SOUTHFIELD, MI -- Issued in a press release late this afternoon, Federal-Mogul Corp. announced the start of its emergence from Chapter 11. The company today filed form 8-K's on the agreements summarized today in the U.S. Bankruptcy Court, which include a settlement agreement among the company, plan proponents and the U.K. administrators, to settle all outstanding matters in dispute among them. In addition, the Asbestos Committee also agreed that the Asbestos Trust would satisfy indemnification obligations to the company by delivering a portion of the Trust's equity back to the company.

Concurrent with the settlement agreement, The Asbestos Committee requested that one of the company's biggest investors, Carl Icahn, provide the Asbestos Trust, upon the effectiveness of the Plan of Reorganization, with immediate liquidity. In order to facilitate Federal-Mogul's emergence from Chapter 11, Icahn agreed that one of his entities would provide the Asbestos Trust its desired liquidity by either exercising an option, after the effective date of the plan, to acquire the Asbestos Trust's position in Federal-Mogul or, if it did not exercise the option, by providing certain financing to the Trust.

Federal-Mogul Chairman, President and CEO José Maria Alapont said the agreements represent one of the most significant steps toward emergence from Chapter 11 in the U.S. and Administration in the U.K.

"We are pleased with the support and collaboration in the recent months from Mr. Icahn, our plan proponents and stakeholders," he said. "We will welcome Mr. Icahn's potential increased stake in the emerging and reorganized company."

Icahn stated that he was extremely pleased by the settlement agreement among the parties and was gratified that he was able to lend assistance to the settlement process. He further stated that he looked forward to the company's early emergence from Chapter 11, especially at a time when it appeared that other companies in the auto parts industry were moving in the opposite direction.

For more information about Federal-Mogul, visit: federal-mogul.com.

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