EXECUTION COPY
 
RESTATED STOCK OPTION AGREEMENT DATED FEBRUARY 15, 2008
 
Federal-Mogul Corporation, a Delaware corporation (the "Company"), grants to
José Maria Alapont (the "Optionee") on February 15, 2008 a non-qualified option
(the "Option") to purchase from the Company the number of shares of its Common
Stock ("Stock") described below, at the exercise price per share described below
and upon and subject to the terms and conditions set forth below.  The date on
which the Option is granted is referred to herein as the “Grant Date”.  In
connection with the extension of Optionee’s employment to March 23, 2013,
pursuant to a Second Amended and Restated Employment Agreement dated as of March
23, 2010 (“SAREA”), Executive and the Company have agreed that the Option should
be restated as follows:

1.           Intentionally Omitted.

2.           Number of Shares Subject to Option.  Four million (4,000,000)
shares of  Common Stock are subject to the Option.

3.           Option Exercise Price.  The per share exercise price of the Option
shall be $19.50, which is at least equal to the fair market value of a share of
Stock on the Grant Date.

4.           Time and Manner of Exercise of Option.

4.1.        Maximum Term of Option.  In no event may the Option be exercised, in
whole or in part, after December 27, 2014 (the "Expiration Date") and may, under
certain circumstances described in Section 4.2(c)  hereof, be exercised only
through a date earlier than December 27, 2014.

4.2.        Exercise of Option.  (a)  Effective March 23 , 2010, 100% of the
Option shall have vested assuming that Optionee is employed by Company on that
date.

(b)  Intentionally Omitted

(c)  For the avoidance of doubt, the Company and the Optionee each acknowledges
and agrees that, anything else to the contrary contained in this Agreement, the
SAREA or any other agreement to which Optionee and the Company are parties, if,
on any date prior to December 27, 2014, the Optionee is no longer employed by
the Company for any reason whatsoever (the date on which such event occurs being
the “Optionee’s Nonemployment Date”), including but not limited to being
terminated by the Company for cause or without cause, the Optionee’s leaving the
employ of the Company for good reason or not for good reason, as a result of his
death or disability or as a result of his retirement at any time or because the
SAREA expires without being renewed either on March 23, 2013 or before or after
March 23, 2013, then the Option shall be exercisable by the Optionee or the
Optionee's legal representative until and including the earlier to occur of (i)
the date which is the ninetieth (90th) day after the Optionee's Nonemployment
Date and (ii) December 27, 2014.

 
 

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4.3.           Method of Exercise.  Subject to the limitations set forth in this
Agreement, the Option may be exercised by the Optionee by giving written notice
to the Company specifying the number of whole shares of Stock to be purchased
and accompanied by payment therefor in full (or arrangement made for such
payment to the Company's satisfaction) either (i) in cash, (ii) by delivery
(either actual delivery or by attestation procedures established by the Company)
of previously owned whole shares of Stock (for which the Optionee has good
title, free and clear of all liens and encumbrances) having an aggregate fair
market value, determined as of the date of exercise, equal to the aggregate
purchase price payable pursuant to the Option by reason of such exercise, (iii)
authorizing the Company to withhold whole shares of Stock which would otherwise
be delivered to the Optionee upon exercise of the Option having an aggregate
fair market value, determined as of the date of exercise, equal to the aggregate
purchase price payable pursuant to the Option by reason of such exercise, (iv)
to the extent permitted by applicable law, in cash by a broker-dealer acceptable
to the Company to whom the Optionee has submitted an irrevocable notice of
exercise, or (v) a combination of (i), (ii) and (iii).  Any fraction of a share
of Stock which would be required to pay such purchase price shall be disregarded
and the remaining amount due shall be paid in cash by the Optionee.  No
certificate representing a share of Stock shall be delivered until the full
purchase price therefor has been paid.

4.4.           Termination of Option.  (a)  In no event may the Option be
exercised after it expires as set forth in this Section 4.4.  The Option shall
expire (i) on December 27, 2014 or (ii) on or prior to such date as provided in
Sections 4.1 and 4.2(c) hereof under the circumstances described in such two
Sections, in each case to the extent not exercised pursuant to Section 4.3.

(b)  In the event that rights to purchase all or a portion of the shares of
Stock subject to the Option expire or are exercised or forfeited, the Optionee
shall, upon the Company's request, promptly return this Agreement to the Company
for full or partial cancellation, as the case may be.  Such cancellation shall
be effective regardless of whether the Optionee returns this Agreement.  If the
Optionee continues to have rights to purchase shares of Stock hereunder, the
Company shall, within ten (10) days of the Optionee's delivery of this Agreement
to the Company, either (i) mark this Agreement to indicate the extent to which
the Option has expired or been exercised, cancelled or forfeited or (ii) issue
to the Optionee a substitute option agreement applicable to such rights, which
agreement shall otherwise be substantially similar to this Agreement in form and
substance.

5.              Additional Terms and Conditions of Option.

5.1.           Nontransferability of Option.  The Option may not be transferred
by the Optionee other than by will or the laws of descent and
distribution.  Except to the extent permitted by the foregoing sentence, during
the Optionee's lifetime the Option is exercisable only by the Optionee or the
Optionee's legal representative.  Except to the extent permitted by the
foregoing, the Option may not be sold, transferred, assigned, pledged,
hypothecated, encumbered or otherwise disposed of (whether by operation of law
or otherwise) or be subject to execution, attachment or similar process.  Upon
any attempt to so sell, transfer, assign, pledge, hypothecate, encumber or
otherwise dispose of the Option, such attempted sale, transfer, assignment,
pledge, hypothecation, encumbrance or other attempted transaction shall
immediately become null and void.
 
 
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5.2.           Investment Representation; Restriction on Transfer of Stock.  (a)
The Optionee hereby represents and covenants that (i) any share of Stock
purchased upon exercise of the Option will be purchased for investment and not
with a view to the distribution thereof within the meaning of the Securities Act
of 1933, as amended (the "Securities Act"), unless such purchase has been
registered under the Securities Act and any applicable state securities laws;
(ii) any subsequent sale of any such shares shall be made either pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws, or pursuant to an exemption from registration under the
Securities Act and such state securities laws; and (iii) if requested by the
Company, the Optionee shall submit a written statement, in form satisfactory to
the Company, to the effect that such representation (x) is true and correct as
of the date of purchase of any shares hereunder or (y) is true and correct as of
the date of any sale of any such shares, as applicable.  As a further condition
precedent to any exercise of the Option, the Optionee shall comply with all
regulations and requirements of any regulatory authority having control of or
supervision over the issuance or delivery of the shares and, in connection
therewith, shall execute such documents as are necessary to comply with such
regulations and requirements.

(b)  The Company shall require that certificates evidencing shares of Stock
delivered in connection with the exercise of the Option bear a legend indicating
that the sale, transfer or other disposition thereof by the holder is prohibited
except in compliance with Section 5.2(a) hereof.

(c)  Notwithstanding the foregoing, the Company agrees to register under the
Securities Act the shares of Stock subject to the Option as promptly as
practicable following the date hereof, but not later than thirty (30) days
following the date of the Company’s 2010 annual meeting of stockholders, by
filing a Form S-8 registration statement in respect such shares of Stock.

5.3.           Withholding Taxes.  (a)  As a condition precedent to the delivery
of Stock upon exercise of the Option, the Optionee shall, upon request by the
Company, pay to the Company, in addition to the purchase price of the Stock,
such amount of cash as the Company may be required, under all applicable
federal, state, local or other laws or regulations, to withhold and pay over as
income or other withholding taxes (the "Required Tax Payments") with respect to
such exercise of the Option.  If the Optionee shall fail to advance the Required
Tax Payments after request by the Company, the Company may, in its discretion,
deduct any Required Tax Payments from any amount then or thereafter payable by
the Company to the Optionee.

(b)  The Optionee may elect to satisfy his obligation to advance the Required
Tax Payments by any of the following means:  (i) a cash payment to the Company
pursuant to Section 5.3(a), (ii) delivery (either actual delivery or by
attestation procedures established by the Company) to the Company of previously
owned whole shares of Stock (for which the Optionee has good title, free and
clear of all liens and encumbrances) having an aggregate fair market value,
determined as of the date the obligation to withhold or pay taxes first arises
in connection with the Option (the "Tax Date"), equal to the Required Tax
Payments, (iii) directing the Company to withhold whole shares of Stock which
would otherwise be delivered to the Optionee upon exercise of the Option having
an aggregate fair market value, determined as of the Tax Date, equal to the
Required Tax Payments, (iv) to the extent permitted by applicable law, a cash
payment by a broker-dealer reasonably acceptable to the Company to whom the
Optionee has submitted an irrevocable notice of exercise or (v) any combination
of (i), (ii) and (iii).  Shares of Stock to be delivered or withheld may not
have a fair market value in excess of the amount of the Required Tax Payments
determined by applying the minimum statutory withholding rate.  Any fraction of
a share of Stock which would be required to satisfy any such obligation shall be
disregarded and the remaining amount due shall be paid in cash by the
Optionee.  No certificate representing a share of Stock shall be delivered until
the Required Tax Payments have been satisfied in full.

 
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5.4.           Adjustment.  In the event of any stock split, stock dividend,
recapitalization, reorganization, merger, consolidation, combination, exchange
of shares, liquidation, spin-off or other similar change in capitalization or
event, or any distribution to holders of Stock other than a regular cash
dividend, the number and class of securities subject to the Option and the
purchase price per security shall be appropriately adjusted by the Company
without an increase in the aggregate purchase price.  If any adjustment would
result in a fractional security being subject to the Option, the Company shall
pay the Optionee, in connection with the first exercise of the Option occurring
after such adjustment, an amount in cash determined by multiplying (i) the
fraction of such security (rounded to the nearest hundredth) by (ii) the excess,
if any, of (x) the fair market value on the exercise date over (y) the exercise
price of the Option.

5.5.           Compliance with Applicable Law.  The Option is subject to the
condition that if the listing, registration or qualification of the shares
subject to the Option upon any securities exchange or under any law, or the
consent or approval of any governmental body, or the taking of any other action
is necessary or desirable as a condition of, or in connection with, the purchase
or delivery of shares hereunder, the Option may not be exercised, in whole or in
part, unless such listing, registration, qualification, consent or approval
shall have been effected or obtained, free of any conditions not acceptable to
the Company.  The Company agrees to use reasonable efforts to effect or obtain
any such listing, registration, qualification, consent or approval.

5.6.           Delivery of Certificates.  Upon the exercise of the Option, in
whole or in part, the Company shall deliver or cause to be delivered one or more
certificates representing the number of shares purchased against full payment
therefor.  The Company shall pay all original issue or transfer taxes and all
fees and expenses incident to such delivery, except as otherwise provided in
Section 5.3.

5.7.           Option Confers No Rights as Stockholder.  The Optionee shall not
be entitled to any privileges of ownership with respect to shares of Stock
subject to the Option unless and until purchased and delivered upon the exercise
of the Option, in whole or in part, and the Optionee becomes a stockholder of
record with respect to such delivered shares; and the Optionee shall not be
considered a stockholder of the Company with respect to any such shares not so
purchased and delivered.

5.8.           Option Confers No Rights to Continued Employment.  In no event
shall the granting of the Option or its acceptance by the Optionee give or be
deemed to give the Optionee any right to continued employment by the Company or
any affiliate of the Company.

5.9.           Company to Reserve Shares.  The Company shall at all times prior
to the expiration or termination of the Option reserve and keep available,
either in its treasury or out of its authorized but unissued shares of Stock,
the full number of shares subject to the Option from time to time.

 
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6.              Cash Out of Option. The Company, acting through the Compensation
Committee of the Board of Directors, shall have the right in connection with any
exercise of the Option by the Optionee (which exercise shall be evidenced by a
written notice delivered by the Optionee to the Company specifying the amount
and manner of exercise in accordance with Section 4.3 hereof), to cash out all
or part of the portion of the shares of Stock for which the Stock Option is
being exercised by paying the Optionee an amount in cash equal to the excess of
the fair market value of the Stock, determined as of the date of exercise of the
Option, over the option exercise price times the number of shares of Stock for
which the Option is being exercised on such exercise date (the “Cash Out
Right”).  In the event that the Compensation Committee of the Board of Directors
does not exercise in whole the Cash Out Right within one business day of receipt
of such notice of exercise of the Option, then the Option (or portion thereof)
shall have been exercised in the amount and manner specified in such notice.

7.              Miscellaneous Provisions.

7.1.           Designation as Nonqualified Stock Option.  The Option is hereby
designated as not constituting an "incentive stock option" within meaning of
section 422 of the Internal Revenue Code of 1986, as amended (the "Code").  This
Agreement shall be interpreted and treated in a manner consistent with such
designation.

7.2.           Successors.  This Agreement shall be binding upon and inure to
the benefit of any successor or successors of the Company and any person or
persons who shall, upon the death of the Optionee, acquire any rights hereunder
in accordance with this Agreement or the Plan.

7.3.           Notices.  All notices, requests or other communications provided
for in this Agreement shall be made, if to the Company, to Federal-Mogul
Corporation, 26555 Northwestern Highway, Southfield, Michigan 48033,
Attention:  General Counsel; and if to the Optionee, to José Maria Alapont, 1772
Heron Ridge Drive, Bloomfield Hills, MI 48302.  All notices, requests or other
communications provided for in this Agreement shall be made in writing either
(a) by personal delivery to the party entitled thereto, (b) by facsimile with
confirmation of receipt, (c) by mailing in the United States mails to the last
known address of the party entitled thereto or (d) by express courier
service.  The notice, request or other communication shall be deemed to be
received upon personal delivery, upon confirmation of receipt of facsimile
transmission or upon receipt by the party entitled thereto if by United States
mail or express courier service; provided, however, that if a notice, request or
other communication sent to the Company is not received during regular business
hours, it shall be deemed to be received on the next succeeding business day of
the Company.

 
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7.4.           Amendment.  The provisions of this Agreement may be amended only
by the written agreement of the Company executed by the Chairman of the
Compensation Committee of the Board of Directors and the Optionee following the
review and approval of any such amendment by the Compensation Committee of the
Board of Directors or its designee.

7.5.           Governing Law.  This Agreement, the Option and all determinations
made and actions taken pursuant hereto and thereto, to the extent not governed
by the laws of the United States, shall be governed by the laws of the State of
Michigan and construed in accordance therewith without giving effect to
principles of conflicts of laws.

7.6.           Counterparts.  This Agreement may be executed in two
counterparts, each of which shall be deemed an original and both of which
together shall constitute one and the same instrument.
 
FEDERAL-MOGUL CORPORATION
   
By:
/s/ Vincent J. Intrieri
 
Name: Vincent J. Intrieri
 
Title: Chairman of the Compensation Committee

 
Accepted this 23rd day of March, 2010.
 
José Maria Alapont

 
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