall have an obligation to make a payment to the Buyer in an amount equal to such Adjustment Payment on the Business Day on which the Seller makes such Adjustment Payment. Section 2.04. Covenants of the Seller. The Seller hereby covenants that: (a) No Liens. Except for the conveyances hereunder, the Seller will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on, any Receivable, whether now existing or hereafter created, or any interest therein, and the Seller shall defend the right, title and interest of the Buyer and the Trust in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under the Seller. (b) Delivery of Collections. In the event that the Seller receives Collections, the Seller agrees to pay the Servicer or any Successor Servicer all payments received by the Seller in respect of the Receivables as soon as practicable after receipt thereof by the Seller, but in no event later than two Business Days after the receipt by the Seller thereof. (c) Notice of Liens. The Seller shall notify the Buyer and the Trustee promptly after becoming aware of any Lien on any Receivable other than the conveyances hereunder or under the Pooling and Servicing Agreement. (d) Compliance with Law. The Seller hereby agrees to comply in all material respects with all Requirements of Law applicable to the Seller. (e) Preservation of Corporate Existence. Except as otherwise permitted by Section 5.01 hereof, the Seller shall preserve and maintain its corporate existence, rights, franchises and privileges in the jurisdiction of its incorporation, and qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where the failure to maintain such qualification would materially adversely affect (i) the interests of the Buyer hereunder or in the Receivables, (ii) the collectibility of any Receivable or (iii) the ability of the Seller to perform its obligations hereunder. (f) Keeping of Records and Books of Account. The Seller shall maintain and implement administrative and operating procedures (including, without limitation, an ability to recreate records evidencing the Receivables, in the event of the destruction of the originals thereof), and keep and maintain, all documents, books, records and other information reasonably necessary or advisable for the collection of all Receivables

(including, without limitation, records adequate to permit the daily identification of each new Receivable and all Collections of and adjustments to each existing Receivable). (g) Credit Policies. The Seller shall comply in all material respects with the credit and collection policies and procedures in effect on the date hereof (the "Credit Policies") with respect to the Receivables a copy of which is attached hereto as Exhibit B. The Seller shall not amend, modify or supplement the Credit Policies in any material adverse respect without the prior written consent of the Program Agent. Upon any amendment, modification or supplement to the Credit Policies with the prior written consent of the Program Agent, the Seller shall deliver to the Buyer, the Trustee and the Program Agent a copy of such amendment, modification or supplement and Exhibit B shall be deemed to be amended by such amendment, modification or supplement. (h) Inspection Rights. The Seller shall provide the Program Agent, and any of its agents and representatives, with access to (x) any books, records, files and documents (including, without limitation, computer tapes and discs) relating to this Agreement and the Receivables and (y) the officers, directors and auditors of the Seller to discuss the business and operations of the Seller relating to this Agreement and the Receivables and the Seller's performance under this Agreement, but only (i) upon reasonable request, (ii) during normal business hours, (iii) subject to the Seller's normal security and confidentiality procedures and (iv) at reasonably accessible offices in the continental United States as designated by the Seller. ARTICLE III.

(including, without limitation, records adequate to permit the daily identification of each new Receivable and all Collections of and adjustments to each existing Receivable). (g) Credit Policies. The Seller shall comply in all material respects with the credit and collection policies and procedures in effect on the date hereof (the "Credit Policies") with respect to the Receivables a copy of which is attached hereto as Exhibit B. The Seller shall not amend, modify or supplement the Credit Policies in any material adverse respect without the prior written consent of the Program Agent. Upon any amendment, modification or supplement to the Credit Policies with the prior written consent of the Program Agent, the Seller shall deliver to the Buyer, the Trustee and the Program Agent a copy of such amendment, modification or supplement and Exhibit B shall be deemed to be amended by such amendment, modification or supplement. (h) Inspection Rights. The Seller shall provide the Program Agent, and any of its agents and representatives, with access to (x) any books, records, files and documents (including, without limitation, computer tapes and discs) relating to this Agreement and the Receivables and (y) the officers, directors and auditors of the Seller to discuss the business and operations of the Seller relating to this Agreement and the Receivables and the Seller's performance under this Agreement, but only (i) upon reasonable request, (ii) during normal business hours, (iii) subject to the Seller's normal security and confidentiality procedures and (iv) at reasonably accessible offices in the continental United States as designated by the Seller. ARTICLE III. Administration and Servicing of Receivables Section 3.01. The Receivables will be administered and serviced in accordance with the Pooling and Servicing Agreement. ARTICLE IV. Rights of Certificateholders and Allocation and Application of Collections Section 4.01. Allocations and Applications of Collections and Other Funds. The Servicer will apply all Collections with respect to the Receivables and all funds on deposit in the Collection Account as described in Article IV of the Pooling and Servicing Agreement.

ARTICLE V. Other Matters Relating to the Seller Section 5.01. Merger or Consolidation of, or Assumption, of the Obligations of the Seller. The Seller shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (a) the corporation formed by such consolidation or into which the Seller is merged or the Person which acquires by conveyance or transfer the properties and assets of the Seller substantially as an entirety shall be a corporation organized and existing under the laws of the United States of America or any State or the District of Columbia and, if the Seller is not the surviving entity, such corporation shall assume, without the execution or filing of any paper or any further act on the part of any of the parties hereto, the performance of every covenant and obligation of the Seller hereunder; and (b) the Seller has delivered to the Buyer and the Trustee an Officers' Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance or transfer comply with this Section 5.01 and that all conditions precedent herein provided for relating to such transaction have been complied with.

ARTICLE V. Other Matters Relating to the Seller Section 5.01. Merger or Consolidation of, or Assumption, of the Obligations of the Seller. The Seller shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (a) the corporation formed by such consolidation or into which the Seller is merged or the Person which acquires by conveyance or transfer the properties and assets of the Seller substantially as an entirety shall be a corporation organized and existing under the laws of the United States of America or any State or the District of Columbia and, if the Seller is not the surviving entity, such corporation shall assume, without the execution or filing of any paper or any further act on the part of any of the parties hereto, the performance of every covenant and obligation of the Seller hereunder; and (b) the Seller has delivered to the Buyer and the Trustee an Officers' Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance or transfer comply with this Section 5.01 and that all conditions precedent herein provided for relating to such transaction have been complied with. Section 5.02. Seller Indemnification of the Buyer. The Seller shall indemnify and hold harmless the Buyer, from and against any loss, liability, expense, claim, damage or injury suffered or sustained by reason of any acts, omissions or alleged acts or omissions arising out of activities of the Seller pursuant to this Agreement arising out of or based on the arrangement created by this Agreement and the activities of the Seller taken pursuant thereto, including any judgment, award, settlement, reasonable attorneys' fees and other costs or expenses incurred in connection with the defense of any actual or threatened action, proceeding or claim; provided, however, that the Seller shall not indemnify the Buyer if such acts, omissions or alleged acts or omissions constitute fraud, gross negligence or wilful misconduct by the Buyer; and provided further, that the Seller shall not indemnify the Buyer for any liabilities, cost or expense of the Buyer with respect to any federal, state or local income or franchise taxes or the Michigan Single Business tax (or any interest or penalties with respect thereto) required to be paid by the Buyer in connection herewith to any taxing authority. Any indemnification under this Article V shall survive the termination of the Agreement.

ARTICLE VI. Termination This Agreement will terminate immediately after the Trust terminates pursuant to the Pooling and Servicing Agreement. In addition, the Buyer shall not purchase Receivables if the Seller shall become an involuntary party to (or be made the subject of) any proceeding provided for by any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Seller or relating to all or substantially all of its property (an "Involuntary Case") and such Involuntary Case shall have continued for a period of ten Business Days from and including the day of receipt by the Seller at its principal corporate office of notice of such Involuntary Case; provided, that during such ten Business Day period, the Buyer shall suspend its purchase of Receivables and shall hold all Principal Collections that would have been available to purchase Receivables in the Collection Account and (a) if by the first Business Day after such ten Business Day period, the Buyer has not obtained an order from the court having jurisdiction of such case or filing which order approves the continuation of the sale of Receivables by the Seller to the Buyer and which provided that the Buyer and any of its transferees (including the Trustee) may rely on such order for the validity and non-avoidance of such transfer (the "Order"), the Buyer shall hold such Collections in the Collection Account until such time as they may be paid as elsewhere provided herein and shall not purchase Receivables thereafter or (b) if by such first Business Day, the Buyer has obtained such Order, the Seller may continue selling Receivables, and the Buyer may continue purchasing Receivables, pursuant to the terms hereof, as modified by the immediately succeeding sentence. During the period after the ten Business Day period described above and before the end of the 60-day period described below, the purchase price of the Receivables transferred during such period, notwithstanding anything in this Agreement to the contrary, shall be paid to the Seller by the Buyer in cash not later than the same Business Day of any sale of

ARTICLE VI. Termination This Agreement will terminate immediately after the Trust terminates pursuant to the Pooling and Servicing Agreement. In addition, the Buyer shall not purchase Receivables if the Seller shall become an involuntary party to (or be made the subject of) any proceeding provided for by any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Seller or relating to all or substantially all of its property (an "Involuntary Case") and such Involuntary Case shall have continued for a period of ten Business Days from and including the day of receipt by the Seller at its principal corporate office of notice of such Involuntary Case; provided, that during such ten Business Day period, the Buyer shall suspend its purchase of Receivables and shall hold all Principal Collections that would have been available to purchase Receivables in the Collection Account and (a) if by the first Business Day after such ten Business Day period, the Buyer has not obtained an order from the court having jurisdiction of such case or filing which order approves the continuation of the sale of Receivables by the Seller to the Buyer and which provided that the Buyer and any of its transferees (including the Trustee) may rely on such order for the validity and non-avoidance of such transfer (the "Order"), the Buyer shall hold such Collections in the Collection Account until such time as they may be paid as elsewhere provided herein and shall not purchase Receivables thereafter or (b) if by such first Business Day, the Buyer has obtained such Order, the Seller may continue selling Receivables, and the Buyer may continue purchasing Receivables, pursuant to the terms hereof, as modified by the immediately succeeding sentence. During the period after the ten Business Day period described above and before the end of the 60-day period described below, the purchase price of the Receivables transferred during such period, notwithstanding anything in this Agreement to the contrary, shall be paid to the Seller by the Buyer in cash not later than the same Business Day of any sale of Receivables. During such period, Receivables will be considered transferred to the Buyer only to the extent that the purchase price therefor has been paid in cash on the same Business Day. If an Order is obtained but subsequently is reversed or rescinded or expires, the Seller shall immediately cease selling Receivables to the Buyer and the Buyer shall immediately cease buying Receivables. The Seller shall give prompt written notice to each of the Buyer and the Trustee immediately upon becoming a party to an Involuntary Case. If by the first Business Day after the 60-day period after such involuntary filing, such Involuntary Case has not been dismissed, the Buyer shall not purchase thereafter Receivables.

ARTICLE VII. Miscellaneous Provisions Section 7.01 Amendment. (a) This Agreement may be amended from time to time by the Seller and the Buyer; provided, however, that such action shall not, as evidenced by an Opinion of Counsel for the Seller addressed and delivered to the Trustee, adversely affect in any material respect the interests of any Investor Certificateholder. (b) This Agreement may also be amended from time to time by the Buyer and Seller with the consent of the Holders of Investor Certificates evidencing not less than 66-2/3% of the aggregate unpaid principal amount of the Investor Certificates of all materially adversely affected Series, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Seller; provided, however, that no such amendment shall (i) reduce in any manner the amount of or delay the timing of any distributions to be made to Investor Certificateholders or deposits of amounts to be so distributed with the amount available under any Enhancement without the consent of each affected Investor Certificateholder, (ii) change the definition of or the manner of calculating the interest of any Investor Certificateholders without the consent of each affected Certificateholder or (iii) reduce the aforesaid percentage required to consent to any such amendment without the consent of each Certificateholder. Any amendment to be effected pursuant to this paragraph shall be deemed to materially adversely affect all outstanding Series, other than any Series with respect to which such action shall not, as evidenced by an Opinion of Counsel for the Seller, addressed and delivered to the Trustee, adversely affect in any material respect the interests of any Investor Certificateholder of such Series. The Trustee may, but shall not be obligated to, enter into any such amendment which affects the Trustee's rights, duties or immunities under this Agreement or otherwise.

ARTICLE VII. Miscellaneous Provisions Section 7.01 Amendment. (a) This Agreement may be amended from time to time by the Seller and the Buyer; provided, however, that such action shall not, as evidenced by an Opinion of Counsel for the Seller addressed and delivered to the Trustee, adversely affect in any material respect the interests of any Investor Certificateholder. (b) This Agreement may also be amended from time to time by the Buyer and Seller with the consent of the Holders of Investor Certificates evidencing not less than 66-2/3% of the aggregate unpaid principal amount of the Investor Certificates of all materially adversely affected Series, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Seller; provided, however, that no such amendment shall (i) reduce in any manner the amount of or delay the timing of any distributions to be made to Investor Certificateholders or deposits of amounts to be so distributed with the amount available under any Enhancement without the consent of each affected Investor Certificateholder, (ii) change the definition of or the manner of calculating the interest of any Investor Certificateholders without the consent of each affected Certificateholder or (iii) reduce the aforesaid percentage required to consent to any such amendment without the consent of each Certificateholder. Any amendment to be effected pursuant to this paragraph shall be deemed to materially adversely affect all outstanding Series, other than any Series with respect to which such action shall not, as evidenced by an Opinion of Counsel for the Seller, addressed and delivered to the Trustee, adversely affect in any material respect the interests of any Investor Certificateholder of such Series. The Trustee may, but shall not be obligated to, enter into any such amendment which affects the Trustee's rights, duties or immunities under this Agreement or otherwise. (c) Promptly after the execution of any such amendment or consent (other than an amendment pursuant to paragraph (a)), the seller shall furnish notification of the substance of such amendment to each Investor Certificateholder, each Enhancement provider, each Agent and each Rating Agency. (d) It shall not be necessary for the consent of Investor Certificateholders under this Section to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Investor Certificateholders shall be subject to such reasonable requirements as the Trustee may prescribe.

(e) Notwithstanding anything in this Section to the contrary, no amendment may be made to this Agreement which would adversely affect in any material respect the interests of any Enhancement Provider without the consent of such Enhancement Provider. Section 7.02 Protection of Right, Title and Interest to Receivables. (a) The Seller shall cause this Agreement, all amendments hereto and/or all financing statements and continuation statements and any other necessary documents covering the Buyer's right, title and interest to the Receivables to be promptly recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may be required by law fully to preserve and protect the right, title and interest of the Buyer hereunder. The Seller shall deliver to the Buyer file-stamped copies of, or filing receipts for, any document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. The Buyer shall cooperate fully with the Seller in connection with the obligations set forth above and will execute any and all documents reasonably required to fulfill the intent of this Section 7.02(a). (b) Within 30 days after the Seller makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with Section 7.02(a) seriously misleading within the meaning of Section 9-402(7) of the UCC as in effect in the State of Michigan, the Seller shall give the Buyer and any Agent notice of any such change and shall file such financing statements or amendments as may be necessary to continue the perfection of the Buyer's security interest in the Receivables and the proceeds thereof. (c) The Seller will give the Buyer prompt written notice of any relocation of any office at which it keeps records

(e) Notwithstanding anything in this Section to the contrary, no amendment may be made to this Agreement which would adversely affect in any material respect the interests of any Enhancement Provider without the consent of such Enhancement Provider. Section 7.02 Protection of Right, Title and Interest to Receivables. (a) The Seller shall cause this Agreement, all amendments hereto and/or all financing statements and continuation statements and any other necessary documents covering the Buyer's right, title and interest to the Receivables to be promptly recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may be required by law fully to preserve and protect the right, title and interest of the Buyer hereunder. The Seller shall deliver to the Buyer file-stamped copies of, or filing receipts for, any document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. The Buyer shall cooperate fully with the Seller in connection with the obligations set forth above and will execute any and all documents reasonably required to fulfill the intent of this Section 7.02(a). (b) Within 30 days after the Seller makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with Section 7.02(a) seriously misleading within the meaning of Section 9-402(7) of the UCC as in effect in the State of Michigan, the Seller shall give the Buyer and any Agent notice of any such change and shall file such financing statements or amendments as may be necessary to continue the perfection of the Buyer's security interest in the Receivables and the proceeds thereof. (c) The Seller will give the Buyer prompt written notice of any relocation of any office at which it keeps records concerning the Receivables or of its principal executive office and whether, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall file such financing statements or amendments as may be necessary to perfect or to continue the perfection of the Buyer's security interest in the Receivables and the proceeds thereof. The Seller will at all times maintain its principal executive office within the United States of America. (d) The Seller will deliver to the Buyer, upon the execution and delivery of each amendment of this Agreement, an Opinion of Counsel to the effect specified in Exhibit A.

Section 7.03 Limited Recourse. Notwithstanding anything to the contrary contained herein, the obligations of the Buyer hereunder shall not be recourse to the Buyer (or any person or organization acting on behalf of the Buyer or any affiliate, officer or director of the Buyer), other than to (a) the portion of the Seller's Interest on any date of determination which is in excess of the Required Participation Amount and (b) any other assets of the Buyer not pledged to third parties or otherwise encumbered in a manner permitted by the Seller's Certificate of Incorporation; provided, however, that any payment by the Buyer made in accordance with this Section 7.03 shall be made only after payment in full of any amounts that the Buyer is obligated to deposit in the Collection Account pursuant to the Pooling and Servicing Agreement; provided further that the Investor Certificateholders shall be entitled to the benefits of the subordination of the Collections allocable to the Seller's Interest to the extent provided in the Supplements. Section 7.04 No Petition. The Seller hereby covenants and agrees that it will not at any time institute against the Buyer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law. Section 7.05 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.06. Notices. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered at or mailed by registered mail, return receipt requested, to the parties at such addresses specified in the Pooling and Servicing Agreement.

Section 7.03 Limited Recourse. Notwithstanding anything to the contrary contained herein, the obligations of the Buyer hereunder shall not be recourse to the Buyer (or any person or organization acting on behalf of the Buyer or any affiliate, officer or director of the Buyer), other than to (a) the portion of the Seller's Interest on any date of determination which is in excess of the Required Participation Amount and (b) any other assets of the Buyer not pledged to third parties or otherwise encumbered in a manner permitted by the Seller's Certificate of Incorporation; provided, however, that any payment by the Buyer made in accordance with this Section 7.03 shall be made only after payment in full of any amounts that the Buyer is obligated to deposit in the Collection Account pursuant to the Pooling and Servicing Agreement; provided further that the Investor Certificateholders shall be entitled to the benefits of the subordination of the Collections allocable to the Seller's Interest to the extent provided in the Supplements. Section 7.04 No Petition. The Seller hereby covenants and agrees that it will not at any time institute against the Buyer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law. Section 7.05 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.06. Notices. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered at or mailed by registered mail, return receipt requested, to the parties at such addresses specified in the Pooling and Servicing Agreement. Section 7.07 Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of the Certificates or rights of the Certificateholders. Section 7.08. Assignment. Notwithstanding anything to the contrary contained herein, this Agreement may not be assigned by the Seller (other than as provided in Section 5.01 hereof) without the prior consent of the Buyer and the Trustee. The Buyer may assign its rights, remedies, powers and privileges under this Agreement to the Trust pursuant to the Pooling and Servicing Agreement.

Section 7.09. Further Assurances. The Seller agrees to do and perform, from time to time, any and all acts and to execute any and all further instruments required or reasonably requested by the Buyer more fully to effect the purposes of this Agreement, including the execution of any financing statements or continuation statements relating to the Receivables for filing under the provisions of the UCC of any applicable jurisdiction. Section 7.10 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Buyer, any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. Section 7.11 Counterparts. This Agreement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. Section 7.12. Third-Party Beneficiaries. This Agreement will inure to the benefit of and be binding upon the parties hereto, the Certificateholders and the other Beneficiaries and their respective successors and permitted assigns. Except as otherwise provided in this Agreement, no other Person will have any right or obligation hereunder.

Section 7.09. Further Assurances. The Seller agrees to do and perform, from time to time, any and all acts and to execute any and all further instruments required or reasonably requested by the Buyer more fully to effect the purposes of this Agreement, including the execution of any financing statements or continuation statements relating to the Receivables for filing under the provisions of the UCC of any applicable jurisdiction. Section 7.10 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Buyer, any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. Section 7.11 Counterparts. This Agreement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. Section 7.12. Third-Party Beneficiaries. This Agreement will inure to the benefit of and be binding upon the parties hereto, the Certificateholders and the other Beneficiaries and their respective successors and permitted assigns. Except as otherwise provided in this Agreement, no other Person will have any right or obligation hereunder. Section 7.13. Merger and Integration. Except as specifically stated otherwise herein, this Agreement sets forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement. This Agreement may not be modified, amended, waived, or supplemented except as provided herein. Section 7.14. Headings. The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.

IN WITNESS WHEREOF, the Seller and the Buyer have caused this Receivables Purchase Agreement to be duly executed by their respective officers as of the day and year first above written. FEDERAL-MOGUL FUNDING CORPORATION, Buyer By------------------------Name: Title: FEDERAL-MOGUL CORPORATION, Seller By---------------------------Name: Title:

CERTIFICATE PURCHASE AGREEMENT dated February 28, 1997 (this "Agreement") among FEDERAL-MOGUL FUNDING CORPORATION, a Michigan corporation, as Seller (the "Seller"), FALCON ASSET SECURITIZATION CORPORATION, Delaware corporation ("Falcon"), THE FINANCIAL INSTITUTIONS LISTED FROM TIME TO TIME ON THE SIGNATURE PAGES HERETO AS LIQUIDITY PROVIDERS (individually, a "Liquidity Provider" and collectively, the "Liquidity Providers"), and THE FIRST NATIONAL BANK OF CHICAGO, as agent (the "Program Agent") for Falcon and the Liquidity Providers.

IN WITNESS WHEREOF, the Seller and the Buyer have caused this Receivables Purchase Agreement to be duly executed by their respective officers as of the day and year first above written. FEDERAL-MOGUL FUNDING CORPORATION, Buyer By------------------------Name: Title: FEDERAL-MOGUL CORPORATION, Seller By---------------------------Name: Title:

CERTIFICATE PURCHASE AGREEMENT dated February 28, 1997 (this "Agreement") among FEDERAL-MOGUL FUNDING CORPORATION, a Michigan corporation, as Seller (the "Seller"), FALCON ASSET SECURITIZATION CORPORATION, Delaware corporation ("Falcon"), THE FINANCIAL INSTITUTIONS LISTED FROM TIME TO TIME ON THE SIGNATURE PAGES HERETO AS LIQUIDITY PROVIDERS (individually, a "Liquidity Provider" and collectively, the "Liquidity Providers"), and THE FIRST NATIONAL BANK OF CHICAGO, as agent (the "Program Agent") for Falcon and the Liquidity Providers. W I T N E S S E T H: WHEREAS, the Federal-Mogul Trade Receivables Master Trust may issue the Series 1997-1 Certificates (as hereinafter defined) at the direction of the Seller; WHEREAS, subject to the terms and conditions of this Agreement and of the Series 1997-1 Supplement, the Seller may sell the Class A Certificates to the Program Agent for the benefit of Falcon and/or the Liquidity Providers (Falcon and the Liquidity Providers, each a "Purchaser" and collectively, the "Purchasers"); WHEREAS, subject to the terms and conditions of this Agreement, Falcon may and the Liquidity Providers shall fund from time to time Increases in the Class A Invested Amount; and WHEREAS, the Class A Certificates will be held by the Program Agent for the benefit of the applicable Purchaser(s); NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto hereby agree as follows:

ARTICLE I DEFINITIONS SECTION 1.01. Defined Terms. As used in this Agreement, terms defined in the foregoing paragraphs shall have their defined meanings when used herein and the following terms shall have the following meanings: "Acquisition Amount" means, on the date of any purchase from Falcon of Class A Certificates Interests pursuant to Section 2.07, (i) with respect to each Liquidity Provider other than First Chicago, the lesser of (a) such Liquidity Providers's Liquidity Provider Commitment Percentage of the Falcon Transfer Price and (b) such Liquidity Provider's unused Liquidity Provider Commitment and (ii) with respect to First Chicago, the difference

CERTIFICATE PURCHASE AGREEMENT dated February 28, 1997 (this "Agreement") among FEDERAL-MOGUL FUNDING CORPORATION, a Michigan corporation, as Seller (the "Seller"), FALCON ASSET SECURITIZATION CORPORATION, Delaware corporation ("Falcon"), THE FINANCIAL INSTITUTIONS LISTED FROM TIME TO TIME ON THE SIGNATURE PAGES HERETO AS LIQUIDITY PROVIDERS (individually, a "Liquidity Provider" and collectively, the "Liquidity Providers"), and THE FIRST NATIONAL BANK OF CHICAGO, as agent (the "Program Agent") for Falcon and the Liquidity Providers. W I T N E S S E T H: WHEREAS, the Federal-Mogul Trade Receivables Master Trust may issue the Series 1997-1 Certificates (as hereinafter defined) at the direction of the Seller; WHEREAS, subject to the terms and conditions of this Agreement and of the Series 1997-1 Supplement, the Seller may sell the Class A Certificates to the Program Agent for the benefit of Falcon and/or the Liquidity Providers (Falcon and the Liquidity Providers, each a "Purchaser" and collectively, the "Purchasers"); WHEREAS, subject to the terms and conditions of this Agreement, Falcon may and the Liquidity Providers shall fund from time to time Increases in the Class A Invested Amount; and WHEREAS, the Class A Certificates will be held by the Program Agent for the benefit of the applicable Purchaser(s); NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto hereby agree as follows:

ARTICLE I DEFINITIONS SECTION 1.01. Defined Terms. As used in this Agreement, terms defined in the foregoing paragraphs shall have their defined meanings when used herein and the following terms shall have the following meanings: "Acquisition Amount" means, on the date of any purchase from Falcon of Class A Certificates Interests pursuant to Section 2.07, (i) with respect to each Liquidity Provider other than First Chicago, the lesser of (a) such Liquidity Providers's Liquidity Provider Commitment Percentage of the Falcon Transfer Price and (b) such Liquidity Provider's unused Liquidity Provider Commitment and (ii) with respect to First Chicago, the difference between (a) the Falcon Transfer Price and (b) the aggregate amount payable by all other Liquidity Providers on such date pursuant to clause (i) above. "Adjusted Liquidity Price" means, in determining the Falcon Transfer Price for any Class A Certificate Interest, an amount equal to PI x (i)DC + (ii) NDR ARD
where: PI = the undivided percentage interest in the Trust Assets evidenced by such Class A Certificate Interest. the Deemed Collections. the outstanding balance of all Receivables that are not Defaulted Receivables. 1 + (.50 x Aggregate Reserves)

DC NDR

= =

ARD

=

ARTICLE I DEFINITIONS SECTION 1.01. Defined Terms. As used in this Agreement, terms defined in the foregoing paragraphs shall have their defined meanings when used herein and the following terms shall have the following meanings: "Acquisition Amount" means, on the date of any purchase from Falcon of Class A Certificates Interests pursuant to Section 2.07, (i) with respect to each Liquidity Provider other than First Chicago, the lesser of (a) such Liquidity Providers's Liquidity Provider Commitment Percentage of the Falcon Transfer Price and (b) such Liquidity Provider's unused Liquidity Provider Commitment and (ii) with respect to First Chicago, the difference between (a) the Falcon Transfer Price and (b) the aggregate amount payable by all other Liquidity Providers on such date pursuant to clause (i) above. "Adjusted Liquidity Price" means, in determining the Falcon Transfer Price for any Class A Certificate Interest, an amount equal to PI x (i)DC + (ii) NDR ARD
where: PI = the undivided percentage interest in the Trust Assets evidenced by such Class A Certificate Interest. the Deemed Collections. the outstanding balance of all Receivables that are not Defaulted Receivables. 1 + (.50 x Aggregate Reserves)

DC NDR

= =

ARD

=

Each of the foregoing shall be determined from the most recent Distribution Date Statement received from the Trustee. "Affected Liquidity Provider" shall have the meaning assigned to such term in Section 6.01(c). "Affected Person" shall have the meaning assigned to such term in Section 3.02. "Affiliate" means any Person directly or indirectly

controlling, controlled by, or under direct or indirect common control with, another Person or any subsidiary of such other Person. A Person shall be deemed to control another Person if the controlling Person owns 10% or more of any class of voting securities of the controlled Person or possesses, directly or indirectly, the power to direct or cause the direction of the management or policies of the controlled Person, whether through ownership of stock, by contract or otherwise. "Aggregate Unpaids" means, at any time, an amount equal to the sum of all accrued and unpaid Class A Monthly Interest, Class A Additional Interest, Class A Invested Amount, and all amounts (whether owed or accrued) hereunder, under the Series 1997-1 Supplement or under the Fee Letter to the Program Agent and the Purchasers at such time. "Assignment and Acceptance" shall mean an assignment and acceptance in substantially the form of Exhibit A pursuant to which a Liquidity Provider assigns all or a portion of its rights and obligations under this Agreement in accordance with the terms of Section 6.01.

controlling, controlled by, or under direct or indirect common control with, another Person or any subsidiary of such other Person. A Person shall be deemed to control another Person if the controlling Person owns 10% or more of any class of voting securities of the controlled Person or possesses, directly or indirectly, the power to direct or cause the direction of the management or policies of the controlled Person, whether through ownership of stock, by contract or otherwise. "Aggregate Unpaids" means, at any time, an amount equal to the sum of all accrued and unpaid Class A Monthly Interest, Class A Additional Interest, Class A Invested Amount, and all amounts (whether owed or accrued) hereunder, under the Series 1997-1 Supplement or under the Fee Letter to the Program Agent and the Purchasers at such time. "Assignment and Acceptance" shall mean an assignment and acceptance in substantially the form of Exhibit A pursuant to which a Liquidity Provider assigns all or a portion of its rights and obligations under this Agreement in accordance with the terms of Section 6.01. "Base Rate" means, (i) prior to the occurrence of a Servicer Default, a rate per annum equal to the corporate base rate, prime rate or base rate of interest, as applicable, announced by the Reference Bank from time to time, changing when and as such rate changes, and (ii) at all times after the occurrence of an Early Amortization Event, such rate plus 2.00% per annum. "Class A Certificate Interest" shall mean each undivided percentage interest in the Class A Certificates acquired by Falcon or any Liquidity Provider in connection with the Purchase or any Increase in the Class A Invested Amount. "Class A Certificateholder" shall mean the Program Agent. "Closing Date" shall mean February 28, 1997. "Commercial Paper" means promissory notes of Falcon issued by Falcon in the commercial paper market. "CP Rate" means, the rate, requested by the Seller and agreed to by Falcon, equivalent to the rate (or if more than one rate, the weighted average of the rates) at which Commercial Paper having a term equal to the relevant Tranche Period may be sold by any placement agent or commercial paper dealer reasonably selected by Falcon, as agreed between each such dealer or agent and Falcon plus any and all applicable issuing and paying agent

fees and commissions of placement agents and commercial paper dealers in respect of such Commercial Paper; provided, however, that if the rate (or rates) as agreed between any such agent or dealer and Falcon is a discount rate (or rates), the "CP Rate" for such Tranche Period shall be the rate (or if more than one rate, the weighted average of the rates) resulting from Falcon's converting such discount rate (or rates) to an interest-bearing equivalent rate per annum. "Deemed Collections" means, in connection with the transfer by Falcon of one or more Class A Certificate Interests to the Liquidity Providers pursuant to Section 2.07 hereof, the aggregate of all amounts owing to the Program Agent on behalf of Falcon pursuant to Sections 2.03, 2.04(c), 3.03(c) and 3.09 of the Pooling and Servicing Agreement and Section 8.01 hereof relating to the Class A Certificate Interests which are the subject of such transfer. "Defaulting Liquidity Provider" shall have the meaning assigned to such term in Section 2.11. "Discount" means, for each Class A Certificate Interest for any Tranche Period: DR x C X AD 360 where:

fees and commissions of placement agents and commercial paper dealers in respect of such Commercial Paper; provided, however, that if the rate (or rates) as agreed between any such agent or dealer and Falcon is a discount rate (or rates), the "CP Rate" for such Tranche Period shall be the rate (or if more than one rate, the weighted average of the rates) resulting from Falcon's converting such discount rate (or rates) to an interest-bearing equivalent rate per annum. "Deemed Collections" means, in connection with the transfer by Falcon of one or more Class A Certificate Interests to the Liquidity Providers pursuant to Section 2.07 hereof, the aggregate of all amounts owing to the Program Agent on behalf of Falcon pursuant to Sections 2.03, 2.04(c), 3.03(c) and 3.09 of the Pooling and Servicing Agreement and Section 8.01 hereof relating to the Class A Certificate Interests which are the subject of such transfer. "Defaulting Liquidity Provider" shall have the meaning assigned to such term in Section 2.11. "Discount" means, for each Class A Certificate Interest for any Tranche Period: DR x C X AD 360 where:
DR = the Discount Rate for such Class A Certificate Interest for such Tranche Period; the Class A Invested Amount of such Class A Certificate Interest during such Tranche Period; and the actual number of days elapsed during such Tranche Period;

C

=

AD

=

provided that no provision of this Agreement shall require the payment or permit the collection of Discount in excess of the maximum rate permitted by applicable law; and provided, further, that Discount for any Tranche Period shall not be considered paid by any distribution to the extent that at any time all or a portion of such distribution is rescinded or must otherwise be returned for any reason. "Discount Rate" means the LIBO Rate, the CP Rate or the Base Rate, as applicable.

"Extension Term" shall have the meaning assigned to such term in Section 2.12. "Falcon" shall mean Falcon Asset Securitization Corporation and its successors and assigns, but shall not include the Liquidity Providers as assignees under Section 2.07. "Falcon Residual" shall mean the sum of the Falcon Transfer Price Reductions. "Falcon Transfer Price" means, with respect to the assignment by Falcon of one or more Class A Certificate Interests to the Liquidity Providers, the sum of (i) the lesser of (a) the Class A Invested Amount allocated to each Class A Certificate Interest and (b) the Adjusted Liquidity Price of each Class A Certificate Interest and (ii) all accrued and unpaid Discount for such Class A Certificate Interest(s). "Falcon Transfer Price Deficit" shall have the meaning assigned to such term in Section 2.11. "Falcon Transfer Price Reduction" shall mean in connection with the assignment of a Class A Certificate Interest by Falcon to the Liquidity Providers, the positive difference between (i) the Class A Invested Amount allocated to such Class A Certificate Interest and (ii) the Adjusted Liquidity Price for such Class A Certificate Interest.

"Extension Term" shall have the meaning assigned to such term in Section 2.12. "Falcon" shall mean Falcon Asset Securitization Corporation and its successors and assigns, but shall not include the Liquidity Providers as assignees under Section 2.07. "Falcon Residual" shall mean the sum of the Falcon Transfer Price Reductions. "Falcon Transfer Price" means, with respect to the assignment by Falcon of one or more Class A Certificate Interests to the Liquidity Providers, the sum of (i) the lesser of (a) the Class A Invested Amount allocated to each Class A Certificate Interest and (b) the Adjusted Liquidity Price of each Class A Certificate Interest and (ii) all accrued and unpaid Discount for such Class A Certificate Interest(s). "Falcon Transfer Price Deficit" shall have the meaning assigned to such term in Section 2.11. "Falcon Transfer Price Reduction" shall mean in connection with the assignment of a Class A Certificate Interest by Falcon to the Liquidity Providers, the positive difference between (i) the Class A Invested Amount allocated to such Class A Certificate Interest and (ii) the Adjusted Liquidity Price for such Class A Certificate Interest. "Federal Funds Effective Rate" shall mean, for any period, a fluctuating interest rate per annum equal for each day during such period equal to (a) the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day, for the preceding Business Day) by the Federal Reserve Bank of New York in the Composite Closing Quotations for U.S. Government Securities; or (b) if such rate is not so published for any day which is a Business Day, the average of the quotations at approximately 10:30 a.m. (Chicago time) for such day on such transactions received by the Reference Bank from three federal funds brokers of recognized standing selected by it. "Federal-Mogul" shall mean Federal-Mogul Corporation, a Michigan corporation, and its successors in interest to the extent permitted hereunder, as amended, modified or supplemented and in effect from time to time. "Fee Letter" shall mean the letter agreement dated the date hereof by and between the Program Agent and the Seller.

"First Chicago" means The First National Bank of Chicago in its individual capacity and its successors. "First Chicago Roles" shall have the meaning assigned to such term in Section 5.07. "Indemnified Amounts" shall have the meaning assigned to such term in Section 8.01. "Indemnified Party" shall have the meaning assigned to such term in Section 8.01. "Initial Term" shall mean, with respect to each Liquidity Provider Commitment, the period which commences on the date such Liquidity Provider enters into this Agreement and ends on the date which is 364 days from the date of this Agreement. "LIBO Rate" means the rate per annum equal to the sum of (i) (a) the rate at which deposits in U.S. Dollars are offered by the Reference Bank to first-class banks in the London interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the first day of the relevant Tranche Period, such deposits being in the approximate amount of the Class A Invested Amount of the Class A Certificate Interest to be funded or maintained plus (ii) 0.75% per annum. The LIBO Rate shall be rounded, if necessary, to the next higher 1/16 of 1%. "Liquidity Provider Commitment" shall mean, as to any Liquidity Provider, the obligation of such Liquidity Provider to (i) make the Purchase pursuant to Section 2.01, (ii) purchase the Class A Certificate Interests of Falcon pursuant to Section 2.07 and (iii) fund Increases in the Class A Invested Amount, in each instance up to the amount set

"First Chicago" means The First National Bank of Chicago in its individual capacity and its successors. "First Chicago Roles" shall have the meaning assigned to such term in Section 5.07. "Indemnified Amounts" shall have the meaning assigned to such term in Section 8.01. "Indemnified Party" shall have the meaning assigned to such term in Section 8.01. "Initial Term" shall mean, with respect to each Liquidity Provider Commitment, the period which commences on the date such Liquidity Provider enters into this Agreement and ends on the date which is 364 days from the date of this Agreement. "LIBO Rate" means the rate per annum equal to the sum of (i) (a) the rate at which deposits in U.S. Dollars are offered by the Reference Bank to first-class banks in the London interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the first day of the relevant Tranche Period, such deposits being in the approximate amount of the Class A Invested Amount of the Class A Certificate Interest to be funded or maintained plus (ii) 0.75% per annum. The LIBO Rate shall be rounded, if necessary, to the next higher 1/16 of 1%. "Liquidity Provider Commitment" shall mean, as to any Liquidity Provider, the obligation of such Liquidity Provider to (i) make the Purchase pursuant to Section 2.01, (ii) purchase the Class A Certificate Interests of Falcon pursuant to Section 2.07 and (iii) fund Increases in the Class A Invested Amount, in each instance up to the amount set forth opposite such Liquidity Provider's name on the signature pages hereto, subject to Section 2.02, or as otherwise set forth in an Assignment and Acceptance in connection with an assignment from a Liquidity Provider of its obligations hereunder in accordance with the terms of Section 6.01, as such amount may be reduced from time to time pursuant to Section 2.04. "Liquidity Provider Commitment Percentage" shall mean, on any day and as to any Liquidity Provider, a fraction, the numerator of which is such Liquidity Provider's Liquidity Provider Commitment and the denominator of which is the Class A Purchase Limit on such day, as such percentage may be modified by assignments made from time to time pursuant to Section 6.01. "Liquidity Providers" shall mean the banks and financial institutions party hereto from time to time as

"Liquidity Providers" hereunder, as their names appear on the signature pages hereto under the heading "Liquidity Providers" or as otherwise set forth in an Assignment and Acceptance in connection with an assignment from a Liquidity Provider of its rights and obligations hereunder in accordance with the terms of Section 6.01. "Majority of Class A Certificate Interests" shall mean the Program Agent and holders of Class A Certificate Interests evidencing 66 2/3% or more of the aggregate Class A Certificate Interests; provided that, solely for purposes of this computation, (i) Liquidity Providers shall be deemed to hold Class A Certificate Interests equal to their respective Liquidity Provider Commitment Percentages of such aggregate Class A Certificate Interests, whether or not they have made the Purchase or funded any Increases, and (ii) Falcon's Class A Certificate Interest will be reduced by the amount set forth in clause (i). "Non-Defaulting Liquidity Provider" shall have the meaning assigned to such term in Section 2.11. "Obligations" shall mean all obligations of the Seller, the Servicer or Federal-Mogul to the Trustee, the Trust, the Program Agent, any Purchaser, any Enhancement Provider, the other Indemnified Parties and their respective successors, permitted transferees and assigns, arising under or in connection with the Transaction Documents, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due.

"Liquidity Providers" hereunder, as their names appear on the signature pages hereto under the heading "Liquidity Providers" or as otherwise set forth in an Assignment and Acceptance in connection with an assignment from a Liquidity Provider of its rights and obligations hereunder in accordance with the terms of Section 6.01. "Majority of Class A Certificate Interests" shall mean the Program Agent and holders of Class A Certificate Interests evidencing 66 2/3% or more of the aggregate Class A Certificate Interests; provided that, solely for purposes of this computation, (i) Liquidity Providers shall be deemed to hold Class A Certificate Interests equal to their respective Liquidity Provider Commitment Percentages of such aggregate Class A Certificate Interests, whether or not they have made the Purchase or funded any Increases, and (ii) Falcon's Class A Certificate Interest will be reduced by the amount set forth in clause (i). "Non-Defaulting Liquidity Provider" shall have the meaning assigned to such term in Section 2.11. "Obligations" shall mean all obligations of the Seller, the Servicer or Federal-Mogul to the Trustee, the Trust, the Program Agent, any Purchaser, any Enhancement Provider, the other Indemnified Parties and their respective successors, permitted transferees and assigns, arising under or in connection with the Transaction Documents, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due. "Person" means an individual, partnership, limited liability company, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof. "Pooling and Servicing Agreement" shall mean the Amended and Restated Pooling and Servicing Agreement, dated as of February 1, 1997, among the Seller, as seller, the Servicer and the Trustee, as amended, supplemented or otherwise modified from time to time. "Purchase" shall mean the purchase of the Class A Certificates on the Purchase Date, whether by Falcon or the Liquidity Providers. "Purchase Date" shall mean the Closing Date. "Purchase Notice" shall have the meaning set forth in Section 2.05.

"Purchase Price" shall mean the price specified in the notice from the Seller (substantially in the form of Exhibit B) delivered pursuant to Section 2.05. "Purchaser" shall have the meaning assigned to such term in the second recital hereof. "Purchasing Liquidity Provider" shall have the meaning assigned to such term in Section 6.01(b). "Reduction Percentage" shall mean, for any Class A Certificate Interest acquired by the Liquidity Providers from Falcon for less than the Class A Invested Amount allocated to such Class A Certificate Interest, a percentage equal to (i) one, minus (ii) a fraction the numerator of which is the Falcon Transfer Price Reduction for such Class A Certificate Interest and the denominator of which is the Class A Invested Amount allocated to such Class A Certificate Interest. "Reference Bank" means NBD Bank or such other bank as the Program Agent shall designate with the consent of the Seller. "Required Notice Date" shall mean, with respect to the date of the funding of any Increase, by 11:00 a.m. (Chicago time) (i) at least three Business Days prior to such date if the LIBO Rate is being requested as the Discount Rate relating to such Increase, (ii) at least three Business Days prior to such date if the CP Rate is being requested as

"Purchase Price" shall mean the price specified in the notice from the Seller (substantially in the form of Exhibit B) delivered pursuant to Section 2.05. "Purchaser" shall have the meaning assigned to such term in the second recital hereof. "Purchasing Liquidity Provider" shall have the meaning assigned to such term in Section 6.01(b). "Reduction Percentage" shall mean, for any Class A Certificate Interest acquired by the Liquidity Providers from Falcon for less than the Class A Invested Amount allocated to such Class A Certificate Interest, a percentage equal to (i) one, minus (ii) a fraction the numerator of which is the Falcon Transfer Price Reduction for such Class A Certificate Interest and the denominator of which is the Class A Invested Amount allocated to such Class A Certificate Interest. "Reference Bank" means NBD Bank or such other bank as the Program Agent shall designate with the consent of the Seller. "Required Notice Date" shall mean, with respect to the date of the funding of any Increase, by 11:00 a.m. (Chicago time) (i) at least three Business Days prior to such date if the LIBO Rate is being requested as the Discount Rate relating to such Increase, (ii) at least three Business Days prior to such date if the CP Rate is being requested as the Discount Rate relating to such Increase and (iii) at least one Business Day prior to such date if the Base Rate is being requested as the Discount Rate relating to such Increase. "Series 1997-1 Supplement" shall mean the Series 1997-1 Supplement to the Pooling and Servicing Agreement, dated as of February 1, 1997, among the Seller, the Servicer and the Trustee. "Servicer Default" shall mean one of the events set forth in Section 10.01 of the Pooling and Servicing Agreement. "Taxes" shall have the meaning set forth in Section 3.03. "Term" shall mean, with respect to each Liquidity Provider Commitment, the Initial Term and each Extension Term as provided in Section 2.12. "Termination Date" shall be the last day of the Term. "Tranche Period" means, with respect to any Class A Certificate Interest:

(a) if Discount for such Class A Certificate Interest is calculated with respect to the CP Rate, a period of days not to exceed 270 days commencing on a Business Day requested by the Seller and agreed to by Falcon; (b) if Discount for such Class A Certificate Interest is calculated on the basis of the LIBO Rate, a period of one, two or three months, or such other period as may be mutually agreeable to the Program Agent and the Seller, commencing on a Business Day selected by the Seller or the Program Agent pursuant to this Agreement. Such Tranche Period shall end on the day in the applicable succeeding calendar month which corresponds numerically to the beginning day of such Tranche Period, provided, however, that if there is no such numerically corresponding day in such succeeding month, such Tranche Period shall end on the last Business Day of such succeeding month; and (c) if Discount for such Class A Certificate Interest is calculated on the basis of the Base Rate, a period of 30 days commencing on a Business Day selected by the Seller. If any Tranche Period would end on a day which is not a Business Day, such Tranche Period shall end on the next succeeding Business Day, provided, however, that in the case of Tranche Periods corresponding to the LIBO Rate, if such next succeeding Business Day falls in a new month, such Tranche Period shall end on the immediately preceding Business Day. In the case of any Tranche Period for any Class A Certificate Interest

(a) if Discount for such Class A Certificate Interest is calculated with respect to the CP Rate, a period of days not to exceed 270 days commencing on a Business Day requested by the Seller and agreed to by Falcon; (b) if Discount for such Class A Certificate Interest is calculated on the basis of the LIBO Rate, a period of one, two or three months, or such other period as may be mutually agreeable to the Program Agent and the Seller, commencing on a Business Day selected by the Seller or the Program Agent pursuant to this Agreement. Such Tranche Period shall end on the day in the applicable succeeding calendar month which corresponds numerically to the beginning day of such Tranche Period, provided, however, that if there is no such numerically corresponding day in such succeeding month, such Tranche Period shall end on the last Business Day of such succeeding month; and (c) if Discount for such Class A Certificate Interest is calculated on the basis of the Base Rate, a period of 30 days commencing on a Business Day selected by the Seller. If any Tranche Period would end on a day which is not a Business Day, such Tranche Period shall end on the next succeeding Business Day, provided, however, that in the case of Tranche Periods corresponding to the LIBO Rate, if such next succeeding Business Day falls in a new month, such Tranche Period shall end on the immediately preceding Business Day. In the case of any Tranche Period for any Class A Certificate Interest which commences before the last day of the Revolving Period and would otherwise end on a date occurring after the last day of the Revolving Period, such Tranche Period shall end on the last day of the Revolving Period. The duration of each Tranche Period which commences after the last day of the Revolving Period shall be of such duration as selected by the Program Agent. "Transaction Documents" means, collectively, this Agreement all other instruments, documents and agreements executed and delivered by the Seller in connection herewith, the Fee Letter, the Pooling and Servicing Agreement, the Series 1997-1 Supplement, the Class A Certificates and the Receivable Purchase Agreement. "Withholding Tax" shall have the meaning assigned to such term in Section 9.16. SECTION 1.02. Other Definitional Provisions. (a) All capitalized terms not otherwise defined herein are defined in the Pooling and Servicing Agreement and the Series 1997-1 Supplement. (b) As used herein, in the Class A Certificates and in

any certificate or other document made or delivered pursuant hereto, accounting terms not defined in Section 1.01 and accounting terms partly defined in Section 1.01 to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles as in effect in the United States from time to time. (c) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified. (d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

ARTICLE II THE PURCHASE; INCREASES SECTION 2.01. The Purchase. (a) Falcon may, in its sole discretion, make the Purchase. Falcon's election to make the Purchase is subject to the satisfaction of the conditions precedent set forth in Section 4.01. (b) If Falcon shall elect not to make the Purchase on the Purchase Date, the Liquidity Providers shall, subject to

any certificate or other document made or delivered pursuant hereto, accounting terms not defined in Section 1.01 and accounting terms partly defined in Section 1.01 to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles as in effect in the United States from time to time. (c) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified. (d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

ARTICLE II THE PURCHASE; INCREASES SECTION 2.01. The Purchase. (a) Falcon may, in its sole discretion, make the Purchase. Falcon's election to make the Purchase is subject to the satisfaction of the conditions precedent set forth in Section 4.01. (b) If Falcon shall elect not to make the Purchase on the Purchase Date, the Liquidity Providers shall, subject to the satisfaction of the conditions precedent set forth in Section 4.01, make the Purchase. Each Liquidity Provider shall make the Purchase in an amount equal to its Liquidity Provider Commitment Percentage of the Purchase Price. (c) Under no circumstances shall Falcon or the Liquidity Providers make the Purchase if, as a result thereof, the Class A Invested Amount would exceed the Class A Purchase Limit or, in the case of a Liquidity Provider, if such Liquidity Provider's Liquidity Provider Commitment Percentage of the Purchase Price would exceed such Liquidity Provider's Liquidity Provider Commitment. SECTION 2.02. Increases. (a) Falcon may, in its sole discretion, from time to time during the period from the date of this Agreement to the last day of the Revolving Period, upon the request of the Seller and subject to the satisfaction of the conditions precedent set forth in Section 4.01, fund Increases, and, upon so funding an Increase, shall acquire Class A Certificate Interests representing a portion of the Class A Invested Amount equal to the amount of such Increase. (b) If Falcon elects not to fund a requested Increase, each Liquidity Provider shall, upon the request of the Seller and subject to the satisfaction of the conditions precedent set forth in Section 4.01, fund such Increase in an amount equal to its Liquidity Provider Commitment Percentage of the amount of such requested Increase. All Increases funded by the Liquidity Providers shall be at the LIBO Rate and shall be made on a pro rata basis in accordance with the Liquidity Provider Commitments. (c) Under no circumstances shall Falcon or any Liquidity Provider fund any Increase to the extent that, after giving effect to such Increase and the other Increases to be funded by the other Liquidity Providers concurrently therewith, (i) the Class A Invested Amount would exceed the Class A Purchase Limit or (ii) with respect to any Liquidity Provider, the funding of such Increase would exceed its Liquidity Provider Commitment.

SECTION 2.03. Class A Certificates. On the Purchase Date, on each date an Increase in the Class A Invested Amount is funded hereunder and on each date the Class A Invested Amount is reduced, a duly authorized agent of the Program Agent shall make appropriate notations in its books and records of the Purchase Price, the amount of such Increase and the amount of such reduction, as applicable. Each of the Servicer, the Seller and the Trustee hereby authorizes each duly authorized agent of the Program Agent to make such notations on the books and records as aforesaid and every such notation made in accordance with the foregoing authority shall be prima facie evidence of the accuracy of the information so recorded and shall be binding on the Seller and the Trustee

ARTICLE II THE PURCHASE; INCREASES SECTION 2.01. The Purchase. (a) Falcon may, in its sole discretion, make the Purchase. Falcon's election to make the Purchase is subject to the satisfaction of the conditions precedent set forth in Section 4.01. (b) If Falcon shall elect not to make the Purchase on the Purchase Date, the Liquidity Providers shall, subject to the satisfaction of the conditions precedent set forth in Section 4.01, make the Purchase. Each Liquidity Provider shall make the Purchase in an amount equal to its Liquidity Provider Commitment Percentage of the Purchase Price. (c) Under no circumstances shall Falcon or the Liquidity Providers make the Purchase if, as a result thereof, the Class A Invested Amount would exceed the Class A Purchase Limit or, in the case of a Liquidity Provider, if such Liquidity Provider's Liquidity Provider Commitment Percentage of the Purchase Price would exceed such Liquidity Provider's Liquidity Provider Commitment. SECTION 2.02. Increases. (a) Falcon may, in its sole discretion, from time to time during the period from the date of this Agreement to the last day of the Revolving Period, upon the request of the Seller and subject to the satisfaction of the conditions precedent set forth in Section 4.01, fund Increases, and, upon so funding an Increase, shall acquire Class A Certificate Interests representing a portion of the Class A Invested Amount equal to the amount of such Increase. (b) If Falcon elects not to fund a requested Increase, each Liquidity Provider shall, upon the request of the Seller and subject to the satisfaction of the conditions precedent set forth in Section 4.01, fund such Increase in an amount equal to its Liquidity Provider Commitment Percentage of the amount of such requested Increase. All Increases funded by the Liquidity Providers shall be at the LIBO Rate and shall be made on a pro rata basis in accordance with the Liquidity Provider Commitments. (c) Under no circumstances shall Falcon or any Liquidity Provider fund any Increase to the extent that, after giving effect to such Increase and the other Increases to be funded by the other Liquidity Providers concurrently therewith, (i) the Class A Invested Amount would exceed the Class A Purchase Limit or (ii) with respect to any Liquidity Provider, the funding of such Increase would exceed its Liquidity Provider Commitment.

SECTION 2.03. Class A Certificates. On the Purchase Date, on each date an Increase in the Class A Invested Amount is funded hereunder and on each date the Class A Invested Amount is reduced, a duly authorized agent of the Program Agent shall make appropriate notations in its books and records of the Purchase Price, the amount of such Increase and the amount of such reduction, as applicable. Each of the Servicer, the Seller and the Trustee hereby authorizes each duly authorized agent of the Program Agent to make such notations on the books and records as aforesaid and every such notation made in accordance with the foregoing authority shall be prima facie evidence of the accuracy of the information so recorded and shall be binding on the Seller and the Trustee absent manifest error. All Increases in the Class A Invested Amount shall be subject to reduction in accordance with the provisions of this Agreement and the Series 1997-1 Supplement. SECTION 2.04. Reductions to the Class A Purchase Limit. The Seller may, from time to time, upon at least 30 days' prior written notice to the Program Agent, elect to reduce the Class A Purchase Limit by an amount up to the difference between the Class A Purchase Limit at such time and the Class A Invested Amount at such time; provided that such partial reduction in the Class A Purchase Limit shall be in a minimum amount equal to $2,000,000 and integral multiples of $1,000,000 in excess of such minimum. Any such reduction shall be permanent and shall reduce the Liquidity Provider Commitments of the Liquidity Providers hereunder ratably in accordance with the Liquidity Provider Commitment Percentages. SECTION 2.05. Procedures for Making the Purchase and Increases. (a) Notice of the Purchase and Increases. The Purchase and each Increase shall occur on a Business Day and shall be made or funded on notice (the "Purchase Notice") from the Seller (substantially in the form of Exhibit B, in the case of the Purchase, or Exhibit

SECTION 2.03. Class A Certificates. On the Purchase Date, on each date an Increase in the Class A Invested Amount is funded hereunder and on each date the Class A Invested Amount is reduced, a duly authorized agent of the Program Agent shall make appropriate notations in its books and records of the Purchase Price, the amount of such Increase and the amount of such reduction, as applicable. Each of the Servicer, the Seller and the Trustee hereby authorizes each duly authorized agent of the Program Agent to make such notations on the books and records as aforesaid and every such notation made in accordance with the foregoing authority shall be prima facie evidence of the accuracy of the information so recorded and shall be binding on the Seller and the Trustee absent manifest error. All Increases in the Class A Invested Amount shall be subject to reduction in accordance with the provisions of this Agreement and the Series 1997-1 Supplement. SECTION 2.04. Reductions to the Class A Purchase Limit. The Seller may, from time to time, upon at least 30 days' prior written notice to the Program Agent, elect to reduce the Class A Purchase Limit by an amount up to the difference between the Class A Purchase Limit at such time and the Class A Invested Amount at such time; provided that such partial reduction in the Class A Purchase Limit shall be in a minimum amount equal to $2,000,000 and integral multiples of $1,000,000 in excess of such minimum. Any such reduction shall be permanent and shall reduce the Liquidity Provider Commitments of the Liquidity Providers hereunder ratably in accordance with the Liquidity Provider Commitment Percentages. SECTION 2.05. Procedures for Making the Purchase and Increases. (a) Notice of the Purchase and Increases. The Purchase and each Increase shall occur on a Business Day and shall be made or funded on notice (the "Purchase Notice") from the Seller (substantially in the form of Exhibit B, in the case of the Purchase, or Exhibit C, in the case of an Increase) to the Program Agent received by the Program Agent not later than 12:00 noon (New York City time) on, in the case of the Purchase, the first Business Day immediately preceding the Purchase Date or, in the case of an Increase, on the Required Notice Date (with a copy provided to the Trustee). Each notice shall, except as set forth below, be irrevocable and specify the Purchase Price, the amount of the Increase (in each case, not to be less than $2,000,000 and integral multiples of $1,000,000 in excess of such minimum), the Purchase Date or date of the Increase, the initial Tranche Period and the initial Discount Rate related thereto. The Program Agent shall promptly notify, and in any event on or prior to 10:00 a.m., Chicago time, on the date of the funding of the Purchase or any Increase, the Seller and each Liquidity Provider if Falcon elects in its discretion not to make the Purchase or fund an

Increase. If Falcon declines to make a proposed Purchase or fund an Increase, the Seller may cancel the Purchase Notice or the Purchase or Increase will be made by the Liquidity Providers. (b) Delivery of the Class A Certificates. On the Purchase Date, the Seller will deliver to the Program Agent, on behalf of the Purchaser(s), one Class A Certificate, dated the Purchase Date, registered in the name of the Program Agent and duly authenticated in accordance with the provisions of the Pooling and Servicing Agreement against delivery by the Program Agent, on behalf of the Purchaser(s), to the Seller of the Purchase Price. (c) Funding of the Purchase and Increases. On the Purchase Date and any date on which an Increase is funded, Falcon or the Liquidity Providers, as applicable, shall, upon satisfaction of the applicable conditions set forth in Article IV, deposit, the Purchase Price or amount of the Increase (in the case of Falcon) or its Liquidity Provider Commitment Percentage of the Purchase Price or of the Increase (in the case of each Liquidity Provider) in immediately available funds in the following Accounts: in the case of the Purchase, deposit of the Purchase Price to the Escrow Account, held by The Chase Manhattan Bank, as escrow agent, account number 507-871731 and identified as the "Federal-Mogul Trade Receivables Master Trust, Series 1992-1 and Series 1993-1 Escrow Account"; if Falcon is funding an Increase, a deposit shall be made to an account of the Seller at Bank of America, account number 73-63613; if the Liquidity Providers are funding an Increase, a deposit shall be made to the FMSD Clearing Account, number 7521-7683, at The First National Bank of Chicago. The Program Agent to use its best efforts to cause such deposits to be made by not later than 12:00 noon (Chicago time). Section 2.06. Selection of Tranche Periods and Discount Rates. (a) Each Class A Certificate Interest shall at all times have an associated amount of Class A Invested Amount, a Discount Rate and Tranche Period applicable to it. Not less than $2,000,000 of Invested Amount may be allocated to any single Class A Certificate Interest. The Seller shall request Discount Rates and Tranche Periods for the Class A Certificate Interests. The Seller may select the CP Rate, with the concurrence of the Program Agent, or the Base Rate for the Class A Certificate

Increase. If Falcon declines to make a proposed Purchase or fund an Increase, the Seller may cancel the Purchase Notice or the Purchase or Increase will be made by the Liquidity Providers. (b) Delivery of the Class A Certificates. On the Purchase Date, the Seller will deliver to the Program Agent, on behalf of the Purchaser(s), one Class A Certificate, dated the Purchase Date, registered in the name of the Program Agent and duly authenticated in accordance with the provisions of the Pooling and Servicing Agreement against delivery by the Program Agent, on behalf of the Purchaser(s), to the Seller of the Purchase Price. (c) Funding of the Purchase and Increases. On the Purchase Date and any date on which an Increase is funded, Falcon or the Liquidity Providers, as applicable, shall, upon satisfaction of the applicable conditions set forth in Article IV, deposit, the Purchase Price or amount of the Increase (in the case of Falcon) or its Liquidity Provider Commitment Percentage of the Purchase Price or of the Increase (in the case of each Liquidity Provider) in immediately available funds in the following Accounts: in the case of the Purchase, deposit of the Purchase Price to the Escrow Account, held by The Chase Manhattan Bank, as escrow agent, account number 507-871731 and identified as the "Federal-Mogul Trade Receivables Master Trust, Series 1992-1 and Series 1993-1 Escrow Account"; if Falcon is funding an Increase, a deposit shall be made to an account of the Seller at Bank of America, account number 73-63613; if the Liquidity Providers are funding an Increase, a deposit shall be made to the FMSD Clearing Account, number 7521-7683, at The First National Bank of Chicago. The Program Agent to use its best efforts to cause such deposits to be made by not later than 12:00 noon (Chicago time). Section 2.06. Selection of Tranche Periods and Discount Rates. (a) Each Class A Certificate Interest shall at all times have an associated amount of Class A Invested Amount, a Discount Rate and Tranche Period applicable to it. Not less than $2,000,000 of Invested Amount may be allocated to any single Class A Certificate Interest. The Seller shall request Discount Rates and Tranche Periods for the Class A Certificate Interests. The Seller may select the CP Rate, with the concurrence of the Program Agent, or the Base Rate for the Class A Certificate Interests of Falcon and the LIBO Rate or the Base Rate for the Class A Certificate Interests of the Liquidity Providers. The Seller shall by 11:00 a.m. (Chicago time), (i) at least three Business Days prior to the expiration of any then existing Tranche Period with respect to which the LIBO Rate is being requested as a new Discount Rate, (ii) at least three Business Days prior to the expiration of any then existing Tranche Period

with respect to which the CP Rate is being requested as a new Discount Rate and (iii) at least one Business Day prior to the expiration of any Tranche Period with respect to which the Base Rate is being requested as a new Discount Rate, give the Program Agent irrevocable notice of the new Tranche Period and Discount Rate for the Receivable Interest associated with such expiring Tranche Period. (b) If any Liquidity Provider notifies the Program Agent that it has determined that funding its Liquidity Provider Commitment Percentage of the Class A Certificate Interests of the Liquidity Providers at a LIBO Rate would violate any applicable law, rule, regulation, or directive, whether or not having the force of law, or that (i) deposits of a type and maturity appropriate to match fund its Class A Certificate Interests at such LIBO Rate are not available or (ii) such LIBO Rate does not accurately reflect the cost of acquiring or maintaining Class A Certificate Interests at such LIBO Rate, then the Program Agent shall suspend the availability of such LIBO Rate and require the Seller to select a new Discount Rate for any Class A Certificate Interest accruing Discount at such LIBO Rate. SECTION 2.07. Assignments by Falcon to Liquidity Providers. (a) On any date during the Term (including, without limitation, any date on which Falcon has elected in its discretion not to fund an Increase hereunder pursuant to Section 2.02), Falcon may, in its own discretion, upon written notice given to the Program Agent and the Seller, assign to the Liquidity Providers (in accordance with their respective Liquidity Provider Commitment Percentages) and the Liquidity Providers shall purchase a portion of or all of the right and title to and interest in the Class A Certificate Interests which are then owned by Falcon. Such assignment of Class A Certificate Interests shall be made upon receipt of consideration (in cash) from the Liquidity Providers equal to the applicable Acquisition Amount; provided that no Liquidity Provider shall be required to purchase any Class A Certificate Interest to the extent that, after giving effect thereto, its Liquidity Provider Commitment Percentage of the then outstanding Class A Invested Amount would exceed its Liquidity Provider Commitment.

with respect to which the CP Rate is being requested as a new Discount Rate and (iii) at least one Business Day prior to the expiration of any Tranche Period with respect to which the Base Rate is being requested as a new Discount Rate, give the Program Agent irrevocable notice of the new Tranche Period and Discount Rate for the Receivable Interest associated with such expiring Tranche Period. (b) If any Liquidity Provider notifies the Program Agent that it has determined that funding its Liquidity Provider Commitment Percentage of the Class A Certificate Interests of the Liquidity Providers at a LIBO Rate would violate any applicable law, rule, regulation, or directive, whether or not having the force of law, or that (i) deposits of a type and maturity appropriate to match fund its Class A Certificate Interests at such LIBO Rate are not available or (ii) such LIBO Rate does not accurately reflect the cost of acquiring or maintaining Class A Certificate Interests at such LIBO Rate, then the Program Agent shall suspend the availability of such LIBO Rate and require the Seller to select a new Discount Rate for any Class A Certificate Interest accruing Discount at such LIBO Rate. SECTION 2.07. Assignments by Falcon to Liquidity Providers. (a) On any date during the Term (including, without limitation, any date on which Falcon has elected in its discretion not to fund an Increase hereunder pursuant to Section 2.02), Falcon may, in its own discretion, upon written notice given to the Program Agent and the Seller, assign to the Liquidity Providers (in accordance with their respective Liquidity Provider Commitment Percentages) and the Liquidity Providers shall purchase a portion of or all of the right and title to and interest in the Class A Certificate Interests which are then owned by Falcon. Such assignment of Class A Certificate Interests shall be made upon receipt of consideration (in cash) from the Liquidity Providers equal to the applicable Acquisition Amount; provided that no Liquidity Provider shall be required to purchase any Class A Certificate Interest to the extent that, after giving effect thereto, its Liquidity Provider Commitment Percentage of the then outstanding Class A Invested Amount would exceed its Liquidity Provider Commitment. (b) Upon the assignment described in subsection (a) above, (i) the applicable Class A Certificate Interests previously owned by Falcon and so assigned shall become Class A Certificate Interests owned by the Liquidity Providers and (ii) the Program Agent shall, to the extent provided under the Series 1997-1 Supplement, pay to Falcon on the date of such assignment if such assignment occurs on a Distribution Date, or on the next succeeding Distribution Date, out of Collections available for such payments as provided in the Series 1997-1 Supplement, (A) to

the extent Falcon received the amount described in Section 2.05(c) above, all accrued and unpaid interest with respect to the Class A Invested Amount related to the Class A Certificate Interests so assigned and (B) any Breakage Costs. (c) The assignment of Class A Certificate Interests from Falcon to the Liquidity Providers pursuant to this Section 2.07 shall be without recourse or warranty, express or implied, except that such Class A Certificate Interests are free and clear of adverse claims created by or arising as a result of claims against the Program Agent or Falcon. Nothing in this Section 2.07 shall be deemed to limit any rights of Falcon under any other provisions of this Agreement to assign its right, title to and interest in and to any portion of the Class A Certificate Interests owned by it. SECTION 2.08. Transfer Price Reduction Discount. If the Adjusted Liquidity Price is included in the calculation of the Falcon Transfer Price for any Class A Certificate Interest, each Liquidity Provider agrees that the Program Agent shall pay to Falcon the Reduction Percentage of any Discount received by the Program Agent with respect to such Class A Certificate Interest. SECTION 2.09. Payments to Falcon. In consideration for the reduction of the Falcon Transfer Prices by the Falcon Transfer Price Reductions, effective only at such time as the aggregate amount of the Class A Invested Amount allocated to the Class A Certificate Interests of the Liquidity Providers equals the Falcon Residual, each Liquidity Provider hereby agrees that the Program Agent shall not distribute to the Liquidity Providers and shall immediately remit to Falcon any Discount, Class A Monthly Interest, Class A Additional Interest, Class A Monthly Principal or other payments received by it to be applied pursuant to the terms hereof or otherwise to reduce the Class A Invested Amount allocated to the Class A Certificate Interests of the Liquidity Providers.

the extent Falcon received the amount described in Section 2.05(c) above, all accrued and unpaid interest with respect to the Class A Invested Amount related to the Class A Certificate Interests so assigned and (B) any Breakage Costs. (c) The assignment of Class A Certificate Interests from Falcon to the Liquidity Providers pursuant to this Section 2.07 shall be without recourse or warranty, express or implied, except that such Class A Certificate Interests are free and clear of adverse claims created by or arising as a result of claims against the Program Agent or Falcon. Nothing in this Section 2.07 shall be deemed to limit any rights of Falcon under any other provisions of this Agreement to assign its right, title to and interest in and to any portion of the Class A Certificate Interests owned by it. SECTION 2.08. Transfer Price Reduction Discount. If the Adjusted Liquidity Price is included in the calculation of the Falcon Transfer Price for any Class A Certificate Interest, each Liquidity Provider agrees that the Program Agent shall pay to Falcon the Reduction Percentage of any Discount received by the Program Agent with respect to such Class A Certificate Interest. SECTION 2.09. Payments to Falcon. In consideration for the reduction of the Falcon Transfer Prices by the Falcon Transfer Price Reductions, effective only at such time as the aggregate amount of the Class A Invested Amount allocated to the Class A Certificate Interests of the Liquidity Providers equals the Falcon Residual, each Liquidity Provider hereby agrees that the Program Agent shall not distribute to the Liquidity Providers and shall immediately remit to Falcon any Discount, Class A Monthly Interest, Class A Additional Interest, Class A Monthly Principal or other payments received by it to be applied pursuant to the terms hereof or otherwise to reduce the Class A Invested Amount allocated to the Class A Certificate Interests of the Liquidity Providers. SECTION 2.10. Limitation on Commitment to Purchase from Falcon. Notwithstanding anything to the contrary in this Agreement, no Liquidity Provider shall have any obligation to purchase any Class A Certificate Interest from Falcon, pursuant to Section 2.07 hereof or otherwise, if: (a) Falcon shall have voluntarily commenced any proceeding or filed any petition under any bankruptcy, insolvency or similar law seeking the dissolution, liquidation or reorganization of Falcon or taken any corporate action for the purpose of effectuating any of the foregoing; or (b) involuntary proceedings or an involuntary petition

shall have been commenced or filed against Falcon by any Person under any bankruptcy, insolvency or similar law seeking the dissolution, liquidation or reorganization of Falcon and such proceeding or petition shall have not been dismissed. SECTION 2.11. Defaulting Liquidity Providers. If one or more Liquidity Providers defaults in its obligation to pay its Acquisition Amount pursuant to Section 2.07 (each such Liquidity Provider shall be called a "Defaulting Liquidity Provider" and the aggregate amount of such defaulted obligations being herein called the "Falcon Transfer Price Deficit"), then upon notice from the Program Agent, each Liquidity Provider other than the Defaulting Liquidity Providers (a "Non-Defaulting Liquidity Provider") shall promptly pay to the Program Agent, in immediately available funds, an amount equal to the lesser of (x) such Non-Defaulting Liquidity Provider's proportionate share (based upon the relative Liquidity Provider commitments of the Non-Defaulting Liquidity Providers) of the Falcon Transfer Price Deficit and (y) the unused portion of such Non-Defaulting Liquidity Provider's Commitment. A Defaulting Liquidity Provider shall forthwith upon demand pay to the Program Agent for the account of the Non-Defaulting Liquidity Providers all amounts paid by each Non-Defaulting Liquidity Provider on behalf of such Defaulting Liquidity Provider, together with interest thereon, for each day from the date a payment was made by a Non-Defaulting Liquidity Provider until the date such Non-Defaulting Liquidity Provider has been paid such amounts in full, at a rate per annum equal to the Federal Funds Effective Rate plus 2%. In addition, without prejudice to any other rights that Falcon may have under applicable law, each Defaulting Liquidity Provider shall pay to Falcon forthwith upon demand, the difference between such Defaulting Liquidity Provider's unpaid Acquisition Amount and the amount paid with respect thereto by the Non-Defaulting Liquidity Providers, together with interest thereon, for each day from the date of the Program Agent's request for such Defaulting Liquidity Provider's Acquisition Amount pursuant to Section 2.07 until the date the requisite amount is

shall have been commenced or filed against Falcon by any Person under any bankruptcy, insolvency or similar law seeking the dissolution, liquidation or reorganization of Falcon and such proceeding or petition shall have not been dismissed. SECTION 2.11. Defaulting Liquidity Providers. If one or more Liquidity Providers defaults in its obligation to pay its Acquisition Amount pursuant to Section 2.07 (each such Liquidity Provider shall be called a "Defaulting Liquidity Provider" and the aggregate amount of such defaulted obligations being herein called the "Falcon Transfer Price Deficit"), then upon notice from the Program Agent, each Liquidity Provider other than the Defaulting Liquidity Providers (a "Non-Defaulting Liquidity Provider") shall promptly pay to the Program Agent, in immediately available funds, an amount equal to the lesser of (x) such Non-Defaulting Liquidity Provider's proportionate share (based upon the relative Liquidity Provider commitments of the Non-Defaulting Liquidity Providers) of the Falcon Transfer Price Deficit and (y) the unused portion of such Non-Defaulting Liquidity Provider's Commitment. A Defaulting Liquidity Provider shall forthwith upon demand pay to the Program Agent for the account of the Non-Defaulting Liquidity Providers all amounts paid by each Non-Defaulting Liquidity Provider on behalf of such Defaulting Liquidity Provider, together with interest thereon, for each day from the date a payment was made by a Non-Defaulting Liquidity Provider until the date such Non-Defaulting Liquidity Provider has been paid such amounts in full, at a rate per annum equal to the Federal Funds Effective Rate plus 2%. In addition, without prejudice to any other rights that Falcon may have under applicable law, each Defaulting Liquidity Provider shall pay to Falcon forthwith upon demand, the difference between such Defaulting Liquidity Provider's unpaid Acquisition Amount and the amount paid with respect thereto by the Non-Defaulting Liquidity Providers, together with interest thereon, for each day from the date of the Program Agent's request for such Defaulting Liquidity Provider's Acquisition Amount pursuant to Section 2.07 until the date the requisite amount is paid to Falcon in full, at a rate per annum equal to the Federal Funds Effective Rate plus 2%. SECTION 2.12. Term. The "Initial Term" of each Liquidity Provider Commitment hereunder shall be for a period commencing on the date such Liquidity Provider enters into this Agreement and ending on the date that is 364 days after the date of this Agreement. Prior to the expiration of the Initial Term or any Extension Term, the Program Agent may request an extension of such Term (such extended period being an "Extension Term") and each Liquidity Provider may, in its sole and absolute discretion, extend its Liquidity Provider Commitment by delivering to the Program Agent a written notice of such Liquidity Provider's commitment to extend, provided, however, that any such extension

shall be ineffective if an Early Amortization Event has occurred and is continuing at the time of the proposed commencement of such Extension Term. Failure of a Liquidity Provider to deliver a notice of such Liquidity Provider's intent to grant an Extension Term shall be deemed to be an election by such Liquidity Provider not to grant an Extension Term. If less than all of the Liquidity Providers have elected to grant an Extension Term and the Program Agent has been unable (a) to replace any Liquidity Provider which has declined to grant an Extension Term or (b) to obtain the agreement of one or more Liquidity Providers to assume the Liquidity Provider's Commitment Percentage who have so declined to grant the Extension Term (such replacement or assumption being subject to the Seller's review and approval, which such approval shall not be unreasonably withheld), such request for an Extension Term shall be deemed automatically withdrawn and the Program Agent will so notify the Liquidity Providers prior to the day on which the Term expires.

ARTICLE III FEES AND INTEREST PROTECTION SECTION 3.01. Fees. The Seller shall pay to the Program Agent such fees for its own account and for the account of Falcon and the Liquidity Providers in such amounts and at such times as set forth in the Fee Letter. SECTION 3.02 Increased Costs and Reduced Returns. (a) If any Liquidity Provider (each, an "Affected Person") determines that compliance with any law or regulation or any guideline or request from any central bank or other governmental authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Affected Person and such Affected Person determines that the amount of such capital is increased by or based

shall be ineffective if an Early Amortization Event has occurred and is continuing at the time of the proposed commencement of such Extension Term. Failure of a Liquidity Provider to deliver a notice of such Liquidity Provider's intent to grant an Extension Term shall be deemed to be an election by such Liquidity Provider not to grant an Extension Term. If less than all of the Liquidity Providers have elected to grant an Extension Term and the Program Agent has been unable (a) to replace any Liquidity Provider which has declined to grant an Extension Term or (b) to obtain the agreement of one or more Liquidity Providers to assume the Liquidity Provider's Commitment Percentage who have so declined to grant the Extension Term (such replacement or assumption being subject to the Seller's review and approval, which such approval shall not be unreasonably withheld), such request for an Extension Term shall be deemed automatically withdrawn and the Program Agent will so notify the Liquidity Providers prior to the day on which the Term expires.

ARTICLE III FEES AND INTEREST PROTECTION SECTION 3.01. Fees. The Seller shall pay to the Program Agent such fees for its own account and for the account of Falcon and the Liquidity Providers in such amounts and at such times as set forth in the Fee Letter. SECTION 3.02 Increased Costs and Reduced Returns. (a) If any Liquidity Provider (each, an "Affected Person") determines that compliance with any law or regulation or any guideline or request from any central bank or other governmental authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Affected Person and such Affected Person determines that the amount of such capital is increased by or based upon the existence of any commitment to make the Purchase or fund Increases or otherwise to maintain its investment in the Class A Certificates or Class A Certificate Interests, then, upon demand by such Affected Person (with a copy to the Program Agent and the Seller), the Seller shall immediately pay to the Program Agent, for the account of such Affected Person (as a third party beneficiary), additional amounts sufficient to compensate such Affected Person, in light of the circumstances, for such increase in capital. A certificate as to such amounts submitted to the Seller and the Program Agent by such Affected Person shall be conclusive and binding for all purposes, absent manifest error. (b) If, due to either (i) the introduction or any change in or in the interpretation of any law or regulation or (ii) compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law), there shall be an increase in the cost to any Liquidity Provider of any commitment to make the Purchase or to fund Increases or otherwise to maintain the investment in the Class A Certificates or Class A Certificate Interests, then, upon demand by such Liquidity Provider (with a copy to the Program Agent and the Seller), the Seller shall immediately pay to the Program Agent, for the account of such Liquidity Provider (as a third party beneficiary), additional amounts sufficient to compensate such Liquidity Provider for such increase in cost. A certificate as to such amounts submitted to the Seller and the Program Agent by such Affected Person, shall be conclusive and binding for all purposes, absent manifest error. (c) Each Liquidity Provider will promptly notify the Seller and the Program Agent of any event of which it has knowledge which is reasonably likely to entitle such Liquidity Provider to compensation pursuant to this Section 3.02; provided, however, that no failure to give or delay in giving such

notification shall adversely affect the rights of any Liquidity Provider to such compensation. SECTION 3.03. Taxes. (a) Any and all payments and deposits required to be made hereunder or under any other Transaction Document by the Seller or the Trustee to or for the benefit of Falcon or any Liquidity Provider shall be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding taxes imposed on, or measured by reference to, the net income of, franchise taxes imposed on, and taxes (other than withholding taxes) imposed on the receipts or gross receipts that are imposed on Falcon or such Liquidity Provider by any of (i) the United States or any State thereof, (ii) the state jurisdiction under the laws of which Falcon or such Liquidity Provider is organized or in which it is otherwise doing business or (iii) any political subdivision thereof (all such

ARTICLE III FEES AND INTEREST PROTECTION SECTION 3.01. Fees. The Seller shall pay to the Program Agent such fees for its own account and for the account of Falcon and the Liquidity Providers in such amounts and at such times as set forth in the Fee Letter. SECTION 3.02 Increased Costs and Reduced Returns. (a) If any Liquidity Provider (each, an "Affected Person") determines that compliance with any law or regulation or any guideline or request from any central bank or other governmental authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Affected Person and such Affected Person determines that the amount of such capital is increased by or based upon the existence of any commitment to make the Purchase or fund Increases or otherwise to maintain its investment in the Class A Certificates or Class A Certificate Interests, then, upon demand by such Affected Person (with a copy to the Program Agent and the Seller), the Seller shall immediately pay to the Program Agent, for the account of such Affected Person (as a third party beneficiary), additional amounts sufficient to compensate such Affected Person, in light of the circumstances, for such increase in capital. A certificate as to such amounts submitted to the Seller and the Program Agent by such Affected Person shall be conclusive and binding for all purposes, absent manifest error. (b) If, due to either (i) the introduction or any change in or in the interpretation of any law or regulation or (ii) compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law), there shall be an increase in the cost to any Liquidity Provider of any commitment to make the Purchase or to fund Increases or otherwise to maintain the investment in the Class A Certificates or Class A Certificate Interests, then, upon demand by such Liquidity Provider (with a copy to the Program Agent and the Seller), the Seller shall immediately pay to the Program Agent, for the account of such Liquidity Provider (as a third party beneficiary), additional amounts sufficient to compensate such Liquidity Provider for such increase in cost. A certificate as to such amounts submitted to the Seller and the Program Agent by such Affected Person, shall be conclusive and binding for all purposes, absent manifest error. (c) Each Liquidity Provider will promptly notify the Seller and the Program Agent of any event of which it has knowledge which is reasonably likely to entitle such Liquidity Provider to compensation pursuant to this Section 3.02; provided, however, that no failure to give or delay in giving such

notification shall adversely affect the rights of any Liquidity Provider to such compensation. SECTION 3.03. Taxes. (a) Any and all payments and deposits required to be made hereunder or under any other Transaction Document by the Seller or the Trustee to or for the benefit of Falcon or any Liquidity Provider shall be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding taxes imposed on, or measured by reference to, the net income of, franchise taxes imposed on, and taxes (other than withholding taxes) imposed on the receipts or gross receipts that are imposed on Falcon or such Liquidity Provider by any of (i) the United States or any State thereof, (ii) the state jurisdiction under the laws of which Falcon or such Liquidity Provider is organized or in which it is otherwise doing business or (iii) any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). If the Seller or the Trustee shall be required by law to deduct any Taxes from or in respect of any sum required to be paid or deposited hereunder or under any instrument delivered hereunder to or for the benefit of Falcon or any Liquidity Provider, (A) such sum shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums required to be paid or deposited under this Section 3.03) the amount received by Falcon or the relevant Liquidity Provider, or otherwise deposited hereunder or under such instrument, shall be equal to the sum which would have been so received or deposited had no such deductions been made, (B) the Seller or the Trustee (as appropriate) shall make such deductions and (C) the Seller or the Trustee (as appropriate) shall pay the full amount of such deductions to the relevant taxation authority or other authority in accordance with applicable law. (b) The Seller will indemnify Falcon and each Liquidity Provider for the full amount of Taxes (including, without limitation, any Taxes imposed by any jurisdiction on amounts payable under this Section 3.03) paid by Falcon or

notification shall adversely affect the rights of any Liquidity Provider to such compensation. SECTION 3.03. Taxes. (a) Any and all payments and deposits required to be made hereunder or under any other Transaction Document by the Seller or the Trustee to or for the benefit of Falcon or any Liquidity Provider shall be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding taxes imposed on, or measured by reference to, the net income of, franchise taxes imposed on, and taxes (other than withholding taxes) imposed on the receipts or gross receipts that are imposed on Falcon or such Liquidity Provider by any of (i) the United States or any State thereof, (ii) the state jurisdiction under the laws of which Falcon or such Liquidity Provider is organized or in which it is otherwise doing business or (iii) any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). If the Seller or the Trustee shall be required by law to deduct any Taxes from or in respect of any sum required to be paid or deposited hereunder or under any instrument delivered hereunder to or for the benefit of Falcon or any Liquidity Provider, (A) such sum shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums required to be paid or deposited under this Section 3.03) the amount received by Falcon or the relevant Liquidity Provider, or otherwise deposited hereunder or under such instrument, shall be equal to the sum which would have been so received or deposited had no such deductions been made, (B) the Seller or the Trustee (as appropriate) shall make such deductions and (C) the Seller or the Trustee (as appropriate) shall pay the full amount of such deductions to the relevant taxation authority or other authority in accordance with applicable law. (b) The Seller will indemnify Falcon and each Liquidity Provider for the full amount of Taxes (including, without limitation, any Taxes imposed by any jurisdiction on amounts payable under this Section 3.03) paid by Falcon or such Liquidity Provider and any liability (including penalties, interest and expenses) arising therefrom or required to be paid with respect thereto. Falcon and each Liquidity Provider agrees to promptly notify the Seller of any payment of Taxes made by it and, if practicable, any request, demand or notice received in respect thereof prior to such payment. Falcon and each Liquidity Provider shall be entitled to payment of this indemnification, as owner of Class A Certificate Interests pursuant to the terms of the Series 1997-1 Supplement, within 30 days from the date Falcon or such Liquidity Provider makes written demand therefor to the

Program Agent and the Seller. A certificate as to the amount of such indemnification submitted to the Seller and the Program Agent by Falcon or such Liquidity Provider, setting forth the calculation thereof, shall (absent manifest error) be conclusive and binding for all purposes. (c) Within 30 days after the date of any payment of Taxes, the Seller or the Trustee (as the case may be) will furnish to the Program Agent the original or a certified copy of a receipt evidencing payment thereof. (d) Notwithstanding the foregoing and any other provisions of this Section 3.03, the obligations of the Trustee under this Section 3.03 shall be payable only out of the Trust Assets. (e) Each Liquidity Provider that is organized under the laws of a jurisdiction other than the United States or a state thereof hereby agrees to complete, execute and deliver to the Trustee from time to time prior to the initial Distribution Date on which the Program Agent, acting on behalf of such Liquidity Provider, will be entitled to receive distributions pursuant to the Series 1997-1 Supplement and this Agreement, Internal Revenue Service Forms 1001 or 4224 (or any successor form), as applicable, or such other forms or certificates as may be required under the laws of any applicable jurisdiction in order to permit the Seller or the Trustee to make payments to, and deposit funds to or for the account of, the Program Agent, acting on behalf of such Liquidity Provider, hereunder and under the other Transaction Documents without any deduction or withholding for or on account of any tax or with such withholding or deduction at a reduced rate. SECTION 3.04. Sharing of Payments. If Falcon or any Liquidity Provider shall obtain any payment or other recovery (whether voluntary, involuntary, by application of set-off or otherwise) on account of any Obligation (other than pursuant to Section 3.02 of this Agreement) which is in excess of its pro rata share of the sum of payments then or theretofore obtained by Falcon and the Liquidity Providers, Falcon or any such Liquidity Provider shall purchase from the Liquidity Providers or Falcon, as applicable, such participations in Obligations held by them as shall be

Program Agent and the Seller. A certificate as to the amount of such indemnification submitted to the Seller and the Program Agent by Falcon or such Liquidity Provider, setting forth the calculation thereof, shall (absent manifest error) be conclusive and binding for all purposes. (c) Within 30 days after the date of any payment of Taxes, the Seller or the Trustee (as the case may be) will furnish to the Program Agent the original or a certified copy of a receipt evidencing payment thereof. (d) Notwithstanding the foregoing and any other provisions of this Section 3.03, the obligations of the Trustee under this Section 3.03 shall be payable only out of the Trust Assets. (e) Each Liquidity Provider that is organized under the laws of a jurisdiction other than the United States or a state thereof hereby agrees to complete, execute and deliver to the Trustee from time to time prior to the initial Distribution Date on which the Program Agent, acting on behalf of such Liquidity Provider, will be entitled to receive distributions pursuant to the Series 1997-1 Supplement and this Agreement, Internal Revenue Service Forms 1001 or 4224 (or any successor form), as applicable, or such other forms or certificates as may be required under the laws of any applicable jurisdiction in order to permit the Seller or the Trustee to make payments to, and deposit funds to or for the account of, the Program Agent, acting on behalf of such Liquidity Provider, hereunder and under the other Transaction Documents without any deduction or withholding for or on account of any tax or with such withholding or deduction at a reduced rate. SECTION 3.04. Sharing of Payments. If Falcon or any Liquidity Provider shall obtain any payment or other recovery (whether voluntary, involuntary, by application of set-off or otherwise) on account of any Obligation (other than pursuant to Section 3.02 of this Agreement) which is in excess of its pro rata share of the sum of payments then or theretofore obtained by Falcon and the Liquidity Providers, Falcon or any such Liquidity Provider shall purchase from the Liquidity Providers or Falcon, as applicable, such participations in Obligations held by them as shall be necessary to cause such purchaser to share the excess payment or other recovery ratably with each of them; provided, however, that if all or any portion of the excess payment or other recovery is thereafter recovered from such purchasing Liquidity Provider or Falcon, as the case may be, the purchase of such participations shall be rescinded and the seller of such participation shall repay to such purchaser the purchase price of such participation to the ratable extent of such recovery

together with an amount equal to such Liquidity Provider's or Falcon's ratable share (according to the proportion of the amount of such seller's required repayment to such purchaser to the total amount so recovered from such purchaser) of any interest or other amount payable by such purchaser in respect of the total amount so recovered. ARTICLE IV CONDITIONS PRECEDENT TO THE PURCHASE AND ALL INCREASES SECTION 4.01. Conditions Precedent to the Purchase. 1. The making of the Purchase is subject to the following conditions precedent: (i) the Seller shall have furnished to the Program Agent an opinion or opinions of Brown & Wood LLP, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to certain corporate and bankruptcy matters and such matters as the Program Agent may reasonably require; (ii) the Seller shall have furnished to the Program Agent an opinion of Brown & Wood LLP, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to federal income tax consequences with respect to the Class A Certificates and the Trust; (iii) the Seller shall have furnished to the Program Agent an opinion of Dykema Gossett, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to the Michigan state income tax consequences with respect to the Class A Certificates and the Trust; (iv) the Seller shall have furnished to the Program Agent an opinion of in-house counsel for the Seller, the

together with an amount equal to such Liquidity Provider's or Falcon's ratable share (according to the proportion of the amount of such seller's required repayment to such purchaser to the total amount so recovered from such purchaser) of any interest or other amount payable by such purchaser in respect of the total amount so recovered. ARTICLE IV CONDITIONS PRECEDENT TO THE PURCHASE AND ALL INCREASES SECTION 4.01. Conditions Precedent to the Purchase. 1. The making of the Purchase is subject to the following conditions precedent: (i) the Seller shall have furnished to the Program Agent an opinion or opinions of Brown & Wood LLP, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to certain corporate and bankruptcy matters and such matters as the Program Agent may reasonably require; (ii) the Seller shall have furnished to the Program Agent an opinion of Brown & Wood LLP, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to federal income tax consequences with respect to the Class A Certificates and the Trust; (iii) the Seller shall have furnished to the Program Agent an opinion of Dykema Gossett, counsel for the Seller, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to the Michigan state income tax consequences with respect to the Class A Certificates and the Trust; (iv) the Seller shall have furnished to the Program Agent an opinion of in-house counsel for the Seller, the Servicer and the Receivables Sellers, dated the Purchase Date and satisfactory in form and substance to the Purchaser, as to such matters as the Program Agent may reasonably require; (v) the Seller shall have furnished to the Program Agent an opinion of Baker & McKenzie, Canadian counsel for Federal-Mogul Canada Limited, dated the Purchase Date and satisfactory in form and substance to the Purchaser, as to such matters as the Program Agent may reasonably require; (vi) the Program Agent shall have received an opinion of counsel for the Trustee, dated the Purchase Date and satisfactory in form and substance to the Program Agent, as to such matters as the Program Agent may reasonably require; (vii) the Program Agent shall have received a certificate, dated the Purchase Date, of the Chairman of the Board, the President, any Vice President, the Treasurer, any Assistant Treasurer, the principal financial officer or the

principal accounting officer of the Seller, which such certificate shall state, among other things, that the representations and warranties of the Seller contained in this Agreement and the other Transaction Documents are true and correct, and the Seller has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under such agreements at or prior to such date, and such certificate shall have attached thereto organizational documents and resolutions and shall include specimen signatures; (viii) the Program Agent shall have received a certificate, dated the Purchase Date, of the Chairman of the Board, the President, any Vice President, the Treasurer, any Assistant Treasurer, the principal financial officer or the principal accounting officer of each Receivables Seller, which such certificate shall state, among other things, that the representations and warranties of such Receivables Seller contained in the applicable Receivables Purchase Agreement are true and correct, and the Receivables Seller has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under such agreements at or prior to such date, and such certificate shall have attached thereto organizational documents and resolutions and shall include specimen signatures; (ix) the Purchaser shall have received evidence satisfactory to it that, on or before the Purchase Date, (a) amended UCC-1 financing statements have been or are being filed in the office of the Secretary of State of the State of Michigan reflecting the grant of the security interest in the Receivables by the Sellers named in the

principal accounting officer of the Seller, which such certificate shall state, among other things, that the representations and warranties of the Seller contained in this Agreement and the other Transaction Documents are true and correct, and the Seller has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under such agreements at or prior to such date, and such certificate shall have attached thereto organizational documents and resolutions and shall include specimen signatures; (viii) the Program Agent shall have received a certificate, dated the Purchase Date, of the Chairman of the Board, the President, any Vice President, the Treasurer, any Assistant Treasurer, the principal financial officer or the principal accounting officer of each Receivables Seller, which such certificate shall state, among other things, that the representations and warranties of such Receivables Seller contained in the applicable Receivables Purchase Agreement are true and correct, and the Receivables Seller has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under such agreements at or prior to such date, and such certificate shall have attached thereto organizational documents and resolutions and shall include specimen signatures; (ix) the Purchaser shall have received evidence satisfactory to it that, on or before the Purchase Date, (a) amended UCC-1 financing statements have been or are being filed in the office of the Secretary of State of the State of Michigan reflecting the grant of the security interest in the Receivables by the Sellers named in the Receivable Purchase Agreements to the Seller and the grant of the security interest by the Seller in the Trust Assets to the Trustee, for the benefit of the Class A Certificateholders and (b) UCC-1 continuation statements have been filed in the applicable jurisdictions; (x) no Early Amortization Event or Servicer Default, and no event that (a) if notice of such event were given or (b) after a specified amount of time had elapsed would become an Early Amortization Event or Servicer Default, shall have occurred and be continuing; (xi) the Revolving Period shall not have ended and an Early Amortization Period shall not have occurred and be continuing; (xii) any and all representations and warranties made by the Seller and by the Servicer in this Agreement, the Pooling and Servicing Agreement and the Series 1997-1 Supplement shall be true and correct in all material respects, as if repeated on such date with respect to the facts and circumstances then existing;

(xiii) any and all representations and warranties made by each Receivables Seller in the applicable Receivables Purchase Agreement shall be true and correct in all material respects, as if repeated on such date with respect to the facts and circumstances then existing; (xiv) the Pooling and Servicing Agreement, Series 1997-1 Supplement and Receivables Purchase Agreements shall be in full force and effect; (xv) after making the Purchase or funding such Increase, the Class A Invested Amount shall not exceed the Class A Purchase Limit; and (xvi) the Program Agent shall have received by 12:00 noon (New York City time), on the Business Day immediately preceding the Purchase Date or the date of such Increase (a) in the case of the Purchase, the Distribution Date Statement relating to the Distribution Date in February 1997 and (b) in the case of any Increase, a certificate of the Servicer delivered pursuant to Section 5.03 of the Series 1997-1 Supplement dated as of such Business Day, which shall be prepared on a pro forma basis and shall show that the Servicer is in compliance with the Pooling and Servicing Agreement and the Series 1997-1 Supplement (after giving effect to the Purchase or such Increase). (b) If Falcon is the Purchaser, the making of the Purchase and the funding of Increases are subject to the following additional conditions precedent: (i) the Program Agent shall not have given notice that Falcon will not make the Purchase or fund an Increase; and

(xiii) any and all representations and warranties made by each Receivables Seller in the applicable Receivables Purchase Agreement shall be true and correct in all material respects, as if repeated on such date with respect to the facts and circumstances then existing; (xiv) the Pooling and Servicing Agreement, Series 1997-1 Supplement and Receivables Purchase Agreements shall be in full force and effect; (xv) after making the Purchase or funding such Increase, the Class A Invested Amount shall not exceed the Class A Purchase Limit; and (xvi) the Program Agent shall have received by 12:00 noon (New York City time), on the Business Day immediately preceding the Purchase Date or the date of such Increase (a) in the case of the Purchase, the Distribution Date Statement relating to the Distribution Date in February 1997 and (b) in the case of any Increase, a certificate of the Servicer delivered pursuant to Section 5.03 of the Series 1997-1 Supplement dated as of such Business Day, which shall be prepared on a pro forma basis and shall show that the Servicer is in compliance with the Pooling and Servicing Agreement and the Series 1997-1 Supplement (after giving effect to the Purchase or such Increase). (b) If Falcon is the Purchaser, the making of the Purchase and the funding of Increases are subject to the following additional conditions precedent: (i) the Program Agent shall not have given notice that Falcon will not make the Purchase or fund an Increase; and (ii) the Liquidity Provider Commitments shall be in full force and effect. SECTION 4.02. Conditions Precedent to All Increases. The funding of all Increases is subject to the conditions precedent specified in subsections (x)-(xvi) of Section 4.01 and to the condition precedent that such Increase of the Class A Invested Amount shall be a minimum of $2,000,000 or in integral multiples of $1,000,000 in excess of such minimum. SECTION 4.03. Representations and Warranties of the Seller Relating to the Seller and the Transaction Documents. The Seller hereby represents and warrants to the Program Agent, Falcon and the Liquidity Providers as the Closing Date that: (a) Organization and Good Standing. The Seller is a corporation duly organized and validly existing and in good standing under the law of the State of Michigan and has, in all material respects, full corporate power, authority and legal

right to own its properties and conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under this Agreement and the Transaction Documents. (b) Due Qualification. The Seller is duly qualified to do business and, where necessary, is in good standing as a foreign corporation (or is exempt from such requirement) and has obtained all necessary licenses and approvals in each jurisdiction in which the conduct of its business requires such qualification except where the failure to so qualify or obtain licenses or approvals would not have a material adverse effect on its ability to perform its obligations hereunder and under the Transaction Documents. (c) Due Authorization. The execution and delivery of this Agreement and the Transaction Documents by the Seller and the consummation of the transactions provided for or contemplated by this Agreement and the Transaction Documents, have been duly authorized by the Seller by all necessary corporate action on the part of the Seller. (d) No Conflict. The execution and delivery of this Agreement and the Transaction Documents, the performance of the transactions contemplated by this Agreement and the Transaction Documents and the fulfillment of the terms hereof and thereof, will not conflict with, result in any breach of any of the material terms and provisions of,

right to own its properties and conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under this Agreement and the Transaction Documents. (b) Due Qualification. The Seller is duly qualified to do business and, where necessary, is in good standing as a foreign corporation (or is exempt from such requirement) and has obtained all necessary licenses and approvals in each jurisdiction in which the conduct of its business requires such qualification except where the failure to so qualify or obtain licenses or approvals would not have a material adverse effect on its ability to perform its obligations hereunder and under the Transaction Documents. (c) Due Authorization. The execution and delivery of this Agreement and the Transaction Documents by the Seller and the consummation of the transactions provided for or contemplated by this Agreement and the Transaction Documents, have been duly authorized by the Seller by all necessary corporate action on the part of the Seller. (d) No Conflict. The execution and delivery of this Agreement and the Transaction Documents, the performance of the transactions contemplated by this Agreement and the Transaction Documents and the fulfillment of the terms hereof and thereof, will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which the Seller is a party or by which it or its properties are bound. (e) No Violation. The execution and delivery of this Agreement and the Transaction Documents, the performance of the transactions contemplated by this Agreement and the Transaction Documents and the fulfillment of the terms hereof and thereof applicable to the Seller, will not conflict with or violate any material Requirements of Law applicable to the Seller. (f) No Proceedings. There are no proceedings or investigations pending or, to the best knowledge of the Seller, threatened against the Seller before any Governmental Authority (i) asserting the invalidity of this Agreement or any of the Transaction Documents, (ii) seeking to prevent the issuance of the Class A Certificates or the consummation of any of the transactions contemplated by this Agreement and the applicable Transaction Documents, (iii) seeking any determination or ruling that, in the reasonable judgment of the Seller, would materially and adversely affect the performance by the Seller of its

obligations under this Agreement and the applicable Transaction Documents, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement and the applicable Transaction Documents or (v) seeking to affect adversely the income tax attributes of the Trust under the United States Federal or any State income, single business or franchise tax systems. (g) All Consents Required. All appraisals, authorizations, consents, orders, approvals or other actions of any Person or of any governmental body or official required in connection with the execution and delivery of this Agreement and the Transaction Documents and the performance of the transactions contemplated by this Agreement and any of the Transaction Documents, and the fulfillment of the terms hereof and thereof, have been obtained. (h) Enforceability. This Agreement and the applicable Transaction Documents each constitutes a legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity).

ARTICLE V THE PROGRAM AGENT

obligations under this Agreement and the applicable Transaction Documents, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement and the applicable Transaction Documents or (v) seeking to affect adversely the income tax attributes of the Trust under the United States Federal or any State income, single business or franchise tax systems. (g) All Consents Required. All appraisals, authorizations, consents, orders, approvals or other actions of any Person or of any governmental body or official required in connection with the execution and delivery of this Agreement and the Transaction Documents and the performance of the transactions contemplated by this Agreement and any of the Transaction Documents, and the fulfillment of the terms hereof and thereof, have been obtained. (h) Enforceability. This Agreement and the applicable Transaction Documents each constitutes a legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity).

ARTICLE V THE PROGRAM AGENT SECTION 5.01. Authorization and Action of the Program Agent. (a) Falcon and each Liquidity Provider hereby appoints and authorizes the Program Agent to take such action as agent on its behalf and to exercise such powers under this Agreement and the other Transaction Documents as are delegated to the Program Agent by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. (b) The Program Agent shall not have any duties or responsibilities, except those expressly set forth herein or in any other Transaction Document, or any fiduciary relationship with any Purchaser, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on the part of the Program Agent shall be read into this Agreement or any other Transaction Document or otherwise exist for the Program Agent. In performing its functions and duties hereunder and under the other Transaction Documents, the Program Agent shall act solely as agent for the Purchasers and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller or any of its successors or assigns. The Program Agent shall not be required to take any action which exposes the Program Agent to personal liability or which is contrary to this Agreement, any other Transaction Document or applicable law. The appointment and authority of the Program Agent hereunder shall terminate upon the indefeasible payment in full of all Aggregate Unpaids. SECTION 5.02. The Program Agent's Reliance, Etc. Neither the Program Agent nor any of its directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or the Program Agent under or in connection with the Transaction Documents, except for its or their own gross negligence or willful misconduct. Without limiting the generality of the foregoing, the Program Agent (a) may consult with independent legal counsel (including counsel for the Trust, the Seller or the Servicer), independent certified public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts, (b) makes no representation or warranty to Falcon, any Liquidity Provider or any such other holder of any interest in the Trust Assets and shall not be responsible to Falcon, any Liquidity Provider or any other holder for any statements, representations or warranties made in or in connection with the Transaction Documents, (c) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of the

Transaction Documents on the part of the Trust, the Trustee, the Seller or the Servicer or to inspect the property (including the books and records) of the Trust, the Trustee, the Seller or the Servicer, (d) shall not be responsible to Falcon, any Liquidity Provider or any other holder of any interest in Trust Assets for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Transaction Document (except for the execution by the Program Agent of, and legality, validity and enforceability against the Program Agent of its

ARTICLE V THE PROGRAM AGENT SECTION 5.01. Authorization and Action of the Program Agent. (a) Falcon and each Liquidity Provider hereby appoints and authorizes the Program Agent to take such action as agent on its behalf and to exercise such powers under this Agreement and the other Transaction Documents as are delegated to the Program Agent by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. (b) The Program Agent shall not have any duties or responsibilities, except those expressly set forth herein or in any other Transaction Document, or any fiduciary relationship with any Purchaser, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on the part of the Program Agent shall be read into this Agreement or any other Transaction Document or otherwise exist for the Program Agent. In performing its functions and duties hereunder and under the other Transaction Documents, the Program Agent shall act solely as agent for the Purchasers and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller or any of its successors or assigns. The Program Agent shall not be required to take any action which exposes the Program Agent to personal liability or which is contrary to this Agreement, any other Transaction Document or applicable law. The appointment and authority of the Program Agent hereunder shall terminate upon the indefeasible payment in full of all Aggregate Unpaids. SECTION 5.02. The Program Agent's Reliance, Etc. Neither the Program Agent nor any of its directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or the Program Agent under or in connection with the Transaction Documents, except for its or their own gross negligence or willful misconduct. Without limiting the generality of the foregoing, the Program Agent (a) may consult with independent legal counsel (including counsel for the Trust, the Seller or the Servicer), independent certified public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts, (b) makes no representation or warranty to Falcon, any Liquidity Provider or any such other holder of any interest in the Trust Assets and shall not be responsible to Falcon, any Liquidity Provider or any other holder for any statements, representations or warranties made in or in connection with the Transaction Documents, (c) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of the

Transaction Documents on the part of the Trust, the Trustee, the Seller or the Servicer or to inspect the property (including the books and records) of the Trust, the Trustee, the Seller or the Servicer, (d) shall not be responsible to Falcon, any Liquidity Provider or any other holder of any interest in Trust Assets for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Transaction Document (except for the execution by the Program Agent of, and legality, validity and enforceability against the Program Agent of its obligations under, the Transaction Documents to which the Program Agent is a party), and (e) shall incur no liability under or in respect of the Transaction Documents by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by facsimile or telex) believed by it to be genuine and signed or sent by the proper party or parties; except in each case for gross negligence or wilful misconduct on the part of the Program Agent. SECTION 5.03. Non-Reliance on Program Agent and Other Purchasers. Each Purchaser expressly acknowledges that neither the Program Agent, nor any of its officers, directors, employees, agents, attorneys-infact or affiliates has made any representations or warranties to it and that no act by the Program Agent hereafter taken, including, without limitation, any review of the affairs of the Seller, shall be deemed to constitute any representation or warranty by the Program Agent. Each Purchaser represents and warrants to the Program Agent that it has and will, independently and without reliance upon the Program Agent or any other Purchaser and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Seller and the Trust Assets and made its own decision to enter into this Agreement, the other Transaction Documents and all other documents related hereto or thereto. SECTION 5.04. Reimbursement and Indemnification. The Liquidity Providers agree to reimburse and indemnify the Program Agent and its officers, directors, employees, representatives and agents ratably according to their

Transaction Documents on the part of the Trust, the Trustee, the Seller or the Servicer or to inspect the property (including the books and records) of the Trust, the Trustee, the Seller or the Servicer, (d) shall not be responsible to Falcon, any Liquidity Provider or any other holder of any interest in Trust Assets for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Transaction Document (except for the execution by the Program Agent of, and legality, validity and enforceability against the Program Agent of its obligations under, the Transaction Documents to which the Program Agent is a party), and (e) shall incur no liability under or in respect of the Transaction Documents by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by facsimile or telex) believed by it to be genuine and signed or sent by the proper party or parties; except in each case for gross negligence or wilful misconduct on the part of the Program Agent. SECTION 5.03. Non-Reliance on Program Agent and Other Purchasers. Each Purchaser expressly acknowledges that neither the Program Agent, nor any of its officers, directors, employees, agents, attorneys-infact or affiliates has made any representations or warranties to it and that no act by the Program Agent hereafter taken, including, without limitation, any review of the affairs of the Seller, shall be deemed to constitute any representation or warranty by the Program Agent. Each Purchaser represents and warrants to the Program Agent that it has and will, independently and without reliance upon the Program Agent or any other Purchaser and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Seller and the Trust Assets and made its own decision to enter into this Agreement, the other Transaction Documents and all other documents related hereto or thereto. SECTION 5.04. Reimbursement and Indemnification. The Liquidity Providers agree to reimburse and indemnify the Program Agent and its officers, directors, employees, representatives and agents ratably according to their respective Liquidity Provider Commitment Percentages, to the extent not paid or reimbursed by the Seller (i) for any amounts for which the Program Agent, acting in its capacity as Program Agent, is entitled to reimbursement by the Seller hereunder and (ii) for any other expenses incurred by the Program Agent, in its capacity as Program Agent and acting on behalf of the Purchasers, in connection with the administration and enforcement of this Agreement and the other Transaction Documents.

SECTION 5.05. Program Agent in its Individual Capacity. The Program Agent and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Seller or any Affiliate of the Seller as though the Program Agent were not the Program Agent hereunder. With respect to the acquisition of Class A Certificate Interests pursuant to this Agreement, the Program Agent shall have the same rights and powers under this Agreement as any Purchaser and may exercise the same as though it were not the Program Agent, and the terms "Liquidity Provider," "Purchaser," "Liquidity Providers" and "Purchasers" shall include the Program Agent in its individual capacity. SECTION 5.06. Successor Program Agent. The Program Agent may, upon ten days' notice to the Seller and the Purchasers, and the Program Agent will, upon the direction of all of the Purchasers (other than the Program Agent, in its individual capacity) resign as Program Agent. If the Program Agent shall resign, then the Majority of Class A Certificate Interests during such ten-day period shall appoint from among the Purchasers a successor agent. If for any reason no successor Program Agent is appointed by the Majority of Class A Certificate Interests during such ten-day period, then effective upon the termination of such ten day period, the Purchasers shall perform all of the duties of the Program Agent hereunder and under the other Transaction Documents and the Seller shall make all payments in respect of the Aggregate Unpaids directly to the applicable Purchasers and for all purposes shall deal directly with the Purchasers. After the effectiveness of any retiring Program Agent's resignation hereunder as Program Agent, the retiring Program Agent shall be discharged from its duties and obligations hereunder and under the other Transaction Documents and the provisions of this Article V and Article VIII shall continue in effect for its benefit with respect to any actions taken or omitted to be taken by it while it was Program Agent under this Agreement and under the other Transaction Documents. SECTION 5.07. First Chicago Roles. Each of the Liquidity Providers acknowledges that First Chicago acts, or may in the future act, (i) as administrative agent for Falcon, (ii) as issuing and paying agent for the Commercial Paper, (iii) to provide credit or liquidity enhancement for the timely payment for the Commercial Paper and (iv) to provide other services from time to time for Falcon (collectively, the "First Chicago Roles"). Without limiting the

SECTION 5.05. Program Agent in its Individual Capacity. The Program Agent and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Seller or any Affiliate of the Seller as though the Program Agent were not the Program Agent hereunder. With respect to the acquisition of Class A Certificate Interests pursuant to this Agreement, the Program Agent shall have the same rights and powers under this Agreement as any Purchaser and may exercise the same as though it were not the Program Agent, and the terms "Liquidity Provider," "Purchaser," "Liquidity Providers" and "Purchasers" shall include the Program Agent in its individual capacity. SECTION 5.06. Successor Program Agent. The Program Agent may, upon ten days' notice to the Seller and the Purchasers, and the Program Agent will, upon the direction of all of the Purchasers (other than the Program Agent, in its individual capacity) resign as Program Agent. If the Program Agent shall resign, then the Majority of Class A Certificate Interests during such ten-day period shall appoint from among the Purchasers a successor agent. If for any reason no successor Program Agent is appointed by the Majority of Class A Certificate Interests during such ten-day period, then effective upon the termination of such ten day period, the Purchasers shall perform all of the duties of the Program Agent hereunder and under the other Transaction Documents and the Seller shall make all payments in respect of the Aggregate Unpaids directly to the applicable Purchasers and for all purposes shall deal directly with the Purchasers. After the effectiveness of any retiring Program Agent's resignation hereunder as Program Agent, the retiring Program Agent shall be discharged from its duties and obligations hereunder and under the other Transaction Documents and the provisions of this Article V and Article VIII shall continue in effect for its benefit with respect to any actions taken or omitted to be taken by it while it was Program Agent under this Agreement and under the other Transaction Documents. SECTION 5.07. First Chicago Roles. Each of the Liquidity Providers acknowledges that First Chicago acts, or may in the future act, (i) as administrative agent for Falcon, (ii) as issuing and paying agent for the Commercial Paper, (iii) to provide credit or liquidity enhancement for the timely payment for the Commercial Paper and (iv) to provide other services from time to time for Falcon (collectively, the "First Chicago Roles"). Without limiting the generality of this Section 5.07, each Liquidity Provider hereby acknowledges and consents to any and all First Chicago Roles and agrees that in connection with any First Chicago Role, First Chicago may take, or refrain from taking, any action which it, in its discretion, deems appropriate, including, without limitation, in its role as

administrative agent for Falcon, the giving of notice to the Program Agent of a mandatory purchase pursuant to Section 2.01 (b) or Section 2.07. SECTION 5.08. Amendments, Waivers and Consents. Falcon and the Program Agent each reserves the right, in its sole discretion (subject to the next following sentence), to exercise any rights and remedies available to the Purchasers or the Program Agent under the Transaction Documents or pursuant to applicable law, and also to agree to any amendment, modification or waiver of any Transaction Document, to the extent such Transaction Document provides for, or requires, the Purchasers' or the Program Agent's agreement, modification or waiver. Notwithstanding the foregoing, each of Falcon and the Program Agent agrees for the benefit of the Liquidity Providers that it shall not, subject to the terms of the Transaction Documents: (a) without the prior written consent of each of the Liquidity Providers, (i) reduce in any manner the amount of, or delay the timing of, distributions to be made to any Class A Certificateholder or any Purchaser or deposits of amounts to be so distributed, or (ii) reduce any fees payable to the Program Agent or Falcon which relate to payments to Liquidity Providers or delay the dates on which such fees are payable, or (iii) amend or waive any Early Amortization Event or Servicer Default under any Transaction Document relating to the bankruptcy of the Seller, the Servicer or Federal-Mogul, or (iv) amend the definition of Class A Certificate Rate or Amortization Commencement Date. (b) without the prior written consent of the Majority of Class A Certificate Interests,

administrative agent for Falcon, the giving of notice to the Program Agent of a mandatory purchase pursuant to Section 2.01 (b) or Section 2.07. SECTION 5.08. Amendments, Waivers and Consents. Falcon and the Program Agent each reserves the right, in its sole discretion (subject to the next following sentence), to exercise any rights and remedies available to the Purchasers or the Program Agent under the Transaction Documents or pursuant to applicable law, and also to agree to any amendment, modification or waiver of any Transaction Document, to the extent such Transaction Document provides for, or requires, the Purchasers' or the Program Agent's agreement, modification or waiver. Notwithstanding the foregoing, each of Falcon and the Program Agent agrees for the benefit of the Liquidity Providers that it shall not, subject to the terms of the Transaction Documents: (a) without the prior written consent of each of the Liquidity Providers, (i) reduce in any manner the amount of, or delay the timing of, distributions to be made to any Class A Certificateholder or any Purchaser or deposits of amounts to be so distributed, or (ii) reduce any fees payable to the Program Agent or Falcon which relate to payments to Liquidity Providers or delay the dates on which such fees are payable, or (iii) amend or waive any Early Amortization Event or Servicer Default under any Transaction Document relating to the bankruptcy of the Seller, the Servicer or Federal-Mogul, or (iv) amend the definition of Class A Certificate Rate or Amortization Commencement Date. (b) without the prior written consent of the Majority of Class A Certificate Interests, (i) amend, modify or waive any provision of any Transaction Document which would impair any rights expressly granted to an assignee or participant, or (ii) change the definitions of Eligible Receivable, Liquidity Provider Commitment, Liquidity Provider Commitment Percentage and Aggregate Reserves, or (iii) amend any Early Amortization Event or Servicer Default, or

(iv) waive violations of the maximum permitted levels for the Delinquency Ratio, the Loss-to-Liquidation Ratio and the Dilution Ratio. SECTION 5.09. Direction by Liquidity Providers to Program Agent. The majority of the Liquidity Providers holding Class A Certificate Interests shall have the right to direct the Program Agent as to exercise by the Program Agent, as the Class A Certificateholder, of any of its rights and/or remedies under the Pooling and Servicing Agreement and the Series 1997-1 Supplement; provided, however, the Program Agent shall have the right to decline to follow any such direction if the Program Agent being advised by counsel determines that the action so directed may not be lawfully taken or would involve the Program Agent in any personal liability.

ARTICLE VI ASSIGNMENTS SECTION 6.01. Assignment. (a) The Seller and each Liquidity Provider hereby agree and consent to the complete or partial assignment by Falcon of all of its rights under, interest in, title to and obligations under this Agreement to the Liquidity Providers pursuant to Section 2.07 or to any other Person, and upon such assignment, Falcon shall be released from its obligations so assigned. Further, the Seller and Falcon hereby agree that any assignee of a Liquidity Provider of this Agreement or all or any of the Class A Certificate Interests of such Liquidity Provider shall have all of the rights and benefits under this Agreement as if the term "Liquidity

(iv) waive violations of the maximum permitted levels for the Delinquency Ratio, the Loss-to-Liquidation Ratio and the Dilution Ratio. SECTION 5.09. Direction by Liquidity Providers to Program Agent. The majority of the Liquidity Providers holding Class A Certificate Interests shall have the right to direct the Program Agent as to exercise by the Program Agent, as the Class A Certificateholder, of any of its rights and/or remedies under the Pooling and Servicing Agreement and the Series 1997-1 Supplement; provided, however, the Program Agent shall have the right to decline to follow any such direction if the Program Agent being advised by counsel determines that the action so directed may not be lawfully taken or would involve the Program Agent in any personal liability.

ARTICLE VI ASSIGNMENTS SECTION 6.01. Assignment. (a) The Seller and each Liquidity Provider hereby agree and consent to the complete or partial assignment by Falcon of all of its rights under, interest in, title to and obligations under this Agreement to the Liquidity Providers pursuant to Section 2.07 or to any other Person, and upon such assignment, Falcon shall be released from its obligations so assigned. Further, the Seller and Falcon hereby agree that any assignee of a Liquidity Provider of this Agreement or all or any of the Class A Certificate Interests of such Liquidity Provider shall have all of the rights and benefits under this Agreement as if the term "Liquidity Provider" explicitly referred to such party, and no such assignment shall in any way impair the rights and benefits of such Liquidity Provider hereunder. The Seller shall not have the right to assign its rights or obligations under this Agreement. (b) Any Liquidity Provider may at any time and from time to time assign to one or more Persons ("Purchasing Liquidity Provider") all or any part of its rights and obligations under this Agreement pursuant to the Assignment and Acceptance, executed by such Purchasing Liquidity Provider and such selling Liquidity Provider. The written consent of Falcon and the Seller shall be required prior to the effectiveness of any such assignment. Each assignee of a Liquidity Provider must have a short-term debt rating of A-1 or better by Standard & Poor's Ratings Group and P-1 by Moody's Investors Service, Inc. and must agree to deliver to the Program Agent, promptly following any request therefor by the Program Agent or Falcon, an enforceability opinion in form and substance satisfactory to the Program Agent and Falcon. Upon delivery of the executed Assignment and Acceptance to the Program Agent, such selling Liquidity Provider shall be released from its obligations hereunder to the extent of such assignment. Thereafter, the Purchasing Liquidity Provider shall for all purposes be a Liquidity Provider party to this Agreement and shall have all the rights and obligations of a Liquidity Provider under this Agreement to the same extent as if it were an original party hereto and no further consent or action by the Seller, the Purchasers or the Program Agent shall be required. (c) Each of the Liquidity Providers agree that in the event that it shall cease to have a short-term debt rating of A1 or better by Standard & Poor's Ratings Group and P-1 by Moody's Investors Service, Inc. (an "Affected Liquidity Provider"), such Affected Liquidity Provider shall be obliged, at the request of Falcon or the Program Agent, to assign promptly all of its rights and obligations hereunder to (x) another Liquidity Provider or

(y) another financial institution nominated by the Program Agent and acceptable to Falcon and the Seller, and willing to participate in this Agreement through the Termination Date in the place of such Affected Liquidity Provider; provided that the Affected Liquidity Provider receives payment in full, pursuant to an Assignment and Acceptance, of an amount equal to such Liquidity Provider's Liquidity Provider Commitment Percentage of the Class A Invested Amount and Discount owing to the Liquidity Providers and all accrued but unpaid fees and other costs and expenses payable in respect of its Liquidity Provider Commitment Percentage of the Class A Certificate Interests. SECTION 6.02. Rights of Assignee. Upon any assignment in accordance with this Article VI, (a) the assignee receiving such assignment shall have all of the rights of such assignor hereunder with respect to the Class A Certificate Interest (or portion thereof) or rights associated therewith being assigned, (b) the assignor shall be released from the obligations so assigned and (c) all references to such assignor in the

ARTICLE VI ASSIGNMENTS SECTION 6.01. Assignment. (a) The Seller and each Liquidity Provider hereby agree and consent to the complete or partial assignment by Falcon of all of its rights under, interest in, title to and obligations under this Agreement to the Liquidity Providers pursuant to Section 2.07 or to any other Person, and upon such assignment, Falcon shall be released from its obligations so assigned. Further, the Seller and Falcon hereby agree that any assignee of a Liquidity Provider of this Agreement or all or any of the Class A Certificate Interests of such Liquidity Provider shall have all of the rights and benefits under this Agreement as if the term "Liquidity Provider" explicitly referred to such party, and no such assignment shall in any way impair the rights and benefits of such Liquidity Provider hereunder. The Seller shall not have the right to assign its rights or obligations under this Agreement. (b) Any Liquidity Provider may at any time and from time to time assign to one or more Persons ("Purchasing Liquidity Provider") all or any part of its rights and obligations under this Agreement pursuant to the Assignment and Acceptance, executed by such Purchasing Liquidity Provider and such selling Liquidity Provider. The written consent of Falcon and the Seller shall be required prior to the effectiveness of any such assignment. Each assignee of a Liquidity Provider must have a short-term debt rating of A-1 or better by Standard & Poor's Ratings Group and P-1 by Moody's Investors Service, Inc. and must agree to deliver to the Program Agent, promptly following any request therefor by the Program Agent or Falcon, an enforceability opinion in form and substance satisfactory to the Program Agent and Falcon. Upon delivery of the executed Assignment and Acceptance to the Program Agent, such selling Liquidity Provider shall be released from its obligations hereunder to the extent of such assignment. Thereafter, the Purchasing Liquidity Provider shall for all purposes be a Liquidity Provider party to this Agreement and shall have all the rights and obligations of a Liquidity Provider under this Agreement to the same extent as if it were an original party hereto and no further consent or action by the Seller, the Purchasers or the Program Agent shall be required. (c) Each of the Liquidity Providers agree that in the event that it shall cease to have a short-term debt rating of A1 or better by Standard & Poor's Ratings Group and P-1 by Moody's Investors Service, Inc. (an "Affected Liquidity Provider"), such Affected Liquidity Provider shall be obliged, at the request of Falcon or the Program Agent, to assign promptly all of its rights and obligations hereunder to (x) another Liquidity Provider or

(y) another financial institution nominated by the Program Agent and acceptable to Falcon and the Seller, and willing to participate in this Agreement through the Termination Date in the place of such Affected Liquidity Provider; provided that the Affected Liquidity Provider receives payment in full, pursuant to an Assignment and Acceptance, of an amount equal to such Liquidity Provider's Liquidity Provider Commitment Percentage of the Class A Invested Amount and Discount owing to the Liquidity Providers and all accrued but unpaid fees and other costs and expenses payable in respect of its Liquidity Provider Commitment Percentage of the Class A Certificate Interests. SECTION 6.02. Rights of Assignee. Upon any assignment in accordance with this Article VI, (a) the assignee receiving such assignment shall have all of the rights of such assignor hereunder with respect to the Class A Certificate Interest (or portion thereof) or rights associated therewith being assigned, (b) the assignor shall be released from the obligations so assigned and (c) all references to such assignor in the Transaction Documents shall be deemed to apply to such assignee to the extent of its interest in the related Collections. SECTION 6.03. Notice of Assignment. Each assignor shall provide notice to the Seller, the Program Agent and the Trustee of any assignment of any Class A Certificate Interest (or portion thereof) or rights associated therewith by such assignor to any assignee. ARTICLE VII PARTICIPATIONS SECTION 7.01 Participations. Each Liquidity Provider may in the ordinary course of business sell participations, in minimum amounts of $1,000,000, to one or more banks or other entities in or to all or a portion of its rights

(y) another financial institution nominated by the Program Agent and acceptable to Falcon and the Seller, and willing to participate in this Agreement through the Termination Date in the place of such Affected Liquidity Provider; provided that the Affected Liquidity Provider receives payment in full, pursuant to an Assignment and Acceptance, of an amount equal to such Liquidity Provider's Liquidity Provider Commitment Percentage of the Class A Invested Amount and Discount owing to the Liquidity Providers and all accrued but unpaid fees and other costs and expenses payable in respect of its Liquidity Provider Commitment Percentage of the Class A Certificate Interests. SECTION 6.02. Rights of Assignee. Upon any assignment in accordance with this Article VI, (a) the assignee receiving such assignment shall have all of the rights of such assignor hereunder with respect to the Class A Certificate Interest (or portion thereof) or rights associated therewith being assigned, (b) the assignor shall be released from the obligations so assigned and (c) all references to such assignor in the Transaction Documents shall be deemed to apply to such assignee to the extent of its interest in the related Collections. SECTION 6.03. Notice of Assignment. Each assignor shall provide notice to the Seller, the Program Agent and the Trustee of any assignment of any Class A Certificate Interest (or portion thereof) or rights associated therewith by such assignor to any assignee. ARTICLE VII PARTICIPATIONS SECTION 7.01 Participations. Each Liquidity Provider may in the ordinary course of business sell participations, in minimum amounts of $1,000,000, to one or more banks or other entities in or to all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Liquidity Provider Commitment and the Class A Certificate Interests owned by it); provided, however, that (i) such Liquidity Provider's obligations under this Agreement (including, without limitation, its Liquidity Provider Commitment) shall remain unchanged, (ii) such Liquidity Provider shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the sale of such participations shall be subject to the review and approval of the Seller, which such approval shall not be unreasonably withheld. The Seller, the Program Agent and the other Liquidity Providers shall continue to deal solely and directly with such Liquidity Provider in connection with such Liquidity Provider's rights and obligations under this Agreement.

ARTICLE VIII INDEMNIFICATION SECTION 8.01. Indemnities by the Seller. Without limiting any other rights which the Program Agent or any Purchaser may have hereunder or under applicable law, the Seller hereby agrees to indemnify the Program Agent and each Purchaser and their respective officers, directors, agents and employees (each an "Indemnified Party") from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other amounts payable, including reasonable attorneys' fees (which attorneys may be employees of the Program Agent or such Purchaser) and disbursements (all of the foregoing being collectively referred to as "Indemnified Amounts") awarded against or incurred by any of them arising out of or as a result of Transaction Documents or the acquisition, either directly or indirectly, by a Purchaser of an interest in the Class A Certificates or Class A Certificate Interests, excluding, however: (i) Indemnified Amounts to the extent that final judgment of a court of competent jurisdiction holds such Indemnified Amounts resulted from gross negligence or willful misconduct on the part of the Indemnified Party seeking indemnification; or (ii) Indemnified Amounts to the extent the same includes losses in respect of Eligible Receivables which are wholly or partially uncollectible on account of the insolvency, bankruptcy or lack of creditworthiness of the related Obligor or the failure of such Collections to cover interest and principal owed to a Class A Certificateholder; provided, however, that nothing contained in this sentence shall limit the liability of the Seller or limit the recourse

ARTICLE VIII INDEMNIFICATION SECTION 8.01. Indemnities by the Seller. Without limiting any other rights which the Program Agent or any Purchaser may have hereunder or under applicable law, the Seller hereby agrees to indemnify the Program Agent and each Purchaser and their respective officers, directors, agents and employees (each an "Indemnified Party") from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other amounts payable, including reasonable attorneys' fees (which attorneys may be employees of the Program Agent or such Purchaser) and disbursements (all of the foregoing being collectively referred to as "Indemnified Amounts") awarded against or incurred by any of them arising out of or as a result of Transaction Documents or the acquisition, either directly or indirectly, by a Purchaser of an interest in the Class A Certificates or Class A Certificate Interests, excluding, however: (i) Indemnified Amounts to the extent that final judgment of a court of competent jurisdiction holds such Indemnified Amounts resulted from gross negligence or willful misconduct on the part of the Indemnified Party seeking indemnification; or (ii) Indemnified Amounts to the extent the same includes losses in respect of Eligible Receivables which are wholly or partially uncollectible on account of the insolvency, bankruptcy or lack of creditworthiness of the related Obligor or the failure of such Collections to cover interest and principal owed to a Class A Certificateholder; provided, however, that nothing contained in this sentence shall limit the liability of the Seller or limit the recourse of the Purchasers to the Seller for amounts otherwise specifically provided to be paid by the Seller under the terms of the Transaction Documents. Without limiting the generality of the foregoing indemnification, the Seller shall indemnify the Program Agent and the Purchasers for Indemnified Amounts (including, without limitation, losses in respect of uncollectible receivables, regardless of whether reimbursement therefor would constitute recourse to the Seller) resulting from: (i) any representation or warranty made by the Seller (or any officers of the Seller) under or in connection with any Transaction Document or any other information or report delivered by the Seller pursuant thereto, having been false or incorrect in any material respect when made or deemed made;

(ii) the failure by the Seller to comply with any applicable law, rule or regulation with respect to any Receivable related thereto, or the nonconformity of any Receivable included therein with any such applicable law, rule or regulation; (iii) any material failure of the Seller to perform its duties or obligations in accordance with the provisions of any Transaction Document; (iv) any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including, without limitation, a defense based on such Receivable not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale of the merchandise or service related to such Receivable or the furnishing or failure to furnish such merchandise or services; (v) the commingling of Collections of Receivables at any time with other funds; (vi) any investigation, litigation or proceeding related to or arising from any Transaction Document, the transactions contemplated thereby, the use of the proceeds of a purchase, the ownership of the Class A Certificate Interests or any other investigation, litigation or proceeding relating to the Seller in which any Indemnified Party becomes involved as a result of any of the transactions contemplated thereby other than (a) litigation between the Seller on the one hand and the Program Agent and/or one or more of the Purchasers on the other hand in which the Seller shall prevail or (b) any investigation or proceeding arising from (i) the gross negligence or wilful misconduct of the Program Agent and/or one or more of the Purchasers or (ii) the unlawful conduct of the Program Agent and/or one or more of the Purchasers; and

(ii) the failure by the Seller to comply with any applicable law, rule or regulation with respect to any Receivable related thereto, or the nonconformity of any Receivable included therein with any such applicable law, rule or regulation; (iii) any material failure of the Seller to perform its duties or obligations in accordance with the provisions of any Transaction Document; (iv) any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including, without limitation, a defense based on such Receivable not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale of the merchandise or service related to such Receivable or the furnishing or failure to furnish such merchandise or services; (v) the commingling of Collections of Receivables at any time with other funds; (vi) any investigation, litigation or proceeding related to or arising from any Transaction Document, the transactions contemplated thereby, the use of the proceeds of a purchase, the ownership of the Class A Certificate Interests or any other investigation, litigation or proceeding relating to the Seller in which any Indemnified Party becomes involved as a result of any of the transactions contemplated thereby other than (a) litigation between the Seller on the one hand and the Program Agent and/or one or more of the Purchasers on the other hand in which the Seller shall prevail or (b) any investigation or proceeding arising from (i) the gross negligence or wilful misconduct of the Program Agent and/or one or more of the Purchasers or (ii) the unlawful conduct of the Program Agent and/or one or more of the Purchasers; and (vii) any Servicer Default.

ARTICLE IX MISCELLANEOUS SECTION 9.01. Amendments, Etc. Subject to Section 5.08, no amendment of any provision of this Agreement shall in any event be effective unless the same shall be in writing and signed by the parties hereto. Any waiver or consent shall be effective only if signed by the party waiving any right, in the specific instance and for the specific purpose for which given. SECTION 9.02. Notices, Etc. All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including telex and facsimile communication) and shall be personally delivered or sent by certified mail, postage prepaid, or overnight courier or facsimile, to the intended party at the address or facsimile number of such party set forth under its name on the signature pages hereof or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective (a) if personally delivered, when received, (b) if sent by certified mail, four Business Days after having been deposited in the mail, postage prepaid, (c) if sent by overnight courier, two Business Days after having been given to such courier, unless sooner received by the addressee and (d) if transmitted by facsimile, when sent, upon receipt confirmed by telephone or electronic means. Notices and communications sent or transmitted hereunder on a day that is not a Business Day shall be deemed to have been sent or transmitted on the following Business Day. SECTION 9.03. No Waiver; Remedies. No failure on the part of the Program Agent, any Liquidity Provider, any Indemnified Party, Falcon or any other holder of any Class A Certificate Interest to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Without limiting the foregoing, the Program Agent and each Liquidity Provider is hereby authorized by the Seller at any time and from time to time, to the fullest extent permitted by law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by the Program Agent and each Liquidity Provider to or for the credit or the account of the Seller, now or hereafter existing under this Agreement, to the Program Agent, any Liquidity Provider, any Indemnified Party or Falcon, or their respective

ARTICLE IX MISCELLANEOUS SECTION 9.01. Amendments, Etc. Subject to Section 5.08, no amendment of any provision of this Agreement shall in any event be effective unless the same shall be in writing and signed by the parties hereto. Any waiver or consent shall be effective only if signed by the party waiving any right, in the specific instance and for the specific purpose for which given. SECTION 9.02. Notices, Etc. All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including telex and facsimile communication) and shall be personally delivered or sent by certified mail, postage prepaid, or overnight courier or facsimile, to the intended party at the address or facsimile number of such party set forth under its name on the signature pages hereof or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective (a) if personally delivered, when received, (b) if sent by certified mail, four Business Days after having been deposited in the mail, postage prepaid, (c) if sent by overnight courier, two Business Days after having been given to such courier, unless sooner received by the addressee and (d) if transmitted by facsimile, when sent, upon receipt confirmed by telephone or electronic means. Notices and communications sent or transmitted hereunder on a day that is not a Business Day shall be deemed to have been sent or transmitted on the following Business Day. SECTION 9.03. No Waiver; Remedies. No failure on the part of the Program Agent, any Liquidity Provider, any Indemnified Party, Falcon or any other holder of any Class A Certificate Interest to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Without limiting the foregoing, the Program Agent and each Liquidity Provider is hereby authorized by the Seller at any time and from time to time, to the fullest extent permitted by law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by the Program Agent and each Liquidity Provider to or for the credit or the account of the Seller, now or hereafter existing under this Agreement, to the Program Agent, any Liquidity Provider, any Indemnified Party or Falcon, or their respective successors and assigns; provided, however, that no

such Person shall exercise any such right of set-off without the prior written consent of the Program Agent. Each set-off by Falcon or any Liquidity Provider under this Section 9.03 against the Class A Invested Amount shall reduce the Class A Invested Amount accordingly. SECTION 9.04. Binding Effect; Survival. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, and the provisions of Section 3.02 shall inure to the benefit of the Liquidity Providers and their respective successors and assigns; provided, however, that nothing in the foregoing shall be deemed to authorize any assignment not permitted by Section 6.01. This Agreement shall create and constitute the continuing obligation of the parties hereto in accordance with its terms, and shall remain in full force and effect until one year and one day after the earlier of the date on which all Obligations are paid in full or the Trust shall terminate in accordance with the Pooling and Servicing Agreement. The provisions of Sections 3.02, 3.03(b), 5.04, 8.01 and 9.16 shall be continuing and shall survive any termination of this Agreement. SECTION 9.05. No Proceedings. The Seller (on its own behalf and on behalf of its Affiliates), the Trustee, The First National Bank of Chicago, individually and as Program Agent, and each Liquidity Provider hereby agrees that it will not institute against Falcon, or join any other Person in instituting against Falcon, any insolvency proceeding (namely, any proceeding of the type referred to in the definition of "Insolvency Event") so long as any Commercial Paper issued by Falcon shall be outstanding or there shall not have elapsed one year plus one day since the last day on which any such Commercial Paper shall have been outstanding. The foregoing shall not limit the right of the Seller, the Trustee, The First National Bank of Chicago, individually or as the Program Agent, or any Liquidity Provider to file any claim in or otherwise take any action with respect to any such insolvency proceeding that was instituted against Falcon by any Person other than the Seller, the Trustee, The First National Bank of Chicago, individually or as the Program Agent, or any Liquidity Provider.

such Person shall exercise any such right of set-off without the prior written consent of the Program Agent. Each set-off by Falcon or any Liquidity Provider under this Section 9.03 against the Class A Invested Amount shall reduce the Class A Invested Amount accordingly. SECTION 9.04. Binding Effect; Survival. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, and the provisions of Section 3.02 shall inure to the benefit of the Liquidity Providers and their respective successors and assigns; provided, however, that nothing in the foregoing shall be deemed to authorize any assignment not permitted by Section 6.01. This Agreement shall create and constitute the continuing obligation of the parties hereto in accordance with its terms, and shall remain in full force and effect until one year and one day after the earlier of the date on which all Obligations are paid in full or the Trust shall terminate in accordance with the Pooling and Servicing Agreement. The provisions of Sections 3.02, 3.03(b), 5.04, 8.01 and 9.16 shall be continuing and shall survive any termination of this Agreement. SECTION 9.05. No Proceedings. The Seller (on its own behalf and on behalf of its Affiliates), the Trustee, The First National Bank of Chicago, individually and as Program Agent, and each Liquidity Provider hereby agrees that it will not institute against Falcon, or join any other Person in instituting against Falcon, any insolvency proceeding (namely, any proceeding of the type referred to in the definition of "Insolvency Event") so long as any Commercial Paper issued by Falcon shall be outstanding or there shall not have elapsed one year plus one day since the last day on which any such Commercial Paper shall have been outstanding. The foregoing shall not limit the right of the Seller, the Trustee, The First National Bank of Chicago, individually or as the Program Agent, or any Liquidity Provider to file any claim in or otherwise take any action with respect to any such insolvency proceeding that was instituted against Falcon by any Person other than the Seller, the Trustee, The First National Bank of Chicago, individually or as the Program Agent, or any Liquidity Provider. SECTION 9.06. Captions and Cross References. The various captions (including, without limitation, the table of contents) in this Agreement are provided solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Agreement. SECTION 9.07. Integration. This Agreement, together with the other Transaction Documents, contains a final and complete integration of all prior expressions by the parties

hereto with respect to the subject matter hereof and, together with all the other Transaction Documents and the Fee Letter, shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, superseding all prior oral or written understandings. SECTION 9.08. Governing Law. THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE INTERESTS OF FALCON OR THE LIQUIDITY PROVIDERS IN THE TRUST ASSETS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. SECTION 9.09. Submission to Jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally submits to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, and each of the parties hereto hereby irrevocably and unconditionally (i) agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, such federal court and (ii) waives the defense of an inconvenient forum. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. SECTION 9.10. Consent to Service of Process. Each party to this Agreement irrevocably consents to service of process by personal delivery, certified mail, postage prepaid or overnight courier. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted or required by law.

hereto with respect to the subject matter hereof and, together with all the other Transaction Documents and the Fee Letter, shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, superseding all prior oral or written understandings. SECTION 9.08. Governing Law. THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE INTERESTS OF FALCON OR THE LIQUIDITY PROVIDERS IN THE TRUST ASSETS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. SECTION 9.09. Submission to Jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally submits to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, and each of the parties hereto hereby irrevocably and unconditionally (i) agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, such federal court and (ii) waives the defense of an inconvenient forum. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. SECTION 9.10. Consent to Service of Process. Each party to this Agreement irrevocably consents to service of process by personal delivery, certified mail, postage prepaid or overnight courier. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted or required by law. SECTION 9.11. Waiver of Jury Trial. Each party to this Agreement waives any right to a trial by jury in any action or proceeding to enforce or defend any rights under or relating to this Agreement, any other Transaction Document, the Fee Letter or any amendment, instrument, document or agreement delivered or which may in the future be delivered in connection herewith or therewith or arising from any course of conduct, course of dealing, statements (whether verbal of written), actions of any of the parties hereto and the Liquidity Providers or any other relationship existing in connection with this Agreement of any other Transaction Document or the Fee Letter, and agrees that any such action or proceeding shall be tried before a court and not before a jury.

SECTION 9.12. Execution in Counterparts. This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. SECTION 9.13. Replacement of Liquidity Providers. The Program Agent shall have the right, in its sole discretion, to terminate the rights and obligations of the Liquidity Providers to make the Purchase or fund Increases in the event that the applicable rating described in Sections 6.01(b) and 6.01(c) shall be downgraded. Such termination shall be effective upon written notice to such effect delivered by the Program Agent to such Liquidity Provider, whereupon the Term of such Liquidity Provider's Commitment shall be deemed to have terminated. Upon such termination, the Liquidity Provider shall cease to have any rights or obligations with respect to future Increases under this Agreement but shall continue to have the rights and obligations of a Liquidity Provider with respect to any Increases funded by it under this Agreement prior to such termination. SECTION 9.14. Reimbursement of Program Agent. Each Liquidity Provider will on demand reimburse the Program Agent its Liquidity Provider Commitment Percentage of any and all reasonable costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) which may be incurred in connection with collecting amounts owed with respect to any Class A Certificate in which such Liquidity Provider purchases Class A Certificate Interests for which the Program Agent is not promptly reimbursed by the Seller or otherwise. Should the Program Agent later be reimbursed by the Seller or Falcon for any such amount, the Program Agent shall immediately pay to each Liquidity Provider its Liquidity Provider Commitment Percentage of such amount. SECTION 9.15. No Conflict of Interest. The Program Agent and its Affiliates may accept deposits from, lend money or otherwise extend credit to, act as trustee under indentures of, and generally engage in any kind of business with, the Seller and any of its Affiliates and any Person who may do business with or own securities of

SECTION 9.12. Execution in Counterparts. This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. SECTION 9.13. Replacement of Liquidity Providers. The Program Agent shall have the right, in its sole discretion, to terminate the rights and obligations of the Liquidity Providers to make the Purchase or fund Increases in the event that the applicable rating described in Sections 6.01(b) and 6.01(c) shall be downgraded. Such termination shall be effective upon written notice to such effect delivered by the Program Agent to such Liquidity Provider, whereupon the Term of such Liquidity Provider's Commitment shall be deemed to have terminated. Upon such termination, the Liquidity Provider shall cease to have any rights or obligations with respect to future Increases under this Agreement but shall continue to have the rights and obligations of a Liquidity Provider with respect to any Increases funded by it under this Agreement prior to such termination. SECTION 9.14. Reimbursement of Program Agent. Each Liquidity Provider will on demand reimburse the Program Agent its Liquidity Provider Commitment Percentage of any and all reasonable costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) which may be incurred in connection with collecting amounts owed with respect to any Class A Certificate in which such Liquidity Provider purchases Class A Certificate Interests for which the Program Agent is not promptly reimbursed by the Seller or otherwise. Should the Program Agent later be reimbursed by the Seller or Falcon for any such amount, the Program Agent shall immediately pay to each Liquidity Provider its Liquidity Provider Commitment Percentage of such amount. SECTION 9.15. No Conflict of Interest. The Program Agent and its Affiliates may accept deposits from, lend money or otherwise extend credit to, act as trustee under indentures of, and generally engage in any kind of business with, the Seller and any of its Affiliates and any Person who may do business with or own securities of the Seller or any of its Affiliates, all as though this Agreement had not been entered into and without any duty to account therefor to Falcon or any Liquidity Provider. SECTION 9.16. Withholding Taxes. Each Liquidity Provider warrants that it is not subject to any taxes, charges, levies or withholdings with respect to payments under this

Agreement that are imposed by means of withholding by any applicable taxing authority ("Withholding Tax"). Each Liquidity Provider agrees to provide the Program Agent, from time to time upon the Program Agent's request, completed and signed copies of any documents that may be required by any applicable taxing authority to certify such Liquidity Provider's exemption from Withholding Tax with respect to payments to be made to such Liquidity Provider under this Agreement. Each Liquidity Provider agrees to hold the Program Agent and the Seller harmless from any Withholding Tax imposed due to such Liquidity Provider's failure to establish that it is not subject to Withholding Tax. IN WITNESS WHEREOF, the parties hereto have caused this Certificate Purchase Agreement to be duly executed by their respective officers thereunto duly authorized as of the date first above written. FEDERAL-MOGUL FUNDING CORPORATION, as Seller By---------------------------------Name: Title: FALCON ASSET SECURITIZATION CORPORATION, a Purchaser By----------------------------------Name: Title: Authorized Signatory THE FIRST NATIONAL BANK OF CHICAGO,

Agreement that are imposed by means of withholding by any applicable taxing authority ("Withholding Tax"). Each Liquidity Provider agrees to provide the Program Agent, from time to time upon the Program Agent's request, completed and signed copies of any documents that may be required by any applicable taxing authority to certify such Liquidity Provider's exemption from Withholding Tax with respect to payments to be made to such Liquidity Provider under this Agreement. Each Liquidity Provider agrees to hold the Program Agent and the Seller harmless from any Withholding Tax imposed due to such Liquidity Provider's failure to establish that it is not subject to Withholding Tax. IN WITNESS WHEREOF, the parties hereto have caused this Certificate Purchase Agreement to be duly executed by their respective officers thereunto duly authorized as of the date first above written. FEDERAL-MOGUL FUNDING CORPORATION, as Seller By---------------------------------Name: Title: FALCON ASSET SECURITIZATION CORPORATION, a Purchaser By----------------------------------Name: Title: Authorized Signatory THE FIRST NATIONAL BANK OF CHICAGO, as Program Agent By---------------------------------Name: Title: Authorized Agent

Liquidity Providers: Liquidity Provider Commitment: $100,000,000 Liquidity Provider Commitment Percentage: 100% NBD Bank, a Liquidity Provider and a Potential Purchaser By---------------------------- Name: Title:

EXHIBIT 11.1 - STATEMENT RE COMPUTATION OF PER SHARE EARNINGS

FEDERAL-MOGUL CORPORATION AND SUBSIDIARIES

FOR THE THREE MONTHS ENDED MARCH 31 - ------------------------------------------

PRIMARY -------------1997 1996 ------ ------

FULLY DILUTED --------------1997 1996 -----------

Liquidity Providers: Liquidity Provider Commitment: $100,000,000 Liquidity Provider Commitment Percentage: 100% NBD Bank, a Liquidity Provider and a Potential Purchaser By---------------------------- Name: Title:

EXHIBIT 11.1 - STATEMENT RE COMPUTATION OF PER SHARE EARNINGS

FEDERAL-MOGUL CORPORATION AND SUBSIDIARIES

FOR THE THREE MONTHS ENDED MARCH 31 - -----------------------------------------EARNINGS: (In Millions) Net earnings

PRIMARY -------------1997 1996 ------ ------

FULLY DILUTED --------------1997 1996 -----------

$ 13.9

$ 10.6

$ 13.9

$ 10.6

EXHIBIT 11.1 - STATEMENT RE COMPUTATION OF PER SHARE EARNINGS

FEDERAL-MOGUL CORPORATION AND SUBSIDIARIES

FOR THE THREE MONTHS ENDED MARCH 31 - -----------------------------------------EARNINGS: (In Millions) Net earnings Series C preferred dividend requirements Series D preferred dividend requirements Additional required ESOP contribution <F1>

PRIMARY -------------1997 1996 ------ ------

FULLY DILUTED --------------1997 1996 -----------

$ 13.9 $ 10.6 (.6) (.6) (1.5) (1.6) ---------

$ 13.9 (1.6) (.5) -----

$ 10.6 (1.6) (.5) -----

Net earnings available for common and equivalent shares

$ 11.8 =====

$ 8.4 =====

$ 11.9 =====

$ 8.5 =====

WEIGHTED AVERAGE SHARES:

(In Millions) 35.0 ----35.0 ===== 35.1 .2 1.6 .3 ----37.2 ===== 35.0 1.8 .6 ----37.4 =====

Common shares outstanding 35.1 Dilutive stock options outstanding .1 Conversion of Series C preferred stock <F3> Contingent issuance of common stock to satisfy the redemption price guarantee <F2><F4> ----Common and equivalent shares outstanding 35.2 =====

PER COMMON AND EQUIVALENT SHARE: Net earnings $ .33 ===== $ .24 ===== $ .32 ===== $ .23 =====

[FN] <F1> Amount represents the additional after-tax contribution that would be necessary to meet the ESOP debt service requirements under an assumed conversion of the Series C preferred stock. <F2> Calculations consider the March 31, 1997 common stock market price in accordance with Emerging Issues Task Force Abstract No. 89-12. <F3> Amount represents the weighted average number of common shares issued assuming conversion of preferred stock outstanding. <F4> Amount represents the additional number of common shares that would be issued in order to satisfy the Series C preferred stock redemption price guarantee. This calculation considers only the number of preferred shares Held by the ESOP that have been allocated to participants' accounts as of March 31 of the respective years.

ARTICLE 5 MULTIPLIER: 1,000

PERIOD TYPE FISCAL YEAR END PERIOD END CASH SECURITIES

3 MOS DEC 31 1997 MAR 31 1997 33,000 0

ARTICLE 5 MULTIPLIER: 1,000

PERIOD TYPE FISCAL YEAR END PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS COMMON PREFERRED MANDATORY PREFERRED OTHER SE TOTAL LIABILITY AND EQUITY SALES TOTAL REVENUES CGS TOTAL COSTS OTHER EXPENSES LOSS PROVISION INTEREST EXPENSE INCOME PRETAX INCOME TAX INCOME CONTINUING DISCONTINUED EXTRAORDINARY CHANGES NET INCOME EPS PRIMARY EPS DILUTED

3 MOS DEC 31 1997 MAR 31 1997 33,000 0 273,100 17,600 385,700 757,200 525,900 200,600 1,419,700 639,600 206,900 175,300 0 128,100 6,800 1,419,700 485,600 485,600 373,500 78,400 1,400 0 9,800 22,500 8,600 13,900 0 0 0 13,900 .33 .32