RCL TRUST 1996 1, S-1, 1996-08-30

RCL TRUST 1996 1
S-1, 1996-08-30
PERSONAL CREDIT INSTITUTIONS

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<PAGE> 1

REGISTRATION NO. 333-
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________

Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
______________________

FORD CREDIT AUTO LEASE TRUST 1996-1
(Issuer of the Senior Notes)
______________________

RCL TRUST 1996-1
(Originator of the Trust described herein)
(Exact name of registrant as specified in
its charter)

<TABLE>
<S> <C> <C>
FORD MOTOR CREDIT A Delaware Trust FORD CREDIT LEASING COMPANY, INC.
COMPANY Primary Standard Industrial Classification (Originator of the Registrant; originator
(Originator of the Registrant; originator Code Number 6733 of Ford Credit Titling Trust)
of Ford Credit Titling Trust) IRS Employer No. Applied For
The American Road A Delaware Corporation
A Delaware Corporation Dearborn, Michigan 48121 Primary Standard Industrial Classification
Primary Standard Industrial Classification (313) 594-9876 Code Number 6159
Code Number 6153 IRS Employer No. 38-3156318
IRS Employer No. 38-1612444 The American Road
The American Road Dearborn, Michigan 48121
Dearborn, Michigan 48121 (313) 845-4072
(313) 322-3000
</TABLE>
______________________

J. D. BRINGARD, ESQ.
Ford Motor Credit Company
The American Road
Dearborn, Michigan 48121
(313) 594-7742
(Name and Address of Agent for Service
for each of the above named entities)

Copy to:
SUSAN M. CURTIS, ESQ.
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
(212) 735-3000
____________

Approximate date of commencement of proposed sale to the public: As
soon as practicable on or after the effective date of this Registration
Statement.

If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box. [ ]

If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
effective registration statement for the same offering. [ ]_____

If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]_____

If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

CALCULATION OF REGISTRATION FEE

<TABLE>
<S> <C> <C> <C> <C>
Proposed Proposed
Maximum Maximum
Title of Securities Amount Being Offering Price Aggregate Amount of
Being Registered Registered Per Unit (1) Offering Price (1) Registration Fee
Class A-1 Asset Backed Senior Notes . $500,000.00 100% $500,000.00 $172.41
Class A-2 Asset Backed Senior Notes . $500,000.00 100% $500,000.00 $172.42

Series 1996-1 Certificates (2) . . . (3) (3) (3) (3)
TOTAL . . . . . . . . . . . . . . . . $1,000,000.00 $1,000,000.00 $1,000,000.00 $344.83
</TABLE>

(1) Estimated solely for the purpose of calculating the registration fee.
(2) The Series 1996-1 Certificates issued by Ford Credit Titling Trust
represent a beneficial interest in Series 1996-1 Assets (including
Series 1996-1 Leases and Series 1996-1 Leased Vehicles). The Series
1996-1 Certificates are not being offered to investors hereunder, but
will be pledged to the Indenture Trustee to secure the payment of
interest on and principal of the Senior Notes.
(3) Not applicable.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 2
THE INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

PRELIMINARY PROSPECTUS Subject to Completion, Dated _______ __, 1996

$ __________________________
FORD CREDIT AUTO LEASE TRUST 1996-1
ISSUER

$__________ CLASS A-1 ___% ASSET BACKED SENIOR NOTES
$__________ CLASS A-2 ___% ASSET BACKED SENIOR NOTES

RCL TRUST 1996-1
TRANSFEROR
FORD MOTOR CREDIT COMPANY
ADMINISTRATIVE AGENT

Ford Credit Auto Lease Trust 1996-1 (the "Issuer") will be formed pursuant to a
Lease Trust Agreement to be dated as of ______ __, 1996 between ______ (the
"RCL Trustee") in its capacity as trustee of the RCL Trust 1996-1 (the
"Transferor") and PNC Bank, Delaware (the "Lease Trustee") in its capacity as
trustee of the Issuer. Pursuant to an Indenture to be dated as of ______ ___,
1996 between the Lease Trustee, on behalf of the Issuer, and The Chase
Manhattan Bank, as Indenture Trustee, the Issuer will issue notes secured by
interests in certain retail automotive leases and leased vehicles, including
$_______ initial principal balance of __% Class A-1 Asset Backed Senior Notes
(the "Class A-1 Senior Notes") and $_______ initial principal balance of __%
Class A-2 Asset Backed Senior Notes (the "Class A-2 Senior Notes" and, together
with the Class A-1 Senior Notes, the "Senior Notes"). The Issuer also will
issue $_____ initial principal balance of __% Asset Backed Subordinated Notes
(the "Subordinated Notes") and $_____ initial principal balance of __ % Asset
Backed Lease Trust Certificates (the "Lease Trust Certificates"). The
Subordinated Notes and the Lease Trust Certificates are not being offered
hereby.
(cover continued on following page)

PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH IN "RISK FACTORS" BEGINNING ON PAGE 15 HEREIN.

EXCEPT TO THE EXTENT DESCRIBED HEREIN, THE SENIOR NOTES REPRESENT OBLIGATIONS
OF THE ISSUER ONLY AND DO NOT REPRESENT INTERESTS IN, RECOURSE TO OR
OBLIGATIONS OF THE TRANSFEROR, FORD MOTOR CREDIT COMPANY OR ANY OF THEIR
RESPECTIVE AFFILIATES.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.

<TABLE>
<S> <C> <C> <C> <C>
Initial Price to Underwriting PROCEEDS TO
Principal Balance Public (1) DISCOUNT THE ISSUER (1)(2)
Class A-1 Senior Notes $ % % %
Class A-2 Senior Notes $ % % %
Total $ $ $ $
</TABLE>
(1) Plus accrued interest, if any, calculated from ______ ___, 1996.
(2) Before deducting expenses payable by the Issuer estimated at
$____________.

The Senior Notes are offered by the Underwriters when, as, and if issued and
accepted by them and subject to their right to reject orders in whole or in
part. The Underwriters reserve the right to withdraw, cancel or modify such
offer. It is expected that the Senior Notes will be delivered in book-entry
form through the facilities of The Depository Trust Company on or about
_________ __, 1996 against payment therefor in immediately available funds.

J.P. Morgan & Co.

_________ __, 1996

<PAGE> 3

As more fully described herein, the assets of the Issuer will include
certificates (the "Series 1996-1 Certificates") transferred to the Issuer by the
Transferor representing a 100% undivided beneficial interest in specified retail
automobile and light truck leases (the "Series 1996-1 Leases"), all payments
from lessees (the "Obligors") thereunder, the related leased vehicles (the
"Series 1996-1 Leased Vehicles") and all proceeds from the sale of Series
1996-1 Leased Vehicles upon termination of the related Series 1996-1 Leases.
Subject to the security interest granted to the Indenture Trustee pursuant to
the Indenture to secure the Senior Notes, the Issuer will enter into the Program
Operating Lease with the Transferor pursuant to which the Transferor will be
entitled to the benefits of the Series 1996-1 Certificates during the term of
the underlying Series 1996-1 Leases in exchange for the payment by the
Transferor of certain amounts paid under the underlying Series 1996-1 Leases and
paid from the sale of Series 1996-1 Leased Vehicles. These payments will be
applied by the Issuer, together with other amounts payable on the Series 1996-1
Certificates, to pay interest on and principal of the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates. See "Series 1996-1
Certificates--Lease of the Series 1996-1 Certificates to the Transferor." The
Issuer will have the benefit of the Cash Collateral Account established by the
Transferor to secure the Transferor's payment obligations under the Program
Operating Lease. As outlined above and as more fully described herein, the
sources of payments on the Senior Notes will be limited to the amounts payable
to the Issuer under the Series 1996-1 Certificates, the payments by the
Transferor under the Program Operating Lease and the benefits provided by the
Cash Collateral Account.

Interest on the Senior Notes will accrue at the respective fixed per annum
interest rates specified above and generally will be payable quarterly on
_________ 15, _________ 15, _________ 15 and _________ 15 of each year,
commencing _________ 15, 199_ or, if any such day is not a business day, on the
next succeeding business day (each, a "Payment Date"). Principal of the Senior
Notes will be payable on each Payment Date to the extent described herein. No
principal payments will be made on the Class A-2 Senior Notes until the Class
A-1 Senior Notes have been paid in full; provided that if an Event of Default
under the Indenture has occurred and the maturity of the Senior Notes has been
accelerated, principal payments will be made on the Senior Notes on a pro rata
basis based on their respective principal balances, without any distinction
between Classes. No principal will be payable on the Subordinated Notes until
the Senior Notes have been paid in full. No principal will be payable on the
Lease Trust Certificates until the Senior Notes and the Subordinated Notes have
been paid in full.

The Stated Maturity of the Class A-1 Senior Notes will be the _____ 1997
Payment Date. The Stated Maturity of the Class A-2 Senior Notes will be the
____________ Payment Date. However, payment in full of either Class of Senior
Notes could occur earlier than such date as described herein.

There is currently no secondary market for the Senior Notes offered hereby.
The Underwriters expect, but will not be obligated, to make a market in the
Senior Notes. There can be no assurance that a secondary market for any of the
Senior Notes will develop or, if one does develop, that it will provide the
Senior Noteholders with liquidity of investment or that it will continue for the
life of the Senior Notes offered hereby.

AVAILABLE INFORMATION

The Transferor, as originator of the Issuer, has filed a Registration
Statement under the Securities Act of 1933, as amended (the "Securities Act"),
with the Securities and Exchange Commission (the "Commission") on behalf of the
Issuer with respect to the Senior Notes offered pursuant to this Prospectus. For
further information, reference is made to the Registration Statement and
amendments thereof and to the exhibits thereto, which are available for
inspection without charge at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549; 7 World Trade
Center, 13th Floor, New York, New York 10048; and Northwest Atrium Center, 500
West Madison Street, Chicago, Illinois 60661. Copies of the Registration
Statement and amendments thereof and exhibits thereto may be obtained from the
Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. In addition, the Commission maintains a public
access site on the Internet through the World Wide Web at which the Registration
Statement and amendments thereof and exhibits thereto may be viewed. The
Internet address of such World Wide Web site is http://www.sec.gov.

2
<PAGE> 4

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SENIOR NOTES AT
A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained in this Prospectus and,
if given or made, such information or representation must not be relied upon as
having been authorized by the Transferor, the Issuer, the Administrative Agent
or the Underwriters. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities offered hereby in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus, nor
any sale made hereunder, shall, under any circumstances, create any implication
that the information herein is correct as of any time subsequent to the date
hereof.

UNTIL _____ __, 199_ (90 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE SENIOR NOTES, WHETHER OR NOT PARTICIPATING
IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS DELIVERY
REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS
WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS. UPON RECEIPT OF A REQUEST BY AN INVESTOR OR HIS OR HER
REPRESENTATIVE WITHIN THE PERIOD DURING WHICH THERE IS A PROSPECTUS DELIVERY
OBLIGATION, THE ISSUER OR THE UNDERWRITERS WILL TRANSMIT OR CAUSE TO BE
TRANSMITTED PROMPTLY, WITHOUT CHARGE, AND IN ADDITION TO ANY SUCH DELIVERY
REQUIREMENTS, A PAPER COPY OF A PROSPECTUS, OR A PROSPECTUS ENCODED IN AN
ELECTRONIC FORMAT.

TABLE OF CONTENTS

PAGE PAGE
---- ----
<S> <C> <C> <C>
Summary . . . . . . . . . . . . . . . . . . . . . 5 Description of the Administrative Agency
Risk Factors . . . . . . . . . . . . . . . . . . 15 Agreement . . . . . . . . . . . . . . . . . 57
Ford Credit . . . . . . . . . . . . . . . . . . . 22 Additional Document Provisions . . . . . . . 65
The Issuer . . . . . . . . . . . . . . . . . . . 23 Ratings of the Senior Notes . . . . . . . . . 71
Property of the Issuer . . . . . . . . . . . . . 23 Certain Legal Aspects of FCTT and the Series
Use of Proceeds . . . . . . . . . . . . . . . . . 24 1996-1 Certificates . . . . . . . . . . . . 72
FCTT . . . . . . . . . . . . . . . . . . . . . . 24 Certain Legal Aspects of the Leases and
The Transferor . . . . . . . . . . . . . . . 26 Leased Vehicles . . . . . . . . . . . . . . 75
Series 1996-1 Certificates . . . . . . . . . . . 27 Certain Federal Income Tax Consequences . . . 78
The Leases and Leased Vehicles . . . . . . . . . 30 Certain State Tax Consequences . . . . . . . 83
Maturity, Prepayment and Yield Considerations . . 39 ERISA Considerations . . . . . . . . . . . . 84
Pool Factors and Trading Information . . . . . . 41 Underwriting . . . . . . . . . . . . . . . . 85
Management's Discussion and Analysis of Finan- Legal Matters . . . . . . . . . . . . . . . . 85
cial Condition and Results of Operations . . . 41 Glossary of Terms . . . . . . . . . . . . . . 86
Description of the Senior Notes . . . . . . . . . 41
</TABLE>

REPORTS TO SENIOR NOTEHOLDERS

Unless and until Definitive Senior Notes are issued, quarterly
unaudited reports containing information concerning the Issuer will be prepared
by the Administrative Agent and sent by the Indenture Trustee on behalf of the
Issuer only to Cede & Co. ("Cede"), as nominee of The Depository Trust Company
("DTC") and registered holder of the Senior Notes. See "Description of the
Senior Notes -- Book-Entry Registration." Such reports will not constitute
financial statements prepared in accordance with generally accepted accounting
principles. See "Pool Factors and Trading Information" for additional
information concerning periodic reports to Senior Noteholders.

3
<PAGE> 5

OVERVIEW -- TRANSFER OF SERIES 1996-1 CERTIFICATES

<TABLE>

<S><C>
98% Beneficial Interest in FCTT 2% Beneficial Interest in FCTT
- Exchangeable Beneficial Certificate - Exchangeable Beneficial Certificate
- Series 1996-1 Certificate - Series 1996-1 Certificate

</TABLE>

4
<PAGE> 6

SUMMARY

The following summary is qualified in its entirety by reference to the
detailed information appearing elsewhere in this Prospectus. Certain capitalized
terms used herein are defined in the "Glossary of Terms" or elsewhere in this
Prospectus.

OVERVIEW . . . . . As more fully described herein, Dealers in fifteen
states have originated certain retail lease contracts for
automobiles and light trucks on or after _________ __, 199_
and have assigned and will assign such lease contracts and
the related vehicles to the Ford Credit Titling Trust
("FCTT"), a trust established by Ford Credit and Ford Credit
Leasing, a special purpose wholly-owned subsidiary of Ford
Credit. Ford Credit and Ford Credit Leasing are the
beneficiaries of the interests in FCTT which have not
previously been securitized and have instructed the
Administrative Agent to select, in accordance with certain
eligibility criteria, Leases and Leased Vehicles held by
FCTT to be designated as Series 1996-1 Assets. On the
Closing Date, the Series 1996-1 Certificates representing
the beneficial interest in the Series 1996-1 Assets will be
issued to Ford Credit and Ford Credit Leasing. Immediately
thereafter, Ford Credit and Ford Credit Leasing will
contribute their Series 1996-1 Certificates to the
Transferor which in turn will transfer the Series 1996-1
Certificates to the Issuer. The Issuer will issue the
Senior Notes pursuant to the Indenture and will pledge the
Series 1996-1 Certificates to the Indenture Trustee as
security for such Senior Notes. The Issuer also will issue
the Subordinated Notes and the Lease Trust Certificates,
which are not offered hereby.

Pursuant to the Program Operating Lease the Issuer will
lease the Series 1996-1 Certificates, subject to the lien
securing the Senior Notes, back to the Transferor in
exchange for the obligation of the Transferor to make
certain payments during the period that each underlying
Series 1996-1 Leased Vehicle is subject to the Program
Operating Lease. Such payments (the "Program Operating Lease
Payments") will consist of a Required Interest Payment
portion and an Additional Payment portion. The "Required
Interest Payment" generally will be equal to the sum for the
related three months of the Administrative Agent Fee and
three months of interest accrued on the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates. The
"Additional Payment" generally will be equal to the amount,
if any, by which the amount on deposit in the Cash
Collateral Account on the business day preceding any Payment
Date (after giving effect to any withdrawals therefrom to
pay the Required Interest Payment and any deposits therein
with respect to such Payment Date) exceeds the Required Cash
Collateral Amount for such Payment Date. The Issuer will
apply such Program Operating Lease Payments, together with
certain proceeds (as described in "--Transferor Leased
Vehicle Purchase Option") from Series 1996-1 Leased Vehicles
which are sold on or after their Scheduled Lease End Dates,
to pay interest on and principal of the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates in
accordance with their respective terms.

On the Closing Date, the Transferor will make an initial
deposit to the Cash Collateral Account of $_____. The Cash
Collateral Account will secure the Transferor's obligation
to make Program Operating Lease Payments on a quarterly
basis. The Transferor initially will retain the Subordinated
Notes and will be required to deposit payments of interest
on and principal of the

5
<PAGE> 7

Subordinated Notes into the Cash Collateral Account.
Amounts payable to the Issuer with respect to the
Series 1996-1 Certificates and the Program Operating
Lease (including amounts withdrawn from the Cash
Collateral Account) will be applied to pay interest on
and principal of the Senior Notes, the Subordinated
Notes and the Lease Trust Certificates and certain
other amounts as more fully described herein. The
Issuer has pledged amounts payable to it to the
Indenture Trustee to secure payment of the Senior
Notes. Ford Credit and Ford Credit Leasing intend that
the securitization described in this prospectus will
result in a sale of the Series 1996-1 Assets for
accounting purposes and a financing of the Series
1996-1 Leases and Series 1996-1 Leased Vehicles for tax
purposes.

THE ISSUER . . . . . . Ford Credit Auto Lease Trust 1996-1, established
pursuant to the Lease Trust Agreement.

THE LEASE TRUSTEE . . . PNC Bank, Delaware, as Lease Trustee under the
Lease Trust Agreement.

THE INDENTURE TRUSTEE . The Chase Manhattan Bank, as Indenture Trustee
under the Indenture.

THE ADMINISTRATIVE
AGENT . . . . . . . Ford Credit, a wholly owned indirect subsidiary of
Ford Motor Company, is the Administrative Agent.
See "Description of the Administrative Agency
Agreement."

FORD CREDIT LEASING . . Ford Credit Leasing Company, Inc., a wholly owned
special purpose subsidiary of Ford Credit.

THE TRANSFEROR . . . . The Transferor will be formed by Ford Credit and
Ford Credit Leasing as a Delaware business trust
pursuant to the RCL Trust Agreement. The RCL
Trustee is ______, a Delaware banking corporation.
See "The Transferor."

THE SENIOR NOTES . . . On the Closing Date the Issuer will issue,
pursuant to the Indenture, Class A-1 Senior Notes
in an initial principal balance of $__________ and
Class A-2 Senior Notes in an initial principal
balance of $__________. Concurrently with the
issuance of the Senior Notes, the Issuer will
issue Subordinated Notes in an initial principal
balance of $__________ and Lease Trust
Certificates in an initial principal balance of
$__________. The Subordinated Notes and the Lease
Trust Certificates are not being offered hereby.

INTEREST. . . . . . . . The Class A-1 Senior Notes will bear interest at
the rate of ____% per annum and the Class A-2
Senior Notes will bear interest at the rate of
____% per annum. Interest on the principal
balance of the Senior Notes will accrue at the
applicable interest rate either from and including
the Closing Date (in the case of the first Payment
Date) or from and including the fifteenth day of
the third calendar month preceding the calendar
month in which such Payment Date occurs, to but
excluding the fifteenth day of the calendar month
in which such Payment Date occurs. Interest will
be payable on each Payment Date to Senior
Noteholders of record on the related Record Date.
Interest accrued but not paid as of any Payment
Date will be due on the next Payment Date together
with interest on such amount (to the extent
lawful) at a rate per annum equal to the interest
rate for the applicable Class. Interest will be
calculated based on a 360-day year of twelve
30-day months. See "Description of the Senior
Notes--Interest."

6
<PAGE> 8

PRINCIPAL . . . . . . . The aggregate amount of principal of the Senior
Notes payable on each Payment Date will equal the
Total Available Funds remaining after giving
effect on such Payment Date to (i) the payment of
the Administrative Agent Fee and (ii) the payment
of interest accrued on the Senior Notes, the
Subordinated Notes and the Lease Trust
Certificates. See "Description of the Senior
Notes--Indenture Cash Flows."

Principal of the Senior Notes will be paid to
holders of each Class of Senior Notes
sequentially. No principal payments will be made
on the Class A-2 Senior Notes until the principal
balance of the Class A-1 Senior Notes has been
reduced to zero; no principal payments will be
made on the Subordinated Notes until the principal
balance of the Class A-2 Senior Notes has been
reduced to zero; and no principal payments will be
made on the Lease Trust Certificates until the
principal balance of the Subordinated Notes has
been reduced to zero; provided that if an Event of
Default under the Indenture has occurred and the
maturity of the Senior Notes has been accelerated,
principal payments will be made on a pro rata
basis to holders of the Class A-1 Senior Notes and
the Class A-2 Senior Notes based on their
respective principal balances without any
distinction between Classes. See "Description of
the Senior Notes--Indenture" for a discussion of
the Events of Default under the Indenture and the
remedies available to the Indenture Trustee and
the Senior Noteholders.

As described in "Description of the Senior
Notes--The Indenture Cash Flows," the "Total
Available Funds" available to make payments on any
Payment Date will be equal to the sum of the
Available Sale Proceeds and the Cash Collateral
Draw Amount. The "Available Sale Proceeds" on
deposit in the Collection Account with respect to
any Payment Date will be equal to the Monthly
Scheduled Termination Sale Proceeds deposited
therein on each of the two preceding Distribution
Dates and Monthly Scheduled Termination Sale
Proceeds deposited therein on the business day
preceding the Distribution Date occurring on such
Payment Date (or on each business day during the
related Accrual Period if any Monthly Remittance
Condition has not been satisfied) plus the
Aggregate Net Sale Proceeds Advances deposited on
the business day preceding such Payment Date plus
any investment earnings on funds on deposit in the
Collection Account. See "Description of the
Senior Notes--Cash Collateral Account Withdrawals
and Deposits" for a description of how the Cash
Collateral Draw Amount is calculated.

The rate of payment and the yield to maturity on
each Class of Senior Notes generally will be
directly related to the rate at which payments are
made on the Series 1996-1 Leases and in respect of
the Series 1996-1 Leased Vehicles. The rate of
prepayments on the Series 1996-1 Leases may be
influenced by a variety of economic, social and
other factors including competing consumer finance
products and the conditions in the used car
market. If there are prepayments in full of the
Series 1996-1 Leases, Senior Noteholders will bear
the risk of being able to reinvest principal
payments of the Senior Notes at yields at least
equal to the yield on their respective Class of
Senior Notes. For further discussion of the
factors which may affect the amount and timing of
payments of principal of the Senior Notes, see
"Maturity, Prepayment and Yield Considerations."
See also "Description of the Senior
Notes--Principal" and "--The Indenture Cash
Flows."

7
<PAGE> 9

OPTIONAL
REDEMPTION
OF THE SENIOR NOTES . . The Administrative Agent may, at its option,
purchase the Series 1996-1 Certificates on any
Payment Date on which the Pool Balance has
declined to less than 10% of the Initial Pool
Balance. Because the principal balance of the
Subordinated Notes and the Lease Trust
Certificates exceeds 10% of the Initial Pool
Balance, the Issuer does not anticipate, although
no assurances can be given, that the Pool Balance
will decline to a level permitting the
Administrative Agent to purchase the Series 1996-1
Certificates while the Senior Notes are
outstanding. If, however, such a decline occurs
and the Administrative Agent exercises such
option, the Senior Notes will be redeemed in
whole, but not in part, on the Payment Date of
such exercise. See "Description of the Senior
Notes--Optional Redemption."

FCTT . . . . . . . FCTT is a trust formed pursuant to the FCTT
Agreement. The FCTT Trustee is Comerica Bank, a
Michigan banking corporation, which may appoint
one or more co-trustees or separate trustees for
the purpose of meeting applicable state
requirements. FCTT was formed for the purpose of
holding title to vehicles subject to leases in
order to enable Ford Credit to obtain the benefits
of financing such vehicles and leases without
retitling. Vehicles which would otherwise be sold
by Dealers to Ford Credit are instead sold to
FCTT. The FCTT Trustee will hold the assets of
FCTT in trust for the benefit of the beneficiaries
of FCTT. As of the date of this Prospectus, the
primary assets of FCTT are Leases and Leased
Vehicles assigned to it by Dealers located in
fifteen states and all amounts payable in
connection therewith. See "FCTT--Creation of FCTT
by Ford Credit and Ford Credit Leasing." Ford
Credit and Ford Credit Leasing were the initial
beneficiaries of FCTT. Ford Credit initially held
an Exchangeable Beneficial Certificate (an "EBC")
representing a 98% beneficial interest in FCTT and
the FCTT Assets and Ford Credit Leasing initially
held an EBC representing a 2% beneficial interest
in FCTT and the FCTT Assets. Ford Credit and Ford
Credit Leasing have previously exchanged a portion
of their EBCs for a Series of Specified Beneficial
Certificates, the Series 1995-1 Certificates, and
contributed such Series 1995-1 Certificates to an
affiliate which deposited them to a securitization
trust in connection with the issuance of a
previous series of asset backed securities.
Similarly, Ford Credit and Ford Credit Leasing
will exchange a portion of their EBCs for the
Series 1996-1 Certificates and contribute them to
the Transferor which will deposit them with the
Issuer. After the issuance of the Series 1996-1
Certificates on the Closing Date, the EBCs will
represent the beneficial interest in the FCTT
Assets other than the Series 1995-1 Assets, the
Series 1996-1 Assets and any other Series
Specified Assets which may be designated from time
to time. See "FCTT--Exchangeable Beneficial
Certificates and Specified Beneficial
Certificates."

Payments by or on behalf of Obligors made on or in
respect of FCTT Assets other than the Series
1996-1 Assets will not be available to make
payments on the Senior Notes, the Subordinated
Notes or the Lease Trust Certificates. Neither
Ford Credit nor Ford Credit Leasing, as holders of
the EBCs, nor holders of any Series of Specified
Beneficial Certificates other than Series 1996-1
(whether issued in connection with a future
securitization or for any other purpose) will have
any interest in the Series 1996-1 Assets.

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<PAGE> 10

THE SERIES 1996-1
ASSETS . . . . . . . The Series 1996-1 Leases will consist of a pool of
retail closed-end lease contracts originated by
Dealers and assigned to FCTT. Each Series 1996-1
Lease is an operating lease for accounting
purposes and a "true lease" for tax purposes and
will be purchased by FCTT, together with the
related Series 1996-1 Leased Vehicle, from the
Dealer for an amount equal to the Balance Subject
to Lease Charges. The Obligor under each Series
1996-1 Lease is obligated to make a fixed total
monthly payment (a "Total Monthly Payment") to the
Administrative Agent, acting on behalf of FCTT and
the holders of the Series 1996-1 Certificates,
equal to the sum of (i) the Monthly Payment, (ii)
the Use and Lease Tax Amount (payable to tax
authorities), and (iii) the Vehicle Insurance and
Maintenance Amount (payable to Dealers). Only the
Monthly Payment portion of each Total Monthly
Payment is available to holders of the Series
1996-1 Certificates. See "Description of the
Administrative Agency Agreement--Remittance of
Payments; Allocation of Funds."

The Monthly Payments remitted by Obligors will be
deposited into the Cash Collateral Account to
secure the Transferor's obligation to make Program
Operating Lease Payments to the Issuer. See
"Description of the Senior Notes-- Cash Collateral
Account Withdrawals and Deposits."

The Series 1996-1 Leases consist of _______
individual Leases. The aggregate Balance Subject
to Lease Charges of the Series 1996-1 Leases as of
their respective dates of origination was
$____________. As of the Series 1996-1 Cut-Off
Date, the Pool Balance was $____________ (the
"Initial Pool Balance") and the aggregate Residual
Values of the Series 1996-1 Leased Vehicles were
$____________. The Series 1996-1 Leases and
Series 1996-1 Leased Vehicles were selected by the
Administrative Agent at the direction of Ford
Credit and Ford Credit Leasing as holders of the
EBCs from FCTT's portfolio of Leases and Leased
Vehicles represented by the EBCs, based upon the
General Eligibility Criteria and the Specific
Eligibility Criteria described herein. See "The
Leases and Leased Vehicles," "FCTT--Exchangeable
Beneficial Certificates and Specified Beneficial
Certificates" and "Additional Document
Provisions--Representations, Warranties and
Covenants."

THE SERIES 1996-1
CERTIFICATES . . . . . The Series 1996-1 Certificates will represent in
the aggregate a 100% beneficial interest in the
Series 1996-1 Assets and will entitle the holders
thereof to all proceeds of and payments in
connection with the Series 1996-1 Assets. The
Series 1996-1 Certificates will not evidence legal
title to or direct ownership of the Series 1996-1
Assets nor will they represent a beneficial
interest in any FCTT Assets other than the Series
1996-1 Assets. See "FCTT--Exchangeable Beneficial
Certificates and Specified Beneficial
Certificates." The Indenture Trustee as assignee
of the Issuer will have a perfected security
interest in the underlying Series 1996-1 Leases
but will not have a security interest in the
underlying Series 1996-1 Leased Vehicles. For a
discussion of the security interests in the Series
1996-1 Certificates, the Series 1996-1 Leases and
the Series 1996-1 Leased Vehicles, see "Certain
Legal Aspects of the Leases and Leased Vehicles."

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<PAGE> 11

CONTRIBUTION, TRANSFER,
AND LEASE OF SERIES
1996-1 CERTIFICATES . . On the Closing Date, Ford Credit and Ford Credit
Leasing each will contribute their respective
Series 1996-1 Certificates to the Transferor
pursuant to the Asset Contribution Agreement. The
Transferor will transfer the Series 1996-1
Certificates to the Issuer pursuant to the
Transfer Agreement. Subject to the pledge by the
Issuer of its interest in such Series 1996-1
Certificates to the Indenture Trustee to secure
payment of the Senior Notes, the Issuer will lease
the Series 1996-1 Certificates back to the
Transferor pursuant to the Program Operating
Lease. The Transferor will assign 1% of all of
its assets and obligations, including its rights
and obligations under the Program Operating Lease,
to Ford Credit Leasing. For convenience, these
rights and obligations of the Transferor and its
assignee, Ford Credit Leasing, generally are
referred to herein as rights and obligations of
the Transferor. In connection with such
assignment, Ford Credit Leasing will hold $_____
in initial principal balance of Subordinated Notes
and $_____ in initial principal balance of Lease
Trust Certificates representing 1% of the initial
principal balance of the Subordinated Notes and
Lease Trust Certificates, respectively, initially
acquired by the Transferor. See "The
Transferor--Creation by Ford Credit and Ford
Credit Leasing; Assignment to Ford Credit
Leasing."

Under the Program Operating Lease, the Transferor
will be entitled to receive all payments and
proceeds with respect to the Series 1996-1
Certificates during the term of the Program
Operating Lease and will be required to deposit
such payments and proceeds into the Cash
Collateral Account to secure its obligation to
make Program Operating Lease Payments to the
Issuer. Because the Program Operating Lease
expires with respect to the portion of the Series
1996-1 Certificates representing the beneficial
interest in a Series 1996-1 Leased Vehicle at the
end of the related Series 1996-1 Lease (and before
such Series 1996-1 Leased Vehicle is sold or a
Sale Proceeds Advance is made in respect thereof),
the Issuer will receive directly the proceeds from
the sale of Series 1996-1 Leased Vehicles
following scheduled termination of the related
Series 1996-1 Leases. See "Series 1996-1
Certificates."

PROPERTY OF THE ISSUER;
PLEDGE TO THE
INDENTURE TRUSTEE . . . Pursuant to the Indenture and prior to entering
into the Program Operating Lease, the Issuer will
pledge its interest in the Lease Trust Estate to
secure its obligation to pay interest on and
principal of the Senior Notes. The "Lease Trust
Estate" consists of (i) the rights of the Issuer
under the Series 1996-1 Certificates, (ii) the
rights under the Program Operating Lease, (iii)
the rights of the Issuer to funds on deposit from
time to time in the Collection Account, the
Payahead Account, the Payment Account, the
Certificate Distribution Account and any other
account or accounts established pursuant to the
Indenture (including investment income on amounts
on deposit in the Collection Account) and proceeds
thereof, (iv) the rights of the Transferor under
the Asset Contribution Agreement, (v) the rights
as holder of the Series 1996-1 Certificates under
the Administrative Agency Agreement and the Series
1996-1 Supplement, (vi) the interest of the Issuer
in the Cash Collateral Account and the right to
make withdrawals therefrom and (vii) all proceeds
of the foregoing. See "Property of the Issuer"
and

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<PAGE> 12

"Series 1996-1 Certificates--Pledge of the Series
1996-1 Certificates to the Indenture Trustee."

TRANSFEROR LEASED
VEHICLE PURCHASE
OPTION . . . . . . . Under the Program Operating Lease, the Transferor
may, at its option, purchase the Issuer's
beneficial interest in any Series 1996-1 Leased
Vehicle which is sold at auction following the
Scheduled Lease End Date of the related Series
1996-1 Lease. The Transferor may exercise such
option (the "Transferor Leased Vehicle Purchase
Option") by paying to the Issuer an amount equal
to the Residual Value of such Series 1996-1 Leased
Vehicle minus any amounts due from the related
Obligor for Uncollected Excess Wear and Tear and
Excess Mileage (such amount, the "Transferor
Purchase Option Price"). The Transferor will
exercise such option only if neither the Obligor
nor the Dealer exercises its option to purchase
the Series 1996-1 Leased Vehicle, and the Sale
Proceeds of such Series 1996-1 Leased Vehicle
exceed the Transferor Purchase Option Price.
Because the Transferor intends to exercise this
option when available, Sale Proceeds received by
the Issuer with respect to any Series 1996-1
Leased Vehicle the related Series 1996-1 Lease of
which terminated on or after its Scheduled Lease
End Date will not exceed the Transferor Purchase
Option Price. With respect to each Series 1996-1
Leased Vehicle for which the Transferor exercises
its purchase option, the Transferor will deposit
the excess of the Sale Proceeds of such Series
1996-1 Leased Vehicle over the related Transferor
Purchase Option Price (the "Transferor Purchase
Option Net Proceeds") into the Cash Collateral
Account until the aggregate cumulative amount
deposited in respect of such Transferor Purchase
Option Net Proceeds for all such Series 1996-1
Leased Vehicles equals $_______. Thereafter, the
Transferor will retain any Transferor Purchase
Option Net Proceeds and such amounts will not be
available to pay interest on or principal of the
Senior Notes, the Subordinated Notes or the Lease
Trust Certificates. To the extent that Transferor
Purchase Option Net Proceeds are deposited into
the Cash Collateral Account, such amounts will
secure the Transferor's obligation to make Program
Operating Lease Payments to the Issuer. See
"Series 1996- 1 Certificates--Lease of the Series
1996-1 Certificates to the Transferor" for further
discussion of the purchase option of the
Transferor and "Description of the Administrative
Agency Agreement--Sale of Leased Vehicles" for a
discussion of the process by which the
Administrative Agent sells Series 1996-1 Leased
Vehicles after their respective Scheduled Lease
End Dates.

Senior Noteholders will not be subject to delay in
receipt of principal resulting from a delay in the
sale of Series 1996-1 Leased Vehicles after their
respective Scheduled Lease End Dates to the extent
that the Admin- istrative Agent makes Sale
Proceeds Advances of the Residual Values of Series
1996-1 Leased Vehicles as described in "--Sale
Proceeds Advances" and "Description of the
Administrative Agency Agreement--Advances of Sale
Proceeds."

CASH COLLATERAL
ACCOUNT . . . . . . . Amounts on deposit in the Cash Collateral Account
from time to time (the "Cash Collateral Amount")
secure the Transferor's obligations under the
Program Operating Lease and on each Payment Date
will be applied to pay Program Operating Lease
Payments. On the Closing Date the Transferor will

11
<PAGE> 13

deposit $________ (the "Initial Cash Collateral
Deposit") in the Cash Collateral Account. Amounts
on deposit in the Cash Collateral Account will be
augmented during each Accrual Period by the
deposit therein of the following amounts with
respect to such Accrual Period: (i) all
Collections other than Monthly Scheduled
Termination Sale Proceeds with respect to Series
1996-1 Assets; (ii) the Aggregate Net Monthly
Payment Advances; (iii) any Transferor Purchase
Option Net Proceeds until the aggregate cumulative
amount deposited in respect of such proceeds
equals $________; and (iv) payments of interest on
and principal of the Subordinated Notes.

On the business day preceding each Payment Date,
the Indenture Trustee will withdraw the Cash
Collateral Draw Amount from the Cash Collateral
Account and use such amount to pay the Program
Operating Lease Payments. The Cash Collateral
Draw Amount will consist of the Cash Collateral
Required Draw Amount and the Cash Collateral
Additional Draw Amount. The Cash Collateral
Required Draw Amount will be applied to pay the
Required Interest Payment portion of the Program
Operating Lease Payments and the Cash Collateral
Additional Draw Amount will be applied to pay the
Additional Payment portion, if any, of the Program
Operating Lease Payments. See "Description of the
Senior Notes--Cash Collateral Account Withdrawals
and Deposits" and "--The Indenture Cash Flows."

The "Required Cash Collateral Amount" as of any
Payment Date will be the greater of (i) ____% of
the Pool Balance as of the last day of the related
Accrual Period and (ii) ____% of the Initial Pool
Balance; provided that the Required Cash
Collateral Amount shall not exceed the sum of the
aggregate principal balance of the Senior Notes,
the Subordinated Notes and the Lease Trust
Certificates as of any Payment Date, before giving
effect to any payments made on such Payment Date.

THE ADMINISTRATIVE
AGENT . . . . . . . The Administrative Agent will act as servicer with
respect to all Leases and Leased Vehicles owned by
FCTT (including the Series 1996-1 Leases and
Series 1996-1 Leased Vehicles) and will be the
custodian of the related Lease Files. The
Administrative Agent will receive the
Administrative Agent Fee and the Supplemental
Adminis- trative Agent Fee as compensation for
servicing the Series 1996-1 Assets (including
disposing of Series 1996-1 Leased Vehicles) and
administering the distribution of funds in respect
thereof. The Administrative Agent Fee as of any
Payment Date will equal the sum, for each of the
three Collection Periods preceding such Payment
Date, of the product of 1/12 of 1.00% and the Pool
Balance as of the beginning of each such
Collection Period. See "Description of the
Administrative Agency Agreement."

ADMINISTRATIVE
PURCHASES . . . . . . . Ford Credit and Ford Credit Leasing, as holders of
the EBCs, will be required to purchase the
beneficial interest in any Series 1996-1 Lease and
Series 1996-1 Leased Vehicle as to which (i) all
of the Specific Eligibility Criteria and General
Eligibility Criteria were not satisfied on the
Series 1996-1 Cut-Off Date, (ii) a breach of
certain covenants has occurred and has not been
cured, (iii) the Administrative Agent has granted
a Term Extension or any Payment Extension over
three months (in the aggregate) or (iv) the Series

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<PAGE> 14

1996-1 Leased Vehicle is relocated to a
jurisdiction in which FCTT is not authorized to
hold the related certificate of title. Any such
purchase shall be effected by the deposit of the
Administrative Purchase Amount in the Collection
Account on the business day preceding the Payment
Date relating to the Accrual Period in which any
of the events specified above occurred or were
discovered, as applicable. See "Description of
the Administrative Agency Agreement--
Administrative Purchases."

MONTHLY
PAYMENT ADVANCES . . . The Administrative Agent will be obligated to make
a Monthly Payment Advance in an amount equal to
any unpaid portion of the Monthly Payments due
under a Series 1996-1 Lease during an Accrual
Period, but only if the Administrative Agent
determines, in its sole discretion, that such
Monthly Payment Advance will be recoverable from
subsequent Collections on such Series 1996-1 Lease
(excluding Sale Proceeds). See "Description of the
Senior Notes--Advances" and "Description of the
Administrative Agency Agreement--Monthly Payment
Advances."

SALE PROCEEDS
ADVANCES . . . . . . . The Administrative Agent will be obligated to make
a Sale Proceeds Advance in an amount equal to the
Residual Value of any Series 1996-1 Leased Vehicle
which has not been sold by the last business day
of the Accrual Period in which the Scheduled Lease
End Date of the related Series 1996-1 Lease
occurred, but only if the Administrative Agent
determines, in its sole discretion, that such Sale
Proceeds Advance will be recoverable from the Sale
Proceeds of such Series 1996-1 Leased Vehicle.
See "Description of the Senior Notes--Advances"
and "Description of the Administrative Agency
Agreement--Advances of Sale Proceeds."

TAX STATUS . . . . . . Special Tax Counsel will render its opinion,
subject to the matters discussed under "Certain
Federal Income Tax Consequences," that for federal
income tax purposes (i) the Senior Notes will be
treated as debt, (ii) the Lease Trust Certificates
(other than the Lease Trust Certificates initially
acquired by the Transferor) should be treated as
debt and (iii) none of FCTT, the Transferor or the
Issuer will be classified as an association (or
publicly traded partnership) taxable as a
corporation.

The Class A-1 Senior Notes will be treated as
"short-term obligations" issued with acquisition
discount. The Class A-2 Senior Notes will be
issued with a de minimis amount of original issue
discount ("OID"). See "Certain Federal Income Tax
Consequences" for additional information
concerning acquisition discount, OID and the
application of federal income tax laws.

In the opinion of Michigan Tax Counsel, assuming
that the Senior Notes will be treated as debt for
federal income tax purposes, (i) the Senior Notes
will be treated as debt for Michigan income and
single business tax purposes and (ii) Senior Note
Owners not otherwise subject to taxation in
Michigan would not become subject to taxation in
Michigan solely because of a Senior Note Owner's
ownership of a Senior Note. Assuming further that
the Lease Trust Certificates (other than the Lease
Trust Certificates initially acquired by the
Transferor) will be treated as debt for federal
income tax purposes and that none of FCTT, the
Transferor or the Issuer will be subject to
federal income tax at the entity level, none of
FCTT, the Transferor or the Issuer should be
subject to Michigan income and single business tax
at the entity

13
<PAGE> 15

level. See "Certain State Tax Consequences" for
additional information concerning the application
of state tax laws.

ERISA
CONSIDERATIONS . . . . Subject to the considerations discussed under
"ERISA Considerations," the Senior Notes are
eligible for purchase by employee benefit plans.

RATINGS OF THE
SENIOR NOTES . . . . . It is a condition to the issuance of the Senior
Notes that they be rated in the highest investment
rating category by at least one Rating Agency.
There can be no assurance that such ratings will
not be lowered or withdrawn by a Rating Agency if
circumstances so warrant. See "Ratings of the
Senior Notes" and "Risk Factors--ERISA
Liabilities; Effect on Ratings."

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<PAGE> 16

RISK FACTORS

LIMITED LIQUIDITY

LIMITED ASSETS

The assets of the Issuer, which have been pledged to the Indenture Trustee
to secure the payment of interest on and principal of the Senior Notes, are
limited to the Lease Trust Estate, including the interest in the Series 1996-1
Certificates held by the Issuer under the Program Operating Lease, the right to
receive payments from the Transferor under the Program Operating Lease and a
security interest in the amounts credited to the Cash Collateral Account to
secure the payments required under the Program Operating Lease. The Issuer will
not have, nor is it permitted or expected to have, any other significant assets
or other sources of funds. The Senior Notes represent obligations of the
Issuer, and are not insured or guaranteed by the Transferor, Ford Credit, Ford
Credit Leasing, the RCL Trustee, the Lease Trustee, the Indenture Trustee or any
other person or entity. Moreover, although payment of interest on and principal
of the Senior Notes is ultimately dependent on the payments made under the
Series 1996-1 Leases by Obligors and proceeds from the disposition of the Series
1996-1 Leased Vehicles, neither the Issuer nor the Transferor has a direct
ownership interest in any Series 1996-1 Lease or a direct ownership interest or
perfected security interest in any Series 1996-1 Leased Vehicle. Because the
interest of the Indenture Trustee, as pledgee of the Issuer, is in the Series
1996-1 Certificates and other assets described above and not directly in the
Series 1996-1 Assets, upon the occurrence of an Event of Default, the Indenture
Trustee would have no rights with respect to either the Series 1996-1 Leases or
the Series 1996-1 Leased Vehicles, but instead would be limited to exercising
its rights with respect to the Series 1996-1 Certificates and the other assets
described above (including the Cash Collateral Account). To the extent that the
exercise of such rights produces insufficient funds to make all required
payments with respect to the Senior Notes, Senior Noteholders could suffer a
loss of all or part of their investment. See "Property of the Issuer" and
"Description of the Senior Notes -- Indenture."

LIMITED OBLIGATIONS OF THE ISSUER, THE TRANSFEROR, FORD CREDIT AND FORD CREDIT
LEASING

The Senior Notes are solely obligations of the Issuer, and neither the
Transferor, Ford Credit nor Ford Credit Leasing is obligated to pay interest on
or principal of the Senior Notes (except indirectly to the extent of payments
required under the Program Operating Lease). The Transferor's obligation to the
Issuer is limited to making Program Operating Lease Payments as required under
the Program Operating Lease. If, after application of amounts on deposit in the
Cash Collateral Account, the Transferor does not have sufficient funds to pay to
the Issuer the Program Operating Lease Payments on any Payment Date, the Senior
Noteholders could incur a loss on their investment.

The Series 1996-1 Certificates entitle the Issuer to receive the Sale
Proceeds of those Series 1996-1 Leased Vehicles whose Series 1996-1 Leases
terminate on or after their respective Scheduled Lease End Dates. The right to
such Sale Proceeds has been pledged to the Indenture Trustee to secure the
payment of interest on and principal of the Senior Notes. The amount available
to the Issuer from the sale of a Series 1996-1 Leased Vehicle on or after its
Scheduled Lease End Date will be reduced by the Uncollected Excess Wear and Tear
and Excess Mileage, if any, with respect to such vehicle. In addition, the
amount of Sale Proceeds received by the Issuer in the event the Transferor
exercises its option to purchase such vehicle is limited to its Transferor
Purchase Option Price (the Residual Value of such Series 1996-1 Leased Vehicle
minus Uncollected Excess Wear and Tear and Excess Mileage, if any). Because the
Transferor intends to exercise its Transferor Leased Vehicle Purchase Option
whenever it is economically advantageous to do so, any Sale Proceeds of a Series
1996-1 Leased

15
<PAGE> 17

Vehicle which are in excess of its Residual Value minus Uncollected Excess Wear
and Tear and Excess Mileage will be paid to the Transferor, who will deposit
such amounts into the Cash Collateral Account until the cumulative total of
deposits with respect to such amounts equals $______; thereafter, such amounts
will be paid to the Transferor but not deposited into the Cash Collateral
Account and therefore will not be available for distribution on the Series
1996-1 Certificates. To the extent that such amounts are deposited into the
Cash Collateral Account, they will secure the Transferor's obligation to make
Program Operating Lease Payments to the Issuer. See "The Series 1996-1
Certificates -- Lease of the Series 1996-1 Certificates to the Transferor."

RESIDUAL VALUE RISK

The Residual Value of each Leased Vehicle, including each Series 1996-1
Leased Vehicle, is stated in the related Lease, including the Series 1996-1
Leases, and is determined by Ford Credit as Administrative Agent for FCTT. Ford
Credit sets the Residual Value for a particular model of Leased Vehicle by
reference to its estimate of the wholesale market value of such model at the end
of the Lease Term. However, in connection with sales incentive programs for
particular models, Ford Credit may increase the Residual Values set forth in
Leases to levels above its estimate of the wholesale market values of such
Leased Vehicles at the end of their respective Lease Terms, in order to
stimulate sales of particular models by reducing the amount of the Total Monthly
Payments which would be owed by Obligors. See "The Leases and the Leased
Vehicles -- Delinquency, Repossession, Residual Value and Loss Data."

At the end of each Series 1996-1 Lease, each Series 1996-1 Leased Vehicle
is either purchased by the Obligor or the Dealer for a price greater than or
equal to its Residual Value or is returned to the Administrative Agent. For
Series 1996-1 Leased Vehicles which are purchased by the Obligor or Dealer, the
full Residual Value of such Series 1996-1 Leased Vehicle is applied to make
distributions on the Series 1996-1 Certificates. To the extent that a Series
1996-1 Leased Vehicle is not purchased by the related Obligor or Dealer, the
Administrative Agent will sell such Series 1996-1 Leased Vehicle at auction and
proceeds of the sale will be applied to make distributions on the Series 1996-1
Certificates. Any shortfalls between (x) proceeds realized from the sale of
Series 1996-1 Leased Vehicles (including amounts collected in respect of Excess
Wear and Tear and Excess Mileage and reduced by amounts required to be remitted
to the Obligor under applicable law) after their respective Scheduled Lease End
Dates and (y) their respective Residual Values (as such Residual Values are
decreased by Uncollected Excess Wear and Tear and Excess Mileage) will reduce
the amounts available for distribution on the Series 1996-1 Certificates, and,
to the extent such reduction causes the Available Sale Proceeds plus amounts
withdrawn from the Cash Collateral Account to be less than the principal and
interest due on the Senior Notes on any Payment Date, the Senior Noteholders
could suffer a loss on their investment. Because the Transferor intends to
exercise its Transferor Leased Vehicle Purchase Option whenever it is
economically advantageous to do so, any Sale Proceeds of a Series 1996-1 Leased
Vehicle which are in excess of its Residual Value minus Uncollected Excess Wear
and Tear and Excess Mileage will be paid to the Transferor, who will deposit
such amounts into the Cash Collateral Account until the cumulative total of
deposits with respect to such amounts equals $______; thereafter, such amounts
will be paid to the Transferor but not deposited into the Cash Collateral
Account and therefore will not be available for distribution on the Series
1996-1 Certificates. To the extent that such amounts are deposited into the
Cash Collateral Account, they will secure the Transferor's obligation to make
Program Operating Lease Payments to the Issuer. See "The Series 1996-1
Certificates -- Lease of the Series 1996-1 Certificates to the Transferor."
There can be no assurance that the historical realization of the Residual Values
through purchases by the Obligors or Dealers or from sale at auction will be
indicative of future realizations on the Series 1996-1 Leased Vehicles. In
addition, any shortfalls between Liquidation Proceeds and the Adjusted Balance
Subject to Lease Charges of the related Series 1996-1 Leased Vehicle as of the
date the related Series 1996-1 Lease became a Liquidated Lease will also reduce
the amounts available for distribution on the Series 1996-1 Certificates and, to
the extent that such reduction causes the Available Sale Proceeds plus amounts
withdrawn from the Cash Collateral Account to be less than the principal and
interest due on the Senior Notes on any Payment Date, the Senior Noteholders
could suffer a loss on their investment.

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<PAGE> 18

Because on the business day preceding each Payment Date the Administrative
Agent generally will make a Sale Proceeds Advance of the Residual Value of each
Series 1996-1 Leased Vehicle for which as of the end of the related Accrual
Period the Scheduled Lease End Date has occurred but the related Sale Proceeds
have not been received, Senior Noteholders will not be subject to delays in the
receipt of principal payments due to delays in the sale of Series 1996-1 Leased
Vehicles. The Administrative Agent is obligated to make a Sale Proceeds Advance
with respect to a Series 1996-1 Leased Vehicle only to the extent that it
believes such advances are recoverable from the Sale Proceeds of such Series
1996-1 Leased Vehicle; if the Administrative Agent determined that Sale Proceeds
Advances were not recoverable from Sale Proceeds on the Series 1996-1 Leased
Vehicles which had not been sold, or if it otherwise failed to honor its
contractual obligation to make Sale Proceeds Advances, Senior Noteholders could
be subject to delays in the receipt of principal payments to the extent that
there is a delay in the receipt of proceeds from the sale of Series 1996-1
Leased Vehicles. See "Description of the Administrative Agency Agreement --
Sale of Leased Vehicles" and "-- Advances of Sale Proceeds."

GEOGRAPHIC, ECONOMIC AND OTHER FACTORS

The Dealers which originated the Series 1996-1 Leases are located, and the
Obligors generally are located in one of fifteen states, with the largest
percentage of such Dealers and Obligors being located in California, New York,
Pennsylvania, Minnesota and Colorado. The percentage of such Dealers and
Obligors located in any one of the fifteen states other than California, New
York, Pennsylvania, Minnesota or Colorado is less than 5%. See "The Leases and
Leased Vehicles--Characteristics of the Series 1996-1 Assets." Due to the
geographic concentra- tion in California, New York, Pennsylvania, Minnesota and
Colorado, adverse economic conditions in one or more of these states may have a
disproportionate impact on the performance of the Series 1996-1 Assets. Economic
factors such as unemployment, interest rates, the rate of inflation and consumer
perceptions of the economy may affect the rate of prepayment and defaults on the
Series 1996-1 Leases. In addition, natural disasters in one or more of the
states may affect the rate of prepayment and defaults on the Series 1996-1
Leases and the ability to realize the Residual Values of Series 1996-1 Leased
Vehicles upon sale. These economic factors, as well as other factors such as
consumer perceptions of used vehicle values (and Ford vehicles in particular),
may also affect the ability to realize the Residual Values of Series 1996-1
Leased Vehicles upon sale.

STRUCTURAL CONSIDERATIONS

Beneficial Interests

The Issuer does not directly own the Leases or the Leased Vehicles which
constitute the Series 1996-1 Assets nor does it have a perfected security
interest in the Series 1996-1 Leased Vehicles. Because ownership and,
generally, the perfection of a security interest in a vehicle is governed by the
certificate of title statute of the state in which a vehicle is located, and
because obtaining a perfected security interest or an ownership interest in a
vehicle would result in the administrative burden and expense of retitling
vehicles, title to the Series 1996-1 Assets is held by the FCTT Trustee on
behalf of FCTT which will issue the Series 1996-1 Certificates representing
beneficial interests in the Series 1996-1 Assets. Before the designation of
certain specified Leases and Leased Vehicles as the Series 1996-1 Assets and the
issuance of the Series 1996-1 Certificates, the EBCs, held by Ford Credit and
Ford Credit Leasing, will represent the beneficial interest in all FCTT Assets
other than the Series 1995-1 Assets. Ford Credit and Ford Credit Leasing had
previously exchanged a portion of their EBCs for the Series 1995-1 Certificates
in connection with the issuance of an earlier series of asset backed securities.
After the issuance of the Series 1996-1 Certificates, the FCTT Trustee and the
Administrative Agent are required to account separately for the proceeds
relating to the Series 1996-1 Assets and to the other FCTT Assets. Neither the
holders of the EBCs nor the holders of any other Series will have any rights to
the Series 1996-1 Assets, payments relating thereto or the proceeds thereof.
After the contribution of the Series 1996-1 Certificates by Ford Credit and Ford
Credit Leasing to the Transferor and the subsequent transfer of such Series
1996-1 Certificates to the Issuer, the beneficial interest in the Series 1996-1
Assets will be held by the Issuer, subject to

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<PAGE> 19

the pledge of the Series 1996-1 Certificates to the Indenture Trustee and the
rights of the Transferor under the Program Operating Lease.

Allocation of FCTT Liabilities

The FCTT Agreement provides that the holders of the Series 1996-1
Certificates (which for this purpose includes both the Transferor and the
Issuer) are responsible for liabilities to third parties or to the FCTT Trustee
incurred in connection with any Series 1996-1 Assets. The Transferor (or other
holder of the Lease Trust Certificates initially acquired by the Transferor)
will indemnify the Issuer against any such liabilities. The FCTT Agreement
further provides that the holders of the Series 1996-1 Certificates will not be
responsible for liabilities incurred in connection with the other assets of
FCTT. Holders of the EBCs will be responsible for any liabilities to third
parties or liabilities of FCTT incurred in connection with any Non-Specified
Assets, and the holders from time to time of any other Series will be
responsible for any liabilities to third parties and liabilities of FCTT
incurred in connection with the related Series Specified Assets. Such
allocations are not binding on third parties, and to the extent that liabilities
arising with respect to the assets of FCTT or imposed upon the FCTT Trustee are
not satisfied in accordance with the allocations described above, the Series
1996-1 Assets could be used to satisfy such liabilities. To protect against
such liabilities, Ford Credit maintains self-insurance for the benefit of itself
and FCTT, and maintains excess liability insurance policies naming Ford Credit
and FCTT as insured parties. In addition, each of Ford Credit and Ford Credit
Leasing will be liable for claims against FCTT as if FCTT were a partnership and
each were a general partner. If the Contingent and Excess Liability Insurance
is insufficient and Ford Credit and Ford Credit Leasing fail to perform their
obligations to indemnify the Issuer against such liabilities and amounts
otherwise distributable to Ford Credit and Ford Credit Leasing as holders of the
EBCs are insufficient to satisfy such liabilities, the Series 1996-1 Assets,
together with the other assets of FCTT, could be used to satisfy the liabilities
to third parties and to the FCTT Trustee, and the Senior Noteholders could incur
a loss on their investment. See "Certain Legal Aspects of FCTT and the Series
1996-1 Certificates -- Insurance."

The Issuer does not own the Series 1996-1 Assets but instead has an
indirect beneficial interest therein. Therefore, a third-party creditor or
claimant who has a perfected security interest in or otherwise obtains a lien on
any Series 1996-1 Asset will have priority over the interest of the FCTT
Trustee. If such creditor or claimant has a claim on any Series 1996-1 Asset,
the effect is the same as if such creditor or claimant had a claim on the Issuer
and the Issuer owned such Series 1996-1 Asset (that is, the Issuer's interest in
the Series 1996-1 Asset would be subject to the prior perfected claim).
However, because other assets in addition to the Series 1996-1 Assets are held
by FCTT, and third-party creditors of FCTT are not bound by the allocation of
liabilities described above, a general creditor of FCTT may obtain a lien either
on all or any one of the Series 1996-1 Assets with respect to a claim unrelated
to such Series 1996-1 Assets or on all of the FCTT Assets, including the Series
1996-1 Assets, regardless of whether such claim would have been allocated to
such Series 1996-1 Assets under the terms of the FCTT Agreement.

Such liens could include judgment liens arising from either successful
claims under federal and state consumer protection laws with respect to Leases
and Leased Vehicles or from successful claims against FCTT arising from
operation of Leased Vehicles constituting assets of FCTT. Other general liens
which could arise include tax liens arising against the Transferor or the
Issuer, liens arising under various federal and state criminal statutes and
certain liens in favor of the Pension Benefit Guaranty Corporation (the "PBGC").
See "-- Consumer Protection Laws," "-- ERISA Liabilities; Effect on Ratings"
and "-- Vicarious Tort Liability." Ford Credit and Ford Credit Leasing have
each represented that as of the Series 1996-1 Cut-Off Date, there were no
creditors or claimants with respect to the Series 1996-1 Assets or, except for
those expressly permitted in connection with the issuance of previous series of
asset backed securities, with respect to FCTT.

The FCTT Assets are located in several states, the tax laws of which vary.
In addition, FCTT may in the future purchase Leases and Leased Vehicles from
Dealers located in states other than the fifteen states in which the Series
1996-1 Leases were originated. In the event that any state imposes

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<PAGE> 20

a tax on FCTT at the entity level, Ford Credit and Ford Credit Leasing have
agreed to indemnify the holders of the SBCs for the full amount of such taxes.
If Ford Credit and Ford Credit Leasing should fail to fulfill their respective
indemnification obligations, amounts otherwise distributable to them as holders
of the EBCs will be used to satisfy such indemnification obligations. However,
it is possible that the Senior Noteholders could incur a loss on their
investment in the event Ford Credit and Ford Credit Leasing did not have
sufficient assets available (including distributions on the EBCs) to satisfy
such state tax liabilities.

The FCTT Agreement provides for Ford Credit and Ford Credit Leasing to be
liable as if FCTT were a partnership and each were a general partner to the
extent necessary after giving effect to the payment of liabilities allocated
severally to the holders of certificates representing their respective
beneficial interest in assets of FCTT. However, it is possible that the Senior
Noteholders could incur a loss on their investment to the extent that any such
claim was allocable to the Issuer as holder of the Series 1996-1 Certificates
either because a lien arose in connection with the Series 1996-1 Assets or in
the event Ford Credit and Ford Credit Leasing did not have sufficient assets
available (including distributions on the EBCs) to satisfy such claimant or
creditor in full.

TERMINATION OF FCTT IN CERTAIN CIRCUMSTANCES

If a bankruptcy or insolvency occurs with respect to Ford Credit Leasing
(which is intended to be a special purpose corporation), the FCTT Agreement
provides that FCTT will be terminated. In addition, if the Transferor (which is
intended to be a limited purpose business trust) becomes bankrupt, insolvent or
is terminated, or the Issuer becomes bankrupt or insolvent (or if the Issuer is
terminated as a result of the bankruptcy, insolvency or termination of the
Transferor or Ford Credit Leasing), the FCTT Agreement provides that FCTT will
be terminated with respect to holding the Series 1996-1 Assets. In each case
the FCTT Trustee is required to distribute the Series 1996-1 Assets to the
holder of the Series 1996-1 Certificates. Because the Issuer has pledged its
rights to the Series 1996-1 Certificates to the Indenture Trustee, such
distribution would be made to the Indenture Trustee who would be responsible for
retitling the Series 1996-1 Leased Vehicles. The cost of such retitling would
reduce the amounts payable from the Series 1996-1 Assets which are available for
payments of interest on and principal of the Senior Notes, and in such event the
Senior Noteholders could suffer a loss on their investment.

INSOLVENCY OF FORD CREDIT -- SUBSTANTIVE CONSOLIDATION WITH FORD CREDIT; TRUE
SALE

As described under "Certain Legal Aspects of FCTT and the Series 1996-1
Certificates -- Insolvency Related Matters," the transactions described herein
have been structured and the parties to the Basic Documents described herein
have undertaken to act in a manner such that the voluntary or involuntary
commencement of an insolvency-related case or proceeding under the Bankruptcy
Code or similar state laws by or against Ford Credit should not result in any of
Ford Credit Leasing, FCTT or the Transferor becoming subject to a similar case
or proceeding, and should not result in the substantive consolidation of the
assets and liabilities of Ford Credit Leasing, FCTT or the Transferor with those
of Ford Credit for purposes of such case or proceeding. Each of Ford Credit and
Ford Credit Leasing intends that its transfer of its Series 1996-1 Certificate
to the Transferor be an absolute transfer (a "true sale") of all its interest in
such Series 1996-1 Certificate, and each will so treat and report such transfer
for all relevant purposes. A legal opinion will be delivered to the effect that
(i) the assets and liabilities of each of Ford Credit Leasing, FCTT and the
Transferor would not be substantively consolidated with those of Ford Credit if
Ford Credit were to become the subject of a case under the Bankruptcy Code, and
(ii) the transfer of the Series 1996-1 Certificates by each of Ford Credit and
Ford Credit Leasing would constitute an absolute transfer of all interest in
such Series 1996-1 Certificates and, therefore, such Series 1996-1 Certificates
(including payments thereon and the proceeds thereof) would not be property of
either Ford Credit or Ford Credit Leasing, as the case may be, if either were to
become the subject of a case under the Bankruptcy Code. Such conclusions are
reasoned conclusions, based upon various assumptions regarding factual matters
and future events, as to which there necessarily can be no assurance, and such
legal opinion should not be regarded as a guaranty of the result a court would
reach in an actual case before it. If Ford Credit

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<PAGE> 21

Leasing, FCTT or the Transferor were to become the subject of an
insolvency-related case or proceeding, or if a bankruptcy trustee, Ford Credit
as debtor in possession, a creditor or other party having standing were to
assert that Ford Credit Leasing, FCTT or the Transferor should be substantively
consolidated with Ford Credit, or that the transfer of the Series 1996-1
Certificates from Ford Credit (or, if applicable, Ford Credit Leasing) should
be recharacterized as a pledge of such Series 1996-1 Certificates to secure a
borrowing, then delays in payments on the Series 1996-1 Certificates or (in the
event of such an insolvency-related case or proceeding or should the court rule
in favor of such assertion) reductions in such payments could occur, resulting
in delays (or reductions) in payments on the Senior Notes and a potential loss
to Senior Noteholders on their investment.

INSOLVENCY OF FORD CREDIT -- PREFERENCE RISK

If Ford Credit were to become the subject of a case under the Bankruptcy
Code, Administrative Purchase Amounts paid by Ford Credit pursuant to the
Administrative Agency Agreement might be recoverable as preferential transfers
from Ford Credit to the extent made within a year of the commencement of such
case. Such a case (or a similar case or proceeding under applicable state law)
with respect to Ford Credit also would be an event of default under the
Administrative Agency Agreement, which could result in the removal of Ford
Credit as Administrative Agent. Either of such occurrences could adversely
affect timely payment to Senior Noteholders and, if payments previously made by
Ford Credit were to be recovered, losses to Senior Noteholders could result.

REQUIRED SALE OF ASSETS IN CERTAIN CIRCUMSTANCES

If a bankruptcy or insolvency occurs with respect to the Transferor or Ford
Credit Leasing, or the Transferor is terminated (which could occur upon the
bankruptcy or insolvency of Ford Credit Leasing), the Lease Trust Agreement
provides that the Issuer will be dissolved (and the Program Operating Lease will
terminate) and the Indenture Trustee will be required to sell the assets of the
Issuer in a commercially reasonable manner and on commercially reasonable terms.
Because each of the events which requires the Issuer to be dissolved is also an
event which requires either FCTT to be terminated or FCTT to be terminated with
respect to holding the Series 1996-1 Assets, in connection with such sale, the
Series 1996-1 Assets will be distributed from FCTT to the purchaser and the
Series 1996-1 Vehicles will be retitled at the direction of such purchaser. The
proceeds from the sale of the assets of the Issuer plus amounts on deposit in
the Cash Collateral Account and other accounts of the Issuer will be distributed
first to Senior Noteholders, second to holders of Subordinated Notes (which
amounts will be deposited into the Cash Collateral Account) and third to holders
of Lease Trust Certificates in the priority set forth in the Indenture, and if
such proceeds and amounts are not sufficient to pay the Senior Notes in full,
the amount of principal returned to the Senior Noteholders would be reduced, and
the Senior Noteholders would incur a loss on their investment. See "Additional
Document Provisions -- The Lease Trust Agreement -- Termination."

MATURITY, PREPAYMENT AND YIELD CONSIDERATIONS

The rate of payment of principal and the yield to maturity on each Class of
Senior Notes generally will be directly related to the rate at which payments on
the Series 1996-1 Leases and in respect of the Series 1996-1 Leased Vehicles are
received. Partial prepayments by Obligors will be treated as Payaheads and will
not increase the rate of payment of principal of the Senior Notes because such
payments will be held and paid out to Senior Noteholders as principal only when
required to meet a shortfall in a subsequent payment from the related Obligor.
However, because the Residual Values of Series 1996-1 Leased Vehicles account
for a large portion of the Pool Balance, the rate of payment of principal of the
Senior Notes increases substantially in _____ 199_ as a result of Series 1996-1
Leases beginning to reach their Scheduled Lease End Dates in the related Accrual
Period. See "The Leases and Leased Vehicles." Further, prepayment of the entire
Adjusted Balance Subject to Lease Charges of a Series 1996-1 Lease, whether in
the form of Voluntary Early Termination Proceeds, Liquidation Proceeds or
Administrative Purchase Amounts, will have the effect of increasing the rate of
payment of principal on the Senior Notes. In addition, no principal will be paid
on the Class A-2 Senior Notes until the Class A-1 Senior Notes have been paid in
full, unless an Event of

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<PAGE> 22

Default under the Indenture has occurred and the maturity of the Senior Notes
has been accelerated, in which case principal will be paid on a pro rata basis
to the holders of the Class A-1 Senior Notes and the Class A-2 Senior Notes
based on their respective principal balances without any distinction between
Classes. The rate of payment of principal of the Senior Notes also will be
increased by the application to the payment of principal (after payment of
interest) on the Senior Notes of the portion of the Total Available Funds, if
any, not applied to reduce the Pool Balance or to pay certain fees. To the
extent Series 1996-1 Leases which have higher Retail Operating Lease Factors
are prepaid faster than others, the amount of such additional portion of the
Total Available Funds available to pay principal of the Senior Notes will be
reduced. See "Maturity, Prepayment and Yield Considerations."

CONSUMER PROTECTION LAWS

Numerous federal and state consumer protection laws and regulations,
including the federal Consumer Leasing Act of 1976 and Regulation M promulgated
by the Board of Governors of the Federal Reserve System, impose requirements on
retail lease contracts such as the Series 1996-1 Leases. These laws apply to
FCTT as the assignee of each Series 1996-1 Lease and may also apply to the
Issuer as holder of the Series 1996-1 Certificates which represent a beneficial
interest in the Series 1996-1 Leases, among other things. The failure of the
Dealer, FCTT, or the Administrative Agent acting on behalf of FCTT, to comply
with such laws and regulations may give rise to liabilities on the part of FCTT,
and claims by FCTT or the Administrative Agent acting on behalf of FCTT with
respect to Obligors may be subject to set-off as a result of such
non-compliance.

Each of the fifteen states in which the Series 1996-1 Leases were
originated has adopted a "Lemon Law" that provides purchasers of vehicles,
including lessees in some states, certain rights with respect to vehicles which
are substandard. Such Lemon Laws apply with respect to the Series 1996-1 Leased
Vehicles. A successful claim under a Lemon Law could result in, among other
things, the termination of the related Series 1996-1 Lease and/or the refunding
to the related Obligor of some portion of Total Monthly Payments paid by such
Obligor. Any such refund would reduce the amounts distributed with respect to
the Series 1996-1 Certificates, which could, in certain circumstances, reduce
the payments to Senior Noteholders. See "Certain Legal Aspects of the Leases
and Leased Vehicles -- Consumer Protection Laws."

ERISA LIABILITIES; EFFECT ON RATINGS

It is possible that the PBGC could assert that the assets of FCTT,
including the Series 1996-1 Assets, should be subject to liens in favor of the
PBGC to satisfy any unpaid ERISA liabilities with respect to tax-qualified
defined benefit plans sponsored by any member of an "affiliated group" that
includes Ford Credit, Ford and their respective affiliates. Because such
affiliated group has historically substantially fully funded its ERISA
obligations (none of which arise under multiemployer plans), the Transferor
believes that the likelihood of any such unpaid liability occurring and the PBGC
attempting to assert such a lien (including a lien against the Series 1996-1
Assets) is remote. However, if an unfunded ERISA liability of the type that can
give rise to such a lien existed with respect to any member of such affiliated
group and such a liability were to go unpaid, there can be no assurance that the
PBGC would not attempt to assert such a lien on the assets of FCTT, in which
event the ratings of the Senior Notes might be downgraded. There are currently
no unfunded ERISA liabilities in the Ford affiliated group, although there can
be no assurance that the current level of funding will continue in the future.
See "Ratings of the Senior Notes."

VICARIOUS TORT LIABILITY

Although FCTT will hold title to the Series 1996-1 Leased Vehicles and the
Issuer, as holder of the Series 1996-1 Certificates (subject to the pledge to
the Indenture Trustee and the rights of the Transferor under the Program
Operating Lease), will have a beneficial interest therein, the Series 1996-1
Leased Vehicles will be operated by the related Obligors and their respective
invitees. State laws differ as to whether anyone suffering injury to person or
property involving a leased vehicle may bring an action against the owner of the
vehicle merely by virtue of its ownership of the vehicle.

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<PAGE> 23

To the extent that applicable state law permits such an action, FCTT and the
FCTT Assets, including the Series 1996-1 Assets, may be subject to liability to
such an injured party. FCTT is named as an insured party under the Contingent
and Excess Liability Insurance. In the event that vicarious liability was
imposed on FCTT as owner of a Series 1996-1 Leased Vehicle (or, in certain
circumstances a Leased Vehicle that is not a Series 1996-1 Leased Vehicle) and
the coverage provided by the Contingent and Excess Liability Insurance was
insufficient to cover the full amount of such loss, and Ford Credit and Ford
Credit Leasing failed to perform their obligations to indemnify the Issuer, the
Senior Noteholders could incur a loss on their investment. See "--
Structural Considerations," "Certain Legal Aspects of FCTT and the Series
1996-1 Certificates" and "Certain Legal Aspects of the Leases and Leased
Vehicles -- Vicarious Liability."

ADMINISTRATIVE AGENT DEFAULT

Ford Credit is the Administrative Agent with respect to the Leases and
Leased Vehicles, including the Series 1996-1 Leases and Series 1996-1 Leased
Vehicles. Administrative Agent Events of Default may occur with respect to all
beneficiaries of FCTT, including the Issuer, or only with respect to one or more
Series. Upon the occurrence of an Administrative Agent Event of Default with
respect to all beneficiaries of FCTT, the FCTT Trustee, if so directed by 100%
of the beneficiaries of FCTT (which, so long as any Senior Notes are
outstanding, will for this purpose include the Indenture Trustee and any other
holder of a Series, but exclude Ford Credit and Ford Credit Leasing), may
terminate all of the rights and obligations of Ford Credit under the
Administrative Agency Agreement. Upon the occurrence of an Administrative Agent
Event of Default with respect to Series 1996-1, the Indenture Trustee may
terminate all of the rights and obligations of Ford Credit with respect to
Series 1996-1 only, and the FCTT Trustee will become the successor
Administrative Agent until such time as a successor Administrative Agent is
appointed pursuant to the terms of the Administrative Agency Agreement. Any
replacement of Ford Credit as Administrative Agent in servicing the Leases and
disposing of the Leased Vehicles could have an adverse effect on the timely
receipt of interest and principal by the Senior Noteholders. See "Description
of the Administrative Agency Agreement -- Administrative Agent Events of
Default."

BOOK-ENTRY REGISTRATION

Each Class of the Senior Notes will be initially represented by one or more
physical notes registered in the name of Cede or any successor nominee for DTC
and will not be registered in the names of the beneficial owners of Senior Notes
or their nominees. Accordingly, unless and until Definitive Senior Notes are
issued, holders of beneficial interests in Senior Notes will not be recognized
by the Indenture Trustee as Senior Noteholders and will only be able to exercise
the rights of Senior Noteholders indirectly through DTC and its participants.
See "Description of the Senior Notes -- Book-Entry Registration."

FORD CREDIT

Ford Credit was incorporated in Delaware in 1959 and is a wholly owned
indirect subsidiary of Ford.

Ford Credit provides wholesale financing and capital loans to franchised
Ford vehicle dealers and other dealers associated with such franchisees and
purchases retail installment sale contracts and retail leases from them. Ford
Credit also makes loans to vehicle leasing companies, the majority of which are
affiliated with such dealers. In addition, a wholly-owned subsidiary of Ford
Credit provides these financing services in the United States and Canada to
other vehicle dealers. Ford Credit also provides retail financing for used
vehicles built by Ford and other manufacturers. In addition to vehicle
financing, Ford Credit makes loans to affiliates of Ford and finances certain
receivables of Ford and its subsidiaries. Ford Credit's insurance operations,
conducted through its wholly owned subsidiary, The American Road Insurance
Company and its subsidiaries, consist primarily of underwriting floor plan
insurance related to substantially all new vehicle inventories of dealers
financed at wholesale by Ford

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<PAGE> 24

Credit in the United States and Canada, credit life and disability insurance in
connection with retail vehicle financing, and insurance related to retail
contracts sold by automobile dealers to cover repairs.

The mailing address of Ford Credit's executive offices is The American
Road, Dearborn, Michigan 48121. The telephone number of such offices is (313)
322-3000.

THE ISSUER

FORMATION OF THE ISSUER

The Issuer is a trust formed under the laws of the State of Delaware
pursuant to the Lease Trust Agreement solely for the purposes of the
transactions described in this Prospectus. After its formation, the Issuer will
not engage in any activity other than (i) issuing the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates, (ii) acquiring the Series
1996-1 Certificates and the other property of the Lease Trust Estate using the
proceeds from the sale of the Senior Notes and Lease Trust Certificates to third
party investors and from the issuance of the Subordinated Notes and
$__________________ of Lease Trust Certificates to the Transferor, (iii) making
payments on the Senior Notes, the Subordinated Notes and the Lease Trust
Certificates, (iv) assigning and pledging the Lease Trust Estate to the
Indenture Trustee, (v) entering into and performing its obligations under the
Basic Documents to which it is a party and (vi) engaging in other transactions,
including entering into agreements, that are necessary, suitable or convenient
to accomplish the foregoing or are incidental thereto or connected therewith.

CAPITALIZATION OF THE ISSUER

On the Closing Date, the Issuer will be capitalized with $______ of Senior
Notes, $______ of Subordinated Notes and $______ of Lease Trust Certificates.
The Issuer will sell Lease Trust Certificates with an aggregate initial
principal balance of $______ to third party investors that are expected to be
unaffiliated with the Transferor, the Administrative Agent, their respective
affiliates or the Issuer. In exchange for the transfer of the Series 1996-1
Certificates, the Issuer will pay the proceeds from the sale of the Senior Notes
and the Lease Trust Certificates to the Transferor and will issue to the
Transferor the entire initial principal balance of the Subordinated Notes and
$__________________ initial principal balance of Lease Trust Certificates.

The following table illustrates the capitalization of the Issuer as of the
Closing Date, as if the issuance and sale of the Senior Notes, the Subordinated
Notes and the Lease Trust Certificates as described above had taken place on
such date:

<TABLE>
<S> <C>
Class A-1 Senior Notes . . . . . . . . . . . . . . . . . . . . . . $
Class A-2 Senior Notes . . . . . . . . . . . . . . . . . . . . . .
Subordinated Notes . . . . . . . . . . . . . . . . . . . . . . . .
Lease Trust Certificates . . . . . . . . . . . . . . . . . . . . .
--------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
========
</TABLE>

THE LEASE TRUSTEE

PNC Bank, Delaware, a Delaware banking corporation, is the Lease Trustee
under the Lease Trust Agreement. The principal offices of the Lease Trustee are
located at 222 Delaware Avenue, Wilmington, Delaware 19801. The Transferor,
Ford Credit and their affiliates may maintain normal commercial banking
relationships with the Lease Trustee and its affiliates. The fees and expenses
of the Lease Trustee will be paid by the Administrative Agent.

PROPERTY OF THE ISSUER

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<PAGE> 25

On the Closing Date, the Series 1996-1 Certificates will be transferred to
the Issuer pursuant to the Transfer Agreement. The Issuer will then pledge its
interest in the Series 1996-1 Certificates to the Indenture Trustee under the
Indenture and then, subject to such pledge, will lease the Series 1996-1
Certificates back to the Transferor pursuant to the Program Operating Lease.
The Program Operating Lease with respect to the beneficial interest in each
Series 1996-1 Leased Vehicle expires with respect to such Series 1996-1 Leased
Vehicle immediately preceding the earlier to occur of (i) the sale of such
Series 1996-1 Leased Vehicle, but only if such sale occurs on or after the
related Scheduled Lease End Date and (ii) the making of a Sale Proceeds Advance
in respect thereof. See "Series 1996-1 Certificates." After giving effect to
the transactions described herein and effected by the Basic Documents, the
property of the Issuer (the "Lease Trust Estate") will consist of (i) the rights
of the Issuer under the Series 1996-1 Certificates, (ii) the rights under the
Program Operating Lease, (iii) the rights of the Issuer to funds on deposit from
time to time in the Collection Account, the Payahead Account, the Payment
Account, the Certificate Distribution Account and any other account or accounts
established pursuant to the Indenture (including investment income on amounts on
deposit in the Collection Account) and proceeds thereof, (iv) the rights of the
Transferor under the Asset Contribution Agreement, (v) the rights as holder of
the Series 1996-1 Certificates under the Administrative Agency Agreement and the
Series 1996-1 Supplement, (vi) the interest of the Issuer in the Cash Collateral
Account and the right to make withdrawals therefrom and (vii) all proceeds of
the foregoing. All of the Lease Trust Estate is pledged to the Indenture
Trustee pursuant to the terms of the Indenture.

Because the Series 1996-1 Certificates represent the beneficial interest in
the Series 1996-1 Assets, Senior Noteholders are dependent on payments made on
the Series 1996-1 Leases and proceeds received in connection with the
disposition of Series 1996-1 Leased Vehicles for payment of interest on and
principal of the Senior Notes. The Issuer will not have a direct ownership
interest in the Series 1996-1 Leases, or a direct ownership interest or
perfected security interest in the Series 1996-1 Leased Vehicles (which will be
titled in the name of FCTT), and it is therefore possible that a claim or lien
with respect to the Series 1996-1 Leased Vehicles or on FCTT could limit the
amounts paid to the holders of the Series 1996-1 Certificates to less than the
amount due from the related Obligors or realized from the sale of Series 1996-1
Leased Vehicles. To the extent that a claim or lien delays disposition of
Series 1996-1 Leased Vehicles or reduces the amount paid to the holders of the
Series 1996-1 Certificates as holders of the beneficial interest in the Series
1996-1 Assets, Senior Noteholders could be subject to delays in payment or
losses on their investment. See "Risk Factors -- Structural Considerations,"
"Description of the Senior Notes -- Cash Collateral Account Withdrawals and
Deposits," "Series 1996-1 Certificates" and "Certain Legal Aspects of FCTT and
the Series 1996-1 Certificates."

USE OF PROCEEDS

The net proceeds from the sale of the Senior Notes will be applied,
together with the proceeds from the sale of Lease Trust Certificates to third
party investors and from the issuance of the Subordinated Notes and
$__________________ of Lease Trust Certificates to the Transferor, to acquire
the Series 1996-1 Certificates from the Transferor pursuant to the Transfer
Agreement.

FCTT

CREATION OF FCTT BY FORD CREDIT AND FORD CREDIT LEASING

Ford Credit Titling Trust ("FCTT") was formed by Ford Credit and Ford
Credit Leasing, a special-purpose, wholly-owned subsidiary of Ford Credit,
pursuant to the terms of the FCTT Agreement. The primary purpose of FCTT is to
acquire from Dealers located in specified jurisdictions the Leases and Leased
Vehicles originated by such Dealers and to conserve and hold such Leases and
Leased Vehicles on behalf of the beneficiaries from time to time of FCTT. As of
the date hereof, Ford Credit has directed that each lease under the Red Carpet
Lease Plan which is originated by Dealers in

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<PAGE> 26

Arizona, Arkansas, California, Colorado, Kansas, Minnesota, Nebraska, Nevada,
New Mexico, New York, North Dakota, Pennsylvania, South Dakota, Virginia and
Washington, and the related leased vehicle, be assigned by Dealers to FCTT,
except that if the obligor under the lease is located in any other state, such
lease and the related leased vehicle is assigned to Ford Credit instead of
FCTT. All the Series 1996-1 Leases and Series 1996-1 Leased Vehicles were
originated in one of the fifteen states identified above with Obligors located
in such states. The Administrative Agent has advised the Issuer that it
anticipates that after the date hereof, additional states will be added to the
list of states in which Dealers will assign Leases and Leased Vehicles to FCTT.
Leases and Leased Vehicles originated in such additional states will constitute
FCTT Assets but will not constitute Series 1996-1 Assets. See "-- Lease
Origination from Dealers and Assignment to FCTT."

THE FCTT TRUSTEE

Comerica Bank, a Michigan banking corporation, is the FCTT Trustee. The
principal offices of Comerica Bank are located in Detroit, Michigan. The
Transferor, Ford Credit and their affiliates may maintain normal commercial
banking relationships with Comerica Bank and its affiliates. The FCTT Trustee
may appoint one or more co-trustees or separate trustees for the purpose of
meeting applicable state requirements.

LEASE ORIGINATION FROM DEALERS AND ASSIGNMENT TO FCTT

Dealers originate Leases on a form providing for the assignment thereof to
FCTT. Each Leased Vehicle which is assigned to FCTT previously has been sold to
the Dealer by Ford or, in certain limited circumstances, by another manufacturer
of motor vehicles. The Dealer has negotiated the terms of the Lease with the
Obligor, including an option to purchase the related Leased Vehicle on the
Scheduled Lease End Date for an amount greater than or equal to the Residual
Value of the Leased Vehicle. Upon entering into a Lease with an Obligor and
approval of such Lease by the Administrative Agent, Dealers assign the Lease,
the related Leased Vehicle, the first Total Monthly Payment received from the
Obligor and rights to any security deposit or reconditioning reserve to FCTT
against payment of the related Balance Subject to Lease Charges. As of the date
of the assignment, FCTT holds the title to and is the record owner of the Lease
and Leased Vehicle. Until such date as the Lease and Leased Vehicle are
designated as Series Specified Assets in connection with the issuance of any
Series, the beneficial interest in such Lease and Leased Vehicle is held by Ford
Credit and Ford Credit Leasing as holders of the Exchangeable Beneficial
Certificates. See "-- Exchangeable Beneficial Certificates and Specified
Beneficial Certificates." Pursuant to agreements between Ford Credit and the
Dealers, each Dealer is obligated, after originating and assigning Leases and
Leased Vehicles to FCTT, to repurchase such Leases and Leased Vehicles which do
not meet certain representations and warranties made by such Dealer. The
Administrative Agent or the Dealer has paid or will pay applicable sales, use
and similar taxes to the appropriate authorities from amounts collected from
Obligors or otherwise.

TITLING OF LEASED VEHICLES

The Administrative Agent, on behalf of FCTT, purchases the Leases and
related Leased Vehicles, including the Series 1996-1 Leases and the related
Series 1996-1 Leased Vehicles, from the originating Dealers and causes the
certificate of title for each Leased Vehicle to be issued in the name "Ford
Credit Titling Trust," or "Ford Credit Titling Trust, Comerica Bank [or
applicable co-trustee or separate trustee], Trustee" or in a substantially
similar name acceptable to the relevant governmental departments or agencies. No
lien will be placed on the certificate of title to indicate the interests of the
beneficiaries of FCTT, and new certificates of title will not be issued in
connection with the transfer of any beneficial interests in FCTT. Therefore,
there will be no indication on the certificates of title for the Series 1996-1
Leased Vehicles that the Issuer or any other person has an interest in such
Series 1996-1 Leased Vehicles. In certain circumstances, however, certificates
of title to the Leased Vehicles will reflect a lien recorded in favor of the
Administrative Agent, including therein the address of an office of the
Administrative Agent at which Leases and the certificates of title to Leased
Vehicles are to be delivered. This lien exists only to assure delivery of the
certificates of title to the correct

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<PAGE> 27

location; the Administrative Agent will not have an interest in the Leased
Vehicles, although for administrative convenience, it (or a third-party
contractor hired by it) will hold the certificates of title as custodian on
behalf of the FCTT Trustee. See "Risk Factors -- Structural Considerations"
and "Certain Legal Aspects of FCTT and the Series 1996-1 Certificates."

EXCHANGEABLE BENEFICIAL CERTIFICATES AND SPECIFIED BENEFICIAL CERTIFICATES

The FCTT Trustee initially issued to Ford Credit and Ford Credit Leasing,
as the beneficiaries of FCTT, Exchangeable Beneficial Certificates (each, an
"EBC") representing the entire beneficial interest in the FCTT Assets
(representing a 98% beneficial interest in the FCTT Assets in the case of Ford
Credit, and a 2% beneficial interest in the case of Ford Credit Leasing). On
May 24, 1995, Ford Credit and Ford Credit Leasing exchanged a portion of their
EBCs for a series of Specified Beneficial Certificates (the "Series 1995-1
Certificates") representing beneficial interests in certain FCTT Assets
designated as Series 1995-1 Assets. Such Series 1995-1 Certificates were
contributed to an affiliate which deposited them into a securitization trust in
connection with the issuance of a previous series of asset backed securities. As
described below, the FCTT Trustee may issue from time to time additional series
of Specified Beneficial Certificates ("SBCs") representing beneficial interests
in certain designated FCTT Assets. After the issuance of the Series 1996-1
Certificates and until the next series of SBCs are issued, the EBCs will
represent the beneficial interest in all of the FCTT Assets other than those
FCTT Assets which are designated as Series 1995-1 Assets or Series 1996-1 Assets
(such other FCTT Assets, the "Non-Specified Assets"). The beneficial interest
in FCTT and the FCTT Assets as of any date is represented by the EBCs and each
outstanding SBC. Neither Ford Credit nor Ford Credit Leasing may transfer or
assign their respective EBCs.

Pursuant to the FCTT Agreement, the Administrative Agent, acting at the
unanimous direction of the holders of the EBCs, may at any time deliver to the
FCTT Trustee a Series Specification Notice identifying certain FCTT Assets to be
designated as Series Specified Assets and the date (the "Series Issue Date")
upon which an SBC representing the beneficial interest in such Series Specified
Assets will be issued to each holder of an EBC. Upon delivery of the SBC, such
holder's beneficial interest in the FCTT Assets will be represented by the EBC
(with respect to the Non-Specified Assets) and such SBC (with respect to Series
Specified Assets). As described in "Series 1996-1 Certificates -- Issuance of
Series 1996-1 Certificates to Ford Credit and Ford Credit Leasing," the Series
1996-1 Certificate to be issued to Ford Credit will be an SBC representing a 98%
beneficial interest in the Series 1996-1 Assets and the Series 1996-1
Certificate to be issued to Ford Credit Leasing will be an SBC representing a 2%
beneficial interest in the Series 1996-1 Assets. Ford Credit and Ford Credit
Leasing expect from time to time to designate other FCTT Assets as Series
Specified Assets and to cause FCTT to issue additional Series representing
beneficial interests in such Series Specified Assets. No Series may be issued
unless an Opinion of Counsel is delivered that such issuance will not cause FCTT
to be classified as an association (or publicly traded partnership) taxable as a
corporation for federal income tax purposes.

As set forth in the FCTT Agreement and the Administrative Agency Agreement,
the holders from time to time of any SBC will have a beneficial interest in the
related Series Specified Assets, will be entitled to receive such percentage
interest of the proceeds of the related Series Specified Assets set forth in
such SBC and, acting together with each other holder of an SBC representing a
beneficial interest in such Series Specified Assets, will be entitled to direct
the FCTT Trustee to take actions or refrain from taking actions with respect to
such Series Specified Assets. The holders from time to time of any SBCs will
not be entitled to receive proceeds from Non-Specified Assets or from any other
Series Specified Assets which may exist from time to time. However, it is
possible in certain circumstances that notwithstanding the allocations of
liabilities and the indemnities set forth in the FCTT Agreement, certain Series
Specified Assets could be attached or proceeds of such Series Specified Assets
could be used to satisfy a claim with respect to Non-Specified Assets or other
Series Specified Assets or a claim assessed on FCTT generally. See "Risk
Factors -- Structural Considerations."

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<PAGE> 28

THE TRANSFEROR

DELAWARE BUSINESS TRUST

The Transferor is a business trust formed under the laws of the State
of Delaware pursuant to the RCL Trust Agreement for purposes of the
transactions described herein. The beneficiaries of the Transferor are Ford
Credit and Ford Credit Leasing. The activities of the Transferor are limited
to (i) acquiring and transferring the Series 1996-1 Certificates and entering
into and performing its obligations under the Program Operating Lease; (ii)
acting as depositor to the Issuer and entering into the Lease Trust Agreement
and acquiring certain Lease Trust Certificates issued thereunder; (iii)
acquiring the Subordinated Notes; and (iv) making distributions and executing
agreements as are necessary, suitable or convenient to accomplish the
foregoing. In addition, after entering into the Program Operating Lease the
Transferor will assign a 1% interest in all of its assets and obligations to
Ford Credit Leasing. See "-- Creation by Ford Credit and Ford Credit
Leasing; Assignment to Ford Credit Leasing" and "Series 1996-1 Certificates
- -- Lease of the Series 1996-1 Certificates to the Transferor."

RCL TRUSTEE

The RCL Trustee is ______, a Delaware banking corporation, with
offices located at ______, ______, Delaware _____. The fees and expenses of
the RCL Trustee will be paid by Ford Credit and Ford Credit Leasing, the
beneficiaries of the Transferor.

CREATION BY FORD CREDIT AND FORD CREDIT LEASING; ASSIGNMENT TO FORD CREDIT
LEASING

Prior to the issuance of the Series 1996-1 Certificates and the
securitization described herein, Ford Credit held a 98% beneficial interest in
the Transferor and Ford Credit Leasing held a 2% beneficial interest in the
Transferor. Because the Transferor will assign a 1% interest in its assets and
obligations to Ford Credit Leasing on the Closing Date, the beneficial interest
in the Transferor held by Ford Credit and Ford Credit Leasing will be changed
by the amount so assigned. After giving effect to the assignment on the
Closing Date, Ford Credit Leasing, in addition to a direct right to 1% of all
assets of the Transferor (and an obligation to pay 1% of all obligations of the
Transferor), will retain a 1/99 beneficial interest in the Transferor. After
giving effect to the assignment to Ford Credit Leasing, Ford Credit as a
beneficiary of the Transferor will retain a 98/99 beneficial interest in the
Transferor. As described in "Series 1996-1 Certificates -- Lease of the
Series 1996-1 Certificates to the Transferor," the primary obligation of the
Transferor after the Closing Date is to make Program Operating Lease Payments
and its primary assets after the Closing Date are the interest it has as lessee
of the Series 1996-1 Certificates pursuant to the Program Operating Lease, its
interest in the Cash Collateral Account, the Subordinated Notes and $___
______________ in initial principal balance of Lease Trust Certificates.

SERIES 1996-1 CERTIFICATES

ISSUANCE OF SERIES 1996-1 CERTIFICATES TO FORD CREDIT AND FORD CREDIT LEASING

On the Closing Date, the FCTT Trustee will (i) issue a Series 1996-1
Certificate to Ford Credit, as holder of an EBC, representing Ford Credit's 98%
beneficial interest in the FCTT Assets which were designated as Series 1996-1
Assets pursuant to the Series Specification Notice relating to Series 1996-1
and (ii) issue a Series 1996-1 Certificate to Ford Credit Leasing, as holder of
an EBC, representing Ford Credit Leasing's 2% beneficial interest in the FCTT
Assets which were designated as Series 1996-1 Assets pursuant to the Series
Specification Notice relating to Series 1996-1. The Series 1996-1 Certificates
will be the second series of SBCs issued by FCTT. See "FCTT -- Exchangeable
Beneficial Certificates and Specified Beneficial Certificates."

CONTRIBUTION OF SERIES 1996-1 CERTIFICATES TO THE TRANSFEROR

<PAGE> 29

On the Closing Date, Ford Credit and Ford Credit Leasing each will
convey the Series 1996-1 Certificate issued to it to the Transferor pursuant to
the terms of the Asset Contribution Agreement. Ford Credit and Ford Credit
Leasing each will covenant to treat the conveyance of the Series 1996-1
Certificates to the Transferor as an absolute transfer for all purposes. Upon
the conveyance of the Series 1996-1 Certificates, the value of the beneficial
interests of Ford Credit and Ford Credit Leasing in the Transferor will be
increased by the value of the Series 1996-1 Certificates. See "The Transferor
- -- Creation by Ford Credit and Ford Credit Leasing; Assignment to Ford Credit
Leasing."

In addition to the conveyance of the Series 1996-1 Certificates, Ford
Credit and Ford Credit Leasing also will convey to the Transferor their rights
under the Series 1996-1 Supplement and the Administrative Agency Agreement with
respect to Series 1996-1.

The Administrative Agent in the Series 1996-1 Supplement and Ford
Credit and Ford Credit Leasing in the Asset Contribution Agreement will make
certain representations, warranties and covenants with respect to the Series
1996-1 Assets. See "The Leases and Leased Vehicles -- Eligibility Criteria"
and "Additional Document Provisions -- Representations, Warranties and
Covenants." In the event all of the Specific Eligibility Criteria and General
Eligibility Criteria were not satisfied on the Series 1996-1 Cut-Off Date or
certain covenants are breached, Ford Credit and Ford Credit Leasing, as holders
of the EBCs, will be required to purchase the beneficial interest in the Series
1996-1 Asset to which such breach relates. Any such purchase will be effected
by the deposit of the Administrative Purchase Amount in the Collection Account
on the business day preceding the Payment Date relating to the Accrual Period
in which the breach was discovered or occurred, as applicable. See
"Description of the Administrative Agency Agreement -- Administrative
Purchases."

TRANSFER OF THE SERIES 1996-1 CERTIFICATES TO THE ISSUER

On the Closing Date, immediately following the conveyance of the
Series 1996-1 Certificates to the Transferor pursuant to the Asset Contribution
Agreement as described in "-- Contribution of Series 1996-1 Certificates to
the Transferor," the Transferor, pursuant to the terms of the Transfer
Agreement, will transfer the Series 1996-1 Certificates to the Issuer. The
Transferor also will assign to the Issuer the rights under the Administrative
Agency Agreement and the Series 1996-1 Supplement conveyed to it by Ford Credit
and Ford Credit Leasing pursuant to the Asset Contribution Agreement. In
exchange for such transfer and assignment, the Issuer will pay to the
Transferor the proceeds from the sale of the Senior Notes and Lease Trust
Certificates to third party investors and will issue to the Transferor the
Subordinated Notes and $__________________ initial principal balance of Lease
Trust Certificates.

PLEDGE OF THE SERIES 1996-1 CERTIFICATES TO THE INDENTURE TRUSTEE

Immediately following the transfer of the Series 1996-1 Certificates
to the Issuer as described in "-- Transfer of the Series 1996-1 Certificates
to the Issuer," the Issuer will pledge its interest in the Series 1996-1
Certificates as part of the Lease Trust Estate pledged to the Indenture Trustee
as security for the repayment of the Senior Notes. See "Property of the
Issuer."

LEASE OF THE SERIES 1996-1 CERTIFICATES TO THE TRANSFEROR

Immediately following the transfer of the Series 1996-1 Certificates
to the Issuer and the pledge to the Indenture Trustee of the Issuer's interest
therein as described in "-- Transfer of the Series 1996-1 Certificates to the
Issuer" and "-- Pledge of the Series 1996-1 Certificates to the Indenture
Trustee," the Issuer and the Transferor will enter into the Program Operating
Lease pursuant to which the Transferor will lease the Series 1996-1
Certificates during the term of the Program Operating Lease. As lessee, the
Transferor will be entitled to receive all proceeds from the Series 1996-1
Certificates during the term of the Program Operating Lease and will be
required to make Program Operating Lease Payments to the Issuer, subject to the
assignment by the Transferor of 1% of its assets and obligations to Ford Credit
Leasing. See "The Transferor -- Creation by Ford Credit and Ford Credit
Leasing; Assignment to Ford Credit Leasing."

<PAGE> 30

Because the Program Operating Lease expires with respect to the
portion of the Series 1996-1 Certificates representing the beneficial interest
in a Series 1996-1 Leased Vehicle immediately preceding the earlier of (i) the
sale of such Series 1996-1 Leased Vehicle, if such sale occurs on or after such
Series 1996-1 Leased Vehicle's Scheduled Lease End Date or (ii) the date on
which a Sale Proceeds Advance is made relating to such Series 1996-1 Leased
Vehicle, the Transferor will receive and will deposit into the Cash Collateral
Account all Monthly Payments with respect to Series 1996-1 Leases, all Sale
Proceeds of those Series 1996-1 Leased Vehicles the related Series 1996-1
Leases of which terminate before their Scheduled Lease End Date and all amounts
collected in respect of Excess Wear and Tear and Excess Mileage. The
Transferor is obligated to make Program Operating Lease Payments to the Issuer
for so long as the Senior Notes, the Subordinated Notes and the Lease Trust
Certificates are outstanding. Amounts in the Cash Collateral Account will
secure the Transferor's obligation to make Program Operating Lease Payments to
the Issuer. The Transferor will not receive the Sale Proceeds of those Series
1996-1 Leased Vehicles whose Series 1996-1 Leases terminate on or after their
respective Scheduled Lease End Dates. The right to such Sale Proceeds (as
limited by the Transferor Purchase Option Price) is property of the Issuer
pledged pursuant to the Indenture. See "-- Transferor Leased Vehicle
Purchase Option" below.

The Program Operating Lease Payment due on any Payment Date will
consist of a Required Interest Payment portion and an Additional Payment
portion. The "Required Interest Payment" with respect to any Payment Date
equals the sum of the Administrative Agent Fee plus the amount of interest
accrued on the outstanding Senior Notes, Subordinated Notes and Lease Trust
Certificates since the preceding Payment Date (or, in the case of the first
Payment Date, since the Closing Date) plus any previously due but unpaid
interest (and interest thereon). The "Additional Payment" with respect to any
Payment Date equals the excess, if any, of the Cash Collateral Amount (after
giving effect to any decrease thereof to pay the Required Interest Payment and
any increase thereof as a result of any deposits in the Cash Collateral Account
with respect to such Payment Date) over the Required Cash Collateral Amount;
provided, however, that the Additional Payment with respect to any Payment Date
shall not exceed the excess, if any, of the aggregate outstanding principal
balance of the outstanding Senior Notes, Subordinated Notes and Lease Trust
Certificates over the aggregate Residual Values of all Series 1996-1 Leased
Vehicles the related Series 1996-1 Leases of which have not yet terminated as
of the close of the last day of the preceding Collection Period; and provided
further that the Additional Payment with respect to the Payment Date following
the Accrual Period in which the last remaining Series 1996-1 Lease terminated
(via voluntary early termination, termination due to default, scheduled
termination or otherwise) shall not be less than the amount that is necessary
(after giving effect to other amounts to be deposited in the Payment Account
and allocable to principal) to reduce the aggregate outstanding principal
balance of each Class of Senior Notes, the Subordinated Notes and the Lease
Trust Certificates to zero.

On the business day preceding each Payment Date, the Indenture Trustee
will withdraw from the Cash Collateral Account and deposit into the Payment
Account the Cash Collateral Draw Amount. The Cash Collateral Draw Amount will
consist of the Cash Collateral Required Draw Amount and the Cash Collateral
Additional Draw Amount. The Cash Collateral Required Draw Amount will be
applied to pay the Required Interest Payment portion of the Program Operating
Lease Payment for such Payment Date and the Cash Collateral Additional Draw
Amount will be applied to pay the Additional Payment portion, if any, of the
Program Operating Lease Payment for such Payment Date. Such withdrawals and
deposits will be deemed to constitute the payment of Program Operating Lease
Payments by the Transferor to the Issuer. See "Description of the Senior
Notes--Cash Collateral Account Withdrawals and Deposits" for a description of
how the Cash Collateral Required Draw Amount and the Cash Collateral Additional
Draw Amount are calculated.

Defaults under the Program Operating Lease include, among other
things, failure by the Transferor to pay the Required Interest Payment portion
of the Program Operating Lease Payment to the Issuer, the breach of a
representation or warranty, the failure to observe or perform certain covenants
or the occurrence of an Event of Default under the Indenture. Upon the
occurrence of an event of default under the Program Operating Lease, (i) the
Indenture Trustee as assignee of the rights of the Issuer in the Program
Operating Lease pursuant to the pledge of the Lease Trust Estate would

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<PAGE> 31

be entitled to terminate the Program Operating Lease and obtain the right to
receive directly all distributions with respect to the Series 1996-1
Certificates and to apply the Cash Collateral Amount to pay interest on and
principal of the Senior Notes, the Subordinated Notes and the Lease Trust
Certificates and (ii) an Event of Default would occur under the Indenture which
would permit the Senior Noteholders to accelerate the maturity of the Senior
Notes and in certain circumstances cause the sale of the Lease Trust Estate.
See "Description of the Senior Notes -- Indenture."

Transferor Leased Vehicle Purchase Option. Under the Program
Operating Lease, the Transferor may, at its option, purchase the Issuer's
beneficial interest in any Series 1996-1 Leased Vehicle not purchased by the
related Obligor or Dealer following the Scheduled Lease End Date of the related
Series 1996-1 Lease by paying to the Issuer an amount equal to the Residual
Value of such Series 1996-1 Leased Vehicle minus any amounts due from the
related Obligor for Uncollected Excess Wear and Tear and Excess Mileage (the
"Transferor Purchase Option Price"). The Transferor will exercise such option
only if neither the Obligor nor the Dealer exercises its option to purchase the
Series 1996-1 Leased Vehicle and the related Sale Proceeds exceed the
Transferor Purchase Option Price. Because the Transferor intends to exercise
this option when available, Sale Proceeds received by the Issuer with respect
to the sale of any Series 1996-1 Leased Vehicle the related Series 1996-1 Lease
of which was terminated on or after its Scheduled Lease End Date will never
exceed the Transferor Purchase Option Price. With respect to each Series
1996-1 Vehicle for which the Transferor exercises its purchase option, the
Transferor will deposit an amount equal to the excess of the related Sale
Proceeds over the Transferor Purchase Option Price (the "Transferor Purchase
Option Net Proceeds") into the Cash Collateral Account until the aggregate
cumulative amount deposited in respect of such Transferor Purchase Option Net
Proceeds equals $______. Thereafter, the Transferor will retain any Transferor
Purchase Option Net Proceeds and such amounts will not be available to pay
interest on or principal of the Senior Notes, the Subordinated Notes and the
Lease Trust Certificates. To the extent that Transferor Purchase Option Net
Proceeds are deposited into the Cash Collateral Account, such amounts will
secure the Transferor's obligation to make Program Operating Lease Payments to
the Issuer. See "Description of the Senior Notes --Cash Collateral Account
Withdrawals and Deposits."

THE LEASES AND LEASED VEHICLES

ORIGINATION PROCEDURES

The Ford Credit Red Carpet Lease Plan (the "Red Carpet Lease Plan") is
one of a number of financing programs offered by Dealers to assist their
customers in the acquisition of new automobiles and light trucks. Under the
Red Carpet Lease Plan, an Obligor enters into a Lease that requires the Obligor
to make Total Monthly Payments for a predetermined number of months ("Lease
Term") in return for the use of the related Leased Vehicle. At the end of the
Lease Term, the Obligor has the option to purchase the Leased Vehicle or return
it to the Dealer. Dealers negotiate the terms of the Lease with prospective
lessees in accordance with guidelines set by Ford Credit.

A credit application completed by a prospective lessee is evaluated by
Ford Credit with consideration given to, among other things, the prospective
lessee's credit history, current income, and years at present address. Ford
Credit uses a proprietary credit scoring model that measures the probability of
payment for each potential obligor given information concerning the prospective
lessee, the price of the Leased Vehicle and terms of the Lease. Credit
analysts at the applicable Ford Credit branch office evaluate credit
applications based on the information set forth therein and the results of the
proprietary credit scoring model or in some cases based on additional
information obtained from the relevant Dealer and make a judgment to accept or
reject such applications. Credit analysts may also propose changes to the
terms of the Lease to increase the probability of payment such as a larger down
payment or a less expensive vehicle.

If the credit application is approved and the prospective lessee
agrees to the terms of the Lease, the Dealer completes the transaction
documentation and submits it to Ford Credit. Prior to the

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Obligor taking possession of the Leased Vehicle, the Dealer must: (i) collect
the first Total Monthly Payment, including a refundable security deposit (which
in certain instances may be waived), (ii) obtain written evidence that the
Obligor has purchased adequate insurance coverage, and (iii) ensure that all
required license fees, registration fees and up-front taxes are paid. Certain
fees and taxes may be financed by the Dealer and included in the Obligor's
Total Monthly Payment (such fees and taxes, the "Use and Lease Tax Amounts").
The Dealer is responsible for registering and titling the Leased Vehicle; it is
registered in the name of the Obligor, the Obligor and Ford Credit, the Obligor
and FCTT, Ford Credit only or FCTT only and titled in the name of Ford Credit
or FCTT, as the case may be. Titles are mailed directly to the appropriate
Ford Credit branch office or to a central office of an independent contractor
hired by Ford Credit.

SERVICING PROCEDURES

The Leases, including the Series 1996-1 Leases, are serviced through
Ford Credit branch offices. Approximately 19 days before a Total Monthly
Payment is due, Ford Credit sends the Obligor an invoice. The Obligor is
instructed to send the Total Monthly Payment to one of several regional
lockboxes dedicated to the collection of payments for Leases and retail
installment contracts. If an Obligor does not make the payment within 10 days
of its due date, a late fee is assessed. At that time, Ford Credit initiates
collection procedures by mailing a past due notice to the Obligor. In cases
such as chronic delinquency, payment default, multiple returned checks or
bankruptcy, a Lease generally is assigned to a Ford Credit customer service
representative after it has become 15 days delinquent. In other cases,
collection assignments are issued when a Lease becomes 22 days delinquent. The
Obligor will be contacted to determine the cause of the delinquency and to help
the Obligor develop plans to resolve it. If the Obligor cannot make the past
due payment, Ford Credit will either grant a Payment Extension or repossess the
Leased Vehicle. If a Payment Extension is granted, the Obligor is assessed a
fee and the Lease Term is extended (although the Obligor is not permitted to
drive the Leased Vehicle more than the originally agreed upon number of miles
without incurring excess mileage fees). If repossession is necessary, the
Obligor may agree to return the Leased Vehicle or the Leased Vehicle will be
repossessed by a contractor hired by Ford Credit.

Any Obligor not in default is permitted to terminate its Lease before
the Scheduled Lease End Date (a "Voluntary Early Termination") if the Obligor:
(i) returns the Leased Vehicle to the Dealer, (ii) pays to Ford Credit the
difference, if any, between (a) the sum of the Adjusted Balance Subject to
Lease Charges and any past due amounts and (b) the fair market wholesale value
of the Leased Vehicle as agreed to by the Obligor and the Dealer (or if the
Obligor and Dealer fail to agree, the amount received at auction), and (iii)
pays a fee of $200. The Dealer is required to pay an amount equal to such
agreed fair market wholesale value (or the amount received at auction) to Ford
Credit or FCTT, as the case may be. As described in "Description of the Senior
Notes -- Indenture Cash Flows," Voluntary Early Termination Proceeds with
respect to the Series 1996-1 Leases are included in the Collections deposited
in the Cash Collateral Account. See "Maturity, Prepayment and Yield
Considerations" for a discussion of the effect of prepayments of the Series
1996-1 Leases on the payment of principal of the Senior Notes.

At the Scheduled Lease End Date, the Obligor may (i) purchase the
Leased Vehicle for an amount greater than or equal to its Residual Value or
(ii) return the Leased Vehicle to the Dealer. If the Leased Vehicle is
returned to the Dealer, the Dealer may purchase the Leased Vehicle for an
amount equal to its Residual Value or return it to Ford Credit to be sold at
auction. If the Dealer does not purchase the Vehicle, the Dealer will inspect
the Leased Vehicle, complete a Vehicle Conditioning Report ("VCR") and submit
the VCR to Ford Credit. The Dealer will assess any additional charges for
excess wear and tear or excess mileage on the basis of the VCR. See
"Description of the Senior Notes -- Indenture Cash Flows" and "Series 1996-1
Certificates -- Lease of the Series 1996-1 Certificates to the Transferor
- -- Transferor Leased Vehicle Purchase Option" for a description of how
amounts collected from the sale of Series 1996-1 Leased Vehicles are
distributed as Collections (and therefore are available via the Cash Collateral
Account to make payments to Senior Noteholders) and, in certain circumstances,
to the Transferor (and are therefore are not available to make payments to
Senior Noteholders).

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All Leased Vehicles that are returned to Ford Credit will be inspected
to ensure that the VCR properly reflects the condition of the Leased Vehicle
and that the Dealer has billed the Obligor for all excess wear and tear and
excess mileage charges due. If the VCR does not properly reflect the condition
of the Leased Vehicle, Ford Credit may seek reimbursement for any discrepancies
from the returning Dealer. The Leased Vehicle is then shipped to one of
several Ford Credit regional auction locations. In an attempt to maximize
proceeds from the auction of Leased Vehicles, Ford Credit has established an
"Extra Step" program to refurbish and recondition vehicles returned at the end
of 24-month leases. The results of each auction are monitored and Leased
Vehicles will generally be transported to the regional auction where Ford
Credit believes the highest auction proceeds will be realized.

The procedures that Ford Credit has applied and will apply in
originating and servicing the Leases assigned to FCTT (including the Series
1996-1 Leases) will be consistent with those that Ford Credit has applied and
will apply to leases under the Red Carpet Lease Plan that are not assigned to
FCTT. For convenience, the discussion under this heading ("--Servicing
Procedures") and under the heading "--Origination Procedures" above uses
capitalized terms which have meanings defined with respect to Leases assigned
to FCTT. Such terms have equivalent meanings when applied to leases under the
Red Carpet Lease Plan that are not assigned to FCTT.

DELINQUENCY, REPOSSESSION, RESIDUAL VALUE AND LOSS DATA

The following tables set forth Ford Credit's average Red Carpet Lease
asset balance and loss experience for each of the periods shown with respect to
the leases and leased vehicles under the Red Carpet Lease Plan (the "Red Carpet
Lease Portfolio") in the fifteen states in which Leases are currently assigned
to FCTT. See "FCTT -- Creation of FCTT by Ford Credit and Ford Credit
Leasing." There can be no assurance that the loss experience for the Red
Carpet Lease Portfolio or Series 1996-1 Leases in the future will be similar to
the historical experience set forth below.

Because Ford Credit has not historically maintained separate records
based on the term of leases, the data set forth in the following tables
includes data for finance leases (classified by Ford Credit as leases which
have a term of more than 36 months) and operating leases (classified by Ford
Credit as leases which have a term of 36 months or less). However, management
believes that to the extent that there are any material differences between the
historical delinquency and loss statistics for finance leases and operating
leases, the delinquencies and losses would be higher on a mixed pool of finance
leases and operating leases (such as that reflected in the tables) than in a
pool consisting solely of operating leases (such as the Series 1996-1 Leases).
This is because, in the opinion of management based on its experience servicing
both finance leases and operating leases, there is a positive correlation
between increased credit risk and the duration of the lease. In addition,
management believes that the statistics provided in such tables closely reflect
the performance of the Red Carpet Lease Portfolio because the proportion of
originations of operating leases to finance leases in the Red Carpet Lease
Portfolio increased: in 1991, the proportion of originations which were
operating leases was approximately __%, while in 1995 the proportion of
originations which were operating leases was approximately __%. During this
four year period the number of originations grew from approximately ____ to
____ leases per year.

32
<PAGE> 34

RED CARPET LEASE PORTFOLIO

(FIFTEEN STATES IN WHICH LEASES ARE CURRENTLY ASSIGNED TO FCTT(1))
HISTORICAL LOSS EXPERIENCE(2)

<TABLE>
<CAPTION>
SIX MONTHS
CALENDAR YEAR ENDED JUNE 30,
-------------------------------------------------- ----------------
1991 1992 1993 1994 1995 1995 1996
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Average Contracts Outstanding (000)
California . . . . . . . . . . . . . . .
New York . . . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Other(3) . . . . . . . . . . . . . . . .
----- ----- ----- ----- ----- ----- -----
Total ---- Fifteen State . . . . . . .
Average Net RCL Assets (Millions)
California . . . . . . . . . . . . . . . $ $ $ $ $ $ $
New York . . . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Other(3) . . . . . . . . . . . . . . . .
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total ---- Fifteen State . . . . . . . $ $ $ $ $ $ $
Net Credit Losses as a Percentage of
Average Net RCL Assets(4)
California . . . . . . . . . . . . . . . % % % % % %(5) %(5)
New York . . . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Other(3) . . . . . . . . . . . . . . . .
Weighted Average ---- Fifteen State . % % % % % %(5) %(5)
Repossessions as a Percentage of
Average Contracts Outstanding
California . . . . . . . . . . . . . . . % % % % % %(5) %(5)
New York . . . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Other(3) . . . . . . . . . . . . . . . .
Weighted Average ---- Fifteen State . % % % % % %(5) %(5)
Average Gross Loss per Repossession
California . . . . . . . . . . . . . . . $ $ $ $ $ $ $
New York . . . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Other(3) . . . . . . . . . . . . . . . .

Weighted Average ---- Fifteen State . $ $ $ $ $ $ $
Average Delinquency Ratios ---- Fifteen State
31-60 Days Past Due . . . . . . . . . . . % % % % % % %
61-90 Days Past Due . . . . . . . . . . .
Over 90 Days Past Due . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . % % % % % % %
</TABLE>

(Totals may not equal the sum of the respective columns due to rounding.)
- --------------
(1) Regional data is based on results from branch offices located in the states
of Arizona, Arkansas, California, Colorado, Kansas, Minnesota, Nebraska,
Nevada, New Mexico, New York, North Dakota, Pennsylvania, Virginia and
Washington. and may include a small number of Leases associated with
Obligors living outside of such states. Data relating to

33
<PAGE> 35

some Leases associated with Obligors living in South Dakota are excluded for
administrative reasons but the inclusion of such data would not have a
material effect on the data shown.
(2) Includes operating (original terms less than or equal to 36 months) and
finance (original terms greater than 36 months) leases on new and used
vehicles. Only operating leases are part of this securitization structure.
(3) Each other state represents less than 5% of the Total -- Fifteen State
Average Contracts Outstanding and less than 5% of the Total -- Fifteen
State Average Net RCL Assets for each of the periods shown.
(4) "Net Credit Losses" means with respect to the period (i) the aggregate
adjusted balance subject to lease charges of all lease contracts and
related leased vehicles which are determined to be uncollectible during
such period plus the aggregate amount of uncollected charges for excess
wear and tear and excess mileage relating to lease contracts which
terminated during the period with respect to which proceeds from the sale
of the related leased vehicle were received in the period plus any
uncollected scheduled monthly payments in the period with respect to leased
vehicles sold during the period minus (ii) all amounts received in the
period with respect to lease contracts and related leased vehicles which
were determined to be uncollectible during the period and recoveries
received in the period on lease contracts and related leased vehicles
charged-off in the period or any previous period.
(5) Annualized rate.

The reduction in "Net Credit Losses as a Percentage of Average RCL
Assets" (as set forth in the preceding table entitled Red Carpet Lease
Portfolio) during the period 1991 to 1994 is a result of fewer leased vehicles
being repossessed (as a percentage of the number of leases outstanding) and an
increase in the amount recovered for each vehicle which has been repossessed.
Management of Ford Credit believes that this trend is a result of actions taken
to improve procedures relating to credit quality and collection procedures. In
particular, efforts have been made to reduce the proportion of longer term (and
therefor higher risk) leases as a percentage of the total number of leases,
introduce improved risk rating guides, increase the number of collection
personnel and improve their training, and contact lessees promptly on
delinquent accounts. In addition, the general improvement in the economy,
combined with a reduction in market interest rates, have had a positive effect
on Net Credit Losses. Net Credit Losses increased in 1995 and in the first
half of 1996 as a result of higher repossessions and higher severity of loss
per repossession.

The following tables provide residual value and residual loss
information for each of the periods shown with respect to the portion of the
Red Carpet Lease Portfolio comprised of the fifteen states in which Leases are
currently assigned to FCTT.

RED CARPET LEASE PORTFOLIO(1)

(FIFTEEN STATES IN WHICH LEASES ARE CURRENTLY ASSIGNED TO FCTT(2))
RESIDUAL VALUE ANALYSIS

<TABLE>
<CAPTION>
SIX MONTHS ENDED
CALENDAR YEAR JUNE 30,
---------------------------------------------------- ------------------
1991 1992 1993 1994 1995 1995 1996
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Residual value of all vehicles the related lease of
which terminated in the period ($000)(3) 117,686 352,402 515,503 956,768 1,889,774 845,163 1,405,632
Residual value as a percentage of MSRP of all
vehicles the related lease of which terminated
in the period(4) . . . . . . . . . . . 43.1% 42.0% 42.3% 47.8% 52.4% 51.4% 54.9%
Aggregate Residual Losses(5) ($000) . . . 3,448 7,178 4,461 11,913 75,508 30,975 45,965
Aggregate Residual Losses as a percentage of
residual value of all vehicles the related lease
of which terminated in the period . . . 2.9% 2.0% 0.9% 1.3% 4.0% 3.7% 3.3%
Vehicles returned with a Residual Loss as a
percentage of all vehicles the related lease
of which terminated in the period . . . 16.5% 12.0% 5.4% 8.1% 19.6% 18.8% 16.8%
</TABLE>
- -------------------------

(1) Includes only leases on new and used vehicles with original terms of
36 months or less (including the Advance Payment Plan).

34
<PAGE> 36

(2) Based on results on leases for which the last billing address of the
related obligor is in Arizona, Arkansas, California, Colorado, Kansas,
Minnesota, Nebraska, Nevada, New Mexico, New York, North Dakota,
Pennsylvania, South Dakota, Virginia or Washington.
(3) Terminations include voluntary early terminations, terminations due to
defaults and scheduled terminations.
(4) "MSRP" means the Manufacturer's Suggested Retail Price, which will
generally exceed the balance subject to lease charges at inception
of a lease.
(5) "Residual Loss" means the amount by which the residual value of a
leased vehicle the related lease of which terminated on or after the
end of its lease term exceeds the sum of (i) sale proceeds of such
leased vehicle (including collected excess wear and tear and excess
mileage) and (ii) uncollected excess wear and tear and excess mileage.

Based on results for the leases included in the preceding table,
during the period 1991 to 1995 a total of 18.5% of all leased vehicles subject
to 24- and 36-month leases were not purchased either by the lessee or the
dealer and were returned to Ford Credit as of their respective scheduled lease
end dates. Of such leased vehicles returned on or after their scheduled lease
end dates and subsequently sold by Ford Credit at auction, 73.4% were sold for
a loss versus 26.6% which were sold for a gain. (Due to lessee and dealer
purchase options, the opportunity to realize a gain on a vehicle is given first
to the lessee, then to the related dealer, and finally to Ford Credit.)

Based on results for the leases included in the preceding table,
during the period 1991 to 1995 a total of 344,895 leased vehicles with a
residual exposure (the sum of the residual values of vehicles under leases
which terminated in such period) of $3.8 billion experienced aggregate residual
losses of $102.6 million. For all such leased vehicles with 24- and 36-month
leases which terminated between 1991 and 1995, annual aggregate Residual Losses
as a percent of residual exposure ranged from 0.9% to 4.0%, with a cumulative
average of 2.2%.

ELIGIBILITY CRITERIA

The Series 1996-1 Leases and related Series 1996-1 Leased Vehicles
were purchased by Ford Credit as Administrative Agent on behalf of FCTT, in the
ordinary course of business in accordance with the origination procedures set
forth above. The Series 1996-1 Leases were selected from the Leases in FCTT's
portfolio by several criteria (the "Specific Eligibility Criteria"), including
the following: each related Series 1996-1 Leased Vehicle was an automobile or
light truck which prior to the inception of the related Series 1996-1 Lease had
never been titled, and each Series 1996-1 Lease (a) was entered into by a
Dealer located in and an Obligor with a billing address in Arizona, Arkansas,
California, Colorado, Kansas, Minnesota, Nebraska, Nevada, New Mexico, New
York, North Dakota, Pennsylvania, South Dakota, Virginia or Washington; (b)
provides for Constant Yield Payments that fully amortize the Balance Subject to
Lease Charges of such Series 1996-1 Lease to a final payment equal to the
Residual Value of the related Series 1996-1 Leased Vehicle over the term of
such Series 1996-1 Lease; (c) was not more than 30 days past due as of the
Series 1996-1 Cut-Off Date and has never been extended; (d) was originated on
or after _____ __, 199_; (e) has a Scheduled Lease End Date not later than 36
months from the date it was entered into; (f) has a Retail Operating Lease
Factor equal to or greater than __%; (g) was not originated under the Advance
Payment Plan; (h) is not subject to a holdback of Excess Deferred Gross; and
(i) does not provide for recourse to the related Dealer. (Series 1996-1
Supplement, Section [3.1]; Asset Contribution Agreement, Section [3.2]). The
Series 1996-1 Leases were selected from FCTT's portfolio of Leases that were
Non-Specified Assets, in each case meeting the Specific Eligibility Criteria
set forth herein and the General Eligibility Criteria set forth in "Additional
Document Provisions -- Representations, Warranties and Covenants." No
selection procedures believed to be adverse to the Senior Noteholders were
utilized in selecting the Series 1996-1 Leases from qualifying Leases.

CHARACTERISTICS OF THE SERIES 1996-1 ASSETS

The following table provides data with respect to the composition of
the Series 1996-1 Assets.

COMPOSITION OF THE SERIES 1996-1 ASSETS

35
<PAGE> 37

<TABLE>
<S> <C>
Initial Pool Balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Number of Series 1996-1 Leases . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average Adjusted Balance Subject to Lease Charges
as of Series 1996-1 Cut-Off Date . . . . . . . . . . . . . . . . . . . . . . . . . $
Average Balance Subject to Lease Charges . . . . . . . . . . . . . . . . . . . . . . $
Weighted Average Original Lease Term(1) . . . . . . . . . . . . . . . . . . . . . . . months
Weighted Average Remaining Lease Term(1) . . . . . . . . . . . . . . . . . . . . . . months
Average Retail Operating Lease Factor(2) . . . . . . . . . . . . . . . . . . . . . . %
Aggregate Residual Value as a Percent of Aggregate MSRP . . . . . . . . . . . . . . . %
Residual Value as a Percent of the Initial Pool Balance . . . . . . . . . . . . . . . %
</TABLE>
- --------------
(1) Weighted by Adjusted Balance Subject to Lease Charges as of the Series
1996-1 Cut-Off Date.
(2) Excluding a fixed additional fee (the "Additional Fee") included in
the determination of the amount of the Monthly Payment (generally
0.11% of the Balance Subject to Lease Charges per month). Including
such fee would have the effect of increasing the yield of Se- ries
1996-1 Assets.

The following tables set forth the distribution of the Series 1996-1
Assets by geographic location, Retail Operating Lease Factor, Lease Term and
vehicle type. Percentages may not total 100% due to rounding.

DISTRIBUTION OF THE SERIES 1996-1 ASSETS BY GEOGRAPHIC LOCATION

<TABLE>
<CAPTION>
AGGREGATE ADJUSTED
BALANCE SUBJECT
TO LEASE CHARGES PERCENTAGE OF
NUMBER OF AS OF SERIES 1996-1 INITIAL
LEASES CUT-OFF DATE POOL BALANCE
------ ------------ ------------
<S> <C> <C> <C>
Arizona . . . . . . . . . . . . . . . . $ %
Arkansas . . . . . . . . . . . . . . . .
California . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . .
Kansas . . . . . . . . . . . . . . . .
Minnesota . . . . . . . . . . . . . . . .
Nebraska . . . . . . . . . . . . . . . .
Nevada . . . . . . . . . . . . . . . .
New Mexico . . . . . . . . . . . . . . .
New York . . . . . . . . . . . . . . . .
North Dakota . . . . . . . . . . . . . .
Pennsylvania . . . . . . . . . . . . . .
South Dakota . . . . . . . . . . . . . .
Virginia . . . . . . . . . . . . . . . .
Washington . . . . . . . . . . . . . . .
------ ----------- ------
Total . . . . . . . . . . . . . $ %
====== =========== ======
</TABLE>

36
<PAGE> 38

DISTRIBUTION OF THE SERIES 1996-1 ASSETS BY RETAIL OPERATING LEASE FACTOR

<TABLE>
<CAPTION>
AGGREGATE ADJUSTED
BALANCE SUBJECT
TO LEASE CHARGES PERCENTAGE OF
NUMBER OF AS OF SERIES 1996-1 INITIAL
LEASES CUT-OFF DATE POOL BALANCE
------ ------------ ------------
<S> <C> <C> <C>
1.50% to 2.00% . . . . . . . . . . . . $ %
2.01 to 2.50 . . . . . . . . . . . .
2.51 to 3.00 . . . . . . . . . . . .
3.01 to 3.50 . . . . . . . . . . . .
3.51 to 4.00 . . . . . . . . . . . .
4.01 to 4.50 . . . . . . . . . . . .
4.51 to 5.00 . . . . . . . . . . . .
5.01 to 5.50 . . . . . . . . . . . .
5.51 to 6.00 . . . . . . . . . . . .
6.01 to 6.50 . . . . . . . . . . . .
6.51 to 7.00 . . . . . . . . . . . .
7.01 to 7.50 . . . . . . . . . . . .
7.51 to 8.00 . . . . . . . . . . . .
8.01 to 8.50 . . . . . . . . . . . .
8.51 to 9.00 . . . . . . . . . . . .
9.01 to 9.50 . . . . . . . . . . . .
9.51 to 10.00 . . . . . . . . . . . .
10.01 to 10.50 . . . . . . . . . . . .
10.51 to 11.00 . . . . . . . . . . . .
11.01 to 11.50 . . . . . . . . . . . .
11.51 to 12.00 . . . . . . . . . . . .
12.01 to 12.50 . . . . . . . . . . . .
12.51 to 13.00 . . . . . . . . . . . .
13.01 and above . . . . . . . . . . . .
------ ---------- ------
Total . . . . . . . . . . . . . $ %
====== ========== ======

DISTRIBUTION OF THE SERIES 1996-1 ASSETS BY LEASE TERM

<CAPTION>
AGGREGATE ADJUSTED
BALANCE SUBJECT
TO LEASE CHARGES PERCENTAGE OF
NUMBER OF AS OF SERIES 1996-1 INITIAL
LEASES CUT-OFF DATE POOL BALANCE
------ ------------ ------------
<S> <C> <C> <C>
24 Months . . . . . . . . . . . . . . . . $ %
36 Months . . . . . . . . . . . . . . . .
------ ----------- ------
Total . . . . . . . . . . . . . $ %
====== =========== ======

DISTRIBUTION OF THE SERIES 1996-1 ASSETS BY VEHICLE TYPE

<CAPTION>
AGGREGATE ADJUSTED
BALANCE SUBJECT
TO LEASE CHARGES PERCENTAGE OF
NUMBER OF AS OF SERIES 1996-1 INITIAL
LEASES CUT-OFF DATE POOL BALANCE
------ ------------ ------------
<S> <C> <C> <C>

</TABLE>

37
<PAGE> 39

<TABLE>
<S> <C> <C>
Ford Automobile . . . . . . . . . . . . . $ %
Ford Light Truck . . . . . . . . . . . .
Lincoln-Mercury . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . .
------ ----------- ------
Total . . . . . . . . . . . . . $ %
====== =========== ======
</TABLE>

The following table depicts the projected cash flows of the Series
1996-1 Certificates assuming no prepayments and no defaults.

SERIES 1996-1 LEASES PROJECTED AMORTIZATION, ASSUMING NO PREPAYMENTS AND NO
DEFAULTS

<TABLE>
<CAPTION>
ADJUSTED BALANCE PRINCIPAL PORTION NON-PRINCIPAL WEIGHTED
SUBJECT TO MONTHLY OF MONTHLY PORTION OF AVERAGE
MONTHS LEASE CHARGES PAYMENTS(1) PAYMENT MONTHLY PAYMENT YIELD(2)
------ ------------- ----------- ------- --------------- --------
<S> <C> <C> <C> <C> <C>
1 . . . . . . . . $ $ $ $ %
2 . . . . . . . .
3 . . . . . . . .
4 . . . . . . . .
5 . . . . . . . .
6 . . . . . . . .
7 . . . . . . . .
8 . . . . . . . .
9 . . . . . . . .
10 . . . . . . . .
11 . . . . . . . .
12 . . . . . . . .
13 . . . . . . . .
14 . . . . . . . .
15 . . . . . . . .
16 . . . . . . . .
17 . . . . . . . .
18 . . . . . . . .
19 . . . . . . . .
20 . . . . . . . .
21 . . . . . . . .
22 . . . . . . . .
23 . . . . . . . .
24 . . . . . . . .
25 . . . . . . . .
26 . . . . . . . .
27 . . . . . . . .
28 . . . . . . . .
29 . . . . . . . .
30 . . . . . . . .
31 . . . . . . . .
32 . . . . . . . .
33 . . . . . . . .
34 . . . . . . . .
35 . . . . . . . .
36 . . . . . . . .
</TABLE>

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

38
<PAGE> 40

(1) Includes the Additional Fee.
(2) Weighted Average Yield is computed by dividing the amount shown as the
Non-Principal Portion of Monthly Payment for the related month by the Adjusted
Balance Subject to Lease Charges for such month and multiplying the result by
twelve.

MATURITY, PREPAYMENT AND YIELD CONSIDERATIONS

The rate of payment of principal and the yield to maturity on each
Class of Senior Notes generally will be directly related to the rate at which
payments on the Series 1996-1 Leases and in respect of the Series 1996-1 Leased
Vehicles are received. To the extent that Obligors make Total Monthly Payments
when due (or the Administrative Agent makes Monthly Payment Advances) and the
Residual Values of Series 1996-1 Leased Vehicles are not realized until their
respective Scheduled Lease End Dates, the minimum rate of payment of principal
to Senior Noteholders can be determined with certainty (such minimum rate of
payment of principal is reflected in the data in the column headed "0% ABS" in
the Percentage of Senior Note Balance Outstanding table shown below). However,
the rate of payment of principal on the Senior Notes will be shifted forward to
the prepayment date to the extent that any Series 1996-1 Lease is prepaid in
full, whether due to the receipt of Voluntary Early Termination Proceeds,
Administrative Purchase Amounts or Liquidation Proceeds. Partial prepayments
will be treated as Payaheads and will not increase the rate of payment of
principal of the Senior Notes because such payments will be held and paid out
to Senior Noteholders as principal only when required to meet a shortfall in a
subsequent payment from the related Obligor.

Additionally, an investor's expected yield will be affected by (i) the
price the investor paid for the Senior Notes, (ii) the rate of prepayments of
the Series 1996-1 Leases and (iii) the investor's assumed reinvestment rate.
For example, if prepayments on the Series 1996-1 Leases are slower than
anticipated, the investor's yield will be lower if interest rates are higher
than the investor anticipated and higher if interest rates are lower than the
investor anticipated. Conversely, if prepayments on the Series 1996-1 Leases
are faster than anticipated, the investor's yield will be higher if interest
rates are higher than the investor anticipated and lower if interest rates are
lower than the investor anticipated.

Because Residual Value is a large component of the Adjusted Balance
Subject to Lease Charges, the timing of the cashflows generated by the Series
1996-1 Assets will be heavily weighted toward the Scheduled Lease End Dates
when the Residual Values of the Series 1996-1 Leased Vehicles are expected to
be realized. The rate of payment of principal on the Senior Notes increases
substantially in ____199_ as a result of Series 1996-1 Leases beginning to
reach their Scheduled Lease End Dates in the related Accrual Period. In
general, prepayments of Series 1996-1 Leases in full will have the effect of
shortening the weighted average life of the Senior Notes (the average amount of
time during which each dollar of the principal balance of Senior Notes is
outstanding). Additionally, holders of the Class A-2 Senior Notes will not
receive any principal payments until the Class A-1 Senior Notes have been paid
in full, unless an Event of Default under the Indenture has occurred and the
maturity of the Senior Notes has been accelerated, in which case principal will
be paid pro rata to the holders of the Class A-1 Senior Notes and Class A-2
Senior Notes without distinction between Classes. As the rate of payment of
principal on each Class of Senior Notes depends primarily on the rate of
payment (including prepayments) of the Series 1996-1 Leases, final payment on
each Class of Senior Notes could occur significantly earlier than the
respective Stated Maturities. If there are prepayments in full of Series
1996-1 Leases which cause principal of the Senior Notes to be paid earlier than
projected, Senior Noteholders will bear the risk of being able to reinvest
principal payments of the Senior Notes at yields at least equal to the yield on
their respective Class of Senior Notes.

A prepayment of a Series 1996-1 Lease in full may be in the form of
Voluntary Early Termination Proceeds resulting from a Voluntary Early
Termination of such Series 1996-1 Lease, Liquidation Proceeds following a
bankruptcy of or default by the Obligor, or Administrative Purchase

39
<PAGE> 41

Amounts following the occurrence of certain events set forth in "Description of
the Administrative Agency Agreement -- Administrative Purchases." The rate of
prepayments on the Series 1996-1 Leases may be influenced by a variety of
economic, social and other factors including competing consumer finance
products and the conditions in the used car market. For 24-month leases
originated between ____ and ____, Ford Credit believes approximately __% of the
leases prepaid in full before their respective scheduled lease end dates. For
36-month leases originated between ____ and ____, Ford Credit believes
approximately __% of the leases prepaid in full before their respective
scheduled lease end dates.

Additionally, the rate of payment of principal of each Class of Senior
Notes will be increased by the application to pay principal of the Senior Notes
(after payment of interest) of the portion, if any, of Total Available Funds
not used to reduce the Pool Balance or to pay certain fees and other amounts in
any given month. To the extent Series 1996-1 Leases which have higher Retail
Operating Lease Factors are prepaid faster than others, the amount of such
additional portion of the Total Available Funds available to pay principal of
the Senior Notes will be reduced. See "Description of the Senior Notes --
The Indenture Cash Flows."

The Percentage of Senior Note Balance Outstanding table shown below
was prepared on the basis of certain assumptions, including that (i) all
Collections and Sale Proceeds are timely received, and that no Series 1996-1
Lease is ever delinquent, (ii) none of the Series 1996-1 Leases is repurchased
by the Administrative Agent, (iii) there are no Series 1996-1 Credit Losses or
Series 1996-1 Residual Losses, (iv) the Administrative Agent does not exercise
its option to redeem the Series 1996-1 Certificates as described herein, (v)
distribution of principal and interest on the Senior Notes is made on _______
15, _______ 15, _______ 15 and _______ 15 of each year starting on ________ 15,
199_, (vi) the Administrative Agent Fee is 1.00% per annum, (vii) all
prepayments are prepayments in full and (viii) the Cash Collateral Account is
funded in an amount equal to the Initial Cash Collateral Deposit and the
Required Cash Collateral Amount decreases in accordance with the formulas
described herein.

PERCENTAGE OF SENIOR NOTE BALANCE OUTSTANDING

<TABLE>
<CAPTION>
PREPAYMENT SPEEDS(1)
--------------------------------------------------------------------------------------------------
CLASS A-1 SENIOR NOTES CLASS A-2 SENIOR NOTES
----------------------------------------------- ------------------------------------------------
PAYMENT DATE 0.0% 0.3% 0.5% 0.8% 1.0% 0.0% 0.3% 0.5% 0.8% 1.0%
------------ ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Initial . . . . . . . . 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
__/15/__ . . . . . . . .
Weighted Average Life
(years)(2) . . . . . .
</TABLE>
- --------------
(1) Prepayment speeds are expressed in terms of percentages of ABS. As
used herein, "ABS" refers to a prepayment model which assumes a
constant percentage of the original number of leases in a pool prepay
each month. ABS does not purport to be either an historical
description of the prepayment experience of any pool of leases or a
prediction of the anticipated rate of prepayment of any pool of
leases, including the Series 1996-1 Leases.
(2) The weighted average life of each Class of Senior Notes is determined
by (i) multiplying the amount of each distribution in reduction of
principal balance by the number of years from the date of the issuance
of the Senior Notes to the related Payment Date, (ii) adding the
results and (iii) dividing the sum by the aggregate distributions in
reduction of principal balance referred to in clause (i).

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<PAGE> 42

POOL FACTORS AND TRADING INFORMATION

The Note Pool Factor for each Class of Senior Notes will be a seven
digit decimal which the Administrative Agent will compute prior to each Payment
Date. The "Note Pool Factor" with respect to each Class of Senior Notes as of
any applicable Payment Date represents the remaining outstanding principal
balance of such Class of Senior Notes as of the applicable Payment Date (after
giving effect to payments made on such Payment Date), expressed as a fraction
of the initial outstanding principal balance of such Class of Senior Notes.
Each Note Pool Factor will initially be 1.0000000 and thereafter will decline
to reflect reductions in the outstanding principal balance of the applicable
Class of Senior Notes. A Senior Noteholder's portion of the principal balance
of the related Class of Senior Notes is the product of (i) the original
denomination of such Senior Noteholder's Senior Note and (ii) the applicable
Note Pool Factor.

The Senior Noteholders will receive reports on or about each Payment
Date for the Accrual Period immediately preceding such Payment Date containing
information regarding: (i) payments received on Series 1996-1 Assets, (ii) the
Pool Balance, (iii) the Note Pool Factor of each Class of Senior Notes (as of
such Payment Date after giving effect to payments made on such Payment Date)
and (iv) various other information. See "Description of the Senior Notes --
Statements to Senior Noteholders" for a description of the additional
information provided to Senior Noteholders on each Payment Date. In addition,
Senior Noteholders of record during any calendar year will be furnished
information for tax reporting purposes not later than the latest date permitted
by law.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SOURCES OF CAPITAL AND LIQUIDITY

The Issuer's primary sources of capital will be (i) the net proceeds
of the Senior Notes offered hereby, (ii) the net proceeds of the Lease Trust
Certificates sold to third party investors and (iii) the Subordinated Notes and
$__________________ of Lease Trust Certificates issued to the Transferor See
"The Issuer -- Capitalization of the Issuer."

The Issuer's primary sources of liquidity will be payments on the
Series 1996-1 Certificates received either directly by the Issuer or indirectly
pursuant to payments under the Program Operating Lease (including amounts
available from the Cash Collateral Account).

RESULTS OF OPERATIONS

The Issuer is newly formed and, accordingly, has no results of
operations as of the date of this Prospectus. Because the Issuer does not have
any operating history, there has not been included in this Prospectus any
historical or pro forma ratio of earnings to fixed charges. The payments
received under the Program Operating Lease and payments on other assets owned
by the Issuer and the interest costs of the Senior Notes, the Subordinated
Notes and the Lease Trust Certificates will determine the Issuer's results of
operations in the future. The income generated from the Issuer's assets will
be used to pay interest on and principal of the Senior Notes and the
Subordinated Notes, related costs and expenses of the Issuer (to the extent not
included in items payable by the Administrative Agent pursuant to the
Administrative Agency Agreement), and distributions to the holders of the Lease
Trust Certificates. The principal periodic expense of the Issuer is expected
to be, but is not limited to, the Administrative Agent Fee.

DESCRIPTION OF THE SENIOR NOTES

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<PAGE> 43

GENERAL

The Senior Notes will be issued pursuant to the terms of the
Indenture. A copy of the Indenture will be filed with the Commission following
the issuance of the Senior Notes. The following description summarizes the
material terms of the Senior Notes and the Indenture. The summary does not
purport to be complete and is qualified in its entirety by reference to the
provisions of the Senior Notes, the Indenture and the other Basic Documents.

The Senior Notes will be issued in denominations of $1,000 and
integral multiples thereof in book-entry form through the facilities of DTC.
(Indenture, Sections [2.2] and [2.10]). Each Class of Senior Notes will
initially be represented by one or more Senior Notes, in each case registered
in the name of Cede, the nominee of DTC. Accordingly, Cede is expected to be
the holder of record of the Senior Notes of each Class. Unless and until
Definitive Senior Notes are issued under the limited circumstances described
herein, no beneficial owner of a Senior Note (each, a "Senior Note Owner") will
be entitled to receive a physical certificate representing such owner's Senior
Note, except as set forth in "-- Definitive Senior Notes." Unless and until
the Senior Notes are issued in fully registered, certificated form ("Definitive
Senior Notes") under the limited circumstances described in "-- Definitive
Senior Notes," all references herein to distributions, notices, reports and
statements to Senior Noteholders will refer to the same actions made with
respect to DTC or Cede, as the case may be, for the benefit of Senior Note
Owners in accordance with DTC procedures. (Indenture, Sections [2.10] and
[2.12]).

BOOK-ENTRY REGISTRATION

DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the UCC in effect in the State of New York
and a "clearing agency" registered pursuant to the provisions of Section 17A of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). DTC
holds securities for its participating members (the "Participants") and
facilitates the clearance and settlement of securities transactions between
Participants through electronic book-entry changes in accounts of its
Participants, thereby eliminating the need for physical movement of
certificates. Participants include securities brokers and dealers (including
the Underwriters), banks, trust companies and clearing corporations. Indirect
access to the DTC system also is available to banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly (the "Indirect Participants"). The
rules applicable to DTC and its Participants are on file with the Commission.

Senior Note Owners that are not Participants or Indirect Participants
but that desire to purchase, sell or otherwise transfer ownership of or an
interest in the Senior Notes may do so only through Participants or Indirect
Participants. Participants receive a credit for the Senior Notes in DTC's
records. The ownership interest of each Senior Note Owner is in turn recorded
on the Participants' and Indirect Participants' respective records. Senior
Note Owners will not receive written confirmation from DTC of their purchase,
but Senior Note Owners are expected to receive written confirmations providing
details of the transaction, as well as periodic statements of their holdings,
from the Participant or Indirect Participant through which the Senior Note
Owner entered into the transaction. Transfers of ownership interests in the
Senior Notes will be accomplished by entries made on the books of Participants
acting on behalf of Senior Note Owners.

To facilitate subsequent transfers, all Senior Notes deposited by
Participants with DTC will be registered in the name of Cede, as nominee of
DTC. The deposit of Senior Notes with DTC and their registration in the name
of Cede will effect no change in beneficial ownership. DTC has no knowledge of
the actual Senior Note Owners and its records reflect only the identity of the
Participants to whose accounts such Senior Notes are credited, which may or may
not be the Senior Note Owners.

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<PAGE> 44

Participants and Indirect Participants will remain responsible for keeping
account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Participants,
by Participants to Indirect Participants and by Participants and Indirect
Participants to Senior Note Owners will be governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in effect from
time to time.

DTC's practice is to credit Participants' accounts on each Payment
Date in accordance with their respective holdings shown on DTC's records unless
DTC has reason to believe that it will not receive payment on such Payment
Date. Payments by Participants and Indirect Participants to Senior Note Owners
will be governed by standing instructions and customary practices, as in the
case with securities held for the accounts of customers in bearer form or
registered in "street name", and will be the responsibility of such Participant
and not of DTC, the Indenture Trustee, the Lease Trustee, the RCL Trustee, the
Administrative Agent, the Transferor or the Issuer, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
principal of and interest on the Senior Notes to DTC will be the responsibility
of the Indenture Trustee, disbursement of such payments to Participants will be
the responsibility of DTC and disbursement of such payments to Senior Note
Owners will be the responsibility of Participants and Indirect Participants.
As a result, under the book-entry format, Senior Note Owners may experience
some delay in their receipt of payments.

Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain banks, the ability of a Senior Note
Owner to pledge Senior Notes to persons or entities that do not participate in
the DTC system, or otherwise take actions with respect to such Senior Notes,
may be limited due to the lack of a physical certificate for such Senior Notes.

Neither DTC nor Cede will consent or vote with respect to the Senior
Notes. Under its usual procedures, DTC mails an "Omnibus Proxy" to the
Indenture Trustee as soon as possible after any applicable record date for such
a consent or vote. The Omnibus Proxy assigns Cede's consenting or voting
rights to those Participants to whose accounts the Senior Notes are credited on
that record date (identified in a listing attached to the Omnibus Proxy).

Neither the Indenture Trustee, the Lease Trustee, the RCL Trustee, the
Administrative Agent, the Transferor or the Issuer will have any liability for
any aspect of the records relating to or payments made on account of beneficial
ownership interests of the Senior Notes held by Cede, as nominee of DTC, or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.

DEFINITIVE SENIOR NOTES

Definitive Senior Notes will be issued to Senior Note Owners rather
than to DTC only if (i) DTC is no longer willing or able to discharge its
responsibilities with respect to the Senior Notes and the Administrative Agent
is not able to locate a qualified successor, (ii) the Administrative Agent, at
its option, elects to terminate book-entry registration through DTC or (iii)
after an Event of Default, Senior Note Owners representing not less than a
majority of the aggregate principal balance of the Senior Notes advise the
Indenture Trustee through DTC or its successor in writing that the continuation
of book-entry registration through DTC or its successor is no longer in the
best interest of Senior Note Owners. (Indenture, Section [2.12]).

Upon the occurrence of any of the events described in the immediately
preceding paragraph, DTC will notify all Senior Note Owners, through
Participants, of the availability through DTC of Definitive Senior Notes. Upon
surrender by DTC of the notes representing the Senior Notes and the

43
<PAGE> 45

receipt of instructions for re-registration, the Indenture Trustee will issue
Definitive Senior Notes to Senior Note Owners, who thereupon will become Senior
Noteholders for all purposes of the Indenture. (Indenture, Section [2.12]).

Payments on the Senior Notes will thereafter be made by the Indenture
Trustee directly to Senior Noteholders in accordance with the procedures set
forth herein and in the Indenture. Interest payments and any principal
payments on the Definitive Senior Notes on each Payment Date will be made to
holders in whose names the Definitive Senior Notes were registered at the close
of business on the Record Date with respect to such Payment Date. Payments
will be made by check mailed to the address of such holders as they appear on
the Senior Note Register or, under certain circumstances as provided in the
Indenture, by wire transfer to a bank or depository institution located in the
United States and having appropriate facilities therefor. (Indenture, Section
[2.7]). The final payment on any Senior Notes (whether Definitive Senior Notes
or global notes registered in the name of Cede representing the Senior Notes),
however, will be made only upon presentation and surrender of such Definitive
Senior Notes or global notes at the office or agency specified in the notice of
final distribution to Senior Noteholders. (Indenture, Section [2.7]).

Definitive Senior Notes will be transferable and exchangeable at the
offices of the Indenture Trustee or the Senior Note Registrar to be set forth
in the Indenture. No service charge will be imposed for any registration of
transfer or exchange, but the Indenture Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith. (Indenture, Section [2.4]).

INTEREST

Interest on the principal balance of the Class A-1 Senior Notes will
accrue at the rate of ____% per annum and interest on the principal balance of
the Class A-2 Senior Notes will accrue at the rate of ____% per annum.
(Indenture, Section [2.1]). Interest on the Senior Notes will be payable to
the Senior Noteholders quarterly on each Payment Date to Senior Noteholders of
record on the Record Date preceding such Payment Date. Interest on the
principal balance of the Senior Notes will accrue at the applicable interest
rate either from and including the Closing Date (in the case of the first
Payment Date) or from and including the fifteenth day of the third calendar
month preceding the calendar month in which such Payment Date occurs, to but
excluding the fifteenth day of the calendar month in which such Payment Date
occurs. Interest accrued but not paid as of any Payment Date will be due on
the next Payment Date together with interest on such overdue amount (to the
extent lawful) at a rate per annum equal to the interest rate for the
applicable Class. (Indenture, Section [2.7]). Interest will be calculated on
the basis of a 360-day year consisting of twelve 30-day months. (Indenture,
Section [1.1]). Interest payments on the Senior Notes will be made from the
Total Available Funds as described in "-- The Indenture Cash Flows." If on
any Payment Date occurring in the months of ____ and ____, a shortfall exists
between (i) the Total Available Funds and (ii) the sum of the Administrative
Agent Fee and interest due on the Senior Notes on such Payment Date, amounts
deposited in the Certificate Distribution Account in respect of accrued
interest on the Lease Trust Certificates on the preceding Payment Date will be
withdrawn from the Certificate Distribution Account to the extent necessary to
pay such shortfall.

Interest payments to all Classes of Senior Noteholders will have the
same priority. If the amount of interest on the principal balance of the Class
A-1 Senior Notes and on the principal balance of the Class A-2 Senior Notes
exceeds the Total Available Funds with respect to such Payment Date (after
giving effect to payment of the Administrative Agent Fee), each Senior
Noteholder will receive its pro rata share (based on the total amount of
interest due to all Senior Noteholders) of the amount available to be
distributed in respect of interest on the aggregate principal balance of the
Senior Notes.

PRINCIPAL

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<PAGE> 46

Principal payments will be made to the Senior Noteholders sequentially
on each Payment Date in an amount equal to the Total Available Funds with
respect to such Payment Date after giving effect to the payment to the
Administrative Agent of the Administrative Agent Fee with respect to such
Payment Date, the payment of interest to Senior Noteholders, the deposit of
interest due on the Subordinated Notes into the Cash Collateral Account and the
deposit of accrued interest on the Lease Trust Certificates into the
Certificate Distribution Account for payment to Lease Trust Certificateholders
when due. No principal payments will be made to the Class A-2 Senior
Noteholders until the principal balance of the Class A-1 Senior Notes has been
reduced to zero (Indenture, Section [8.4]); provided that if an Event of
Default under the Indenture has occurred and the maturity of the Senior Notes
has been accelerated, principal payments will be made to the holders of the
Class A-1 Senior Notes and the Class A-2 Senior Notes on a pro rata basis based
on their respective principal balances without any distinction between Classes
(Indenture, Section [5.4]). Payments of principal with respect to the
Subordinated Notes and the Lease Trust Certificates will not be made until the
aggregate principal balance of the Senior Notes has been reduced to zero. See
"-- The Indenture Cash Flows" and "-- The Accounts -- The Cash Collateral
Account."

OPTIONAL REDEMPTION

If the Administrative Agent exercises its option to purchase the
Series 1996-1 Certificates on any Payment Date on which the Pool Balance has
declined to less than 10% of the Initial Pool Balance, the Senior Notes will be
redeemed on such date in whole, but not in part, for the Redemption Price. The
Administrative Agent or the Lease Trustee will provide at least 45 days' prior
notice of the redemption of the Senior Notes to the Indenture Trustee (who will
provide at least 30 days' notice to the Senior Noteholders). On such Payment
Date the aggregate principal balance of the Senior Notes will be due and
payable at the Redemption Price and unless all the Senior Notes are not
redeemed on such Payment Date no interest will accrue on the Senior Notes after
such Payment Date. (Indenture, Section [10.1]; Series 1996-1 Supplement,
Section [7.1]).

Because the initial principal balance of the Subordinated Notes and
the Lease Trust Certificates exceeds 10% of the Initial Pool Balance, absent
substantial shortfalls in amounts available from the Series 1996-1
Certificates, it is likely that the Senior Notes will have been paid in full on
or before the Payment Date on which the Administrative Agent is permitted to
exercise its option to purchase the Series 1996-1 Certificates. See "The
Issuer -- Capitalization of the Issuer."

THE INDENTURE TRUSTEE

The Chase Manhattan Bank is the Indenture Trustee under the Indenture.
The Indenture Trustee is a New York corporation and its corporate trust offices
are located at 450 West 33rd Street, New York, New York 10001. The fees and
expenses of the Indenture Trustee will be paid by the Administrative Agent,
acting on behalf of the Issuer. The Transferor, Ford Credit and their
respective affiliates may maintain normal commercial banking relationships with
the Indenture Trustee and its affiliates.

THE ACCOUNTS

The Collection Account. The Collection Account will be established at
an Eligible Institution in the name of the Indenture Trustee. Amounts
deposited therein will be invested in Permitted Investments, upon instructions
from Ford Credit and Ford Credit Leasing, with a maturity no later than the
business day preceding the next Payment Date. Income (or losses, if any) on
such investments, if any, will be credited (or charged) to the Collection
Account and will be available to make payments on the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates. (Series 1996-1
Supplement, Section [5.1]). The Collection Account will initially be
established with the Indenture

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<PAGE> 47

Trustee. If the Indenture Trustee ceases to be an Eligible Institution, the
Collection Account will be moved to an Eligible Institution. (Series 1996-1
Supplement, Section [5.1]).

The Payahead Account. The Payahead Account will be established at an
Eligible Institution in the name of the Indenture Trustee. Payaheads deposited
therein will be invested in Permitted Investments, upon instructions from Ford
Credit and Ford Credit Leasing, with a maturity no later than the business day
preceding the next Payment Date. Income (or losses, if any) on such
investments, if any, will be distributed to the beneficiaries of the Transferor
(or, in the case of losses, deducted from distributions to such beneficiaries).
The Payahead Account will be initially established with the Indenture Trustee.
If the Indenture Trustee ceases to be an Eligible Institution, the Payahead
Account will be moved to an Eligible Institution. The Administrative Agent is
required to deposit Payaheads in the Payahead Account only if it has failed to
meet a Monthly Remittance Condition. Payahead Credits will be applied by the
Administrative Agent on each Distribution Date if any Monthly Payment with
respect to a Series 1996-1 Lease has not been paid in the related Collection
Period. (Series 1996-1 Supplement, Section [5.1]).

The Payment Account. The Payment Account will be an Eligible Account
established in the name of the Indenture Trustee in trust for the benefit of
the Senior Noteholders, the Subordinated Noteholders and the Lease Trust
Certificateholders. Amounts deposited therein may be invested in Permitted
Investments, upon instructions from the Indenture Trustee, with a maturity no
later than the next Payment Date. Income (or losses, if any) on such
investments, if any, will be credited (or charged) to the Administrative Agent.
(Indenture, Sections [8.1] and [8.5]). The Payment Account will be initially
established with the Indenture Trustee. If the Payment Account may no longer
be maintained at the Indenture Trustee as an Eligible Account, the Payment
Account will be moved to another institution and established as an Eligible
Account. (Indenture, Section [8.2]).

The Cash Collateral Account. The Cash Collateral Account will be an
account established at an Eligible Institution in the name of the Indenture
Trustee. Amounts deposited therein will be invested in Cash Collateral Account
Investments. Income (or losses, if any) on such investments, if any, will be
distributed to the beneficiaries of the Transferor (or, in the case of losses,
deducted from distributions to such beneficiaries), subject to the assignment
to Ford Credit Leasing. The Cash Collateral Account will be initially
established with the Indenture Trustee. If the Indenture Trustee ceases to be
an Eligible Institution, the Cash Collateral Account will be moved to an
Eligible Institution. (Program Operating Lease, Section [3.5]). The Cash
Collateral Account is established to secure the Transferor's obligations under
the Program Operating Lease, and on each Payment Date amounts on deposit
therein are available to pay the Program Operating Lease Payments required to
be made by the Transferor under the Program Operating Lease. See "---- Cash
Collateral Account Withdrawals and Deposits" for a description of the amounts
to be deposited to and withdrawn from the Cash Collateral Account.

The Certificate Distribution Account. The Certificate Distribution
Account will be an Eligible Account established in the name of the Indenture
Trustee in trust for the benefit of the Senior Noteholders, the Subordinated
Noteholders and the Lease Trust Certificateholders. The Certificate
Distribution Account will initially be established with the Indenture Trustee.
If the Certificate Distribution Account may no longer be maintained at the
Indenture Trustee as an Eligible Account, the Certificate Distribution Account
will be moved to another institution and established as an Eligible Account.
(Lease Trust Agreement, Section [5.1]). Amounts deposited in the Certificate
Distribution Account pursuant to the terms of the Indenture will be available
for distribution to Lease Trust Certificateholders semiannually on the Payment
Dates occurring in the months of ____ and ____ in accordance with the terms of
the Lease Trust Agreement; provided, however, that amounts deposited in the
Certificate Distribution Account on the Payment Dates occurring in the months
of ____ and ____ in respect of accrued interest on the Lease Trust Certificates
will be withdrawn on the following Payment Date to the extent necessary to pay
any shortfall between (i) the Total Available Funds and

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<PAGE> 48

(ii) the sum of the Administrative Agent Fee and interest due to Senior
Noteholders on such Payment Date. See "Description of the Senior Notes----The
Indenture Cash Flows."

THE INDENTURE CASH FLOWS

Monthly or Daily Deposits to Collection Account. On each Distribution
Date (or on the business day preceding such Distribution Date, if such
Distribution Date is a Payment Date), or on each business day if each Monthly
Remittance Condition has not been satisfied, the Administrative Agent will
deposit all Collections with respect to Series 1996-1 Assets into the
Collection Account. (Series 1996-1 Supplement, Section [5.2]).

"Collections" means with respect to Series 1996-1 Assets and any
Collection Period, all of the following amounts received by the
Administrative Agent in such Collection Period: (i) all Monthly
Payments and Payahead Credits; (ii) all Administrative Purchase
Amounts; (iii) all Monthly Scheduled Termination Sale Proceeds; (iv)
all Voluntary Early Termination Proceeds; (v) all Liquidation
Proceeds; and (vi) all Recoveries.

"Monthly Payment" means with respect to any Lease, the amount payable
monthly by the Obligor equal to the Constant Yield Payment and the
Additional Fee and certain other fees and charges for such month.

"Payahead Credits" means with respect to any Series 1996-1 Lease the
amount of a Payahead with respect to an Obligor either paid by the
Administrative Agent (if each Monthly Remittance Condition is
satisfied) or withdrawn from the Payahead Account, and applied against
the Monthly Payment due in such Collection Period with respect to such
Lease.

"Administrative Purchase Amount" means with respect to any Lease as of
the end of a Collection Period as to which a breach of certain
representations, warranties or covenants has occurred (including those
resulting from a Term Extension, Payment Extensions in excess of, in
the aggregate, three months or the relocation of a Leased Vehicle),
the Adjusted Balance Subject to Lease Charges as of such date plus any
overdue Monthly Payments which have not been paid by the Obligor.

"Monthly Scheduled Termination Sale Proceeds" means with respect to a
Collection Period, all Sale Proceeds received by the Administrative
Agent in such Collection Period for Series 1996-1 Leased Vehicles
which were sold on or after the termination of the related Series
1996-1 Leases at their respective Scheduled Lease End Dates (increased
by amounts collected in connection with Excess Wear and Tear and
Excess Mileage and reduced by amounts required to be remitted to the
related Obligors under applicable law); provided that to the extent
the Transferor exercises its option to purchase a Series 1996-1 Leased
Vehicle, the Sale Proceeds for any such Series 1996-1 Leased Vehicle
will not exceed the Transferor Purchase Option Price. See "Series
1996-1 Certificates -- Lease of the Series 1996-1 Certificates to
the Transferor."

"Voluntary Early Termination Proceeds" means all amounts received in
connection with a Voluntary Early Termination, which amount includes
the Adjusted Balance Subject to Lease Charges at the time of
termination plus all Monthly Payments due but not paid as of the date
of termination.

"Liquidation Proceeds" means all amounts received with respect to a
Liquidated Lease and the related Leased Vehicle in the month in which
such Lease became a Liquidated Lease, net of any amounts remitted to
the Obligor as required by law.

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<PAGE> 49

"Recoveries" means, with respect to any Collection Period, (i) all
amounts received during such Collection Period (net of taxes) with
respect to Leases which became Liquidated Leases before such
Collection Period plus (ii) all amounts received with respect to
Leases which expired on their respective Scheduled Lease End Dates
before such Collection Period and with respect to which the proceeds
from the sale of the related Leased Vehicles were received before such
Collection Period, minus any amounts remitted to the Obligor as
required by law.

Quarterly Deposits to Collection Account. On the second business day
preceding each Payment Date, the Administrative Agent acting on behalf of the
Issuer will deliver to the Indenture Trustee instructions setting forth the
information necessary to make all disbursements and payments with respect to
such Payment Date. (Indenture, Section [8.3]).

On the business day preceding each Payment Date, the Administrative
Agent will make a deposit or withdrawal from the Collection Account in an
amount equal to the sum of the Aggregate Net Sale Proceeds Advances and
Aggregate Net Monthly Payment Advances to be made by the Administrative Agent
for the preceding Accrual Period. (Series 1996-1 Supplement, Sections [5.2]
and [5.4]).

"Aggregate Net Sale Proceeds Advances" means, with respect to any
Accrual Period, the aggregate Sale Proceeds Advances made by the
Administrative Agent with respect to such Accrual Period minus the
amount received by the Administrative Agent in such Accrual Period as
repayment of Sale Proceeds Advances which were made with respect to
previous Accrual Periods. See "Description of the Administrative
Agency Agreement -- Advances of Sale Proceeds."

"Aggregate Net Monthly Payment Advances" means, with respect to any
Accrual Period, the aggregate Monthly Payment Advances made by the
Administrative Agent with respect to such Accrual Period minus the
amount received by the Administrative Agent in such Accrual Period as
repayment of Monthly Payment Advances which were made with respect to
previous Accrual Periods. See "Description of the Administrative
Agency Agreement -- Monthly Payment Advances."

On the business day preceding each Payment Date, based on the
instructions of the Administrative Agent, the Indenture Trustee will determine
the aggregate amount of Available Sale Proceeds on deposit in the Collection
Account (after giving effect to all deposits of Collections on the business day
preceding such Payment Date and the deposit or withdrawal of the Aggregate Net
Monthly Payment Advances and the Aggregate Net Sale Proceeds Advances on such
day).

The "Available Sale Proceeds" on deposit in the Collection Account on
the business day preceding any Payment Date will be equal to the
Monthly Scheduled Termination Sale Proceeds deposited therein on each
of the two preceding Distribution Dates and Monthly Scheduled
Termination Sale Proceeds deposited therein on the business day
preceding the Distribution Date occurring on such Payment Date (or on
each business day during the related Accrual Period if any Monthly
Remittance Condition has not been satisfied) plus the total Aggregate
Net Sale Proceeds Advances deposited on the business day preceding
such Payment Date plus any investment earnings on funds on deposit in
the Collection Account.

Monthly or Daily Deposits to Cash Collateral Account. On each
Distribution Date (or on the business day preceding such Distribution Date, if
such Distribution Date is a Payment Date), or on each business day if each
Monthly Remittance Condition has not been satisfied, the Administrative Agent
will deposit any Transferor Purchase Option Net Proceeds with respect to the
Series 1996-1 Leased Vehicles into the Cash Collateral Account until the
aggregate cumulative amount deposited in the Cash

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Collateral Account in respect of such proceeds equals $_____. (Series 1996-1
Supplement, Section [5.2]).

Withdrawals from Collection Account/Deposits to Cash Collateral
Account. On the business day preceding each Payment Date and prior to the
Indenture Trustee's withdrawal of any amounts from the Cash Collateral Account
on such day, the Administrative Agent will withdraw from the Collection Account
(after giving effect to all deposits of Collections therein and the deposit or
withdrawal of the Aggregate Net Monthly Payment Advances and the Aggregate Net
Sale Proceeds Advances on such day) and deposit to the Cash Collateral Account
the sum for the related Accrual Period of (i) the Collections other than
Monthly Scheduled Termination Sale Proceeds and (ii) the Aggregate Net Monthly
Payment Advances.

Withdrawals from Collection Account/Deposits to Payment Account. On
the business day preceding each Payment Date, the Administrative Agent will
withdraw from the Collection Account and deposit to the Payment Account the
Available Sale Proceeds on deposit in the Collection Account. (Indenture,
Section [8.4]).

Withdrawals from Cash Collateral Account/Deposits to Payment Account.
On the business day preceding each Payment Date, the Indenture Trustee will
withdraw from the Cash Collateral Account and deposit to the Payment Account
the Cash Collateral Draw Amount. See "-- Cash Collateral Account Withdrawals
and Deposits" for a description of how the Cash Collateral Draw Amount is
calculated. (Indenture, Section [8.3]).

Withdrawals from Payment Account/Payments. On each Payment Date, the
Indenture Trustee will apply the aggregate Available Sale Proceeds and Cash
Collateral Draw Amount on deposit in the Payment Account (such amount, the
"Total Available Funds") in the following order of priority:

(i) to the Administrative Agent, the Administrative Agent
Fee;

(ii) to the Senior Noteholders, pro rata without any priority
between Classes, to pay interest due on the outstanding Senior Notes
on such Payment Date (and, to the extent permitted under applicable
law, interest on any overdue interest at the interest rate for the
applicable Class);

(iii) to the Cash Collateral Account, an amount equal to the
interest due on the outstanding Subordinated Notes with respect to
such Payment Date (and, to the extent permitted under applicable law,
interest on any overdue interest at the interest rate for the
Subordinated Notes), but only to the extent such interest (and overdue
interest) has not already been paid by the deposit into the Cash
Collateral Account of amounts in respect of such interest (and
overdue interest);

(iv) to the Certificate Distribution Account, an amount equal
to the interest accrued on the Lease Trust Certificates with respect
to such Payment Date (and, to the extent permitted under applicable
law, interest on any overdue interest at the interest rate for the
Lease Trust Certificates); and

(v) to the Senior Noteholders, to pay principal with respect
to each Class of Senior Notes outstanding, sequentially, until the
Senior Notes have been paid in full; provided that if an Event of
Default has occurred under the Indenture and the maturity of the
Senior Notes has been accelerated, principal payments will be made on
a pro rata basis to holders of the Class A-1 Senior Notes and the
Class A-2 Senior Notes based on their respective principal balances,
without any distinction between Classes.

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Any Total Available Funds remaining in the Payment Account after the
Class A-2 Senior Notes have been paid in full will be applied to pay the
Subordinated Notes and the Lease Trust Certificates in accordance with the
terms thereof. Amounts deposited in the Cash Collateral Account in accordance
with clause (iii) above will be deemed to have been distributed to the
Subordinated Noteholders as payments in respect of interest (and overdue
interest) and the Subordinated Noteholders will not be entitled to any further
interest on such amounts after the related Payment Date.

Withdrawals from Certificate Distribution Account/Deposits to Payment
Account. To the extent that on any Payment Date occurring in the months of
____ and ____ the sum of the amounts required to be paid under clauses (i) and
(ii) of "-- Withdrawals from Payment Account/Payments" above exceeds the
Total Available Funds with respect to such Payment Date, the Indenture Trustee
shall withdraw from the Certificate Distribution Account the lesser of (a) the
amount of such excess and (b) the amount then on deposit in the Certificate
Distribution Account, and shall deposit such funds into the Payment Account and
apply them to pay the amounts required under clauses (i) and (ii) of "--
Withdrawals from Payment Account/Payments" above, in that order of priority.

CASH COLLATERAL ACCOUNT WITHDRAWALS AND DEPOSITS

Amounts on deposit in the Cash Collateral Account from time to time
(the "Cash Collateral Amount") secure the Transferor's obligations under the
Program Operating Lease, and on each Payment Date are available to pay the
Program Operating Lease Payments. The initial amount deposited in the Cash
Collateral Account on the Closing Date will be $______ (the "Initial Cash
Collateral Deposit"). The Cash Collateral Amount will be increased from time
to time by the deposit in the Cash Collateral Account of the following amounts
with respect to each Accrual Period: (i) all Collections other than Monthly
Scheduled Termination Sale Proceeds; (ii) the Aggregate Net Monthly Payment
Advances; (iii) any Transferor Purchase Option Net Proceeds until the aggregate
cumulative amount deposited therein in respect of such proceeds equals $______;
and (iv) payments of interest on and principal of the Subordinated Notes. The
Cash Collateral Amount will be decreased by the amount of each Cash Collateral
Draw Amount with respect to each Payment Date. The "Required Cash Collateral
Amount" as of any Payment Date will be the greater of (i) ____% of the Pool
Balance as of the last day of the related Accrual Period and (ii) ____% of the
Initial Pool Balance; provided that the Required Cash Collateral Amount shall
not exceed the sum of the aggregate principal balance of the Senior Notes, the
Subordinated Notes and the Lease Trust Certificates as of any Payment Date,
before giving effect to any payments made on such Payment Date.

Cash Collateral Draw Amount. On the business day preceding each
Payment Date, the Indenture Trustee will withdraw from the Cash
Collateral Account and deposit into the Payment Account the Cash
Collateral Draw Amount with respect to such Payment Date. The "Cash
Collateral Draw Amount" with respect to any Payment Date is an amount
equal to the sum of the Cash Collateral Required Draw Amount and the
Cash Collateral Additional Draw Amount. The "Cash Collateral Required
Draw Amount" with respect to any Payment Date is an amount equal to
the lesser of (i) the sum, for the related Accrual Period, of the
Administrative Agent Fee and the amount of interest (including overdue
interest) accrued on the Senior Notes, the Subordinated Notes and the
Lease Trust Certificates and (ii) the Cash Collateral Amount for such
Payment Date (after giving effect to amounts deposited in the Cash
Collateral Account on the business day preceding such Payment Date);
provided, however, that if the Total Available Funds (prior to giving
effect to this proviso) with respect to any Payment Date is less than
the amount specified in clause (i) above, the portion, if any, of such
Total Available Funds allocable to pay interest (and overdue interest)
on the Subordinated Notes shall be deposited to the Cash Collateral
Account and an amount equal to the excess of (x) interest (and overdue
interest) on the Lease Trust Certificates over (y) the portion, if
any, of such Total Available Funds otherwise allocable and available
to pay such interest (and overdue interest) will constitute an
additional component of the Cash Collateral Required Draw Amount (but
only

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to the extent of funds then on deposit in the Cash Collateral Account)
and will be withdrawn by the Indenture Trustee from the Cash
Collateral Account and applied as a portion of Total Available Funds to
pay (without duplication) amounts required to be paid under clause (iv)
of "-- Withdrawals from Payment Account/Payments" above. Amounts
deposited in the Cash Collateral Account in accordance with the
preceding proviso will be deemed to have been distributed to the
Subordinated Noteholders as payments in respect of interest (and
overdue interest) and the Subordinated Noteholders will not be entitled
to any further interest on such amounts after the related Payment
Date. The "Cash Collateral Additional Draw Amount" with respect to any
Payment Date is an amount equal to the Additional Payment.

On the Payment Date on which the Senior Notes, Subordinated Notes and
Lease Trust Certificates are paid in full, any amounts remaining on deposit in
the Cash Collateral Account (after giving effect to any deposits therein or
withdrawals therefrom with respect to such Payment Date) will be paid to the
Transferor.

ADVANCES

The Administrative Agent will make a Monthly Payment Advance on the
business day preceding each Payment Date with respect to Monthly Payments not
received with respect to a Series 1996-1 Lease as of the end of the related
Accrual Period but only if the Administrative Agent determines in its sole
discretion that such Monthly Payment Advance will be recoverable from
subsequent Monthly Payments on such Series 1996-1 Lease. The Administrative
Agent will make Sale Proceeds Advances for Sale Proceeds which have not been
received as of the end of the related Accrual Period with respect to Series
1996-1 Leased Vehicles which were sold in such Accrual Period on or after their
respective Scheduled Lease End Dates. On the business day preceding each
Payment Date, the Administrative Agent will deposit to, or withdraw from, the
Collection Account the Aggregate Net Sale Proceeds Advances and the Aggregate
Net Monthly Payment Advances. (Series 1996-1 Supplement, Section [5.2]). See
"-- The Indenture Cash Flows," "Description of the Administrative Agency
Agreement -- Advances of Sale Proceeds" and "Description of the
Administrative Agency Agreement -- Monthly Payment Advances."

MONTHLY REMITTANCE CONDITION

The Administrative Agency Agreement requires the Administrative Agent
to make all deposits of amounts received from Obligors and proceeds from the
sale of Series 1996-1 Leased Vehicles during each Collection Period on each
business day. However, so long as each Monthly Remittance Condition is
satisfied, the Administrative Agent may retain such amounts until the related
Distribution Date (or until the business day preceding such Distribution Date,
if such Distribution Date is a Payment Date). Pending deposit into the
Collection Account or the Cash Collateral Account, collections of amounts
received from Obligors and proceeds from the sale of Series 1996-1 Leased
Vehicles may be employed by the Administrative Agent at its own risk and for
its own benefit and will not be segregated from its own funds. Deposits or
withdrawals from the Collection Account with respect to Monthly Payment
Advances and Sale Proceeds Advances will be made on the business day preceding
each Payment Date on a net basis. (Series 1996-1 Supplement, Section [5.2]).

STATEMENTS TO SENIOR NOTEHOLDERS

On or prior to each Payment Date, the Administrative Agent will
prepare and provide the Indenture Trustee a statement to be included with the
report delivered to Senior Noteholders described in "Pool Factors and Trading
Information" setting forth the following information with respect to such
Payment Date: (i) the amount of the distribution allocable to principal and
interest with respect to each Class of Senior Notes outstanding; (ii) the
aggregate amount of Collections (including the amount of Monthly Payments, Sale
Proceeds (as limited by the Transferor Purchase Option Price for each

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Series 1996-1 Leased Vehicle), Voluntary Termination Proceeds, Liquidation
Proceeds, Recoveries, Payaheads and Administrative Purchase Amounts) deposited
in the Collection Account; (iii) the Aggregate Net Sale Proceeds Advances and
Aggregate Net Monthly Payment Advances deposited in the Collection Account;
(iv) the amount of Available Sale Proceeds; (v) the aggregate Transferor
Purchase Option Net Proceeds and the aggregate cumulative amount deposited in
the Cash Collateral Account in respect of such proceeds; (vi) the Cash
Collateral Draw Amount, the Cash Collateral Required Draw Amount and the Cash
Collateral Additional Draw Amount, if any; (vii) the amount of Total Available
Funds; (viii) the amount deposited in the Cash Collateral Account for payment
of interest to Subordinated Noteholders; (ix) the amount deposited in the
Certificate Distribution Account for payment of interest to Lease Trust
Certificateholders; (x) the aggregate outstanding balance of Senior Notes,
Subordinated Notes and Lease Trust Certificates and the Pool Balance; (xi) the
Cash Collateral Amount (after giving effect to the Cash Collateral Draw Amount
for such Payment Date); (xii) the aggregate amount of Payaheads credited to
Obligors and the aggregate Payaheads either held by the Administrative Agent or
on deposit in the Payahead Account; (xiii) the aggregate of the Series 1996-1
Credit Losses for each of the three preceding Collection Periods; and (xiv) the
aggregate of the Series 1996-1 Residual Losses for each of the three preceding
Collection Periods. (Indenture, Section [8.4])

INDENTURE

Events of Default. The "Events of Default" in the Indenture consist
of (i) a default for five days or more in the payment of interest on any Senior
Note; (ii) a default in the payment of principal of any Senior Note at its
Stated Maturity or on the Redemption Date; (iii) the occurrence of an event of
default under the Program Operating Lease; (iv) a default in the observance or
performance of any material covenant or agreement, or any representation or
warranty made in the Indenture or in any certificate or writing delivered
pursuant thereto proves to have been incorrect in any material respect as of
the time when made, and the continuation of such default for a period of 60
days or in the case of a materially incorrect representation or warranty, 30
days, after notice thereof is given to the Lease Trustee by the Indenture
Trustee or the Lease Trustee and the Indenture Trustee by the holders of not
less than 25% of the aggregate principal balance of the Senior Notes or (v)
certain events of bankruptcy, insolvency, receivership or liquidation of the
Issuer. (Indenture, Section [5.1]).

Senior Noteholders holding not less than a majority of the aggregate
principal balance of the Senior Notes may waive any past default or Event of
Default prior to the declaration of the acceleration of the maturity of the
Senior Notes, except a default (i) in payment of principal of or interest on
any of the Senior Notes or (ii) in respect of any covenant or provision in the
Indenture which cannot be modified or amended without unanimous consent of the
Senior Noteholders. (Indenture, Section [5.12]). Such a waiver could be
treated, for federal income tax purposes, as a constructive exchange of the
Senior Notes by the Senior Noteholders for deemed new Senior Notes upon which
gain or loss would be recognized if such waiver were to continue for a period
that exceeds two years and any additional period during which the Senior
Noteholders conduct good faith negotiations.

Remedies. If an Event of Default should occur and be continuing, the
Indenture Trustee or the holders of a majority of the aggregate principal
balance of the Senior Notes may declare the principal of the Senior Notes to be
immediately due and payable. Such declaration may be rescinded by the holders
of a majority of the aggregate principal balance of the Senior Notes before a
judgment or decree for payment of the amount due has been obtained by the
Indenture Trustee if (i) the Issuer has deposited with the Indenture Trustee an
amount sufficient to pay (x) all interest on and principal of the Senior Notes
as if the Event of Default giving rise to such declaration had not occurred and
(y) all amounts advanced by the Indenture Trustee and its costs and expenses
and (ii) all Events of Default (other than the nonpayment of principal of the
Senior Notes that has become due solely by such acceleration) have been cured
or waived. (Indenture, Section [5.2]).

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If the Senior Notes have been declared due and payable following an
Event of Default, the Indenture Trustee may institute proceedings to collect
amounts due, exercise remedies as a secured party including foreclosure or sale
of the Lease Trust Estate, or elect to maintain the Lease Trust Estate and
continue to apply proceeds from the Lease Trust Estate as if there had been no
declaration of acceleration. The Indenture Trustee may not, however, unless it
is required to sell the Lease Trust Estate pursuant to the Lease Trust
Agreement as a result of the bankruptcy, insolvency or termination of the
Transferor or the bankruptcy or insolvency of Ford Credit Leasing, sell the
Lease Trust Estate following an Event of Default (other than the occurrence of
an Event of Default described in clauses (i) or (ii) above) unless (i) 100% of
the Senior Noteholders consent thereto, (ii) the proceeds of such sale are
sufficient to pay in full the principal of and the accrued interest on the then
outstanding Senior Notes, Subordinated Notes and Lease Trust Certificates or
(iii) the Indenture Trustee determines that the Lease Trust Estate would not be
sufficient on an ongoing basis to make all payments on the Senior Notes as such
payments would have become due if such obligations had not been declared due
and payable, and the Indenture Trustee obtains the consent of holders of
66-2/3% of the aggregate principal balance of the Senior Notes. The Indenture
Trustee may, but need not, obtain and rely upon an opinion of an independent
accountant or investment banking firm as to the sufficiency of the Lease Trust
Estate to pay interest and principal on the Senior Notes on an ongoing basis.
(Indenture, Section [5.4]). Any sale of the Lease Trust Estate, other than a
sale resulting from the bankruptcy, insolvency or termination of Ford Credit
Leasing or the Transferor, is subject to a requirement that an Opinion of
Counsel be delivered to the effect that such sale will not cause FCTT or the
Issuer to be classified as an association (or publicly traded partnership)
taxable as a corporation for federal income tax purposes.

In the event of a sale of the Lease Trust Estate, either as a result
of the bankruptcy, insolvency or termination of the Transferor or the
bankruptcy or insolvency of Ford Credit Leasing, or following the occurrence of
an Event of Default under the circumstances described in the preceding
paragraph pursuant to the direction of the Indenture Trustee or the Senior
Noteholders, the proceeds of such sale will be distributed first to the
Indenture Trustee for amounts due as compensation or indemnity payments
pursuant to the terms of the Indenture; second to the Administrative Agent for
reimbursement of all outstanding Sale Proceeds Advances and Monthly Payment
Advances; third to the Administrative Agent for amounts due in respect of
unpaid Administrative Agent Fees; fourth to the Senior Noteholders to pay
interest which is due and unpaid, ratably, without preference or priority
between Classes; and fifth to the Senior Noteholders to pay principal which is
due and unpaid, ratably, without any distinction between Classes. Any
remaining amounts will be distributed to the Subordinated Noteholders and the
Lease Trust Certificateholders for amounts due and unpaid in accordance with
the terms of the Subordinated Notes and the Lease Trust Certificates,
respectively. (Indenture, Section [5.4]).

Subject to the provisions of the Indenture relating to the duties of
the Indenture Trustee, in case an Event of Default occurs and is continuing
with respect to the Senior Notes, the Indenture Trustee will be under no
obligation to exercise any of the rights or powers under the Indenture at the
request or direction of any of the Senior Noteholders, if the Indenture Trustee
reasonably believes it will not be adequately indemnified against the costs,
expenses and liabilities which might be incurred by it in complying with such
request. Subject to such provisions for indemnification and certain
limitations contained in the Indenture, the holders of not less than a majority
of the aggregate principal balance of the Senior Notes will have the right to
direct the time, method and place of conducting any proceeding or any remedy
available to the Indenture Trustee or exercising any trust power conferred on
the Indenture Trustee, and the holders of not less than a majority of the
aggregate principal balance of the Senior Notes may, in certain cases, waive
any default with respect thereto, except a default in the payment of principal
or interest or a default in respect of a covenant or provision of the Indenture
that cannot be modified without the waiver or consent of all of the holders of
the outstanding Senior Notes. Until such time, if any, as Definitive Senior
Notes have been issued, the Indenture Trustee will act only in accordance with
the instructions of Cede, as nominee for DTC. However, under the rules,

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regulations and procedures creating and affecting DTC and its operations, DTC
will act only in accordance with the instructions of the Participants to whom
Senior Notes are credited, which will in turn act in accordance with the
instructions of persons holding beneficial interests in such Senior Notes
through such Participants. Accordingly, although only Cede will be entitled to
vote under the Indenture, Senior Note Owners will be entitled to instruct DTC
as to the manner in which to vote. (Indenture, Sections [5.11] and [5.12]).

No Senior Noteholder will have the right to institute any proceeding
with respect to the Indenture, unless (i) such Senior Noteholder previously has
given to the Indenture Trustee written notice of a continuing Event of Default,
(ii) the holders of not less than 25% of the aggregate principal balance of the
Senior Notes have made written request of the Indenture Trustee to institute
such proceeding in its own name as Indenture Trustee, (iii) such Senior
Noteholder or Senior Noteholders have offered the Indenture Trustee reasonable
indemnity, (iv) the Indenture Trustee has for 60 days failed to institute such
proceeding and (v) no direction inconsistent with such written request has been
given to the Indenture Trustee during such 60-day period by the holders of a
majority of the aggregate principal balance of the Senior Notes. (Indenture,
Section [5.6]).

Neither the Indenture Trustee nor the Lease Trustee in their
respective individual capacities, nor any holder of a Subordinated Note or a
Lease Trust Certificate, nor any of their respective owners, beneficiaries,
agents, officers, directors, employees, successors or assigns will, in the
absence of an express agreement to the contrary, be personally liable for the
payment of interest on or principal of the Senior Notes or for the agreements
of the Issuer and the Lease Trustee, in its capacity as trustee, contained in
the Indenture.

Certain Covenants. The Issuer will not, among other things, (i)
except as expressly permitted by the Indenture, the Program Operating Lease and
the other Basic Documents, sell, transfer, exchange or otherwise dispose of any
of the assets of the Issuer, (ii) claim any credit on or make any deduction
from the principal and interest payable in respect of the Senior Notes (other
than amounts withheld under the Code or applicable state law) or assert any
claim against any present or former Senior Noteholder because of the payment of
taxes levied or assessed upon the Issuer, (iii) dissolve or liquidate in whole
or in part or (iv) permit (x) the validity or effectiveness of the Indenture to
be impaired, (y) any person to be released from any covenants or obligations
with respect to the Senior Notes under the Indenture except as may be expressly
permitted thereby or (z) any lien, charge, excise, claim, security interest,
mortgage or other encumbrance to be created on or extend to or otherwise arise
upon or burden the assets of the Issuer or any part thereof, or any interest
therein or the proceeds therefrom. (Indenture, Section [3.8]).

The Issuer may not engage in any activities other than financing,
acquiring, owning, leasing (subject to the lien of the Indenture), pledging and
managing the Series 1996-1 Certificates as contemplated by the Indenture and
the other Basic Documents. (Indenture, Section [3.12]).

The Issuer will not incur, assume or guarantee any indebtedness other
than indebtedness incurred pursuant to the Senior Notes, the Subordinated Notes
and the Lease Trust Certificates or otherwise in accordance with the Basic
Documents. (Indenture, Section [3.13]).

The Issuer will or will cause the Administrative Agent to deliver to
the Indenture Trustee on the second business day preceding each Payment Date
the disbursement and payment instructions as required pursuant to the
Indenture. (Indenture, Section [8.3]).

Replacement of the Indenture Trustee. Senior Noteholders holding not
less than a majority of the aggregate principal balance of the Senior Notes may
remove the Indenture Trustee without cause by so notifying the Indenture
Trustee and the Lease Trustee, and following such removal may appoint a
successor Indenture Trustee. Any successor Indenture Trustee must at all times
satisfy the

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requirements of Section 310(a) of Trust Indenture Act of 1939, as amended and,
in addition, have a combined capital and surplus of at least $50,000,000 and a
long term debt rating of investment grade or better by each Rating Agency.

The Indenture Trustee may resign at any time by so notifying the Lease
Trustee and the Senior Noteholders. The Lease Trustee is required to remove
the Indenture Trustee if the Indenture Trustee (i) ceases to be eligible to
continue as the Indenture Trustee, (ii) is adjudged to be bankrupt or
insolvent, or (iii) otherwise becomes incapable of acting. Upon the
resignation or required removal of the Indenture Trustee, or the failure of the
Senior Noteholders to appoint a successor Indenture Trustee following the
removal without cause of the Indenture Trustee, the Lease Trustee will be
required promptly to appoint a successor Indenture Trustee. (Indenture,
Section [6.8]).

Duties of Indenture Trustee. Except during the continuance of an
Event of Default, the Indenture Trustee will (i) perform such duties and only
such duties as are specifically set forth in the Indenture, (ii) rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, on certificates or opinions furnished to the Indenture Trustee which
conform to the requirements of the Indenture, and (iii) examine any such
certificates and opinions which are specifically required to be furnished to
the Indenture Trustee by the Indenture to determine whether or not they conform
to the requirements of the Indenture. Upon the continuance of an Event of
Default, the Indenture Trustee will be required to exercise the rights and
powers vested in it by the Indenture and use the same degree of care and skill
in the exercise thereof as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs. (Indenture, Section
[6.1]).

Compensation and Indemnity. The Administrative Agent will (i) pay to
the Indenture Trustee from time to time reasonable compensation for its
services, (ii) reimburse the Indenture Trustee for all expenses, advances and
disbursements reasonably incurred and (iii) indemnify the Indenture Trustee
for, and hold it harmless against, any and all losses, liability or expense
(including attorneys' fees) incurred by it in connection with the performance
of its duties. The Indenture Trustee will not be indemnified against any loss,
liability or expense incurred by it through its own willful misconduct,
negligence or bad faith, except that, the Indenture Trustee will not be liable
(i) for any error of judgment made by it in good faith unless it is proved that
the Indenture Trustee was negligent in ascertaining the pertinent facts, (ii)
with respect to any action it takes or omits to take in good faith in
accordance with a direction received by it from Senior Noteholders in accor-
dance with the terms of the Indenture, and (iii) for interest on any money
received by it except as the Indenture Trustee and the Lease Trustee may agree
in writing. The Indenture Trustee will not be deemed to have knowledge of any
event unless an officer of the Indenture Trustee has actual knowledge thereof
or has received written notice thereof in accordance with the provisions of the
Indenture. (Indenture, Sections [6.1] and [6.7]).

Access to Senior Noteholder Lists. If Definitive Senior Notes are
issued in the limited circumstances set forth in "-- Definitive Senior
Notes," and the Indenture Trustee is not the Senior Note Registrar, the Lease
Trustee will furnish or cause to be furnished to the Indenture Trustee a list
of the names and addresses of the Senior Noteholders (i) as of each Record
Date, within five days thereafter and (ii) as of not more than 10 days prior to
the time such list is furnished, within 30 days after receipt by the Lease
Trustee of a written request therefor. (Indenture, Section [7.1]).

Annual Compliance Statement. The Issuer will be required to file
annually with the Indenture Trustee a written statement as to the fulfillment
of its obligations under the Indenture. (Indenture, Section [3.9]).

Satisfaction and Discharge of Indenture. The Indenture will be
discharged with respect to the collateral securing the Senior Notes upon the
delivery to the Indenture Trustee for cancellation of all

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the Senior Notes or, with certain limitations, including receipt of certain
opinions with respect to tax matters, upon deposit with the Indenture Trustee
of funds sufficient for the payment in full of all of the Senior Notes
(including interest and any fees due and payable to the Lease Trustee or the
Indenture Trustee). (Indenture, Section [4.1]).

Modification of Indenture. Without the consent of the Senior
Noteholders, the Lease Trustee, on behalf of the Issuer, and the Indenture
Trustee, upon request by the Issuer, may execute a supplemental indenture for
the purpose of adding to the covenants of the Issuer, curing any ambiguity,
correcting or supplementing any provision which may be inconsistent with any
other provision or making any other provision with respect to matters or
questions arising under the Indenture which will not be inconsistent with other
provisions of the Indenture. (Indenture, Section [9.1]).

Without the consent of the holder of each outstanding Senior Note
affected thereby, however, no supplemental indenture may (i) change the Stated
Maturity of or interest on any Senior Note or reduce the principal amount
thereof, the interest rate specified thereon or the Redemption Price with
respect thereto or change any place of payment where, or the coin or currency
in which, any Senior Note or any interest thereon is payable, (ii) impair the
right to institute suit for the enforcement of certain provisions of the
Indenture regarding payment, (iii) reduce the percentage of the aggregate
principal balance of the Senior Notes the consent of the holders of which is
required for any such supplemental indenture or the consent of the holders of
which is required for any waiver of compliance with certain provisions of the
Indenture or of certain defaults thereunder and their consequences as provided
for in the Indenture, (iv) modify or alter the provisions of the Indenture
regarding the voting of Senior Notes held by the Issuer, the Transferor, the
Administrative Agent, an affiliate of any of them or any obligor on the Senior
Notes, (v) reduce the percentage of the aggregate principal balance of the
Senior Notes the consent of the holders of which is required to direct the
Indenture Trustee to sell or liquidate the Lease Trust Estate if the proceeds
of such sale would be insufficient to pay the principal balance and accrued but
unpaid interest on the Senior Notes, (vi) decrease the percentage of the
aggregate principal balance of the Senior Notes required to amend the sections
of the Indenture which specify the applicable percentage of the aggregate
principal balance of the Senior Notes necessary to amend the Indenture or the
other Basic Documents or (vii) permit the creation of any lien ranking prior to
or on a parity with the lien of the Indenture with respect to any of the
collateral for the Senior Notes or, except as otherwise permitted or
contemplated in the Indenture, terminate the lien of the Indenture on any such
collateral or deprive the holder of any Senior Note of the security afforded by
the lien of the Indenture. (Indenture, Section [9.2]).

The Lease Trustee, on behalf of the Issuer, and the Indenture Trustee,
upon request by the Issuer, may also enter into supplemental indentures, with
the consent of holders of not less than a majority of the aggregate principal
balance of the Senior Notes, and with written notice to the Rating Agencies,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of modifying in any
manner the rights of Senior Noteholders; provided, that (x) such action will
not, (i) as evidenced by an Opinion of Counsel, materially adversely affect the
interests of any Senior Noteholder and (ii) as confirmed by each Rating Agency
rating the Senior Notes, cause the then current rating assigned to either Class
of Senior Notes to be withdrawn or reduced and (y) an Opinion of Counsel as to
certain tax matters is delivered. (Indenture, Section [9.1]).

The Lease Trust Agreement requires the Lease Trustee to give the Lease
Trust Certificateholders 30 days written notice of any proposed supplemental
indenture if it materially adversely affects the Lease Trust Certificateholders
or if Senior Noteholders' consent is required and provides that the Lease
Trustee will not enter into such amendment unless Lease Trust
Certificateholders holding 25% or more of the principal balance of Lease Trust
Certificates consent in writing. See "Additional Document Provisions -- The
Lease Trust Agreement."

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Senior Notes Owned by Transferor or its Affiliates. Any Senior Notes
owned by the Transferor or its affiliates will be entitled to benefits under
the Indenture equal and proportionate to the Senior Notes owned by others (if
any), except that such Senior Notes owned by the Transferor or its affiliates
will be deemed not to be outstanding for the purpose of determining whether the
requisite percentage of Senior Noteholders have given any request, demand,
authorization, direction, notice, consent or other action under the Indenture
and the other Basic Documents (other than the commencement by the Issuer of a
voluntary proceeding in bankruptcy as described under "Additional Document
Provisions -- Bankruptcy Provisions -- Issuer").

DESCRIPTION OF THE ADMINISTRATIVE AGENCY AGREEMENT

DUTIES OF THE ADMINISTRATIVE AGENT

The duties of the Administrative Agent with respect to the Series
1996-1 Assets are set forth in the Administrative Agency Agreement and the
Series 1996-1 Supplement. The Administrative Agent will manage, service,
administer, and make collections on the Series 1996-1 Leases using the same
degree of skill and attention that it exercises with respect to all comparable
retail automotive leases and retail installment sales contracts that it
services for itself or others ("Accepted Servicing Practices"). The
Administrative Agent will collect and post all payments, respond to inquiries
of Obligors, investigate delinquencies, commence legal proceedings to enforce
Series 1996-1 Leases against delinquent Obligors, send invoices to Obligors,
account for collections, furnish monthly and annual statements to the FCTT
Trustee with respect to distributions, make Sale Proceeds Advances and Monthly
Payment Advances, and pay Administrative Purchase Amounts. The Administrative
Agent will be required to take all necessary steps to maintain evidence of
FCTT's ownership on the certificate of title of each Series 1996-1 Leased
Vehicle. The Administrative Agent will obtain all licenses required to be held
by FCTT in connection with the ownership of Series 1996-1 Leases and Series
1996-1 Leased Vehicles. The Administrative Agent may contract with third
parties to perform its duties under the Administrative Agency Agreement, but
shall remain responsible for the performance of such duties. (Administrative
Agency Agreement, Sections [4.1] and [4.5]).

The Administrative Agency Agreement also sets forth the duties of the
Administrative Agent with respect to the origination and purchase of Leases and
Leased Vehicles by FCTT and the obtaining of certificates of title for such
Leased Vehicles. See "FCTT -- Lease Origination from Dealers and Assignment
to FCTT" and "-- Titling of Leased Vehicles."

COLLECTION OF TOTAL MONTHLY PAYMENTS; EXTENSION OF LEASES

The Administrative Agent will collect all payments under the Series
1996-1 Leases. The Administrative Agent may grant extensions, rebates, or
adjustments on Series 1996-1 Leases in accordance with Accepted Servicing
Practices and in its discretion waive any late payment charge or any other fees
that may be collected in the ordinary course of servicing a Series 1996-1
Lease. (Administrative Agency Agreement, Section [4.2]).

The Administrative Agent may grant an extension of the Lease Term (a
"Term Extension") if the Obligor requesting such extension is not in default
under the Series 1996-1 Lease at the time of such request and agrees to
continue to make Total Monthly Payments in the same amount as required under
the original terms of such Series 1996-1 Lease. Because the granting of a Term
Extension with respect to any Series 1996-1 Lease would be deemed to have a
material adverse effect on holders of the Series 1996-1 Certificates, the
Administrative Agent will be required to purchase the beneficial interest in
the related Series 1996-1 Leased Vehicle as of the date of such Term Extension.
See "-- Administrative Purchases."

<PAGE> 59

The Administrative Agent may also extend the term of a Series 1996-1
Lease in accordance with Accepted Servicing Practices, by waiving the Total
Monthly Payment due in any month in exchange for extending the term of the
Series 1996-1 Lease for one or more additional months beyond the Scheduled
Lease End Date for each month for which the Total Monthly Payment is waived
(such extension, a "Payment Extension"). The Obligor under any Payment
Extension does not receive an increase in the aggregate number of miles which
the Series 1996-1 Leased Vehicle may be driven by the Obligor without incurring
an additional charge for excess mileage under the related Series 1996-1 Lease.
If the Administrative Agent grants Payment Extensions in excess of, in the
aggregate, three months beyond the Scheduled Lease End Date of a related Series
1996-1 Lease, it will purchase the beneficial interest in such Series 1996-1
Leased Vehicle as of the date of the granting of such extension.
(Administrative Agency Agreement, Sections [4.2] and [4.7]).

REALIZATION ON LIQUIDATED LEASES

The Administrative Agent will use reasonable efforts (i) to repossess
any Series 1996-1 Leased Vehicle if it determines that eventual payment in full
of the related Series 1996-1 Lease is unlikely and (ii) to maximize Liquidation
Proceeds. Upon repossession, the Administrative Agent has discretion to repair
a damaged Series 1996-1 Leased Vehicle or sell such vehicle without repairs.
This determination will be based on whether the Administrative Agent believes
repairs will increase the related Liquidation Proceeds by an amount greater
than the cost of such repairs. (Administrative Agency Agreement, Section
[4.3]).

ADMINISTRATIVE PURCHASES

The Administrative Agent on behalf of Ford Credit and Ford Credit
Leasing, as holders of the EBCs, will be required to purchase the Issuer's
beneficial interest in any Series 1996-1 Asset as to which: either (i) any of
the Specific Eligibility Criteria and General Eligibility Criteria were not
satisfied on the Series 1996-1 Cut-Off Date; (ii) the Administrative Agent has
breached certain covenants in the Administrative Agency Agreement by either (a)
failing to make reasonable efforts to collect Total Monthly Payments from the
related Obligor, (b) failing to maintain record ownership in such Series 1996-1
Leased Vehicle, (c) changing the Retail Operating Lease Factor of such Series
1996-1 Lease, (d) modifying the number or amount of Monthly Payments due under
the Series 1996-1 Lease, except in connection with a Payment Extension, or (e)
otherwise impairing the rights of FCTT or the Issuer in such Series 1996-1
Lease or Series 1996-1 Leased Vehicle and, in each case, such breach continues
unremedied for a specified period; (iii) the related Series 1996-1 Leased
Vehicle has been relocated to a jurisdiction where FCTT is not qualified or
authorized to maintain evidence of the ownership of Series 1996-1 Leased
Vehicles; or (iv) the Administrative Agent has granted a Term Extension. In
addition, because the granting of Payment Extensions in excess of, in the
aggregate, three months would be deemed to breach a material covenant of the
Administrative Agent, the Administrative Agent will be required to purchase the
beneficial interest in the related Series 1996-1 Leased Vehicle as of the date
the proscribed Payment Extension is granted. The amount payable for each such
purchase will be the Administrative Purchase Amount of the Series 1996-1 Lease
and Series 1996-1 Leased Vehicle. (Administrative Agency Agreement, Sections
[4.2], [4.5], [4.6] and [4.7]; Series 1996-1 Supplement, Section [5.5]).

SALE OF LEASED VEHICLES

On the Scheduled Lease End Date of a Series 1996-1 Lease, the Obligor
has the option to purchase the related Series 1996-1 Leased Vehicle for an
amount equal to or greater than its Residual Value. If the Obligor does not
purchase the Leased Vehicle, the Dealer may, at its option, purchase the Leased
Vehicle. If either the Obligor or the Dealer exercises such option, the
Administrative Agent, on behalf of FCTT will sell the Series 1996-1 Leased
Vehicle to the Dealer for an amount equal to the Residual Value thereof plus
any unpaid amounts owing from the related Obligor. If neither the related

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Obligor nor the Dealer elects to purchase a Series 1996-1 Leased Vehicle upon
termination of the related Lease, the Dealer will inspect the Series 1996-1
Leased Vehicle and assess any charges in respect of Excess Wear and Tear and
Excess Mileage, and the Administrative Agent will sell such Series 1996-1
Leased Vehicle at auction, or otherwise in accordance with Accepted Servicing
Practices. The Sale Proceeds received by the Issuer with respect to a Series
1996-1 Leased Vehicle sold at auction will be limited to the Transferor
Purchase Option Price. With respect to each Series 1996-1 Leased Vehicle for
which the Transferor exercises its Transferor Leased Vehicle Purchase Option,
the Transferor will deposit the related Transferor Purchase Option Net Proceeds
into the Cash Collateral Account until the aggregate cumulative amount
deposited in respect of such Transferor Purchase Option Net Proceeds for all
such Series 1996-1 Leased Vehicles equals $_______. Thereafter, the Transferor
will retain any Transferor Purchase Option Net Proceeds. To the extent that
Transferor Purchase Option Net Proceeds are deposited into the Cash Collateral
Account, such amounts will secure the Transferor's obligation to make Program
Operating Lease Payments to the Issuer. See "Series 1996-1 Certificates ----
Lease of the Series 1996-1 Certificates to the Transferor" and "Risk Factors
- ---- Residual Value Risk." (Administrative Agency Agreement, Sections [5.1],
[5.2] and [5.3]).

If the Dealer determines that a Series 1996-1 Leased Vehicle requires
repairs in respect of Excess Wear and Tear and Excess Mileage, either the
Obligor will pay the estimated costs of such repairs or the Administrative
Agent will grant the Obligor a one-month Term Extension to permit the Obligor
to effect such repairs at its own expense. The Administrative Agent will
purchase the beneficial interest in the Series 1996-1 Leased Vehicle for the
Administrative Purchase Amount if it grants a Term Extension. See "--
Administrative Purchases." The Administrative Agent will apply any security
deposit or reconditioning reserve to pay any amounts owed in respect of
Uncollected Excess Wear and Tear or Excess Mileage which are not paid by the
Obligor. (Administrative Agency Agreement, Section [5.1]).

Upon receipt of Sale Proceeds, the Administrative Agent will deliver
the related certificate of title to the Obligor, Dealer or other purchaser, as
the case may be. The Administrative Agent will deposit the Sale Proceeds from
the sale of Series 1996-1 Leased Vehicles (but not an amount in excess of the
Transferor Purchase Option Price) in the Collection Account and any Transferor
Purchase Option Net Proceeds in the Cash Collateral Account (but only to the
extent the aggregate cumulative amount deposited in respect of such Transferor
Purchase Option Net Proceeds is less than $_______) on the next following
Distribution Date (or on the business day preceding such Distribution Date, if
such Distribution Date is a Payment Date), or on the date it receives such
proceeds if any Monthly Remittance Condition has not been satisfied.
(Administrative Agency Agreement, Sections [5.2] and [5.3]). See "Series
1996-1 Certificates -- Lease of the Series 1996-1 Certificates to the
Transferor."

ADVANCES OF SALE PROCEEDS

If the Scheduled Lease End Date with respect to a Series 1996-1 Lease
occurs and the related Series 1996-1 Leased Vehicle is not sold by the last
business day of the Accrual Period in which the related Scheduled Lease End
Date occurred, the Administrative Agent will, on the business day preceding the
related Payment Date, make an advance (a "Sale Proceeds Advance") equal to the
Residual Value of such Series 1996-1 Leased Vehicle, but only if the
Administrative Agent determines, in its sole discretion, that such Sale
Proceeds Advance will be recoverable from the Sale Proceeds of the related
Series 1996-1 Leased Vehicle. To the extent such Sale Proceeds are
insufficient to reimburse the Sale Proceeds Advance, such Sale Proceeds Advance
will be reimbursed first from the Sale Proceeds of other Series 1996-1 Leased
Vehicles and then, if required after the Senior Notes, Subordinated Notes and
Lease Trust Certificates have been paid in full, from a draw on the Cash
Collateral Account. (Administrative Agency Agreement, Section [5.4]; Series
1996-1 Supplement, Section [5.4]).

VOLUNTARY EARLY TERMINATIONS, LIQUIDATED LEASES AND RECOVERIES

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Upon termination of a Series 1996-1 Lease prior to its Scheduled Lease
End Date and receipt by the Administrative Agent of the related Voluntary Early
Termination Proceeds or Liquidation Proceeds, as the case may be, the
Administrative Agent will deliver the related certificate of title to the
purchaser, if any, of the related Series 1996-1 Leased Vehicle. From and after
such date the Series 1996-1 Certificates will represent a beneficial interest
in the Voluntary Early Termination Proceeds or Liquidation Proceeds and
Recoveries received with respect to such Series 1996-1 Asset and will no longer
represent an interest in such Series 1996-1 Lease or Series 1996-1 Leased
Vehicle. (Administrative Agency Agreement, Section [5.5]).

REMITTANCE OF PAYMENTS; ALLOCATION OF FUNDS

The Administrative Agent will apply Total Monthly Payments received
during each Collection Period from each Obligor in the following order of
priority to pay (i) current and overdue Monthly Payments and Use and Lease Tax
Amounts, in the chronological order in which such payments were due; and (ii)
current and overdue Vehicle Insurance and Maintenance Amounts due to the
related Dealer. (Administrative Agency Agreement, Section [6.1]; Series 1996-1
Supplement, Section [5.2]).

If on any Distribution Date any portion of a Monthly Payment due on a
Series 1996-1 Lease during the related Collection Period has not been received
from the Obligor, the Administrative Agent will apply an amount equal to the
lesser of (i) the amount of Payaheads credited to such Obligor and (ii) the
portion of such Monthly Payment not received to pay the Monthly Payment with
respect to such Series 1996-1 Lease, and reduce the amount credited to such
Obligor by the amount so applied. Payaheads received from an Obligor in any
Collection Period will be credited to such Obligor. (Administrative Agency
Agreement, Section [6.1]).

The Administrative Agent will apply Sale Proceeds (up to the
Transferor Purchase Option Price, if applicable), Voluntary Early Termination
Proceeds and Recoveries which are not from Liquidated Leases received during a
Collection Period in the following order of priority: (i) to pay any sales, use
and lease taxes; (ii) to reduce the Adjusted Balance Subject to Lease Charges
of the related Series 1996-1 Lease until such Adjusted Balance Subject to Lease
Charges has been reduced to zero; (iii) to pay Uncollected Excess Wear and Tear
and Excess Mileage charges, if any; and (iv) as a Total Monthly Payment until
an amount equal to the Total Monthly Payment due in such Collection Period has
been credited as set forth in the first paragraph of this section.
(Administrative Agency Agreement, Section [6.1]).

The Administrative Agent will apply Liquidation Proceeds and
Recoveries from Liquidated Leases received during a Collection Period in the
following order of priority: (i) to pay any sales, use and lease taxes; (ii) to
reduce the Adjusted Balance Subject to Lease Charges until such Adjusted
Balance Subject to Lease Charges has been reduced to zero and (iii) as a Total
Monthly Payment until an amount equal to the Total Monthly Payment due in such
Collection Period has been credited as set forth in the first paragraph of this
section. (Administrative Agency Agreement, Section [6.1]).

The Administrative Agent will pay any Use and Lease Tax Amounts and
any other sales, use and lease taxes and any Vehicle Insurance and Maintenance
Amounts due in connection with a payment received from an Obligor to the
appropriate tax authorities and originating Dealers, respectively, and such
amounts will not be available to pay interest on and principal of the Senior
Notes, the Subordinated Notes or the Lease Trust Certificates. (Administrative
Agency Agreement, Section [6.1]).

MONTHLY PAYMENT ADVANCES

If one or more Monthly Payments due (or any portion thereof) with
respect to a Series 1996-1 Lease during any Accrual Period has not been
deposited to the Collection Account as of the last day

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of such Accrual Period, the Administrative Agent will make an advance (a
"Monthly Payment Advance") in an amount equal to the sum of the Monthly
Payments due with respect to such Series 1996-1 Lease during such Accrual
Period minus amounts received from the related Obligor, but only if the
Administrative Agent determines, in its sole discretion, that such Monthly
Payment Advance will be recoverable from subsequent Monthly Payments on such
Series 1996-1 Lease. To the extent subsequent Monthly Payments with respect to
such Series 1996-1 Lease are insufficient to reimburse the Monthly Payment
Advance, such Monthly Payment Advance will be reimbursed first from Collections
(other than Sale Proceeds) with respect to other Series 1996-1 Leases and then,
if required after the Senior Notes, Subordinated Notes and Lease Trust
Certificates have been paid in full, from a draw on the Cash Collateral
Account. (Administrative Agency Agreement, Section [6.3]; Series 1996-1
Supplement, Section [5.4]).

STATEMENTS TO HOLDERS

On each Distribution Date, the FCTT Trustee will deliver to the Lease
Trustee a statement relying on the information included in the certificate of
the Administrative Agent described in "-- Reporting" for the related
Collection Period, setting forth for such Collection Period the following
information with respect to the Series 1996-1 Assets: (i) the aggregate Monthly
Payments received by the Administrative Agent with respect to the Series 1996-1
Assets; (ii) the Pool Balance as of the beginning and end of such Collection
Period and the portion of such Pool Balance constituting the aggregate Residual
Values of the Series 1996-1 Leased Vehicles; (iii) the amount of the
Administrative Agent Fee payable to the Administrative Agent; (iv) the Series
1996-1 Credit Loss; (v) the aggregate Administrative Purchase Amounts paid;
(vi) the aggregate Monthly Scheduled Termination Sale Proceeds, Voluntary Early
Termination Proceeds, Liquidation Proceeds and Recoveries received by the
Administrative Agent (separately stated); (vii) the aggregate Transferor
Purchase Option Net Proceeds; (viii) the aggregate amount of Payaheads credited
to Obligors and the aggregate amount of Payaheads either held by the
Administrative Agent or on deposit in the Payahead Account as of the beginning
and end of the related Collection Period; (ix) the outstanding Sale Proceeds
Advances as of the beginning and end of the related Collection Period and the
aggregate Residual Values of those Series 1996-1 Leased Vehicles with respect
to which the related Series 1996-1 Leases have expired but have not been sold
as of the beginning and end of the related Collection Period; and (x) the
outstanding Monthly Payment Advances as of the beginning and end of the related
Collection Period and the outstanding amount of Monthly Payments which were due
but not collected from the related Obligors as of the beginning and end of the
related Collection Period. In addition to the foregoing, on each Payment Date
the FCTT Trustee will include in such statement: (i) the Series 1996-1 Credit
Loss with respect to each of the three preceding Collection Periods; and (ii)
the Series 1996-1 Residual Loss with respect to each of the three preceding
Collection Periods. (Administrative Agency Agreement, Section [6.4]; Series
1996-1 Supplement, Section [6.1]).

NO RESIGNATION

The Administrative Agent may not resign from its obligations and
duties under the Administrative Agency Agreement unless, as evidenced by an
Opinion of Counsel, the performance of its duties is no longer permissible
under applicable law. No such resignation will become effective until the FCTT
Trustee or a successor Administrative Agent has assumed the responsibilities
and obligations of the Administrative Agent. (Administrative Agency Agreement,
Section [7.2]).

ADMINISTRATIVE AGENT EVENTS OF DEFAULT

Each of the following will constitute an event of default under the
Administrative Agency Agreement (each, an "Administrative Agent Event of
Default"): (i) failure by the Administrative Agent to make any distribution
required by the Administrative Agency Agreement or the Series 1996-1 Supplement
for three business days after written notice of such failure to the
Administrative Agent or after discovery of such failure by the Administrative
Agent; (ii) any failure by the Administrative Agent to observe or to perform in
any material respect any of its covenants or agreements in the Administrative
Agency Agreement or the Series 1996-1 Supplement, which failure materially
adversely affects the holders of the EBCs, the Issuer, as holder of the Series
1996-1 Certificates, or any other holder of an SBC, and continues for a period
of 30 days after written notice of such failure to the Administrative Agent or

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after discovery of such failure by the Administrative Agent; (iii) any
representation, warranty, report or certification of the Administrative Agent
in, or pursuant to, the Administrative Agency Agreement or the Series 1996-1
Supplement was incorrect when made, which has a material adverse effect on any
holder of an EBC, the Issuer, or any other holder of an SBC, and continues
for a period of 30 days after written notice thereof to the Administrative
Agent or after discovery of such failure by the Administrative Agent; or (iv)
the occurrence of certain events of bankruptcy, insolvency, receivership or
liquidation with respect to the Administrative Agent; provided, however, that
the occurrence of an event set forth in clauses (i), (ii), and (iii) with
respect to Series 1996-1 will be an Administrative Agent Event of Default only
with respect to Series 1996-1 and will not be an Administrative Agent Event of
Default with respect to any other Series or the EBCs. (Administrative Agency
Agreement, Section [7.1]).

Upon the occurrence of any Administrative Agent Event of Default the
sole remedy available to the holders of the EBCs and the SBCs will be to remove
the Administrative Agent and appoint a successor Administrative Agent. See
"-- Removal of the Administrative Agent."

REMOVAL OF THE ADMINISTRATIVE AGENT

The Transferor, with the consent of the Indenture Trustee, acting at
the direction of 100% of the Senior Noteholders, and the Lease Trustee, acting
at the direction of 66-2/3% of the Lease Trust Certificateholders, may at any
time, for any reason, with respect to the Series 1996-1 Assets only, remove the
Administrative Agent and appoint a substitute Administrative Agent. Upon
appointment, the substitute Administrative Agent will assume the rights and
obligations of the Administrative Agent under the Administrative Agency
Agreement with respect to administering and servicing the Series 1996-1 Assets.
Until the appointment of such substitute Administrative Agent, the predecessor
Administrative Agent will continue to perform its duties and obligations with
respect to administering and servicing the Series 1996-1 Assets. No substitute
Administrative Agent will have any responsibilities with respect to the
purchase of additional Leases and Leased Vehicles by FCTT. (Administrative
Agency Agreement, Section [7.1]; Indenture, Section [6.13]).

Upon the occurrence of an Administrative Agent Event of Default, the
FCTT Trustee may, to the extent such Administrative Agent Event of Default
relates (i) to all FCTT Assets, upon direction of the holders of the Series
1996-1 Certificates (which for this purpose will be the Indenture Trustee
acting at the direction of a majority by outstanding principal balance of the
Senior Noteholders so long as any of the Senior Notes are outstanding), all
holders of any other SBCs and the holders of the EBCs (excluding Ford Credit
and Ford Credit Leasing or any other affiliate of the Administrative Agent),
terminate all of the rights and obligations of the Administrative Agent under
the Administrative Agency Agreement with respect to all FCTT Assets, or (ii)
only to the Series 1996-1 Assets, upon direction of the holders of the Series
1996-1 Certificates (which for this purpose will be the Indenture Trustee
acting at the direction of a majority by outstanding principal balance of the
Senior Noteholders, so long as any of the Senior Notes are outstanding),
terminate all of the rights and obligations of the Administrative Agent under
the Administrative Agency Agreement and the Series 1996-1 Supplement, with
respect to the Series 1996-1 Assets. In each case, the FCTT Trustee will
effect such termination by delivering notice thereof to the Administrative
Agent (with a copy to each Rating Agency then rating the Senior Notes, the
Lease Trust Certificates and any other securities based on any SBCs affected by
such Administrative Agent Event of Default). (Administrative Agency Agreement,
Section [7.1]).

APPOINTMENT OF A SUCCESSOR

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Upon termination or resignation of the Administrative Agent, the
predecessor Administrative Agent will continue to perform its functions as
Administrative Agent, in the case of termination of the Administrative Agent,
until the earlier of the date specified in the termination notice or, if no
such date is specified therein, the date of the Administrative Agent's receipt
of such notice and, in the case of resignation of the Administrative Agent,
until the later of (i) 45 days after the delivery to the FCTT Trustee of the
written resignation notice and (ii) the date upon which the predecessor
Administrative Agent becomes unable to act as Administrative Agent, as
specified in the resignation notice and accompanying Opinion of Counsel.
(Administrative Agency Agreement, Section [7.3]).

In the event of the Administrative Agent's termination with respect to
all FCTT Assets as a result of an Administrative Agent Event of Default or
resignation, the FCTT Trustee, acting at the direction of the holders of the
EBCs and the outstanding SBCs will appoint a successor Administrative Agent.
In the event of a termination of the Administrative Agent with respect to the
Series 1996-1 Assets only, the FCTT Trustee, acting at the direction of the
holders of the Series 1996-1 Certificates (which for this purpose will be the
Indenture Trustee so long as any of the Senior Notes are outstanding) will
appoint a successor Administrative Agent. In each such case, the FCTT Trustee
will have the right to approve the successor Administrative Agent, such
approval not to be unreasonably withheld. If a successor Administrative Agent
is not appointed by the effective date of the predecessor Administrative
Agent's resignation or termination, then the FCTT Trustee will act as successor
Administrative Agent. If the FCTT Trustee is legally unable to act as
Administrative Agent, then the FCTT Trustee will be required to appoint, or
petition a court of competent jurisdiction to appoint, any established
institution, having a net worth of not less than $100,000,000 and whose regular
business includes the servicing of retail automotive leases and selling
vehicles at the termination of leases, as the successor Administrative Agent.
(Administrative Agency Agreement, Section [7.3]).

Upon appointment, the successor Administrative Agent will assume all
of the rights and obligations of the Administrative Agent under the
Administrative Agency Agreement; provided, however, that no successor
Administrative Agent will have any responsibilities with respect to the
purchase of additional Leases and Leased Vehicles by FCTT or with respect to
making Monthly Payment Advances or Sale Proceeds Advances. (Administrative
Agency Agreement, Section [7.3]).

Any compensation payable to a successor Administrative Agent may not
be in excess of that permitted the predecessor Administrative Agent unless the
holders of the EBCs bear such excess costs exclusively. (Administrative Agency
Agreement, Section [7.3]).

Any predecessor Administrative Agent will be entitled to reimbursement
for any outstanding Sale Proceeds Advances and Monthly Payment Advances to the
extent funds are available therefor. (Administrative Agency Agreement, Section
[7.4]).

CUSTODY OF LEASE FILES

The Administrative Agent will be the custodian of the Lease Files
(including certificates of title) for FCTT, including with respect to the
Series 1996-1 Assets. The Administrative Agent will be required to maintain
accurate and complete accounts, records, and computer systems pertaining to
each Lease File and to conduct, or cause to be conducted, periodic audits of
the Lease Files and of the related accounts, records, and computer systems.

The Administrative Agent will maintain each Lease File at (i) one of
the offices specified in the Administrative Agency Agreement, (ii) at such
other office (which may be a third party contracted by the Administrative Agent
to hold Lease Files) as the Administrative Agent specifies to the FCTT Trustee
by written notice not later than 90 days after any change in location or (iii)
at one of the offices included in a list delivered to the FCTT Trustee not less
frequently than every 90 days. The Administrative Agent will make available to
the FCTT Trustee, the Lease Trustee, and the Indenture Trustee a list of
locations of the Lease Files, the Lease Files, and the related accounts,
records, and computer systems maintained by the Administrative Agent at such
times as the FCTT Trustee, the Lease Trustee or the Indenture

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Trustee may instruct. As soon as practicable after any termination or
resignation of the Administrative Agent, the Administrative Agent will deliver
the Lease Files and the related accounts and records maintained by the
Administrative Agent to the FCTT Trustee or any successor Administrative Agent.

The Administrative Agent as custodian of the Lease Files will
indemnify the FCTT Trustee, the Issuer, and the Indenture Trustee for any and
all liabilities that result from any improper act or omission of the
Administrative Agent with respect to the Lease Files pertaining to the Series
1996-1 Assets. The Administrative Agent will not be liable for claims
resulting from the willful misfeasance, bad faith, or negligence of the FCTT
Trustee with respect to the Lease Files. (Administrative Agency Agreement,
Section [4.4]).

REPORTING

On or before the tenth day of each calendar month, the Administrative
Agent will deliver to the FCTT Trustee a certificate containing information
relating to the distribution, on the following Distribution Date (or on the
business day preceding such Distribution Date, if such Distribution Date is a
Payment Date), of Collections from the preceding Collection Period and the
information the FCTT Trustee will provide to the Lease Trustee on such
Distribution Date, as described in "-- Statements to Holders."
(Administrative Agency Agreement, Section [4.9]).

On or before April 30th of each year, the Administrative Agent will
deliver to the FCTT Trustee an officer's certificate, dated as of December 31
of the preceding calendar year, stating that (i) a review of the activities of
the Administrative Agent during the preceding 12-month period and of its
performance under the Administrative Agency Agreement and the Series 1996-1
Supplement has been made under such officer's supervision and (ii) to the best
of such officer's knowledge, based on such review, the Administrative Agent has
fulfilled all of its obligations under the Administrative Agency Agreement and
the Series 1996-1 Supplement throughout such period, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof. (Administrative
Agency Agreement, Section [4.10]).

The Administrative Agent will be required to deliver to the FCTT
Trustee, within five business days of having obtained knowledge thereof,
written notice in an officer's certificate of any event which with the giving
of notice or lapse of time, or both, would become an Administrative Agent Event
of Default. (Administrative Agency Agreement, Section [4.10]).

On or before April 30 of each year beginning April 30, 199_, a firm of
independent certified public accountants, who may also render other services to
the Administrative Agent or to Ford or any affiliate of either of them, will
deliver a report to the Administrative Agent, the FCTT Trustee, the Lease
Trustee and the Indenture Trustee (with a copy to each Rating Agency then
rating the Senior Notes and the Lease Trust Certificates), stating that such
firm has audited the financial statements of the Administrative Agent for the
prior calendar year and that such audit (i) was made in accordance with
generally accepted auditing standards, (ii) included procedures relating to
retail automotive leases serviced for others in accordance with applicable
industry standards, and (iii) except as described in such report, disclosed no
exceptions or errors in the records relating to the Series 1996-1 Leases
serviced that, in the firm's opinion, should be included in such report.
(Administrative Agency Agreement, Section [4.11]).

ADDITIONAL DOCUMENT PROVISIONS

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THE LEASE TRUST AGREEMENT

Authority and Duties of the Lease Trustee. The Lease Trustee will
administer the Issuer in the interest of the Lease Trust Certificateholders,
subject to the lien of the Indenture, in accordance with the Lease Trust
Agreement and the other Basic Documents. (Lease Trust Agreement, Section
[6.2]).

The Transferor, in its capacity as holder of the Lease Trust
Certificates initially acquired by it, may, by written instruction, direct the
Lease Trustee in the administration of the Issuer; provided, that such
instruction shall not, as evidenced by an Opinion of Counsel, materially
adversely affect the Senior Noteholders, Subordinated Noteholders or Lease
Trust Certificateholders. However, the Lease Trustee will not be required to
follow any such instruction if it reasonably determines or is advised by
counsel that so doing (i) is likely to result in liability to the Lease
Trustee, (ii) is contrary to the terms of the Lease Trust Agreement or any
other Basic Document, or (iii) is unlawful. (Lease Trust Agreement, Section
[6.3]).

The Lease Trustee will not be required to perform any of the
obligations of the Issuer under the Lease Trust Agreement or the other Basic
Documents that are required to be performed by (i) the Administrative Agent
under the Administrative Agency Agreement or the Series 1996-1 Supplement, (ii)
the Transferor under the Transfer Agreement or the Program Operating Lease or
(iii) the Indenture Trustee under the Indenture. (Lease Trust Agreement,
Section [7.1]).

Restrictions on Actions by Lease Trustee. The Lease Trustee may not
(i) initiate or settle any claim or lawsuit involving the Issuer (unless
brought by the Administrative Agent to collect amounts owed under a Series
1996-1 Lease), (ii) amend the Indenture where Senior Noteholder consent is
required, (iii) amend the Indenture where Senior Noteholder consent is not
required if such amendment materially adversely affects the Lease Trust
Certificateholders or (iv) amend any Basic Document other than the Indenture if
such amendment materially adversely affects the Lease Trust Certificateholders,
unless (a) the Lease Trustee provides 30 days written notice thereof to the
Lease Trust Certificateholders and the Rating Agencies and (b) Lease Trust
Certificateholders holding at least 25% of the aggregate principal balance of
the Lease Trust Certificates do not object in writing to any such proposed
amendment within 30 days of such notice. (Lease Trust Agreement, Section
[4.1]).

Actions by Lease Trust Certificateholders with Respect to Certain
Matters. The Lease Trustee may not, except upon the occurrence of an
Administrative Agent Event of Default subsequent to the payment in full of the
Senior Notes and in accordance with the written directions of Lease Trust
Certificateholders holding 100% of the aggregate principal balance of the Lease
Trust Certificates, remove the Administrative Agent with respect to the Series
1996-1 Assets or appoint a successor Administrative Agent with respect thereto;
provided, however, that the Lease Trustee will not be required to follow any
directions of the Lease Trust Certificateholders if so doing would be contrary
to any obligation of the Lease Trustee or the Issuer. The Lease Trustee may
not sell the Series 1996-1 Certificates except in the event of the bankruptcy
and dissolution of the Issuer or Ford Credit Leasing or upon an event of
default under the Program Operating Lease. Upon a sale of the Series 1996-1
Certificates following such a bankruptcy or dissolution, the Series 1996-1
Assets will be distributed to the purchaser and will no longer constitute FCTT
Assets, and the Series 1996-1 Vehicles will be retitled as directed by the
purchaser. (Lease Trust Agreement, Sections [4.2] and [4.4]).

The right of the Transferor or Lease Trust Certificateholders to take
any action affecting the Lease Trust Estate will be subject to the rights of
the Indenture Trustee under the Indenture.

Resignation and Removal of the Lease Trustee. The Lease Trustee may
resign at any time upon written notice to the Administrative Agent, the
Transferor and the Lease Trust Certificateholders, whereupon the holders of the
Lease Trust Certificates will be obligated to appoint a successor Lease
Trustee. The Transferor or the Lease Trust Certificateholders holding not less
than a majority of the

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aggregate principal balance of the Lease Trust Certificates may remove the
Lease Trustee if the Lease Trustee ceases to be eligible, becomes insolvent or
becomes legally unable to act. Upon removal of the Lease Trustee, the
Transferor or the Lease Trust Certificateholders holding not less than a
majority of the aggregate principal balance of the Lease Trust Certificates
will appoint a successor Lease Trustee. The Transferor will be required to
deliver written notice to the Rating Agencies of any resignation or removal of
the Lease Trustee. (Lease Trust Agreement, Section [10.2]).

The Lease Trustee, and any successor thereto, must at all times (i) be
able to exercise corporate trust powers, (ii) be subject to supervision or
examination by federal or state authorities, (iii) have a combined capital and
surplus of $50,000,000 and (iv) have a long-term debt rating of investment
grade by each of the Rating Agencies or be otherwise acceptable to the Rating
Agencies. (Lease Trust Agreement, Section [10.1]). Any co-trustee or separate
trustee appointed for the purpose of meeting applicable state requirements will
not be required to meet these eligibility requirements. (Lease Trust
Agreement, Section [10.5]).

Termination. The Lease Trust Agreement will terminate (i) upon the
final distribution of all funds or other property or proceeds of the Lease
Trust Estate in accordance with the terms of the Indenture and the final
distribution on the Subordinated Notes and the Lease Trust Certificates
pursuant to the Lease Trust Agreement, (ii) upon the occurrence of certain
events of bankruptcy, insolvency, receivership or liquidation with respect to
the Transferor or Ford Credit Leasing, or (iii) upon the termination of the
Transferor in accordance with the terms of the Basic Documents. Upon
termination of the Lease Trust Agreement pursuant to clause (ii), the Lease
Trustee will direct the Indenture Trustee to sell the assets of the Lease Trust
Estate, other than amounts on deposit in the Payment Account, in a commercially
reasonable manner and on commercially reasonable terms. (Lease Trust
Agreement, Sections [9.1] and 9.2). The Indenture Trustee will apply the
proceeds of such sale to pay amounts owed to the Indenture Trustee and interest
on and principal of the Senior Notes, Subordinated Notes and Lease Trust
Certificates in accordance with the terms of the Indenture. See "Description
of the Senior Notes -- Indenture -- Remedies."

Liabilities and Indemnification. The Transferor as holder of the
Lease Trust Certificates initially acquired by it and Ford Credit Leasing as an
assignee of an interest therein will each be directly liable for any claims
against the Issuer (not including payment of principal and interest on the
Senior Notes, Subordinated Notes and Lease Trust Certificates), as if the
Issuer were a partnership and the Transferor and Ford Credit Leasing were
general partners thereof. (Lease Trust Agreement, Section [2.7]). The
Transferor and Ford Credit Leasing, in such capacities, will indemnify the
Lease Trustee for any expenses incurred by the Lease Trustee in the performance
of its duties under the Lease Trust Agreement. The Transferor and Ford Credit
Leasing will not be entitled to make any claim upon the Lease Trust Estate for
the payment of any such liabilities or indemnified expenses. (Lease Trust
Agreement, Section [8.2]). The Transferor and Ford Credit Leasing will not
indemnify the Lease Trustee for expenses resulting from the willful misconduct,
bad faith or negligence of the Lease Trustee, or for the inaccuracy of any
representation or warranty of the Lease Trustee in the Lease Trust Agreement.
The Lease Trustee will not be liable for (i) any error of judgment made by an
officer of the Lease Trustee, (ii) any action taken or omitted to be taken in
accordance with the instructions of any Lease Trust Certificateholder, the
Indenture Trustee, the Transferor or the Administrative Agent, (iii) the
interest on or principal of the Senior Notes, the Subordinated Notes or the
Lease Trust Certificates and (iv) the default or misconduct of the
Administrative Agent, the Transferor or the Indenture Trustee. (Lease Trust
Agreement, Section [7.1]).

Subordinated Notes. The Subordinated Notes will be issued pursuant to
the Lease Trust Agreement and initially will be retained by the Transferor.
The Subordinated Notes are unsecured and are subordinated in right of payment
to the Senior Notes to the extent described herein. See "Description of the
Senior Notes -- The Indenture Cash Flows." If a default occurs with respect
to the Issuer's obligations under the Subordinated Notes while the Senior Notes
are outstanding, the

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Subordinated Noteholders are not permitted to declare the principal balance of
the Subordinated Notes to be immediately due and payable.

Lease Trust Certificates Owned by Transferor or its Affiliates. Any
Lease Trust Certificates owned by the Transferor or its affiliates will be
entitled to benefits under the Lease Trust Agreement equal and proportionate to
the Lease Trust Certificates owned by others, except that such Lease Trust
Certificates owned by the Transferor or its affiliates will be deemed not to be
outstanding for the purpose of determining whether the requisite percentage of
Lease Trust Certificateholders have given any request, demand, authorization,
direction, notice, consent or other action under the Lease Trust Agreement and
the other Basic Documents (other than the commencement by the Issuer of a
voluntary proceeding in bankruptcy as described under "-- Bankruptcy
Provisions -- Issuer").

REPRESENTATIONS, WARRANTIES AND COVENANTS

The Administrative Agent, in the Series 1996-1 Supplement, and each of
Ford Credit and Ford Credit Leasing, in the Asset Contribution Agreement, will
represent and warrant that each Series 1996-1 Lease and Series 1996-1 Leased
Vehicle meet the Specific Eligibility Criteria set forth in "The Leases and the
Leased Vehicles -- Eligibility Criteria" and certain other eligibility
criteria (the "General Eligibility Criteria") including, among other things,
that (i) each Series 1996-1 Leased Vehicle was titled in the name of "Ford
Credit Titling Trust," "Ford Credit Titling Trust, Comerica Bank [or applicable
co-trustee or separate trustee], Trustee" or such substantially similar words
acceptable to the relevant governmental authority; (ii) the Residual Value of
each Series 1996-1 Leased Vehicle does not exceed an amount established by the
Administrative Agent consistent with its policies and practices regarding the
setting of residual values as applied with respect to closed-end retail
automobile and light truck leases; (iii) all of the originating Dealer's right,
title and interest in such Series 1996-1 Lease and the related Series 1996-1
Leased Vehicle was validly assigned by such Dealer to FCTT; (iv) each Series
1996-1 Lease was originated by a Dealer in the ordinary course of its business
and in compliance with the Administrative Agent's normal credit and collection
policies and practices and contains customary and enforceable provisions; (v)
at its inception, and at the Series 1996-1 Cut-Off Date, each Series 1996-1
Lease complied in all material respects with all requirements of applicable
federal, state, and local laws and regulations; (vi) each Series 1996-1 Lease
represents the genuine, legal, valid and binding payment obligation in writing
of the related Obligor, enforceable by the holder thereof in accordance with
its terms, subject to the effect of bankruptcy, insolvency, reorganization, or
other similar laws affecting the enforcement of creditors' rights generally and
general principles of equity; (vii) none of the Series 1996-1 Leases is an
obligation of the United States of America or any state or of any agency,
department, or instrumentality of the United States of America or any state;
(viii) as of the date of the Series Specification Notice with respect to Series
1996-1, no Series 1996-1 Lease had been satisfied, subordinated, rescinded,
cancelled or terminated; (ix) no provision (other than the assessment of a
security deposit or reconditioning reserve) of a Series 1996-1 Lease has been
waived; (x) no right of rescission, setoff, counterclaim, or defense has been
asserted or threatened with respect to any Series 1996-1 Lease; (xi) each
Obligor, to the best knowledge of the Administrative Agent, has obtained or
agreed to obtain physical damage insurance and liability insurance covering the
Series 1996-1 Leased Vehicle as required under the related Series 1996-1 Lease;
(xii) no Series 1996-1 Asset has been sold, transferred, assigned, or pledged
by any Dealer to any person or entity other than FCTT; (xiii) the FCTT Trustee,
for the benefit of the Issuer, has good and marketable title to each Series
1996-1 Lease and each Series 1996-1 Leased Vehicle, free and clear of all
liens, encumbrances, security interests, and rights of others, including liens
or claims for work, labor or material relating to such Series 1996-1 Leased
Vehicle; (xiv) no Series 1996-1 Leased Vehicle or Series 1996-1 Lease is
subject to the laws of, and no Series 1996-1 Lease was originated in, any
jurisdiction under which the sale, transfer, and assignment of such Series
1996-1 Lease and Series 1996-1 Leased Vehicle to FCTT or of a beneficial
interest in such Series 1996-1 Lease or Series 1996-1 Leased Vehicle pursuant
to transfers of Series 1996-1 Certificates is unlawful, void, or voidable; (xv)
no Dealer has entered into any agreement with any Obligor that prohibits,
restricts or conditions the assignment

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of any portion of the related Series 1996-1 Lease; (xvi) all filings
(including, without limitation, UCC filings) necessary in any jurisdiction to
give the FCTT Trustee, on behalf of FCTT, a first perfected ownership interest
in each Series 1996-1 Lease have been made; (xvii) each Series 1996-1 Lease
constitutes "chattel paper" as defined in the UCC; (xviii) there is only one
original of each Series 1996-1 Lease, which is held by the Administrative
Agent on behalf of FCTT; and (xix) each Series 1996-1 Lease is a "true lease"
for federal income tax purposes. (Series 1996-1 Supplement, Section [3.1];
Asset Contribution Agreement, Section [3.2]). See "Description of
Administrative Agency Agreement -- Administrative Purchases" for circumstances
in which a breach of the foregoing representations will cause a purchase of
the beneficial interest in a Series 1996-1 Lease and Series 1996-1 Leased
Vehicle.

AMENDMENT PROVISIONS

General. So long as any of the Senior Notes are outstanding, the
Issuer's rights in the Series 1996-1 Certificates will be subject to the lien
of the Indenture, and after the Senior Notes have been paid in full will be
subject to the Program Operating Lease. The Indenture Trustee will be the
holder of the Series 1996-1 Certificates for purposes of determining whether
any proposed amendment to the FCTT Agreement, the Administrative Agency
Agreement, the Series 1996-1 Supplement and the RCL Trust Agreement will
materially adversely affect the interests of the holder of the Series 1996-1
Certificates.

The FCTT Agreement, the RCL Trust Agreement and the Administrative
Agency Agreement (including the Series 1996-1 Supplement) each may be amended
without the consent of the holder of the Series 1996-1 Certificates; provided,
however, (x) that such amendment may not, as evidenced by an Opinion of
Counsel, materially adversely affect the interests of the holder of the Series
1996-1 Certificates, (y) as confirmed by each Rating Agency, such amendment may
not cause the then current rating assigned to either Class of Senior Notes or
the Lease Trust Certificates to be withdrawn or reduced and (z) an Opinion of
Counsel as to certain tax matters is delivered. Notwithstanding the foregoing,
the FCTT Agreement, the RCL Trust Agreement and the Administrative Agency
Agreement may be amended at any time by the parties thereto to the extent
reasonably necessary to assure that none of FCTT, the Issuer or the Transferor
will be classified as an association (or publicly traded partnership) taxable
as a corporation for federal income tax purposes.

The Program Operating Lease and Asset Contribution Agreement each may
be amended without the consent of the Noteholders or Lease Trust
Certificateholders; provided, however, (x) that such amendment may not, as
evidenced by an Opinion of Counsel, materially adversely affect the interests
of the Noteholders or Lease Trust Certificateholders, (y) as confirmed by each
Rating Agency, that such amendment may not cause the then current rating
assigned to either Class of Senior Notes or the Lease Trust Certificates to be
withdrawn or reduced and (z) an Opinion of Counsel as to certain tax matters is
delivered. Notwithstanding the foregoing, the Program Operating Lease and the
Asset Contribution Agreement may be amended at any time by the parties thereto
to the extent reasonably necessary to assure that none of FCTT, the Issuer or
the Transferor will be classified as an association (or publicly traded
partnership) taxable as a corporation for federal income tax purposes.

Amendment of the Lease Trust Agreement. The Lease Trust Agreement may
be amended by the Transferor and the Lease Trustee, with prior written notice
to the Rating Agencies, without the consent of any of the Noteholders or the
Lease Trust Certificateholders, to cure any ambiguity or defect therein, to
correct or supplement any provisions therein, to add any provisions thereto or
change in any manner or eliminate any of the provisions therein or to modify in
any manner the rights of the Noteholders or the Lease Trust Certificateholders;
provided, however, that (x) no such amendment may, as evidenced by an Opinion
of Counsel, materially adversely affect the interests of the Indenture Trustee,
any Noteholder or Lease Trust Certificateholder, (y) as confirmed by each
Rating Agency, cause the then current rating of either Class of Senior Notes or
the Lease Trust Certificates to be

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withdrawn or reduced and (z) an Opinion of Counsel as to certain tax matters is
delivered. (Lease Trust Agreement, Section [12.1]). Notwithstanding the
foregoing, the Lease Trust Agreement may be amended at any time by the
Transferor, in its capacity as holder of the Lease Trust Certificates initially
acquired by it, and the Lease Trustee to the extent reasonably necessary to
assure that none of FCTT, the Issuer or the Transferor will be classified as an
association (or publicly traded partnership) taxable as a corporation for
federal income tax purposes.

The Lease Trust Agreement may be amended by the Transferor and the
Lease Trustee, with prior written notice to each Rating Agency, with the
consent of the Senior Noteholders holding not less than a majority of the
aggregate principal balance of each Class of Senior Notes and, to the extent
affected thereby, the consent of Lease Trust Certificateholders holding not
less than a majority of the aggregate principal balance of the Lease Trust
Certificates, to add any provisions thereto or change in any manner or
eliminate any of the provisions therein or modify in any manner the rights of
the Senior Noteholders, the Subordinated Noteholders or the Lease Trust
Certificateholders; provided, that (x) no such amendment may increase or reduce
in any manner the amount of, or accelerate or delay the timing of distributions
that are required to be made for the benefit of the Senior Noteholders, the
Subordinated Noteholders or the Lease Trust Certificateholders or reduce the
percentage of the aggregate principal balance of each Class of Senior Notes or
the Lease Trust Certificates required to consent to any such amendment, without
the consent of the holders of 100% of all outstanding Senior Notes,
Subordinated Notes or Lease Trust Certificates, as the case may be, and (y) an
Opinion of Counsel as to certain tax matters is delivered. (Lease Trust
Agreement, Section [12.1]).

BANKRUPTCY PROVISIONS

Ford Credit Leasing. The FCTT Trustee, the Lease Trustee, the
Transferor, the Indenture Trustee, the RCL Trustee, Ford Credit, the
Administrative Agent, and each holder of an SBC, and each Lease Trust
Certificateholder (other than Ford Credit Leasing) by accepting a Lease Trust
Certificate, each Senior Noteholder by accepting a Senior Note and each
Subordinated Noteholder by accepting a Subordinated Note, will covenant that
for a period of one year and one day after payment in full of all amounts due
to each holder of an SBC, they will not institute, or join in instituting, any
bankruptcy, reorganization, insolvency or liquidation proceeding, or other
similar proceeding against Ford Credit Leasing without the consent of 100% of
the holders of the SBCs (excluding Ford Credit Leasing, the Transferor or any
of their affiliates). (RCL Trust Agreement, Section [10.8]; Administrative
Agency Agreement, Section [8.9]; FCTT Agreement, Section [9.8]; Lease Trust
Agreement, Section [12.8]).

FCTT. The FCTT Trustee and the Administrative Agent each will not
have the power to commence a voluntary bankruptcy proceeding with respect to
FCTT unless each holder of an EBC (Ford Credit and Ford Credit Leasing) and
each holder of an SBC (which with respect to Series 1996-1 for this purpose
is the Indenture Trustee) approves such commencement and certifies to the FCTT
Trustee or the Administrative Agent, as the case may be, that it reasonably
believes that FCTT is insolvent. (FCTT Agreement, Section [9.8];
Administrative Agency Agreement, Section [8.9]).

The FCTT Trustee, the Lease Trustee, the Transferor, the Indenture
Trustee, the RCL Trustee, Ford Credit, Ford Credit Leasing, the Administrative
Agent, each holder of an EBC and each holder of an SBC, will covenant that for
a period of one year and one day after payment in full of all distributions
owing to each holder of an SBC, they will not institute, or join in
instituting, any bankruptcy, reorganization, insolvency or liquidation
proceeding, or other similar proceeding against FCTT without the consent of
100% of the holders of the SBCs (excluding Ford Credit Leasing, the Transferor
or any of their affiliates). (RCL Trust Agreement, Section [10.8];
Administrative Agency Agreement, Section [8.9]; FCTT Agreement, Section [9.8];
Lease Trust Agreement, Section [12.8]).

The Transferor. The RCL Trustee will not commence a voluntary
bankruptcy proceeding with respect to the Transferor unless it reasonably
believes that the Transferor is insolvent and each

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beneficiary of the Transferor approves such commencement and certifies to the
RCL Trustee that it reasonably believes that the Transferor is insolvent. (RCL
Trust Agreement, Section [10.8]).

The Lease Trustee, the Transferor, the Indenture Trustee, each Lease
Trust Certificateholder by accepting a Lease Trust Certificate, each Senior
Noteholder by accepting a Senior Note and each Subordinated Noteholder by
accepting a Subordinated Note, will covenant not to institute or join in the
institution of any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding, or other similar proceeding against the Transferor for
a period of one year and a day after the Series 1996-1 Certificates have been
paid in full; provided, however, that 100% of the Senior Noteholders (or, if no
Senior Notes are then outstanding, 100% of the Subordinated Noteholders), or if
no Senior Notes or Subordinated Notes are then outstanding, 100% of the Lease
Trust Certificateholders (in each case, excluding Ford Credit Leasing, the
Transferor or any of their affiliates) may at any time institute, or join in
instituting, any bankruptcy, reorganization, insolvency or liquidation
proceeding against the Transferor. (Lease Trust Agreement, Section [12.8];
Indenture, Section [11.16]).

The Issuer. The Lease Trustee will not commence a voluntary
bankruptcy proceeding with respect to the Issuer unless each Lease Trust
Certificateholder, each Senior Noteholder and each Subordinated Noteholder
approves such commencement and certifies to the Lease Trustee that it
reasonably believes that the Issuer is insolvent. (Lease Trust Agreement,
Section [4.3]).

The Lease Trustee, the Transferor, the Indenture Trustee and each
Lease Trust Certificateholder by accepting a Lease Trust Certificate, each
Senior Noteholder by accepting a Senior Note and each Subordinated Noteholder
by accepting a Subordinated Note, will covenant not to institute, or join in
instituting, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding, against the Issuer for a period of one year and a day
after the Series 1996-1 Certificates have been paid in full; provided, however,
that 100% of the Senior Noteholders (or, if no Senior Notes are then
outstanding, 100% of the Subordinated Noteholders) may institute, or join in
instituting any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding against the Issuer. (Lease Trust Agreement, Section
[12.8]; Indenture, Section [11.16]).

FEES AND EXPENSES

FCTT Trustee. On each Payment Date, the FCTT Trustee will be entitled
to a fee for its services with respect to Series 1996-1 Assets, which will be
paid by the Administrative Agent on behalf of the holders of the EBCs. The
amount of such fee will equal a pro rata percentage of the total fees and
expenses payable to the FCTT Trustee with respect to all FCTT Assets (excluding
any extraordinary items relating only to specific Series or the EBCs), the
amount of which will be agreed upon from time to time by the FCTT Trustee and
the holders of the EBCs. (FCTT Agreement, Section [6.8]; Series 1996-1
Supplement, Section [4.1]).

The Administrative Agent. On each Payment Date, as compensation for
servicing the Series 1996-1 Assets and administering the distribution of funds
in respect thereof, the Administrative Agent will be paid the Administrative
Agent Fee (equal to the sum, for each of the three Collection Periods preceding
such Payment Date, of the product of 1/12 of 1.00% and the Pool Balance as of
the beginning of each such Collection Period) from the Total Available Funds
distributed on such Payment Date. The Administrative Agent also will receive
the Supplemental Administrative Agent Fee and certain other fees collected in
connection with Series 1996-1 Assets. (Administrative Agency Agreement,
Section [4.8]; Series 1996-1 Supplement, Section [4.3]).

The Administrative Agent also will receive fees with respect to the
servicing and administration of the Non-Specified Assets and other Series
Specified Assets from payments and proceeds of such Non-Specified Assets and
other Series Specified Assets.

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The Administrative Agent will pay all expenses incurred by it in the
performance of its duties under the Administrative Agency Agreement, including
fees and disbursements of independent accountants, taxes imposed on the
Administrative Agent and expenses incurred in connection with distributions and
reports to the FCTT Trustee, the Lease Trustee and the Indenture Trustee. The
Administrative Agent will pay the fees and expenses of the Lease Trustee, the
Indenture Trustee and the FCTT Trustee. The Administrative Agent will be
required to pay all expenses relating to the sale or disposition of any Series
1996-1 Leased Vehicle after the termination of the related Series 1996-1 Lease.
(Administrative Agency Agreement, Section [4.13]).

The RCL Trustee. The RCL Trustee will receive such fees as Ford
Credit, Ford Credit Leasing and the RCL Trustee from time to time agree and
will be reimbursed for all reasonable expenses. Such fees and reimbursements
will be paid first from amounts available for distribution to the beneficiaries
of the Transferor and second, to the extent such amounts are insufficient,
directly by Ford Credit and Ford Credit Leasing. (RCL Trust Agreement, Section
[6.9]).

The Lease Trustee. The Administrative Agent will pay the Lease
Trustee such fees as have been agreed among the Transferor, the Administrative
Agent and the Lease Trustee and will reimburse the Lease Trustee for all
reasonable expenses. The Administrative Agent will not be entitled to be
reimbursed from the Lease Trust Estate for the payment of such expenses.
(Lease Trust Agreement, Section [8.1]).

GOVERNING LAW

The FCTT Agreement will be governed by the laws of the State of
Michigan.

The Administrative Agency Agreement, the Series 1996-1 Supplement, the
Asset Contribution Agreement, the Transfer Agreement, the Program Operating
Lease and the Indenture each will be governed by the laws of the State of New
York.

The RCL Trust Agreement and the Lease Trust Agreement each will be governed by
the laws of the State of Delaware.

RATINGS OF THE SENIOR NOTES

It is a condition to the issuance of the Senior Notes that they be
rated in the highest investment rating category by at least one Rating Agency.
The ratings of the Senior Notes could be downgraded in the event of any
unfunded ERISA liability of the Ford affiliated group. See "Risk Factors --
ERISA Liabilities; Effect on Ratings."

The rating assigned to either Class of Senior Notes is not a
recommendation to purchase, hold or sell such Class of Senior Notes, inasmuch
as such rating does not comment as to market price of suitability for a
particular investor. There is no assurance that the rating with respect to
either Class of Senior Notes will remain for any given period of time or that
the rating will not be lowered or withdrawn entirely by such Rating Agency if
in its judgment circumstances in the future so warrant.

CERTAIN LEGAL ASPECTS OF FCTT
AND THE SERIES 1996-1 CERTIFICATES

SERIES 1996-1 CERTIFICATES

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The Series 1996-1 Certificates will be issued pursuant to the FCTT
Agreement and will evidence a beneficial interest in FCTT and the Series 1996-1
Assets. The Series 1996-1 Certificates will not represent a direct interest in
the Series 1996-1 Assets or any other assets of FCTT the beneficial interest in
which is represented by the EBCs or any other Series issued pursuant to the
FCTT Agreement. Pursuant to the FCTT Agreement, the Lease Trustee with the
consent of the Indenture Trustee and the Transferor (or, upon the occurrence of
an Event of Default, with the consent of only the Indenture Trustee) or the
Transferor, with the consent of the Indenture Trustee and the Lease Trustee,
may at any time direct the FCTT Trustee to distribute the Series 1996-1 Assets
to the Issuer. Any such distribution will be at the expense of the Transferor,
and the Series 1996-1 Assets will remain subject to the lien of the Indenture
and the rights of the Transferor under the Program Operating Lease. Except in
certain limited circumstances as described in "Risk Factors -- Structural
Considerations," proceeds from assets of FCTT other than the Series 1996-1
Assets will not be available to make payments with respect to the Series 1996-1
Certificates or to cover expenses and liabilities of FCTT allocable to the
Series 1996-1 Assets. See "FCTT -- Exchangeable Beneficial Certificates and
Specified Beneficial Certificates."

INSOLVENCY RELATED MATTERS

Each of Ford Credit, Ford Credit Leasing, FCTT (or the FCTT Trustee
when acting on its behalf) and the Transferor (or the RCL Trustee when acting
on its behalf) has taken steps in structuring the transactions described herein
and has undertaken to act throughout the life of such transactions in a manner
intended to ensure that the voluntary or involuntary commencement of a case or
proceeding by or against Ford Credit under the Bankruptcy Code or similar
applicable state laws ("Insolvency Laws") will not result in the commencement
of a similar case or proceeding under such Insolvency Laws with respect to any
of Ford Credit Leasing, FCTT or the Transferor, and that the separate legal
existence of each of Ford Credit Leasing, FCTT and the Transferor will be
respected such that none of their respective assets and liabilities will be
consolidated with the assets and liabilities of Ford Credit.

Ford Credit Leasing has been formed as a separate, limited-purpose
corporate subsidiary of Ford Credit pursuant to a certificate of incorporation
containing certain limitations (including restrictions on the nature of Ford
Credit Leasing's business and its ability to incur indebtedness, a requirement
that it have at least two "Independent Directors" and a restriction on its
ability to voluntarily commence a case or proceeding under any Insolvency Law
without the unanimous affirmative vote of all of its directors, including each
Independent Director). Ford Credit Leasing has represented that it has no
intention of voluntarily commencing a case or proceeding under any Insolvency
Law for so long as it is solvent and it does not reasonably foresee becoming
insolvent.

The activities of FCTT are limited by the terms of the FCTT Agreement
which also provides that FCTT is not intended to be and shall not constitute a
"business trust" within the meaning of the Bankruptcy Code (which provision, if
respected, would result in FCTT not being eligible to become a debtor in a case
under the Bankruptcy Code). To the extent that FCTT may be eligible for relief
under any Insolvency Law, the FCTT Trustee is not authorized to commence a case
or proceeding thereunder without the consent of each holder of an EBC and each
holder of an SBC. Each of the FCTT Trustee, Ford Credit, Ford Credit Leasing
and the holders from time to time of the Series 1996-1 Certificates have agreed
not to institute a case or proceeding against FCTT under any Insolvency Law for
a period of one year and a day after payment in full of all distributions to
holders of SBCs under the FCTT Agreement.

The activities of the Transferor are limited by the terms of the RCL
Trust Agreement. The Transferor has been formed as a Delaware business trust
pursuant to the applicable statute. To the extent that the Transferor may be
eligible for relief under any Insolvency Law, the RCL Trustee is not authorized
to commence a case or proceeding thereunder without the consent of Ford Credit
and

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Ford Credit Leasing, as the sole beneficiaries of the Transferor. Each of the
RCL Trustee, Ford Credit and Ford Credit Leasing has agreed not to institute a
case or proceeding against the Transferor under any Insolvency Law for a period
of one year and a day after payment in full of the Series 1996-1 Certificates.

There can be no assurance, however, that the limitations on the
activities of Ford Credit Leasing, FCTT and the Transferor, as well as the
restrictions on their respective abilities to obtain relief under Insolvency
Laws or lack of eligibility thereunder, as described above, would prevent a
court from concluding that their respective assets and liabilities should be
consolidated with those of Ford Credit if Ford Credit becomes the subject of a
case or proceeding under any Insolvency Law. Skadden, Arps, Slate, Meagher &
Flom will deliver an opinion based on a reasoned analysis of analogous case law
(although there is no precedent based on directly similar facts) to the effect
that, subject to certain facts, assumptions and qualifications specified
therein, under present reported decisional authority and statutes applicable to
federal bankruptcy cases, if Ford Credit were to become the subject of a case
under the Bankruptcy Code, it would not be a proper exercise by a court of its
equitable discretion to disregard the separate legal existence of any of Ford
Credit Leasing, FCTT or the Transferor from that of Ford Credit and to require
the consolidation of the assets and liabilities of any of Ford Credit Leasing,
FCTT or the Transferor with the assets and liabilities of Ford Credit. Among
other things, such opinion will assume that each of Ford Credit Leasing, FCTT
(or the FCTT Trustee when acting on its behalf) and the Transferor (or the RCL
Trustee when acting on its behalf) will follow certain procedures in the
conduct of its affairs, including maintaining records and books of account
separate from those of Ford Credit, refraining from commingling its respective
assets with those of Ford Credit, doing business from an office separate from
that of Ford Credit and refraining from holding itself out as having agreed to
pay, or being liable for, the debts of Ford Credit. In addition, such opinion
will assume that other than as expressly provided by the FCTT Agreement and the
Administrative Agency Agreement (each of which contains terms and conditions
consistent with those that would be arrived at on an arms' length basis between
unaffiliated entities in the belief of the parties thereto), Ford Credit will
not generally guaranty the obligations of Ford Credit Leasing, FCTT or the
Transferor to third parties, and will not conduct the day-to-day business or
activities of any thereof other than in its capacity as Administrative Agent
acting under and in accordance with the Administrative Agency Agreement. Each
of Ford Credit, Ford Credit Leasing, FCTT and the Transferor intends to follow
and has represented to such counsel that it will follow these and other
procedures related to maintaining the separate identity and legal existences of
each of Ford Credit Leasing, FCTT and the Transferor. Such a legal opinion,
however, is not binding on any court.

If a case or proceeding under any Insolvency Law were to be commenced
by or against any of Ford Credit Leasing, FCTT or the Transferor, or if a court
were to conclude in favor of the consolidation of the assets and liabilities of
any thereof with those of Ford Credit, or if an attempt were made to litigate
any of the foregoing issues, delays in distributions on the Series 1996-1
Certificates (and possible reductions in the amount of such distributions) to
the Issuer (either directly or, if the Program Operating Lease remains in
effect, indirectly to the extent resulting in delayed or reduced payments from
the Transferor to the Issuer under the Program Operating Lease), and therefore
to the Senior Noteholders, could occur. In addition, if a bankruptcy or
insolvency occurs with respect to Ford Credit Leasing, the FCTT Agreement
provides that FCTT will be terminated, and if the Transferor or the Issuer
becomes bankrupt or insolvent, or is terminated (which could occur as a result
of the bankruptcy or insolvency of Ford Credit Leasing or the bankruptcy,
insolvency or termination of the Transferor), the FCTT Agreement provides that
FCTT will be terminated with respect to holding the Series 1996-1 Assets. In
each case the FCTT Trustee is required to distribute the Series 1996-1 Assets
to the holder of the Series 1996-1 Certificates. Because the Issuer has pledged
its rights to the Series 1996-1 Certificates to the Indenture Trustee, such
distribution would be made to the Indenture Trustee who would be responsible
for retitling the Series 1996-1 Leased Vehicles. The cost of such retitling
would reduce the amounts payable from the Series 1996-1 Assets which are
available for payments of interest on and principal of the Senior Notes, and in
such event Senior Noteholders could suffer a loss on their investment.

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Each of Ford Credit and Ford Credit Leasing will treat its conveyance
of the Series 1996-1 Certificates to the Transferor as an absolute transfer of
all of its interest therein for all purposes, including without limitation tax
and financial accounting purposes. If such conveyances constitute absolute
transfers, the Series 1996-1 Certificates and the proceeds thereof would not be
part of Ford Credit's or Ford Credit Leasing's bankruptcy estate under Section
541 of the Bankruptcy Code should Ford Credit or Ford Credit Leasing become the
subject of a case thereunder. However, if a case or proceeding under any
Insolvency Law were commenced by or against Ford Credit or Ford Credit Leasing,
and a creditor, receiver or trustee-in-bankruptcy of Ford Credit or Ford Credit
Leasing were to take the position that the transfer of the Series 1996-1
Certificates by Ford Credit and Ford Credit Leasing to the Transferor should
instead be treated as a pledge of such Series 1996-1 Certificates to secure a
borrowing by Ford Credit and Ford Credit Leasing, delays in payments of
proceeds of such Series 1996-1 Certificates to the Issuer, and therefore to the
Senior Noteholders, could occur or (should the court rule in favor of such
creditor, receiver or trustee-in-bankruptcy) reductions in the amount of such
payments could result. Skadden, Arps, Slate, Meagher & Flom will deliver an
opinion to the effect that, subject to certain facts, assumptions and
qualifications specified therein, in the event that either Ford Credit or Ford
Credit Leasing were to become the subject of a case under the Bankruptcy Code
subsequent to the transfer of the Series 1996-1 Certificates to the Transferor,
the transfer of the Series 1996-1 Certificates from Ford Credit and Ford Credit
Leasing would be respected as an absolute transfer (a "true sale") of the
Series 1996-1 Certificates from Ford Credit and Ford Credit Leasing to the
Transferor, and the Series 1996-1 Certificates and the proceeds thereof would
not be included in Ford Credit's or Ford Credit Leasing's bankruptcy estate
pursuant to Section 541 of the Bankruptcy Code. As indicated above, such a
legal opinion is not binding on any court.

As a precautionary measure, the Transferor will take the actions
requisite to obtaining a perfected security interest in the Series 1996-1
Certificates as against Ford Credit and Ford Credit Leasing. Accordingly, if
the conveyances of the Series 1996-1 Certificates by Ford Credit and Ford
Credit Leasing to the Transferor were not respected as absolute transfers, the
Transferor (and ultimately the Issuer and the Indenture Trustee as successors
in interest) should be treated as a secured creditor of Ford Credit and Ford
Credit Leasing, although a case or proceeding under any Insolvency Law with
respect to Ford Credit or Ford Credit Leasing could result in delays or
reductions in distributions under the Series 1996-1 Certificates as indicated
above notwithstanding such perfected security interest.

In the event that Ford Credit were to become subject to a case under
the Bankruptcy Code, certain payments made within one year of the commencement
of such case may be recoverable by Ford Credit as debtor-in-possession or by a
creditor or a trustee in bankruptcy as a preferential transfer from Ford
Credit. These payments include the portion of payments of Administrative
Purchase Amounts allocable to Ford Credit in respect of the purchase of
beneficial interests in certain Series 1996-1 Assets as to which an uncured
breach of certain representations and warranties or certain servicing covenants
has occurred. See "Description of the Administrative Agency Agreement --
Administrative Purchases."

In addition, the commencement of a case or proceeding under any
Insolvency Law with respect to Ford Credit is an Administrative Agent Event of
Default, and if so directed by the holders of the Series 1996-1 Certificates
(which for such purpose will be the Indenture Trustee so long as the Senior
Notes are outstanding), Ford Credit may be removed as the Administrative Agent,
which may have an adverse impact on timely payments to Senior Noteholders.
However, if the commencement of such a case or proceeding were the only
default, Ford Credit (or its trustee-in-bankruptcy) may have the power to
prevent any such removal. See "Description of the Administrative Agency
Agreement -- Administrative Agent Events of Default" and "-- Removal of the
Administrative Agent."

INSURANCE

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Each Obligor is required to maintain liability, collision and
comprehensive insurance coverage in certain amounts on its Leased Vehicle at
all times during the term of the related Lease. The cost of such insurance is
borne solely by the Obligor. Failure to comply with stipulated insurance
requirements may result in early termination of the Lease.

The failure of Obligors to maintain the required insurance coverage
for claims arising from injuries caused by the Series 1996-1 Leased Vehicles
could result in reductions in distributions on the Series 1996-1 Certificates
and losses to Senior Noteholders on their investment.

To protect against such losses, Ford Credit self-insures against the
first $5 million per occurrence for property damage or personal liability
suffered by third persons caused by any vehicle owned by Ford Credit or FCTT.
Additionally, Ford maintains excess insurance policies which name FCTT as an
additional insured party. These policies cover claims in excess of $5 million
per occurrence (together with the self-insurance of Ford Credit, the
"Contingent and Excess Liability Insurance"). The Administrative Agent will
covenant that, so long as the Series 1996-1 Certificates are outstanding, it
will (i) maintain or cause to be maintained Contingent and Excess Liability
Insurance with respect to third party claims relating to the Series 1996-1
Leased Vehicles, FCTT or the FCTT Trustee in such amounts as it deems
reasonable and prudent and (ii) not amend or terminate any such Contingent and
Excess Liability Insurance unless (x) after giving effect to such amendment or
termination, there remains coverage of at least $25 million per occurrence and
$50 million annually in the aggregate or (y) as confirmed by each Rating
Agency, such amendment or termination will not cause the rating of any of the
Senior Notes or Lease Trust Certificates to be reduced or withdrawn. To the
extent the Contingent and Excess Liability Insurance is insufficient to cover
the full amount of any claims and no third party reimbursement for such claims
is available and Ford Credit and Ford Credit Leasing fail to perform their
obligations to indemnify the Issuer, the Senior Noteholders could incur a loss
on their investment to the extent that payment of such claims reduce the
amounts otherwise distributable to the Senior Noteholders from the Series
1996-1 Certificates.

In the event that a Series 1996-1 Leased Vehicle is damaged, the
failure of the related Obligor to maintain the required collision insurance
coverage could result in a reduction of amounts distributable with respect to
the related Series 1996-1 Assets and therefore a reduction in the aggregate
amount distributable on the Series 1996-1 Certificates. In the event that
collision coverage is exhausted and no third-party reimbursement for such
damage to a Series 1996-1 Leased Vehicle is available, the Senior Noteholders
could incur a loss on their investment.

Ford Credit provides Obligors with Guaranteed Automobile Protection
("GAP") coverage on Leased Vehicles, including the Series 1996-1 Leased
Vehicles. In the event a Leased Vehicle is destroyed or stolen, GAP coverage
would reimburse the Obligor for the difference between the insurance valuation
of the Leased Vehicle and the remaining amount required to be paid under the
Lease.

CERTAIN LEGAL ASPECTS OF THE LEASES
AND LEASED VEHICLES

UCC FILINGS

The Series 1996-1 Certificates are either certificated securities or
general intangibles under the UCC. To the extent that the Series 1996-1
Certificates are certificated securities, the Indenture Trustee has perfected
its interest by possession. To the extent that the Series 1996-1 Certificates
are general intangibles and the transfer thereof is deemed to be a transfer for
security, the Transferor will file UCC-1 financing statements against both Ford
Credit and Ford Credit Leasing to perfect its interest in such Series 1996-1
Certificates. The Transferor will assign its perfected security interest to
the

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Issuer and the Indenture Trustee, and the Issuer in turn will assign its
interest to the Indenture Trustee. Financing statements covering the Series
1996-1 Certificates will also be filed naming (i) the Transferor as debtor and
the Issuer as secured party, which financing statement will be assigned to the
Indenture Trustee, (ii) the Transferor as debtor and the Indenture Trustee as
secured party and (iii) the Issuer as debtor and the Indenture Trustee as
secured party.

The FCTT Assets consist principally of the Leases and the ownership
interest in the Leased Vehicles (subject to the rights of the Obligors under
the Leases). To the extent that the Series 1996-1 Certificates were viewed as
representing a transfer of the assets of FCTT, the Series 1996-1 Leases would
be "chattel paper" as defined in the UCC. Pursuant to the UCC a non-possessory
security interest in chattel paper may be perfected by filing a UCC-1 financing
statement with the appropriate filing office in the state where the debtor has
its chief executive office. Accordingly, as a precaution, UCC-1 financing
statements relating to the Series 1996-1 Leases will be filed naming: (i) FCTT
as debtor and Ford Credit and Ford Credit Leasing as secured parties, which
financing statements will be assigned to the Transferor, the Issuer and then
the Indenture Trustee; (ii) each of Ford Credit and Ford Credit Leasing as
debtors and the Transferor as secured party, which financing statement has been
assigned to the Issuer and then the Indenture Trustee; (iii) the Transferor as
debtor and the Issuer as secured party, which financing statement will be
assigned to the Indenture Trustee, (iv) the Transferor as debtor and the
Indenture Trustee as secured party and (v) the Issuer as debtor and the
Indenture Trustee as secured party. Perfection and the effect of perfection or
non-perfection of a security interest in the Series 1996-1 Leased Vehicles are
governed by the certificate of title statutes of the states in which such
Series 1996-1 Leased Vehicles are located. Because of the administrative
burden and expense of perfecting an interest in motor vehicles under the
certificate of title statutes in the fifteen states in which the Series 1996-1
Leases were originated, the Indenture Trustee's interest in the Series 1996-1
Leased Vehicles will be unperfected, and if the transfer of the Series 1996-1
Certificates were viewed as a transfer of the Series 1996-1 Assets, the
Indenture Trustee would only have a perfected security interest in the Series
1996-1 Leases. However, the Indenture Trustee's security interest in the
Series 1996-1 Leases could be subordinate to persons who take actual possession
of the Series 1996-1 Leases without knowledge of such security interest. The
Series 1996-1 Leases will not be stamped to indicate these precautionary
security arrangements.

VICARIOUS TORT LIABILITY

The Series 1996-1 Leased Vehicles will be operated by the Obligors and
their respective invitees. State laws differ as to whether anyone suffering
injury to person or property as a result of an accident involving a leased
vehicle may bring an action against the person who, holding title to the
vehicle, is its legal owner.

In California, under Section 17150, California Vehicle Code, the owner
of a motor vehicle that is subject to a lease is responsible for injuries to
persons or property resulting from the negligent or wrongful operation of the
vehicle by any person using the vehicle with the owner's permission. The
owner's liability for personal injuries is limited to $15,000 per person and
$30,000 in total per accident and for property damage is limited to $5,000 per
accident. Recourse for any judgment arising out of the operation of the
vehicle must first be had against the operator's property, if the operator is
within the court's jurisdiction.

In New York, under Section 388, New York Vehicle and Traffic Law, the
owner of a motor vehicle that is subject to a lease is responsible for injuries
to persons or property resulting from the negligent operation of the vehicle by
any person using the vehicle with the owner's permission. A lessee of a motor
vehicle is considered an owner of the vehicle if the lessee has the exclusive
use of the vehicle for a period greater than 30 days. In situations involving
more than one owner of the same vehicle, the liability of the owners for
negligent operation of the vehicle is joint and several.

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In Pennsylvania, a victim of such an accident has no cause of action
against the owner of a leased vehicle arising from the negligent operation of
such leased vehicle unless the owner has negligently entrusted or negligently
continues to entrust the vehicle to an inappropriate lessee.

Following an accident involving a Series 1996-1 Leased Vehicle, under
certain circumstances FCTT may be the subject of an action for damages as a
result of its ownership of such Series 1996-1 Leased Vehicle. In the event
that liability on FCTT were imposed and the coverage provided by the Contingent
and Excess Liability Insurance was insufficient to cover the full amount of
such claims (or, in certain circumstances claims arising from ownership of
Leased Vehicles that are not Series 1996-1 Leased Vehicles), claims could be
imposed against the assets of FCTT, including the Series 1996-1 Leased
Vehicles. The Senior Noteholders could incur a loss on their investment to the
extent that payment of such claims reduced the amounts otherwise distributable
to the Senior Noteholders.

REPOSSESSION OF LEASED VEHICLES

In the event of a default by an Obligor, the Administrative Agent will
notify the Obligor and, after affording the Obligor an opportunity to cure,
will repossess the Series 1996-1 Leased Vehicle if the Obligor remains in
default. Under the laws of the states in which the 1996-1 Leases were
originated, generally repossession may take place without notice, but only if
it can be accomplished without a breach of the peace. If repossession cannot
be achieved peaceably, court action would be required. In Pennsylvania, a writ
of replevin may be necessary to accomplish repossession.

After repossession, the Administrative Agent may afford the Obligor an
opportunity to cure the default. Absent cure, the Administrative Agent will
ordinarily attempt to sell the Series 1996-1 Leased Vehicle. There is no
assurance that the proceeds from such a sale will equal or exceed the remaining
amounts due under the related Series 1996-1 Lease at the time of the Obligor's
default.

DEFICIENCY JUDGMENTS

Once a repossessed Series 1996-1 Leased Vehicle is sold, the proceeds
from the sale will be used to cover the expenses of repossession and resale and
then to satisfy any remaining amounts due under the related Series 1996-1
Lease. If the proceeds from the sale of the Series 1996-1 Leased Vehicle are
insufficient to satisfy the remaining amount due under the related Series
1996-1 Lease, the amount of such shortfall will be reported as a Series 1996-1
Credit Loss in the Collection Period in which the related Series 1996-1 Lease
became a Liquidated Lease. The Administrative Agent may seek a deficiency
judgment for the amount of any such shortfall. To the extent such deficiency
judgment is collected in a Collection Period other than the Collection Period
in which such Series 1996-1 Lease became a Liquidated Lease, such amount shall
be treated as a Recovery.

However, each of the states in which the Series 1996-1 Leases were
originated places limits on a secured party's ability to obtain a deficiency
judgment. In such states, a deficiency judgment may be prohibited or reduced
in amount if the Obligor was not given proper notice of the resale or if the
terms of the resale were not commercially reasonable. Even if a deficiency
judgment is obtained, there is no assurance that the full amount of the
judgment would ultimately be collected. A deficiency judgment is a personal
judgment against the defaulting Obligor, who generally has few remaining assets
or sources of income after repossession. As a result, obtaining a deficiency
judgment may not be useful in that only a small portion of it, or perhaps none
of it, will ever be collected.

CONSUMER PROTECTION LAWS

Numerous federal and state consumer protection laws and regulations
impose requirements on retail lease contracts such as the Series 1996-1 Leases.
The federal Consumer Leasing Act of 1976 and Regulation M promulgated by the
Board of Governors of the Federal Reserve System, for example,

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require that a number of disclosures be made at the time a vehicle is leased,
including the amount of any periodic payments and the circumstances under which
the lessee may terminate the lease prior to the end of the lease term. The
various consumer protection laws would apply to FCTT as the assignee of each
Series 1996-1 Lease and may also apply to the Issuer as holder of the Series
1996-1 Certificates which represent a beneficial interest in the Series 1996-1
Leases, among other things. The failure of FCTT, or the Administrative Agent
acting on behalf of FCTT, to comply with such laws and regulations may give
rise to liabilities on the part of FCTT, and claims by FCTT or the
Administrative Agent acting on behalf of FCTT with respect to Obligors may be
subject to set-off as a result of non-compliance with such laws and
regulations.

Courts have applied general equitable principles in litigation
relating to repossession and deficiency balances. These equitable principles
may have the effect of relieving a lessee from some or all of the legal
consequences of a default.

In several cases, consumers have asserted that the self-help remedies
of lessors violate the due process protection provided under the Fourteenth
Amendment to the Constitution of the United States. Courts have generally
found that repossession and resale by a lessor do not involve sufficient state
action to afford constitutional protection to consumers.

Each of the states in which the Series 1996-1 Leases were originated
has adopted a law (each, a "Lemon Law") providing redress to consumers who
purchase or in some cases lease a vehicle which remains out of conformance with
its manufacturer's warranty after a specified number of attempts to correct a
problem or after a specific time period. A successful claim under a Lemon Law
with respect to a Series 1996-1 Leased Vehicle could result in, among other
things, the termination of the related Series 1996-1 Lease and/or the refunding
to the related Obligor of some portion of the Total Monthly Payments paid by
such Obligor. To the extent an Obligor is no longer required to make Total
Monthly Payments with respect to a Series 1996-1 Lease subject to a Lemon Law,
or amounts are refunded to such Obligor, such Series 1996-1 Lease will be
deemed to be a Liquidated Lease and the amounts received with respect to such
lease will be limited to Liquidation Proceeds and Recoveries. The net amount
lost will be reported as a Series 1996-1 Credit Loss. Although FCTT or the
Administrative Agent acting on behalf of FCTT may be able to assert a claim
against the manufacturer of any such defective Series 1996-1 Leased Vehicle,
there can be no assurance that any such claim would be successful.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

Set forth below is a summary of certain United States federal income
tax consequences of the purchase, ownership and disposition of the Senior
Notes. This discussion is based upon current provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), existing and proposed Treasury
Regulations thereunder, current administrative rulings, judicial decisions and
other applicable authorities in effect as of the date hereof, all of which are
subject to change, possibly with retroactive effect. There can be no assurance
that the Internal Revenue Service ("IRS") will not challenge the conclusions
reached herein, and no ruling from the IRS has been or will be sought on any of
the issues discussed below.

This summary does not purport to deal with all aspects of federal
income taxation that may be relevant to Senior Note Owners in light of their
personal investment circumstances nor, except for certain limited discussions
of particular topics, to certain types of Senior Note Owners subject to special
treatment under the federal income tax laws (e.g., financial institutions,
broker-dealers, life insurance companies and tax-exempt organizations). This
information is directed to Senior Note Owners who hold the Senior Notes as
"capital assets" within the meaning of Section 1221 of the Code.

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GENERAL

Tax Status of the Senior Notes, FCTT, the Transferor and the Issuer.
On the Closing Date, Skadden, Arps, Slate, Meagher & Flom ("Special Tax
Counsel"), will render its opinion that for federal income tax purposes under
existing law, and subject to the assumptions and qualifications therein: (i)
the Senior Notes will be treated as debt, (ii) the Lease Trust Certificates
(other than the Lease Trust Certificates initially acquired by the Transferor)
should be treated as debt and (iii) none of FCTT, the Transferor or the Issuer
will be classified as an association (or publicly traded partnership) taxable
as a corporation.

Stated Interest. Stated interest on the Senior Notes will be taxable
as ordinary income for federal income tax purposes when received or accrued in
accordance with a Senior Note Owner's method of tax accounting.

Original Issue Discount. A Senior Note will be treated as issued with
Original Issue Discount ("OID") if the excess of the Senior Note's "stated
redemption price at maturity" over its issue price equals or exceeds a de
minimis amount equal to 1/4 of 1 percent of the Senior Note's stated redemption
price at maturity multiplied by the number of complete years (based on the
anticipated weighted average life of a Senior Note) to its maturity. The Class
A-2 Senior Notes will be issued with de minimis OID. Generally, the issue
price of a Senior Note should be the first price at which a substantial amount
of the Senior Notes included in the issue of which the Senior Note is a part is
sold to other than bond houses, brokers or similar persons or organizations
acting in the capacity of underwriters, placement agents or wholesalers. The
stated redemption price at maturity of a Senior Note is expected to equal the
principal amount of the Senior Note. Any amount not treated as OID because it
is de minimis OID must be included in income as principal payments are received
on the Senior Notes in the proportion that each such payment bears to the
original principal balance of the Senior Note.

If the Senior Notes are treated as issued with OID, a Senior Note
Owner will be required to include OID in income before the receipt of cash
attributable to such income using the constant-yield method. The amount of OID
includible in income is the sum of the daily portions of OID with respect to a
Senior Note for each day during the taxable year or portion of the taxable year
in which the Senior Note Owner holds the Senior Note. The amount of OID
includible in income by a Senior Note Owner of a Senior Note will be computed
by allocating to each day during a taxable year a pro rata portion of the OID
that accrued during the relevant "accrual period." Such OID is generally equal
to the product of the yield to maturity of the Senior Note (adjusted for the
length of the accrual period) and its adjusted issue price at the beginning of
the accrual period, reduced by any payments of "qualified stated interest."
Accrual periods with respect to a Senior Note may be any set of periods (which
may be of varying lengths) selected by the Senior Note Owner as long as (i) no
accrual period is longer than one year and (ii) each scheduled payment of
interest or principal on the Senior Note occurs on either the final or first
day of an accrual period.

The adjusted issue price of a Senior Note is the sum of its issue
price plus prior accruals of OID, reduced by the total payments made with
respect to such Senior Note in all prior periods, other than "qualified stated
interest payments." Qualified stated interest payments are interest payments on
the Senior Notes that are unconditionally payable at least annually at a single
fixed rate applied to the outstanding principal amount of the obligation.

Short-Term Obligations. Under the Code, special rules apply to notes
that have a maturity of one year or less from their date of original issue,
such as the Class A-1 Senior Notes. Such notes are treated as issued with
"acquisition discount" which is calculated and included in income under
principles similar to those governing OID except that "acquisition discount" is
equal to the excess of all payments of principal and interest on the Class A-1
Senior Notes over their issue price. In general,

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an individual or other cash basis holder of a short-term obligation (such as a
Class A-1 Senior Note) is not required to accrue acquisition discount for
federal income tax purposes unless it elects to do so. Accrual basis Senior
Note Owners and certain other Senior Note Owners, including banks, regulated
investment companies, dealers in securities and cash basis Senior Note Owners
who so elect, are required to accrue acquisition discount on the Class A-1
Senior Notes on either a straight-line basis or under a constant yield method
(based on daily compounding), at the election of the Senior Note Owner. In the
case of a Senior Note Owner not required and not electing to include
acquisition discount in income currently, any gain realized on the sale or
retirement of the Class A-1 Senior Note will be ordinary income to the extent
of the acquisition discount accrued on a straight line basis (unless an
election is made to accrue the acquisition discount under the constant yield
method) through the date of sale or retirement. Senior Note Owners who are not
required and do not elect to accrue acquisition discount on Class A-1 Senior
Notes will be required to defer deductions for interest on borrowings allocable
to short-term obligations in an amount not exceeding the deferred income until
the deferred income is realized.

Market Discount. The Senior Notes, whether or not issued with
original issue discount, will be subject to the "market discount rules" of
section 1276 of the Code. In general, these rules provide that if the Senior
Note Owner purchases a Senior Note at a market discount (that is, a discount
from its stated redemption price at maturity or, if the Senior Notes were
issued with OID, its original issue price plus any accrued original issue
discount, that exceeds a de minimis amount specified in the Code) and
thereafter (a) recognizes gain upon a disposition, or (b) receives payments of
principal, the lesser of (i) such gain or principal payment, or (ii) the
accrued market discount, will be taxed as ordinary interest income. Generally,
the accrued market discount will be the total market discount on the Senior
Note multiplied by a fraction, the numerator of which is the number of days the
Senior Note Owner held the Senior Note and the denominator of which is the
number of days from the date the Senior Note Owner acquired the Senior Note
until its maturity date. The Senior Note Owner may elect, however, to
determine accrued market discount under the constant-yield method.

Limitations imposed by the Code which are intended to match deductions
with the taxation of income may defer deductions for interest on indebtedness
incurred or continued, or short-sale expenses incurred, to purchase or carry a
Senior Note with accrued market discount. A Senior Note Owner may elect to
include market discount in gross income as it accrues and, if such Senior Note
Owner makes such an election, is exempt from this rule. Any such election will
apply to all debt instruments acquired by the taxpayer on or after the first
day of the first taxable year to which such election applies. The adjusted
basis of a Senior Note subject to such election will be increased to reflect
market discount included in gross income, thereby reducing any gain or
increasing any loss on a sale or taxable disposition.

Election to Treat All Interest as Original Issue Discount. A Senior
Note Owner may elect to include in gross income all interest that accrues on a
Senior Note using the constant-yield method described above under the heading
"-- Original Issue Discount," with modifications described below. For
purposes of this election, interest includes stated interest, OID, de minimis
original issue discount, market discount, de minimis market discount and
unstated interest, as adjusted by any amortizable bond premium (described below
under "-- Amortizable Bond Premium") or acquisition premium.

In applying the constant-yield method to a Senior Note with respect to
which this election has been made, the issue price of the Senior Note will
equal the electing Senior Note Owner's adjusted basis in the Senior Note
immediately after its acquisition, the issue date of the Senior Note will be
the date of its acquisition by the electing Senior Note Owner, and no payments
on the Senior Note will be treated as payments of qualified stated interest.
This election will generally apply only to the Senior Note with respect to
which it is made and may not be revoked without the consent of the IRS. Senior
Note Owners should consult with their own tax advisers as to the effect in
their circumstances of making this election.

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Amortizable Bond Premium. In general, if a Senior Note Owner
purchases a Senior Note at a premium (that is, an amount in excess of the
amount payable upon the maturity thereof), such Senior Note Owner will be
considered to have purchased such Senior Note with "amortizable bond premium"
equal to the amount of such excess. Such Senior Note Owner may elect to
amortize such bond premium as an offset to interest income and not as a
separate deduction item as it accrues under a constant-yield method over the
remaining term of the Senior Note. Such Senior Note Owner's tax basis in the
Senior Note will be reduced by the amount of the amortized bond premium. Any
such election shall apply to all debt instruments (other than instruments the
interest on which is excludible from gross income) held by the Senior Note
Owner at the beginning of the first taxable year for which the election applies
or thereafter acquired and is irrevocable without the consent of the IRS. Bond
premium on a Senior Note held by a Senior Note Owner who does not elect to
amortize the premium will decrease the gain or increase the loss otherwise
recognized on the disposition of the Senior Note.

Disposition of Senior Notes. A Senior Note Owner's adjusted tax basis
in a Senior Note will be its cost, increased by the amount of any OID, market
discount and gain previously included in income with respect to the Senior
Note, and reduced by the amount of any payments on the Senior Note that is not
qualified stated interest and the amount of bond premium previously amortized
with respect to the Senior Note. A Senior Note Owner will generally recognize
gain or loss on the sale or retirement of a Senior Note equal to the difference
between the amount realized on the sale or retirement and the tax basis of the
Senior Note. Such gain or loss will be capital gain or loss (except to the
extent attributable to accrued but unpaid interest or as described above under
"---- Market Discount") and will be long-term capital gain or loss if the
Senior Note was held for more than one year.

WAIVERS AND AMENDMENTS

The Indenture permits the Senior Noteholders to waive an Event of
Default in some circumstances upon a vote of the requisite percentage of Senior
Noteholders. Such a waiver, if it were to continue for a period that exceeds
two years and any additional period during which the Senior Noteholders conduct
good faith negotiations, or certain amendments to the terms of the Senior
Notes, would be treated for federal income tax purposes as a constructive
exchange by a Senior Noteholder of the Senior Notes for new notes, upon which
gain or loss would be recognized.

INFORMATION REPORTING AND BACKUP WITHHOLDING

The Indenture Trustee will be required to report annually to the IRS,
and to each Senior Note Owner, the amount of interest paid on the Senior Notes
(and the amount withheld for federal income taxes, if any) for each calendar
year, except as to exempt recipients (generally, corporations, tax-exempt
organizations, qualified pension and profit-sharing trusts, individual
retirement accounts, or nonresident aliens who provide certification as to
their status). Each Senior Note Owner (other than Senior Note Owners who are
not subject to the reporting requirements) will be required to provide, under
penalties of perjury, a certificate containing the Senior Note Owner's name,
address, correct federal taxpayer identification number (which includes a
social security number) and a statement that the Senior Note Owner is not
subject to backup withholding. Should a non-exempt Senior Note Owner fail to
provide the required certification or should the IRS notify the Indenture
Trustee or the Issuer that the Senior Note Owner has provided an incorrect
federal taxpayer identification number or is otherwise subject to backup
withholding, the Indenture Trustee will be required to withhold (or cause to be
withheld) 31% of the interest otherwise payable to the Senior Note Owner, and
remit the withheld amounts to the IRS as a credit against the Senior Note
Owner's federal income tax liability.

TAX CONSEQUENCES TO FOREIGN INVESTORS

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<PAGE> 83

The following information describes the U.S. federal income tax
treatment of investors that are not U.S. persons (each, a "Foreign Person").
The term "Foreign Person" means any person other than (i) a citizen or resident
of the United States, (ii) a corporation, partnership or other entity organized
in or under the laws of the United States or any political subdivision thereof
or (iii) an estate or trust the income of which is includible in gross income
for U.S. federal income tax purposes, regardless of its source.

(a) Interest paid or accrued to a Foreign Person that is not
effectively connected with the conduct of a trade or business within
the United States by the Foreign Person, will generally be considered
"portfolio interest" and generally will not be subject to United
States federal income tax and withholding tax, as long as the Foreign
Person (i) is not actually or constructively a "10 percent
shareholder" of the Issuer or a "controlled foreign corporation" with
respect to which the Issuer is a "related person" within the meaning
of the Code, and (ii) provides an appropriate statement (Form W-8),
signed under penalties of perjury, certifying that the Senior Note
Owner is a Foreign Person and providing that Foreign Person's name and
address. If the information provided in this statement changes, the
Foreign Person must so inform the Indenture Trustee within 30 days of
such change. The statement generally must be provided in the year a
payment occurs or in either of the two preceding years. If such
interest were not portfolio interest, then it would be subject to
United States federal income and withholding tax at a rate of 30
percent unless reduced or eliminated pursuant to an applicable income
tax treaty.

(b) Any capital gain realized on the sale or other taxable
disposition of a Senior Note by a Foreign Person will be exempt from
United States federal income and withholding tax, provided that (i)
the gain is not effectively connected with the conduct of a trade or
business in the United States by the Foreign Person, and (ii) in the
case of an individual Foreign Person, the Foreign Person is not
present in the United States for 183 days or more in the taxable year
and certain other requirements are met.

(c) If the interest, gain or income on a Senior Note held by
a Foreign Person is effectively connected with the conduct of a trade
or business in the United States by the Foreign Person, the Senior
Note Owner (although exempt from the withholding tax previous- ly
discussed if a duly executed Form 4224 is furnished) generally will be
subject to United States federal income tax on the interest, gain or
income at regular federal income tax rates. In addition, if the
Foreign Person is a foreign corporation, it may be subject to a branch
profits tax equal to 30 percent of its "effectively connected earnings
and profits" within the meaning of the Code for the taxable year, as
adjusted for certain items, unless it qualifies for a lower rate under
an applicable tax treaty.

On April 15, 1996, the IRS issued proposed Treasury regulations (the
"Proposed Regulations") which, if enacted in their proposed form, would
substantially revise some aspects of the current system for withholding on, and
reporting of, amounts paid to Foreign Persons. For example, the certification
procedures described above (i.e., Forms W-8, 4224, etc.) would be unified and
combined into a single form (Form W-8) under the Proposed Regulations. As a
general rule, the Proposed Regulations are proposed to be effective for
payments to Foreign Persons made after December 31, 1997. There is no
assurance that the Proposed Regulations will be adopted or, if adopted, will be
adopted in their proposed form.

CERTAIN STATE TAX CONSEQUENCES

Set forth below is a summary of certain state income tax consequences
of the purchase, ownership and disposition of the Senior Notes. This
discussion is based upon current law,

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administrative rulings, judicial decisions and other applicable authorities in
effect as of the date hereof, all of which are subject to change, possibly with
retroactive effect. There can be no assurance that state income tax
authorities will not challenge the conclusions reached herein, and no ruling
from state income tax authorities has been or will be sought on any of the
issues discussed below. Because of the variation in each state's income tax
laws, it is impossible to predict tax consequences to Senior Note Owners in all
states. Senior Note Owners are urged to consult their own tax advisors with
respect to state tax consequences arising out of the purchase, ownership and
disposition of Senior Notes.

Michigan. In general, state tax laws conform to federal income tax
principles, and partnerships, grantor trusts and mere security devices are not
subject to tax at the entity level. The State of Michigan, however, imposes a
single business tax on corporations, partnerships and other entities doing
business in Michigan. Because the Administrative Agent is headquartered in
Michigan, tax authorities in Michigan may attempt to assert that FCTT, the
Transferor or the Issuer is subject to an entity level tax.

In the opinion of J. D. Bringard, Esq., the Vice President --
General Counsel of Ford Credit ("Michigan Tax Counsel"), assuming that the
Senior Notes will be treated as debt for federal income tax purposes, (i) the
Senior Notes will be treated as debt for Michigan income and single business
tax purposes and (ii) Senior Note Owners not otherwise subject to taxation in
Michigan would not become subject to taxation in Michigan solely because of a
Senior Note Owner's ownership of a Senior Note. Assuming further that the
Lease Trust Certificates (other than the Lease Trust Certificates initially
acquired by the Transferor) will be treated as debt for federal income tax
purposes and that none of FCTT, the Transferor or the Issuer will be subject to
federal income tax at the entity level, none of FCTT, the Transferor or the
Issuer should be subject to Michigan income and single business tax at the
entity level.

Delaware. The Transferor has been organized as a Delaware business
trust. In the opinion of Special Tax Counsel, assuming that the Senior Notes
are treated as debt for federal income tax purposes, the Senior Notes will be
treated as debt for Delaware state income tax purposes. Assuming further that
none of FCTT, the Transferor or the Issuer will be subject to federal income
taxes at the entity level, none of FCTT, the Transferor or the Issuer will be
subject to the Delaware state income tax at the entity level. Further, in the
opinion of Special Tax Counsel, Senior Note Owners not otherwise subject to
taxation in Delaware would not become subject to taxation in Delaware solely
because of a Senior Note Owner's ownership of a Senior Note.

* * *

In the event that any state imposes a tax on FCTT, the Transferor or
the Issuer at the entity level, Ford Credit and Ford Credit Leasing have agreed
to indemnify the holders of the SBCs for the full amount of such taxes. If
Ford Credit and Ford Credit Leasing should fail to fulfill their respective
indemnification obligations, amounts otherwise distributable to them as holders
of the EBCs will be used to satisfy such indemnification obligations. However,
it is possible that the Senior Noteholders could incur a loss on their
investment in the event Ford Credit and Ford Credit Leasing did not have
sufficient assets available (including distributions on the EBCs) to satisfy
such state tax liabilities.

THE FEDERAL AND STATE TAX DISCUSSIONS SET FORTH ABOVE ARE INCLUDED FOR
GENERAL INFORMATION ONLY, DO NOT PURPORT TO ADDRESS THE APPLICABILITY OF STATE
TAX LAWS OTHER THAN THE TREATMENT OF THE TRUSTS AND THE SENIOR NOTE OWNERS
UNDER THE LAWS OF MICHIGAN AND DELAWARE AND MAY NOT BE APPLICABLE DEPENDING
UPON A SENIOR NOTE OWNER'S PARTICULAR TAX SITUATION. PROSPECTIVE PURCHASERS
SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX

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<PAGE> 85

CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF SENIOR
NOTES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX
LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAWS.

ERISA CONSIDERATIONS

Section 406 of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and/or Section 4975 of the Code, prohibit a pension,
profit-sharing or other employee benefit plan, as well as individual retirement
accounts and Keogh Plans (each a "Benefit Plan") from engaging in certain
transactions with persons that are "parties in interest" under ERISA or
"disqualified persons" under the Code with respect to such Benefit Plan. A
violation of these "prohibited transaction" rules may result in an excise tax
or other penalties and liabilities under ERISA and the Code for such persons.
Title I of ERISA also requires that fiduciaries of a Benefit Plan subject to
ERISA make investments that are prudent, diversified (except if prudent not to
do so) and in accordance with governing plan documents.

Certain transactions involving the Issuer might be deemed to
constitute prohibited transactions under ERISA and the Code if assets of the
Issuer were deemed to be assets of a Benefit Plan. Under a regulation issued
by the United States Department of Labor (the "Plan Assets Regulation"), the
assets of the Issuer would be treated as plan assets of a Benefit Plan for
purposes of ERISA and the Code only if the Benefit Plan acquires an "Equity
Interest" in the Issuer and none of the exceptions contained in the Plan Assets
Regulation (discussed below) is applicable. An Equity Interest is defined
under the Plan Assets Regulation as an interest other than an instrument which
is treated as indebtedness under applicable local law and which has no
substantial equity features. The Transferor believes that the Senior Notes
should be treated as indebtedness without substantial equity features for
purposes of the Plan Assets Regulation. However, without regard to whether the
Senior Notes are treated as an Equity Interest for such purposes, the
acquisition or holding of Senior Notes by or on behalf of a Benefit Plan could
be considered to give rise to a prohibited transaction if the Issuer, the Lease
Trustee, the RCL Trustee, the Indenture Trustee, the FCTT Trustee, any Lease
Trust Certificateholder, or any of their respective affiliates, is or becomes a
party in interest or a disqualified person with respect to such Benefit Plan.
In such case, certain exemptions from the prohibited transaction rules could be
applicable depending on the type and circumstances of the plan fiduciary making
the decision to acquire a Senior Note. Included among these exemptions are:
Prohibited Transaction Class Exemption ("PTCE") 90-1, which exempts certain
transactions involving insurance company pooled separate accounts; PTCE 95-60,
which exempts certain transactions involving insurance company general
accounts; PTCE 91-38, which exempts certain transactions involving bank
collective investment funds; PTCE 96-23, which exempts certain transactions
effected on behalf of a Benefit Plan by an "in house" asset manager; and PTCE
84-14, which exempts certain transactions effected on behalf of a Benefit Plan
by a "qualified professional asset manager."

Employee benefit plans that are governmental plans (as defined in
Section 3(32) of ERISA) and certain church plans (as defined in Section 3(33)
of ERISA) are not subject to ERISA requirements.

A plan fiduciary considering the purchase of Senior Notes should
consult its tax and/or legal advisors regarding whether the assets of the
Issuer would be considered plan assets, the possibility of exemptive relief
from the prohibited transaction rules and other issues and their potential
consequences.

UNDERWRITING

Subject to the terms and conditions set forth in the underwriting
agreement (the "Underwriting Agreement"), the Transferor has agreed to cause
the Issuer to sell to the underwriters named below

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<PAGE> 86

(the "Underwriters") and each of the Underwriters has severally agreed to
purchase the initial principal balance of Senior Notes as set forth opposite
its name:

<TABLE>
<CAPTION>
INITIAL PRINCIPAL BALANCE INITIAL PRINCIPAL BALANCE
UNDERWRITERS OF CLASS A-1 SENIOR NOTES OF CLASS A-2 SENIOR NOTES
------------ ------------------------- -------------------------
<S> <C> <C> <C>
J.P. Morgan Securities Inc. . . . . . . $ $
. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . .
----- -----
Total . . . . . . . . . . . . . $ $
===== =====
</TABLE>

The Transferor has been advised by the several Underwriters that the
several Underwriters propose initially to offer the Class A-1 Senior Notes and
Class A-2 Senior Notes to the public at the respective prices set forth on the
cover page of this Prospectus, and to certain dealers at such prices less an
initial concession not in excess of __% per Class A-1 Senior Note and __% per
Class A-2 Senior Note. The several Underwriters may allow and such dealers may
reallow a concession not in excess of __% per Class A-1 Senior Note and __% per
Class A-2 Senior Note to certain other dealers. After the initial public
offering of the Senior Notes, the public offering prices and such concessions
may be changed.

The closing of the sale of the Senior Notes is conditioned on the
closing of the sale of the Lease Trust Certificates.

The Indenture Trustee may, from time to time, invest the funds in the
Collection Account, the Payahead Account, the Cash Collateral Account, the
Payment Account and the Certificate Distribution Account in Eligible
Investments acquired from the Underwriters.

In the ordinary course of business, the Underwriters and their
affiliates have engaged and may engage in investment banking and commercial
banking transactions with Ford and its affiliates.

The Transferor, Ford Credit and Ford Credit Leasing have agreed to
jointly and severally indemnify the Underwriters against certain liabilities,
including civil liabilities under the Securities Act, or to contribute to
payments which the Underwriters may be required to make in respect thereof.

LEGAL MATTERS

Certain legal matters relating to the Senior Notes will be passed upon
for the Issuer and Ford Credit by J.D. Bringard, Esq., Vice President --
General Counsel of Ford Credit, and for the Underwriters by Skadden, Arps,
Slate, Meagher & Flom, New York, New York. Certain federal income tax and
other matters will be passed upon for the Issuer by Skadden, Arps, Slate,
Meagher & Flom. Certain Michigan income tax and other matters will be passed
upon for the Issuer by Mr. Bringard.

Mr. Bringard is a full time employee of Ford Credit and owns and holds
options to purchase shares of Common Stock of Ford. Skadden, Arps, Slate,
Meagher & Flom has from time to time represented Ford and Ford Credit in
connection with certain transactions.

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<PAGE> 87

GLOSSARY OF TERMS

"Accepted Servicing Practices" is defined on page 57 in "Description
of the Administrative Agency Agreement -- Duties of the Administrative
Agent."

"Accrual Period" means, (i) with respect to any Payment Date other
than the first Payment Date, the period from and including the first day of the
third preceding Collection Period up to and including the last day of the
preceding Collection Period, and (ii) with respect to the first Payment Date,
the period from and including the Series 1996-1 Cut-Off Date up to and
including the last day of the preceding Collection Period, in each case whether
or not such day is a business day.

"Additional Fee" is defined on page 36 in footnote 2 to the
Composition of the Series 1996-1 Assets in "The Leases and Leased Vehicles --
Characteristics of the Series 1996-1 Assets"

"Additional Payment" is defined on page 5 in "Summary -- Overview"
and on page 29 in "Series 1996-1 Certificates -- Lease of Series 1996-1
Certificates to the Transferor."

"Adjusted Balance Subject to Lease Charges" means, with respect to any
Leased Vehicle as of any date, the Balance Subject to Lease Charges minus the
sum of the principal portion of all Constant Yield Payments which have been
scheduled to have been received as of such date; provided that the Adjusted
Balance Subject to Lease Charges of a Leased Vehicle shall be zero as of the
date on which the related Lease terminates, whether on or after the Scheduled
Lease End Date or earlier, or if an Administrative Purchase Amount has been
received with respect to such Lease and Leased Vehicle.

"Administrative Agency Agreement" means the agreement dated as of
January 31, 1994 among Comerica Bank, as trustee, Ford Credit, as
Administrative Agent, and Ford Credit and Ford Credit Leasing, as
beneficiaries.

"Administrative Agent" is Ford Credit.

"Administrative Agent Event of Default" is defined on page 62 in
"Description of the Administrative Agency Agreement -- Administrative Agent
Events of Default."

"Administrative Agent Fee" means as of any Payment Date the fee
payable to the Administrative Agent equal to the sum, for each of the three
Collection Periods preceding such Payment Date, of the product of 1/12 of 1.00%
and the Pool Balance as of the beginning of each such Collection Period.

"Administrative Purchase Amount" is defined on page 47 in "Description
of the Senior Notes -- The Indenture Cash Flows."

"Advance Payment Plan" means, with respect to any lease originated
under the Red Carpet Lease Plan, a payment option of the related lessee
pursuant to which such lessee prepays all monthly payments in a single advance
payment, generally discounted to reflect the present value of such single
advance payment and the reduction in the risk of credit loss.

"Aggregate Net Monthly Payment Advances" is defined on page 48 in
"Description of the Senior Notes -- The Indenture Cash Flows."

"Aggregate Net Sale Proceeds Advances" is defined on page 48 in
"Description of the Senior Notes -- The Indenture Cash Flows."

<PAGE> 88

"Asset Contribution Agreement" means the agreement dated as of ____
__, 1996 among Ford Credit, as a contributor, Ford Credit Leasing, as a
contributor and the Transferor, as contributee.

"Available Sale Proceeds" is defined on page 7 in "Summary --
Principal" and on page 48 in "Description of the Senior Notes -- The
Indenture Cash Flows."

"Balance Subject to Lease Charges" means the amount paid by FCTT to
the Dealer in connection with the acquisition of the Lease and Leased Vehicle,
which is the total acquisition cost used to calculate the Monthly Payment.

"Bankruptcy Code" means the United States Bankruptcy Code, 11 U.S.C.
Section Section 101-1330.

"Basic Documents" means the FCTT Agreement, the Administrative Agency
Agreement, the Series 1996-1 Supplement, the Program Operating Lease, the Asset
Contribution Agreement, the Transfer Agreement, the RCL Trust Agreement, the
Lease Trust Agreement, the Indenture, and each instrument and certificate
delivered in connection therewith.

"Benefit Plan" is defined on page 84 in "ERISA Considerations."

"Cash Collateral Account" means the Cash Collateral Account
established pursuant to the Program Operating Lease.

"Cash Collateral Account Investments" means (i) the Hanover 100% U.S.
Treasury Securities Fund, (ii) if the Hanover 100% U.S. Treasury Securities
Fund is not available, the Hanover U.S. Treasury Fund or (iii) if the Hanover
100% U.S. Treasury Securities Fund and the Hanover U.S. Treasury Fund both are
not available, the Fidelity U.S. Government Reserve Fund.

"Cash Collateral Additional Draw Amount" is defined on page 51 in
"Description of the Senior Notes -- Cash Collateral Account Withdrawals and
Deposits."

"Cash Collateral Amount" is defined on page 11 in "Summary -- Cash
Collateral Account" and on page 50 in "Description of the Senior Notes --
Cash Collateral Account Withdrawals and Deposits."

"Cash Collateral Draw Amount" is defined on page 50 in "Description of
the Senior Notes -- Cash Collateral Account Withdrawals and Deposits."

"Cash Collateral Required Draw Amount" is defined on page 50 in
"Description of the Senior Notes -- Cash Collateral Account Withdrawals and
Deposits."

"Cede" means Cede & Co.

"Certificate Distribution Account" means the Certificate Distribution
Account established pursuant to the Lease Trust Agreement.

"Class" means a class of Senior Notes; as the case may be, the Class
A-1 Senior Notes or the Class A-2 Senior Notes.

"Class A-1 Senior Notes" means the Class A-1 __% Asset Backed Notes of
the Issuer.

"Class A-2 Senior Notes" means the Class A-2 __% Asset Backed Notes of
the Issuer.

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<PAGE> 89

"Closing Date" means ____ __, 1996, or such other day as the
Underwriters and the Transferor shall determine.

"Code" means the Internal Revenue Code of 1986, as amended.

"Collections" is defined on page 47 in "Description of the Senior
Notes -- The Indenture Cash Flows."

"Collection Account" means the Series 1996-1 Collection Account
established pursuant to the Series 1996-1 Supplement.

"Collection Period" means any calendar month.

"Commission" means the Securities and Exchange Commission.

"Constant Yield Payment" means the payment made by the Obligor which
provides a fixed internal rate of return equal to the Retail Operating Lease
Factor and amortizes the Balance Subject to Lease Charges of the related Leased
Vehicle to the Residual Value over the term of the Lease.

"Contingent and Excess Liability Insurance" is defined on page 75 in
"Certain Legal Aspects of FCTT and the Series 1996-1 Certificates --
Insurance."

"Dealer" means a motor vehicle dealer who, in the ordinary course of
business, leases automobiles and light trucks to lessees pursuant to the Red
Carpet Lease Plan or such other plan as Ford Credit or its affiliates may
implement from time to time.

"Definitive Senior Notes" is defined on page 42 in "Description of the
Senior Notes -- General."

"Distribution Date" means the date on which distributions are made
with respect to the Series 1996-1 Certificates, which shall be the 15th day of
each month, and if such day is not a business day, the next succeeding business
day.

"DTC" means The Depository Trust Company.

"EBC" means an Exchangeable Beneficial Certificate.

"Eligible Account" means a segregated trust account at a financial
institution having a long-term debt rating by each Rating Agency of at least
"Baa3" or the equivalent.

"Eligible Institution" means a depository institution organized under
the laws of the United States of America or any one of the states thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States of America or one of the States thereof and
subject to supervision and examination by federal or state banking authorities
which at all times has a short-term deposit rating of P-1 and a long-term
deposit rating of A2 by Moody's Investors Service, Inc. and a short-term
deposit rating of A-1+ by Standard and Poor's Ratings Group and, in the case of
any such institution organized under the laws of the United States of America,
whose deposits are insured by the Federal Deposit Insurance Corporation or any
successor thereto.

"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

"Events of Default" means any of the events of default under the
Indenture as set forth on page 52 in "Description of the Senior Notes --
Indenture -- Events of Default."

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<PAGE> 90

"Excess Deferred Gross" means, with respect to any Lease and Leased
Vehicle, the amount, if any, withheld from the total amount paid to the related
Dealer in connection with assignment of such Lease and Leased Vehicle. Excess
Deferred Gross is withheld if the acquisition cost of a Leased Vehicle exceeds
the MSRP of a Leased Vehicle, if the Residual Value of a Leased Vehicle as set
forth in the related Lease exceeds the maximum amount permitted for such Leased
Vehicle by the Administrative Agent, or the security deposit or reconditioning
reserve for such Lease is waived by the Dealer.

"Excess Wear and Tear and Excess Mileage" means, with respect to any
Lease and Leased Vehicle, amounts due from an Obligor upon termination of such
Lease on or after the Scheduled Lease End Date (i) as a result of excess wear
and tear with respect to the related Leased Vehicle and (ii) mileage charges
incurred in excess of the amount permitted pursuant to the related Lease.

"Exchangeable Beneficial Certificate" or "EBC" means a certificate of
beneficial interest in FCTT and the Non-Specified Assets.

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"FCTT" means Ford Credit Titling Trust, formed pursuant to the FCTT
Agreement.

"FCTT Agreement" means the Amended and Restated Trust Agreement dated
as of January 31, 1994 among the FCTT Trustee, Ford Credit and Ford Credit
Leasing.

"FCTT Assets" means (i) each Lease and related Leased Vehicle, (ii)
all collections of monies with respect to such Lease and related Leased
Vehicle, (iii) the related certificates of title, (iv) the rights of the lessor
to any security deposit or reconditioning reserve, (v) any recourse to Dealers
with respect to such Leases and Leased Vehicles and (vi) all proceeds of the
foregoing.

"FCTT Trustee" means Comerica Bank, in its capacity as trustee of
FCTT, and any co-trustee or separate trustee appointed for the purpose of
meeting applicable state requirements.

"Ford" means Ford Motor Company.

"Ford Credit" means Ford Motor Credit Company.

"Ford Credit Leasing" means Ford Credit Leasing Company, Inc.

"Foreign Person" is defined on page 82 in "Certain Federal Income Tax
Consequences -- Tax Consequences to Foreign Investors."

"GAP" is defined on page 75 in "Certain Legal Aspects of FCTT and the
Series 1996-1 Certificates -- Insurance."

"General Eligibility Criteria" is defined on page 67 in "Additional
Document Provisions -- Representations, Warranties and Covenants."

"Indenture" means the Indenture dated as of ____ __, 1996 between the
Issuer and the Indenture Trustee.

"Indenture Trustee" is The Chase Manhattan Bank.

"Indirect Participants" is defined on page 42 in "Description of the
Senior Notes -- Book-Entry Registration."

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"Initial Cash Collateral Deposit" is defined on page 12 in "Summary
- -- Cash Collateral Account" and on page 50 in "Description of the Senior
Notes -- Cash Collateral Account Withdrawals and Deposits."

"Initial Pool Balance" is defined on page 9 in "Summary -- The
Series 1996-1 Assets."

"Insolvency Laws" is defined on page 72 in "Certain Legal Aspects of
FCTT and the Series 1996-1 Certificates -- Insolvency Related Matters."

"IRS" means the Internal Revenue Service.

"Issuer" is Ford Credit Auto Lease Trust 1996-1.

"Lease" means any retail lease contract for an automobile or a light
truck which has been entered into between an Obligor and a Dealer and assigned
by the Dealer to FCTT.

"Leased Vehicle" means any automobile or light truck which is subject
to a Lease.

"Lease Files" means the certificate of title (or application
therefor), the original of the Lease and related documentation with respect to
a Lease and Leased Vehicle.

"Lease Term" is defined on page 30 in "The Leases and Leased Vehicles
- -- Origination Procedures."

"Lease Trust Agreement" means the Ford Credit Auto Lease Trust 1996-1
Trust Agreement dated as of ____ __, 1996 between the RCL Trustee and the Lease
Trustee.

"Lease Trust Certificates" means the __% Asset Backed Lease Trust
Certificates of the Issuer.

"Lease Trust Certificateholders" means the holders of any Lease Trust
Certificates.

"Lease Trustee" is PNC Bank, Delaware.

"Lease Trust Estate" is defined on page 10 in "Summary -- Property
of the Issuer; Pledge to the Indenture Trustee" and on page 24 in "Property of
the Issuer."

"Lemon Law" is defined on page 78 in "Certain Legal Aspects of the
Lease and Leased Vehicles -- Consumer Protections Laws."

"Liquidated Lease" means a Lease which is in default and with respect
to which the Administrative Agent has repossessed or attempted to repossess the
related Leased Vehicle or the related Obligor is the subject of a bankruptcy
proceeding, or a Lease subject to a Lemon Law with respect to which amounts
have either been refunded to the related Obligor or such Obligor is no longer
obligated to make Total Monthly Payments.

"Liquidation Proceeds" is defined on page 47 in "Description of the
Senior Notes -- The Indenture Cash Flows."

"Michigan Tax Counsel" is J.D. Bringard, Esq., Vice President --
General Counsel of Ford Credit.

"Monthly Payment" is defined on page 47 in "Description of the Senior
Notes -- The Indenture Cash Flows."

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<PAGE> 92

"Monthly Payment Advance" is defined on page 61 in "Description of the
Administrative Agency Agreement -- Monthly Payment Advances."

"Monthly Remittance Condition" means that (i) Ford Credit is the
Administrative Agent, (ii) the rating of Ford Credit's short-term unsecured
debt is at least P-1 by Moody's Investors Service, Inc. and A-1 by Standard &
Poor's Ratings Group and (iii) no Administrative Agent Event of Default with
respect to Series 1996-1 shall have occurred under the Administrative Agency
Agreement.

"Monthly Scheduled Termination Sale Proceeds" is defined on page 47 in
"Description of the Senior Notes -- The Indenture Cash Flows."

"MSRP" means the Manufacturer's Suggested Retail Price.

"Net Credit Losses" is defined on page 34 in footnote 4 to the Red
Carpet Lease Portfolio table in "The Leases and Leased Vehicles --
Delinquency, Repossession, Residual Value and Loss Data."

"Non-Specified Assets" is defined on page 26 in "FCTT --
Exchangeable Beneficial Certificates and Specified Beneficial Certificates."

"Note Pool Factor" is defined on page 41 in "Pool Factors and Trading
Information."

"Obligor" means the lessee under a Lease.

"OID" means Original Issue Discount.

"Opinion of Counsel" means a written opinion of counsel which may be
counsel to Ford Credit.

"Participants" is defined on page 42 in "Description of the Senior
Notes -- Book-Entry Registration."

"Payahead Account" means the Series 1996-1 Payahead Account
established pursuant to the Series 1996-1 Supplement.

"Payahead Credits" is defined on page 47 in "Description of the Senior
Notes -- The Indenture Cash Flows."

"Payaheads" are amounts received in a Collection Period from Obligors
in excess of the amount required to be currently applied against such Obligor's
current and past due Monthly Payments and which are not proceeds from the
disposition of the related Leased Vehicle.

"Payment Account" means the Series 1996-1 Payments Account established
pursuant to the Indenture.

"Payment Date" means ____ 15, ____ 15, ____ 15 and ____ 15 of each
year, commencing ____ 15, 199_ or, if any such day is not a business day, the
next succeeding business day.

"Payment Extension" is defined on page 58 in "Description of the
Administrative Agency Agreement -- Collection of Total Monthly Payments;
Extension of Leases."

"PBGC" means the Pension Benefit Guaranty Corporation.

"Permitted Investments" means (i) direct obligations of, and
obligations fully guaranteed by, the United States of America or any agency or
instrumentality of the United States the obligations of

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<PAGE> 93

which are backed by the full faith and credit of the United States; (ii)
commercial paper issued by any corporation incorporated under the laws of the
United States or any State so long as at the time such commercial paper is
issued it is rated at least P-1 by Moody's Investors Service, Inc. and A-1 by
Standard and Poor's Ratings Group; or (iii) any other investment otherwise
approved by any Rating Agency.

"Plan Asset Regulations" is defined on page 84 in "ERISA
Considerations."

"Pool Balance" means, as of any date of determination, the aggregate
Adjusted Balance Subject to Lease Charges of Series 1996-1 Leased Vehicles as
of such date.

"Program Operating Lease" means the agreement dated as of ____ __,
1996 between the Issuer as lessor and the Transferor as lessee.

"Program Operating Lease Payments" is defined on page 5 in "Summary --
Overview."

"Proposed Regulations" is defined on page 82 in "Certain Federal
Income Tax Consequences -- Tax Consequences to Foreign Investors."

"Prospectus" means this prospectus relating to the Senior Notes.

"PTCE" means Prohibited Transaction Class Exemption.

"Rating Agency" means a nationally recognized rating agency rating the
Senior Notes and/or the Lease Trust Certificates at the request of the Issuer.

"RCL Trust Agreement" means the Amended and Restated Trust Agreement
dated as of ____ __, 1996 by and among Ford Credit, Ford Credit Leasing and the
RCL Trustee.

"RCL Trustee" is ______.

"Record Date" means, with respect to any Payment Date or Redemption
Date, the close of business on the fourteenth day of the calendar month in
which such Payment Date or Redemption Date occurs (or, if Definitive Senior
Notes are issued, the last day of the preceding calendar month).

"Recoveries" is defined on page 48 in "Description of the Senior Notes
- -- The Indenture Cash Flows."

"Red Carpet Lease Plan" is defined on page 30 in "The Leases and
Leased Vehicles -- Origination Procedures."

"Red Carpet Lease Portfolio" is defined on page 32 in "The Leases and
Leased Vehicles -- Delinquency, Repossession, Residual Value and Loss Data."

"Redemption Date" means the Payment Date on which the Series 1996-1
Certificates are purchased by the Administrative Agent pursuant to the Series
1996-1 Supplement, which Payment Date shall be the date on which the Senior
Notes and Subordinated Notes are redeemed pursuant to the Indenture and the
Lease Trust Agreement, respectively.

"Redemption Price" means the outstanding principal amount of the
Senior Notes plus accrued and unpaid interest thereon to but not including the
Redemption Date.

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<PAGE> 94

"Required Cash Collateral Amount" is defined on page 12 in "Summary
- -- Cash Collateral Account" and on page 50 in "Description of the Senior
Notes -- Cash Collateral Account Withdrawals and Deposits."

"Required Interest Payment" on any Payment Date means the
Administrative Agent Fee plus the amount of interest accrued on the outstanding
Senior Notes, Subordinated Notes and Lease Trust Certificates since the
preceding Payment Date (or, in the case of the first Payment Date, since the
Closing Date) plus any previously due but unpaid interest (and interest
thereon).

"Residual Loss" is defined on page 35 in footnote 5 to the Red Carpet
Lease Portfolio table in "The Leases and Leased Vehicles -- Delinquency,
Repossession, Residual Value and Loss Data."

"Residual Value" means the value of the Leased Vehicle at its
Scheduled Lease End Date as calculated by the Administrative Agent at the
inception of the related Lease and set forth in the related Lease.

"Retail Operating Lease Factor" means the per annum yield of a Lease
determined by the Administrative Agent.

"Sale Proceeds" means all amounts realized from the sale of Leased
Vehicles.

"Sale Proceeds Advance" is defined on page 59 in "Description of the
Administrative Agency Agreement -- Advances of Sale Proceeds."

"SBC" means a Specified Beneficial Certificate.

"Scheduled Lease End Date" means with respect to any Lease, the date
set forth in such Lease as the termination date for such Lease.

"Securities Act" means the Securities Act of 1933, as amended.

"Senior Noteholder" means, as of any date, the individual or entity in
whose name a Senior Note is registered on the Senior Note Register.

"Senior Note Owner" is defined on page 42 in "Description of the
Senior Notes -- General."

"Senior Note Register" means the Senior Note register maintained
pursuant to the Indenture.

"Senior Note Registrar" means, initially, the Indenture Trustee.

"Senior Notes" means the Class A-1 Senior Notes and the Class A-2
Senior Notes.

"Series" means any series of Specified Beneficial Certificates.

"Series 1995-1" means the Series 1995-1 Certificates and the related
Series 1995-1 Assets.

"Series 1995-1 Assets" are the Series Specified Assets with respect to Series
1995-1.

"Series 1995-1 Certificates" means the series of Specified Beneficial
Certificates designated as Series 1995-1 representing an interest in the Series
1995-1 Assets.

"Series 1996-1" means the Series 1996-1 Certificates and the related
Series 1996-1 Assets.

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<PAGE> 95

"Series 1996-1 Assets" are the Series Specified Assets with respect to
Series 1996-1, including the Series 1996-1 Leases and Series 1996-1 Leased
Vehicles.

"Series 1996-1 Certificates" means the series of Specified Beneficial
Certificates designated as Series 1996-1 representing an interest in the Series
1996-1 Assets.

"Series 1996-1 Credit Loss" means with respect to any Collection
Period and Series 1996-1 Assets, (i) the aggregate Adjusted Balance Subject to
Lease Charges of all Series 1996-1 Leases and Series 1996-1 Leased Vehicles
which become Liquidated Leases during such Collection Period, plus the
aggregate amount of Uncollected Excess Wear and Tear and Excess Mileage
relating to Series 1996-1 Leased Vehicles which were sold in such Collection
Period with respect to which Sale Proceeds of the related Series 1996-1 Leased
Vehicle were received plus any uncollected Monthly Payments minus (ii)
Liquidation Proceeds and Recoveries received during such Collection Period.

"Series 1996-1 Cut-Off Date" means ____ __, 1996.

"Series 1996-1 Leased Vehicles" means the Leased Vehicles designated
in the Series Specification Notice relating to Series 1996-1 and the Series
1996-1 Supplement.

"Series 1996-1 Leases" means the Leases designated in the Series
Specification Notice relating to Series 1996-1 and the Series 1996-1
Supplement.

"Series 1996-1 Residual Loss" means the aggregate Residual Values of
all Series 1996-1 Leased Vehicles the related Series 1996-1 Leases of which
terminated on or after their respective Scheduled Lease End Dates in a
Collection Period minus Sale Proceeds of such Series 1996-1 Leased Vehicles
(but in no event for any Series 1996-1 Leased Vehicle, an amount greater than
the Transferor Purchase Option Price) minus amounts assessed against Obligors
with respect to Excess Wear and Tear and Excess Mileage with respect to such
Series 1996-1 Leased Vehicles.

"Series 1996-1 Supplement" means the Series 1996-1 Supplement to the
Administrative Agency Agreement.

"Series Issue Date" is defined on page 26 in "FCTT -- Exchangeable
Beneficial Certificates and Specified Beneficial Certificates."

"Series Specified Assets" means the Leases and Leased Vehicles
designated in the Series Specification Notice and the Supplement to the
Administrative Agency Agreement relating to such Series, including the related
certificates of title and all other FCTT Assets relating to such Leases and
Leased Vehicles.

"Series Specification Notice" means a notice delivered by the
Administrative Agent, acting at the unanimous direction of the holders of the
EBCs, to the FCTT Trustee directing such FCTT Trustee to (i) designate certain
FCTT Assets as Series Specified Assets, (ii) designate a date on which SBCs
representing the interest in such Series Specified Assets are to be issued to
the holders of the EBCs and (iii) set the date on which payments related to
such Series Specified Assets shall be allocated to the related SBCs. The
Series Specification Notice relating to Series 1996-1 shall contain such
additional information as is reasonably necessary for the FCTT Trustee to
identify separately the Series 1996-1 Assets and to allocate proceeds from such
Series 1996-1 Assets.

"Special Tax Counsel" is Skadden, Arps, Slate, Meagher & Flom.

"Specific Eligibility Criteria" is defined on page 35 in "The Leases
and Leased Vehicles -- Eligibility Criteria."

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<PAGE> 96

"Specified Beneficial Certificate" or "SBC" means a certificate
representing a beneficial interest in FCTT and certain designated Series
Specified Assets.

"Stated Maturity" means with respect to the Class A-1 Senior Notes,
the ____ __, 1997 Payment Date, with respect to the Class A-2 Senior Notes, the
____ __, 199_ Payment Date and with respect to the Subordinated Notes, the ____
__, 199_ Payment Date.

"Subordinated Noteholder" means, as of any date, the individual or
entity in whose name a Subordinated Note is registered pursuant to the Lease
Trust Agreement.

"Subordinated Notes" means the __% Asset Backed Subordinated Notes of
the Issuer.

"Supplemental Administrative Agent Fee" means, with respect to any
Collection Period, all late fees, prepayment charges and certain other
administrative fees and expenses or similar charges allowed by applicable law
with respect to Leases and Leased Vehicles, and interest on amounts invested in
the Payment Account.

"Term Extension" is defined on page 57 in "Description of the
Administrative Agency Agreement -- Collection of Total Monthly Payments;
Extension of Leases."

"Total Available Funds" is defined on page 7 in "Summary --
Principal" and on page 49 in "Description of the Senior Notes -- The
Indenture Cash Flows."

"Total Monthly Payment" is defined on page 9 in "Summary -- The Series 1996-1
Assets."

"Transfer Agreement" means the Transfer Agreement dated as of ____ __,
1996 between the Transferor, as transferor, and the Issuer, as transferee.

"Transferor" is RCL Trust 1996-1.

"Transferor Leased Vehicle Purchase Option" is defined on page 11 in
"Summary -- Transferor Leased Vehicle Purchase Option."

"Transferor Purchase Option Net Proceeds" is defined on page 11 in
"Summary -- Transferor Leased Vehicle Purchase Option" and on page 30 in
"Series 1996-1 Certificates -- Lease of the Series 1996-1 Certificates to the
Transferor."

"Transferor Purchase Option Price" is defined on page 11 in "Summary
- -- Transferor Leased Vehicle Purchase Option" and on page 30 in "Series
1996-1 Certificates -- Lease of the Series 1996-1 Certificates to the
Transferor."

"UCC" means the Uniform Commercial Code.

"Uncollected Excess Wear and Tear and Excess Mileage" means, with
respect to any Payment Date and the related Accrual Period, all amounts which
are due but not collected from an Obligor with respect to a Series 1996-1 Lease
which terminated on its Scheduled Lease End Date as a result of (i) excess wear
and tear with respect to such Series 1996-1 Leased Vehicle and (ii) mileage
charges incurred in excess of the amount permitted pursuant to the related
Series 1996-1 Lease.

"Underwriters" are J.P. Morgan Securities Inc. and ______.

"Underwriting Agreement" is defined on page 85 in "Underwriting."

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<PAGE> 97

"Use and Lease Tax Amounts" is defined on page 31 in "The Leases and
Leased Vehicles -- Origination Procedures."

"VCR" is defined on page 31 in "The Leases and Leased Vehicles --
Servicing Procedures."

"Vehicle Insurance and Maintenance Amounts" means, with respect to any
Lease, any payment due in connection with a Monthly Payment for remittance to
the related Dealer in connection with servicing of the related Leased Vehicle
or the provision of vehicle insurance.

"Voluntary Early Termination" is defined on page 31 in "The Leases and
Leased Vehicles -- Servicing Procedures."

"Voluntary Early Termination Proceeds" is defined on page 47 in
"Description of the Senior Notes -- The Indenture Cash Flows."

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<PAGE> 98

PART II. INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the estimated expenses in connection
with the offering described in this Registration Statement.

Securities and Exchange Commission . . . . . . . . . . . . . . . . $______
Rating agency fees . . . . . . . . . . . . . . . . . . . . . . . . $______
Printing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $______
Accountants' fees . . . . . . . . . . . . . . . . . . . . . . . . . $______
Fees and expenses of the RCL Trustee . . . . . . . . . . . . . . . $______
Fees and expenses of the Lease Trustee . . . . . . . . . . . . . . $______
Fees and expenses of the Indenture Trustee . . . . . . . . . . . . $______
Miscellaneous expenses . . . . . . . . . . . . . . . . . . . . . . $______

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . $
======
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Section 3803 of the Delaware Business Trust Statute provides
as follows:

3803. Liability of Beneficial Owners and Trustees.

(a) Except to the extent otherwise provided in the governing
instrument of the business trust, the beneficial owners shall be entitled to
the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the general corporation law of the
State.

(b) Except to the extent otherwise provided in the governing
instrument of a business trust, a trustee, when acting in such capacity, shall
not be personally liable to any person other than the business trust or a
beneficial owner for any act, omission or obligation of the business trust or
any trustee thereof.

(c) Except to the extent otherwise provided in the governing
instrument of a business trust, an officer, employee, manager or other person
acting pursuant to Section 3806(b)(7), when acting in such capacity, shall not
be personally liable to any person other than the business trust or a
beneficial owner for any act, omission or obligation of the business trust or
any trustee thereof.

Section 3817 of the Delaware Business Trust Statute provides
as follows:

3817. Indemnification.

(a) Subject to such standards and restrictions, if any, as are set
forth in the governing instrument of a business trust, a business trust shall
have the power to indemnify and hold harmless any trustee or beneficial owner
or other person from and against any and all claims and demands whatsoever.

(b) The absence of a provision for indemnity in the governing
instrument of a business trust shall not be construed to deprive any trustee or
beneficial owner or other person of any right to indemnity which is otherwise
available to such person under the laws of this State.
<PAGE> 99

Section 2.7 of the Amended and Restated Trust Agreement of RCL
Trust 1996-1 provides as follows:

Section 2.7 Liability and Indemnification.
(a) Notwithstanding Section 3803 of the Trust Statute, Ford Credit Leasing
shall be directly liable to any claimant for all losses, claims, damages,
liabilities and expenses ("Liabilities") of RCL, or incurred in connection with
RCL Assets and this Agreement and the Basic Documents to the extent that Ford
Credit Leasing would be liable if RCL were a partnership under the Delaware
Revised Uniform Limited Partnership Act or the Delaware Uniform Partnership Law
and Ford Credit Leasing were a general partner thereof, and Ford Credit Leasing
hereby covenants and agrees that it will maintain net worth in an amount
sufficient to maintain its status as a "general partner" of RCL and the Lease
Trust for federal income tax purposes. Any third party creditors of RCL shall
be deemed to be third party beneficiaries for purposes of this Section 2.7.

(b) The RCL Beneficiaries shall indemnify, defend and hold harmless
the RCL Trustee, including its successors, assigns, officers, directors,
shareholders, employees and agents for all Liabilities, penalties and taxes
(other than income taxes relating to the fees paid to it hereunder) incurred by
it in connection with the administration of the RCL Trust (including attorneys'
fees) and the performance of its duties thereunder; provided, however, that in
no event shall the RCL Trustee be indemnified or held harmless for any
Liabilities incurred (i) by reason of the RCL Trustee's willful misconduct, bad
faith or negligence or (ii) incurred by reason of the RCL Trustee's breach of
its representations and warranties set forth in Section 6.6. The RCL Trustee
shall notify the RCL Beneficiaries promptly of any claim for which the RCL
Trustee may seek indemnity. Failure by the RCL Trustee to so notify the RCL
Beneficiaries shall not relieve the RCL Beneficiaries of their obligations
hereunder. If necessary, to the extent not otherwise reimbursed, the RCL
Trustee shall be entitled to indemnification from amounts on deposit in the RCL
Account for any claims against the RCL Trustee the indemnification for which is
provided pursuant to this Section 2.7. Any claim against the RCL Trustee shall
be defended by the RCL Beneficiaries and the RCL Trustee shall be entitled to
separate counsel, the fees and expenses of which shall be paid by such RCL
Beneficiaries. The indemnities contained in this Section 2.7 shall survive the
resignation or termination of the RCL Trustee or the termination of this
Agreement. Any amounts paid to the RCL Trustee pursuant to this Section 2.7
shall be deemed not to be RCL Assets immediately after such payment. The RCL
Trustee acknowledges that funds may be deposited in the RCL Account only as
specifically provided in the Basic Documents, and that certain funds paid to
RCL in respect of the Series 1996-1 Certificates have been pledged to the Lease
Trustee on behalf of the Lease Trust and the Indenture Trustee on behalf of
Senior Noteholders in accordance with the terms of the Basic Documents.

Section 145 of the General Corporation Law of Delaware
provides as follows:

145. Indemnification of officers, directors, employees and agents; insurance --

(a) A corporation may indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea

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<PAGE> 100

of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.

(b) A corporation may indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a judgment in its
favor by reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the Court
of Chancery or such other court shall deem proper.

(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
section, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.

(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met
the applicable standard of conduct set forth in subsections (a) and (b) of this
section. Such determination shall be made (1) by a majority vote of the
directors who are not parties to such action, suit or proceeding, even though
less than a quorum, or (2) if there are no such directors, or if such directors
so direct, by independent legal counsel in a written opinion, or (3) by the
stockholders.

(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending a civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the corporation as authorized in this section. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon
such terms and conditions, if any, as the board of directors deems appropriate.

(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.

(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and

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<PAGE> 101

incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liability under this section.

(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and
employees or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was serving at the
request of such constituent corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, shall stand in the same position under this section with respect to
the resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.

(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to any employee benefit plan;
and references to "serving at the request of the corporation" shall include any
service as a director, officer, employee, or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee,
or agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
section.

(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.

(k) The Court of Chancery is hereby vested with exclusive
jurisdiction to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement, vote
of stockholders or disinterested directors, or otherwise. The Court of
Chancery may summarily determine a corporation's obligation to advance expenses
(including attorneys' fees).

Article Ninth, Section 5 of the Certificate of Incorporation
of Ford Motor Credit Company provides as follows:

SECTION 5.
Indemnification

5.1. Directors, Officers and Employees of the Corporation. Every
person now or hereafter serving as a director, officer or employee of the
corporation shall be indemnified and held harmless by the corporation from and
against any and all loss, cost, liability and expense that may be imposed upon
or incurred by him in connection with or resulting from any claim, action,
suit, or proceeding, civil or criminal, in which he may become involved, as a
party or otherwise, by reason of his being or having been a director, officer
or employee of the corporation, whether or not he continues to be such at the
time such loss, cost, liability or expense shall have been imposed or incurred.
As used herein, the term "loss, cost, liability and expense" shall include, but
shall not be limited to, counsel fees and disbursements and amounts of
judgments, fines or penalties against, and amounts paid in settlement by, any
such director, officer or employee; provided, however, that no such director,
officer or employee shall be entitled to claim such indemnity: (1) with
respect to any matter as to which there shall have been a final adjudication
that he has committed or allowed some act or omission, (a) otherwise than in
good faith in what he considered to be the best interests of the corporation,
and (b)without reasonable

II-4
<PAGE> 102

cause to believe that such act or omission was proper and legal; or (2) in the
event of a settlement of such claim, action, suit, or proceeding unless (a) the
court having jurisdiction thereof shall have approved of such settlement with
knowledge of the indemnity provided herein, or (b) a written opinion of
independent legal counsel, selected by or in manner determined by the Board of
Directors, shall have been rendered substantially concurrently with such
settlement, to the effect that it was not probable that the matter as to which
indemnification is being made would have resulted in a final adjudication as
specified in clause (1) above, and that the said loss, cost, liability or
expense may properly be borne by the corporation. A conviction or judgment
(whether based on a plea of guilty or nolo contendere or its equivalent, or
after trial) in a criminal action, suit or proceeding shall not be deemed an
adjudication that such director, officer or employee has committed or allowed
some act or omission as hereinabove provided if independent legal counsel,
selected as hereinabove set forth, shall substantially concurrently with such
conviction or judgment give to the corporation a written opinion that such
director, officer or employee was acting in good faith in what he considered to
be the best interests of the corporation or was not without reasonable cause to
believe that such act or omission was proper and legal.

5.2. Directors, Officers and Employees of Subsidiaries. Every person
(including a director, officer or employee of the corporation) who at the
request of the corporation acts as a director, officer or employee of any other
corporation in which the corporation owns shares of stock or of which it is a
creditor shall be indemnified to the same extent and subject to the same
conditions that the directors, officers and employees of the corporation are
indemnified under the preceding paragraph, except that the amounts of such
loss, cost, liability or expense paid to any such director, officer or employee
shall be reduced by and to the extent of any amounts which may be collected by
him from such other corporation.

5.3. Miscellaneous. The provisions of this Section 5 of Article
NINTH shall cover claims, actions, suits and proceedings, civil or criminal,
whether now pending or hereafter commenced and shall be retroactive to cover
acts or omissions or alleged acts or omissions which heretofore have taken
place. In the event of death of any person having a right of indemnification
under the provisions of this Section 5 of Article NINTH, such right shall inure
to the benefit of his heirs, executors, administrators and personal
representatives. If any part of this Section 5 of Article NINTH should be
found to be invalid or ineffective in any proceeding, the validity and effect
of the remaining provisions shall not be affected.

5.4. Indemnification Not Exclusive. The foregoing right of
indemnification shall not be deemed exclusive of any other right to which those
indemnified may be entitled, and the corporation may provide additional
indemnity and rights to its directors, officers or employees.

Article V of the Certificate of Incorporation of Ford Credit
Leasing Company, Inc. provides as follows:

ARTICLE V

(a) A director of the corporation shall not be personally liable to
the corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability

(i) for any breach of the director's duty of
loyalty to the corporation or its stockholders,

(ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law,

(iii) under Section 174 of the Delaware
General Corporation Law or

II-5
<PAGE> 103

(iv) for any transaction from which the
director derived an improper personal benefit.

If the Delaware General Corporation Law is amended
after approval by the stockholders of this Article V to authorize corporate
action further eliminating or limiting the personal liability of directors,
then the liability of a director of the corporation shall be eliminated or
limited to the fullest extent permitted by the Delaware General Corporation
Law, as so amended.

(b) Any repeal or modification of paragraph (a) of this Article V by
the stockholders of the corporation shall not adversely affect any right or
protection of a director of the corporation existing at the time of such repeal
or modification.

(c) (i) Each person who was or is made a party or is threatened to
be made a party to or is involved in any action, suit or proceeding, whether
civil, criminal, administrative, investigative or otherwise (hereinafter a
"proceeding"), by reason of the fact that he or she, or a person of whom he or
she is the legal representative, is or was a director, officer or employee of
the corporation or is or was serving at the request of the corporation as a
director, officer or employee of another corporation or of a partnership, joint
venture, trust or other enterprise, including service with respect to employee
benefit plans, whether the basis of such proceeding is alleged action in an
official capacity as a director, officer or employee or in any other capacity
while serving as a director, officer or employee, shall be indemnified and held
harmless by the corporation to the fullest extent authorized by the Delaware
General Corporation Law, as the same exists or may hereafter be amended (but,
in the case of any such amendment, only to the extent that such amendment
permits the corporation to provide broader indemnification rights than said law
permitted the corporation to provide prior to such amendment), against all
expense, liability and loss (including penalties, fines, judgments, attorneys'
fees, amounts paid or to he paid in settlement and excise taxes imposed on
fiduciaries with respect to (i) employee benefit plans, (ii) charitable
organizations or (iii) similar matters) reasonably incurred or suffered by such
person in connection therewith and such indemnification shall continue as to a
person who has ceased to be a director, officer or employee and shall inure to
the benefit of his or her heirs, executors and administrators; provided,
however, that the corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person (other than pursuant to subparagraph (c)(ii) of this Article V)
only if such proceeding (or part thereof) was authorized by the Board of
Directors of the corporation. The right to indemnification conferred in this
subparagraph (c)(i) of Article V shall be a contract right and shall include
the right to be paid by the corporation the expenses incurred in defending any
such proceeding in advance of its final disposition; provided, however, that,
if the Delaware General Corporation Law so requires, the payment of such
expenses incurred by a director or officer in his or her capacity as a director
or officer (and not in any other capacity in which service was or is rendered
by such person while a director or officer, including, without limitation,
service to an employee benefit plan) in advance of the final disposition of a
proceeding shall be made only upon delivery to the corporation of an
undertaking, by or on behalf of such director or officer, to repay all amounts
so advanced if it shall ultimately be determined that such director or officer
is not entitled to be indemnified under this subparagraph (c)(i) of Article V
or otherwise.

(ii) If a claim which the corporation is
obligated to pay under subparagraph (c)(i) of this Article V is not
paid in full by the corporation within 60 days after a written claim
has been received by the corporation, the claimant may at any time
thereafter bring suit against the corporation to recover the unpaid
amount of the claim and, if successful in whole or in part, the
claimant shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending
any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the corporation)
that

II-6
<PAGE> 104

the claimant has not met the standards of conduct which make it
permissible under the Delaware General Corporation Law for the
corporation to indemnify the claimant for the amount claimed, but
the burden of proving such defense shall be on the corporation.
Neither the failure of the corporation (including its Board of
Directors, independent legal counsel or its stockholders) to have
made a determination prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances because
he or she has met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination by the
corporation (including its Board of Directors, independent legal
counsel or its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action
or create a presumption that the Claimant has not met the applicable
standard of conduct.

(iii) The provisions of this paragraph (c)
of Article V shall cover claims, actions, suits and proceedings, civil
or criminal, whether now pending or hereafter commenced, and shall be
retroactive to cover acts or omissions or alleged acts or omissions
which heretofore have taken place. If any part of this paragraph (c)
of Article V should be found to be invalid or ineffective in any
proceeding, the validity and effect of the remaining provisions shall
not be affected.

(iv) The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of
its final disposition conferred in this paragraph (c) of Article V
shall not be exclusive of any other right which any person may have or
hereafter acquire under any statute, provision of the Certificate of
Incorporation, By-Law, agreement, vote of stockholders or
disinterested directors or otherwise.

(v) The corporation may maintain insurance,
at its expense, to protect itself and any director, officer, employee
or agent of the corporation or another corporation, partnership, joint
venture, trust or other enterprise against any such expense, liability
or loss, whether or not the corporation would have the power to
indemnify such person against such expense, liability or loss under
the Delaware General Corporation Law.

(vi) The corporation may, to the extent
authorized from time to time by the Board of Directors, grant rights
to indemnification, and rights to be paid by the corporation the
expenses incurred in defending any proceeding in advance of its final
disposition, to any agent of the corporation to the fullest extent of
the provisions of this paragraph (c) of Article V with respect to the
indemnification and advancement of expenses of director, officers and
employees of the corporation.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Not Applicable

ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS.

(a) EXHIBITS:

1.1 - Form of Underwriting Agreement.*
3.1 - Form of Amended and Restated Trust Agreement of RCL Trust 1996-1,
among Ford Credit, Ford Credit Leasing and the RCL Trustee.*
3.2 - Restated Certificate of Incorporation of Ford Motor Credit Company.*
3.3 - By-Laws of Ford Motor Credit Company.*
3.4 - Certificate of Incorporation of Ford Credit Leasing Company, Inc.*

II-7
<PAGE> 105

<TABLE>
<S> <C> <C>
3.5 - By-Laws of Ford Credit Leasing Company, Inc.*
4.1 - Form of Trust Agreement of the Issuer, between the RCL Trustee and the Lease Trustee.*
4.2 - Form of Trust Indenture, between the Lease Trustee and the Indenture Trustee.*
4.3 - Form of Class A-1 Senior Note (included as part of Exhibit 4.2).*
4.4 - Form of Class A-2 Senior Note (included as part of Exhibit 4.2).*
5.1 - Opinion of J.D. Bringard, Esq., Vice President-General Counsel of Ford Motor Credit Company with respect to
legality.*
8.1 - Opinion of Skadden, Arps, Slate, Meagher & Flom with
respect to tax matters.*
8.2 - Opinion of J.D. Bringard, Esq., Vice President-General Counsel of Ford Motor Credit Company with respect to
Michigan income tax matters.*
10.1 - FCTT Trust Agreement, among Ford Credit, Ford Credit Leasing and Comerica.*
10.2 - Administrative Agency Agreement, among Comerica, Ford Credit and Ford Credit Leasing.*
10.3 - Form of Series 1996-1 Supplement, among Comerica, Ford Credit and Ford Credit Leasing.*
10.4 - Form of Asset Contribution Agreement, among Ford Credit, Ford Credit Leasing and the RCL Trustee.*
10.5 - Form of Transfer Agreement, between the RCL Trustee and the Lease Trustee.*
10.6 - Form of Program Operating Lease, between the RCL Trustee and the Lease Trustee.*
10.7 - Form of Appendix A and Appendix I - Definitions.*
23.1 - Consent of J.D. Bringard Esq., Vice President - General Counsel of Ford Motor Credit Company (included as
part of Exhibit 5.1).*
23.2 - Consent of Skadden, Arps, Slate, Meagher & Flom (included as part of Exhibit 8.1).*
24.1 - Powers of Attorney of officers and directors of Ford Motor Credit Company.*
24.2 - Powers of Attorney of officers and directors Ford Credit Leasing Company, Inc.*
25.1 - Form T-1 of The Chase Manhattan Bank.*
</TABLE>

* To be filed by amendment

(b) FINANCIAL STATEMENTS:

[Not Applicable]

ITEM 17. UNDERTAKINGS.

(a) To provide to the Underwriter at the closing specified in the
Underwriting Agreement certificates in such denominations and registered in
such names as required by the Underwriter to permit prompt delivery to each
purchaser.

(b) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions described under Item 14
above, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.

The undersigned registrant hereby undertakes that:

II-8
<PAGE> 106

(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(b) under the
Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

(2) For the purpose of determining any liability under
the Securities Act of 1933 each post-effective amendment that contains
a form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

II-9
<PAGE> 107

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933,
the registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Detroit
and the State of Michigan on the 30th day of August, 1996.

RCL TRUST 1996-1

By FORD MOTOR CREDIT COMPANY,
Depositor and Beneficiary of the
Registrant

By WILLIAM E. ODOM *
----------------------------------
(William E. Odom, Chairman
of the Board of Directors of
Ford Motor Credit Company)

By FORD CREDIT LEASING COMPANY,
INC., Depositor and Beneficiary of
the Registrant

By KENNETH J. COATES *
----------------------------------
(Kenneth J. Coates, Chairman of
the Board of Directors of
Ford Credit Leasing Company, Inc.)

Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-1 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Detroit and the State of Michigan on the 30th
day of August, 1996.

FORD MOTOR CREDIT COMPANY

By WILLIAM E. ODOM *
----------------------------------
(William E. Odom, Chairman
of the Board of Directors of
Ford Motor Credit Company)

II-10
<PAGE> 108

Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following officers and
directors of FORD MOTOR CREDIT COMPANY, in the capacities and on the date
indicated.

Signature Title Date
- --------- ----- ----

WILLIAM E. ODOM * Chairman of the August 30, 1996
- ----------------------------- Board of Directors
(William E. Odom) and Director (principal
executive officer)

KENNETH J. COATES * Director and Executive August 30, 1996
- ----------------------------- Vice President-Finance
(Kenneth J. Coates) (principal financial
officer)

TERRENCE F. MARRS * Controller (principal August 30, 1996
- ----------------------------- accounting officer)
(Terrence F. Marrs)

JOHN G. CLISSOLD * Director August 30, 1996
- -----------------------------
(John G. Clissold)

EDSEL B. FORD II * Director August 30, 1996
- -----------------------------
(Edsel B. Ford II)

DAVID N. MCCAMMON * Director August 30, 1996
- -----------------------------
(David N. McCammon)

GREGORY C. SMITH * Director August 30, 1996
- -----------------------------
(Gregory C. Smith

DAVID J. WENNERBERG * Director August 30, 1996
- -----------------------------
(David J. Wennerberg)

* By /s/ R. P. CONRAD
--------------------------------
(R. P. Conrad, Attorney in Fact)

II-11
<PAGE> 109

Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following officers and
directors of FORD CREDIT LEASING COMPANY, INC., in the capacities and on the
date indicated.

Signature Title Date
- --------- ----- ----

KENNETH J. COATES * Chairman of the Board of August 30, 1996
- -----------------------------
(Kenneth J. Coates) Directors and Director
(principal executive
officer)

THOMAS W. PARKINSON * Controller (principal August 30, 1996
- ----------------------------- financial officer)
(Thomas W. Parkinson) and Director

PETER W. ATWATER * Director August 30, 1996
- -----------------------------
(Peter W. Atwater)

THEODORE F. BRECK * Director August 30, 1996
- -----------------------------
(Theodore F. Breck)

JOHN P. BURKHARD * Director August 30, 1996
- -----------------------------
(John P. Burkhard)

* By /s/ R. P. CONRAD
---------------------------------
(R. P. Conrad, Attorney in Fact)

II-12
<PAGE> 110
<TABLE>
<CAPTION>

EXHIBIT INDEX

EXHIBITS DESCRIPTION PAGE
-------- ----------- ----
<S> <C> <C>
1.1 - Form of Underwriting Agreement.*
3.1 - Form of Amended and Restated Trust Agreement of RCL Trust 1996-1, among Ford
Credit, Ford Credit Leasing and the RCL Trustee.*
3.2 - Restated Certificate of Incorporation of Ford Motor Credit Company.*
3.3 - By-Laws of Ford Motor Credit Company.*
3.4 - Certificate of Incorporation of Ford Credit Leasing Company, Inc.*
3.5 - By-Laws of Ford Credit Leasing Company, Inc.*
4.1 - Form of Trust Agreement of the Issuer, between the RCL Trustee and the Lease
Trustee.*
4.2 - Form of Trust Indenture, between the Lease Trustee and the Indenture Trustee.*
4.3 - Form of Class A-1 Senior Note (included as part of Exhibit 4.2).*
4.4 - Form of Class A-2 Senior Note (included as part of Exhibit 4.2).*
5.1 - Opinion of J.D. Bringard, Esq., Vice President-General Counsel of Ford Motor Credit
Company with respect to legality.*
8.1 - Opinion of Skadden, Arps, Slate, Meagher & Flom with respect to tax matters.*
8.2 - Opinion of J.D. Bringard, Esq., Vice President-General Counsel of Ford Motor Credit
Company with respect to Michigan income tax matters.*
10.1 - FCTT Agreement, among Ford Credit, Ford Credit Leasing and Comerica.*
10.2 - Administrative Agency Agreement, among Comerica, Ford Credit and Ford Credit
Leasing.*
10.3 - Form of Series 1996-1 Supplement, among Comerica, Ford Credit and Ford Credit
Leasing.*
10.4 - Form of Asset Contribution Agreement, among Ford Credit, Ford Credit Leasing and the
RCL Trustee.*
10.5 - Form of Transfer Agreement, between the RCL Trustee and the Lease Trustee.*
10.6 - Form of Program Operating Lease, between the RCL Trustee and the Lease
Trustee.*
10.7 - Form of Appendix A and Appendix I - Definitions.*
23.1 - Consent of J.D. Bringard Esq., Vice President - General Counsel of Ford Motor Credit
Company (included as part of Exhibit 5.1).*
23.2 - Consent of Skadden, Arps, Slate, Meagher & Flom (included as part of Exhibit 8.1).*
24.1 - Powers of Attorney of officers and directors of Ford Motor Credit Company.*
24.2 - Powers of Attorney of officers and directors of Ford Credit Leasing Company, Inc.*
25.1 - Form T-1 of The Chase Manhattan Bank.*

</TABLE>

- --------------
* To be filed by amendment