EXECUTION COPY

                  FINGERHUT COMPANIES, INC.

                        $60,500,000

 8.92% Senior Unsecured Notes, Series A, due June 15, 2002

                        $14,500,000

 8.92% Senior Unsecured Notes, Series B, due June 15, 2004

                 FOURTH AMENDMENT AGREEMENT

                Dated as of August 14, 1996

                             to

                     PURCHASE AGREEMENT
                 dated as of June 15, 1992

                       as amended by

                 First Amendment Agreement
                 dated as of June 17, 1994


                 Second Amendment Agreement
                dated as of October 30, 1995


                            and

                 Third Amendment Agreement
                  dated as of June 4, 1996



                              FOURTH AMENDMENT AGREEMENT,
               dated as of August 14, 1996 (this
               "Amendment"), between FINGERHUT COMPANIES,
               INC., a Minnesota corporation (the
               "Company"), and the Noteholders (as defined
               below).


                   Preliminary Statement

          Reference is made to the Purchase Agreement dated
as of June 15, 1992, between the Company and the Purchasers
listed in Schedule 1 thereto and their assigns (the
"Noteholders"), pursuant to which the Company issued and
sold its 8.92% Senior Unsecured Notes, Series A, due
June 15, 2002, in the aggregate principal amount of
$60,500,000 (the "Series A Notes"), and its 8.92% Senior
Unsecured Notes, Series B, due June 15, 2004, in the
aggregate principal amount of $14,500,000 (the "Series B
Notes"), as amended by amendments dated as of June 17, 1994,
October 30, 1995 and June 4, 1996 (as amended, the "Purchase
Agreement").  The Series A Notes and the Series B Notes are
hereinafter collectively referred to herein as the "Notes".
Unless otherwise defined in this Amendment, capitalized
terms used herein without definition shall have the meanings
set forth in the Purchase Agreement.

          The Company has requested the amendment of certain
covenants in the Purchase Agreement.

          Accordingly, the Company and the Noteholders
hereby agree as follows:


                         ARTICLE I

     Conditions Precedent to Effectiveness of Amendment

          This Amendment is expressly subject to and shall
become effective only upon satisfaction of each of the
following conditions (such date upon which all of such
conditions are satisfied being herein called the "Effective
Date"):

          SECTION 1.01.  There shall exist on the Effective
Date no Default or Event of Default under the Purchase
Agreement, both before and after giving effect to this
Amendment.

          SECTION 1.02.  The Noteholders shall have received
a certificate, dated as of the Effective Date and signed by
a Responsible Officer of the Company, stating that, as of
the Effective Date, (i) all of the obligations of the
Company to be performed prior to or as of the Effective Date
under this Amendment have been performed; (ii) the
representations and warranties contained in Article IV of
this Amendment are accurate and complete, and (iii) all of
the conditions to the effectiveness of this Amendment have
been satisfied in full.

          SECTION 1.03.  All corporate and other proceedings
and all documents incident to the transaction contemplated
by this Amendment shall be satisfactory in form and
substance to the Noteholders, and the Noteholders shall have
received copies of all documents and records relating
thereto which they may reasonably request.

          SECTION 1.04.  In consideration for having entered
into this Amendment, the Noteholders shall have received in
immediately available funds the one-time payment by the
Company of additional interest in an amount equal to 0.250%
of the outstanding principal balance of the Notes as of the
Effective Date.
                         ARTICLE II

    Amendments to Article VII of the Purchase Agreements

          SECTION 2.01.  (a) Section 7.5 of the Purchase
Agreement is hereby amended by (i) deleting the word "and"
at the end of paragraph (d), (ii) inserting the word "and"
at the end of paragraph (e) and (iii) inserting after
paragraph (e) the following paragraph:

          "(f)  Certificateholder Statements.  Within fifty
     (50) days after the end of each of the first three
     fiscal quarters of each fiscal year of the Company and
     within one hundred (100) days after the end of each
     fiscal year of the Company, any monthly
     certificateholder statements required to be delivered
     by the Fingerhut Master Trust or any similar
     independent trust formed by the Company or any
     Subsidiary for the purpose of acquiring interests in
     the Company's customer accounts receivable and issuing
     certificates of beneficial interest in such receivables
     or commercial paper."

          (b) Section 7.5(c)(y)(B) of the Purchase Agreement
shall be deemed to include a reference to Section 8.13 of
the Purchase Agreement.

          SECTION 2.02.  Section 7.11 of the Purchase
Agreements is hereby amended by amending the first sentence
thereof to read as set forth below:

     "On or prior to (i) the direct or indirect acquisition
     by the Company of any Subsidiary which at the time of
     such acquisition shall be a Significant Subsidiary or
     (ii) the fifth Business Day after the availability of
     financial statements revealing that any Subsidiary
     (other than (A) a Guarantor, (B) either of the MWD
     Subsidiaries, (C) FRI, (D) any of the TV Shopping
     Companies, (E) the Credit Card Bank or (F) any of the
     Financial Services Companies) shall have become a
     Significant Subsidiary, the Company agrees that the
     Company will cause such Subsidiary to
     (x) unconditionally guarantee the payment and
     performance of all obligations and liabilities of the
     Company under this Agreement and the Notes, all upon
     the terms set forth in the Guaranty, and (y) execute
     and deliver or cause to be delivered to the Noteholders
     one or more such instruments as the Noteholders may
     request in form and substance undertaking the
     obligations of a Guarantor; provided that,
     notwithstanding any other provision of this Section
     7.11, if any Subsidiary that is not one of the
     Financial Services Companies guarantees the payment or
     performance of any obligations or liabilities of any of
     the Financial Services Companies, the Company will
     cause such Subsidiary to (x) unconditionally guarantee
     the payment and performance of all obligations and
     liabilities of the Company under this Agreement and the
     Notes, all upon the terms set forth in the Guaranty,
     and (y) execute and deliver or cause to be delivered to
     the Noteholders one or more such instruments as the
     Noteholders may request in form and substance
     undertaking the obligations of a Guarantor."


                        ARTICLE III

   Amendments to Article VIII of the Purchase Agreements

          SECTION 3.01.  Section 8.1 of the Purchase
Agreements is hereby amended by restating paragraph (d)
thereof in its entirety as follows:

          "(d) additional Indebtedness of the Company or any
     Subsidiary, provided that immediately after the
     incurrence of such additional Indebtedness and after
     giving effect thereto, Consolidated Indebtedness of the
     Company and the Subsidiaries does not exceed 60% of the
     sum of (x) the then outstanding Consolidated
     Indebtedness of the Company and the Subsidiaries and
     (y) the then Consolidated Net Worth of the Company and
     the Subsidiaries, and provided, further, that any such
     additional Indebtedness of any Subsidiary which is
     otherwise permitted by this clause (d) shall also be
     permitted by  8.2; for purposes of any computation
     under this clause (d), Indebtedness of the Company and
     the Subsidiaries shall not include (i) Indebtedness
     incurred as a result of the sale of accounts receivable
     on a nonrecourse basis pursuant to the Receivables
     Transfer Agreement or (ii) Guarantees permitted by
     clauses (a) through (e), inclusive, of  8.14."

          SECTION 3.02.  Section 8.2 of the Purchase
     Agreements is hereby amended by restating such section
     in its entirety as follows:

          "SECTION 8.2.  Secured Indebtedness; Subsidiary
     Indebtedness.  (a)  Secured Indebtedness.  The Company
     will not, and will not permit any Subsidiary, other
     than any of the Financial Services Companies, to incur
     or suffer to exist any Secured Indebtedness, except
     (i) Secured Indebtedness to the extent permitted by
     clause (c) of  8.1 and (ii) Indebtedness permitted by
     clause (d) of  8.1, provided that (x) any Lien
     securing any such Secured Indebtedness is permitted by
      8.3 and (y) no property or asset which has been
     subjected to any Lien in favor of the Collateral Agent
     for the benefit of the Secured Parties may secure
     Indebtedness other than Indebtedness under the Bank
     Credit Agreement (and any extension, renewal, refunding
     or replacement thereof) and the Existing Notes.

          "(b)  Subsidiary Indebtedness.  The Company will
     not at any time permit the outstanding amount of
     Indebtedness of all Subsidiaries to exceed $15,000,000,
     provided, however, that such amount shall not include
     (a) any Guarantee permitted by clauses (a) through (e),
     inclusive, of Section 8.14, (b) Indebtedness of any
     Wholly-Owned Subsidiary owing to the Company or to any
     other Wholly-Owned Subsidiary, (c) Indebtedness of any
     of the Financial Services Companies that in the
     aggregate does not exceed Four Hundred Million Dollars
     ($400,000,000) for all such Financial Services
     Companies, (d) any guarantees by the Company or any
     Subsidiaries of any obligations of any of the Financial
     Services Companies that in the aggregate do not exceed
     Four Hundred Million Dollars ($400,000,000) for all
     such Financial Services Companies, provided that such
     guarantees are permitted pursuant to paragraph (g) of
     Section 8.14 hereof, or (e) up to $27,000,000 of
     Capitalized Leases and other Indebtedness listed in
     Schedule 8.2 hereto and any renewals or replacements of
     such Capitalized Leases and any extensions, renewals,
     refundings or replacements of such Indebtedness, except
     that (a) all renewals or replacements of any such
     Capitalized Lease must be in respect of similar
     equipment or replacement equipment of a similar type,
     (b) the amount of Indebtedness (including, without
     limitation, Capitalized Lease Obligations in respect of
     any such Capitalized Lease) represented by any such
     extension, renewal, refunding or replacement must be
     permitted to be incurred as additional Indebtedness
     pursuant to clause (d) of Section 8.1 and (c) in the
     event that (x) the amount of Indebtedness (including,
     without limitation, Capitalized Lease Obligations in
     respect of any such Capitalized Lease) represented, at
     any time, by all of such Capitalized Leases and other
     Indebtedness listed in Schedule 8.2 hereto, including
     any extension, renewal, refunding or replacement
     thereof, is greater than $27,000,000 or (y) any such
     extension, renewal, refunding of replacement would
     cause any additional property (other than the equipment
     referred to in clause (a) above) of the Company or any
     Subsidiary to become subject to any Capitalized Lease
     or otherwise subject to any Lien, such greater amount
     of Indebtedness (including, without limitation,
     obligations in respect of any such Capitalized Lease)
     must be permitted to be incurred or remain outstanding
     as Indebtedness under this Section 8.2, but without
     giving effect to the provisos hereof and any Lien on
     any such additional property must be permitted by
     Section 8.3, and provided further, that any
     Indebtedness that is a Guarantee and that, except for
     clause (a) above, would be included within such
     aggregate outstanding amount must also be permitted by
     Section 8.14."

          SECTION 3.03.  Section 8.3 of the Purchase
Agreements is hereby amended by restating the preamble
thereof in its entirety as follows:

               "The Company will not, and will not permit
          any Subsidiary, other than any of the Financial
          Services Companies, to, create, incur, assume or
          permit to exist any Lien upon any of the property
          or assets, including capital stock (other than
          assets sold on a nonrecourse basis pursuant to the
          Receivables Transfer Agreement, but
          notwithstanding the exceptions set forth below, no
          Lien shall at any time be permitted with respect
          to (i) any of the capital stock of FRI or any
          Subsidiary that is also a subsidiary of FRI, other
          than any of the Financial Services Companies, or
          (ii) any of the capital stock of the TV Shopping
          Companies or any Subsidiary that is also a
          subsidiary of the TV Shopping Companies except for
          only such capital stock that is pledged to secure
          Indebtedness of only the TV Shopping Companies or
          any such subsidiary, which Indebtedness (x) is
          then permitted under the other provisions of this
          8.3 and the other provisions of this Agreement to
          be incurred and (y) is at all times nonrecourse to
          the Company and the Subsidiaries other than the TV
          Shopping Companies or any subsidiary of the TV
          Shopping Companies), now owned or hereafter
          acquired by it or on any income or rights in
          respect of any thereof, except:"

          SECTION 3.04.  Section 8.4 of the Purchase
Agreements is hereby amended by restating such section in
its entirety as follows:

          "SECTION 8.4.  Disposition of Stock and
     Indebtedness of Subsidiaries.  The Company will not,
     and will not permit any Subsidiary, other than any of
     the Financial Services Companies, to, sell or otherwise
     dispose of any shares of stock of, or any Indebtedness
     of, a Subsidiary owned by the Company or another
     Subsidiary, except:

          (a) sales or other dispositions to the Company or
     to a Wholly-Owned Subsidiary; and

          (b) (i) sales, contributions or other dispositions
     of all or a portion of the capital stock or
     Indebtedness of any of the TV Shopping Companies or
     their joint ventures or (ii) a dividend of all or a
     portion of the capital stock of any of the TV Shopping
     Companies to the shareholders of the Company;
     excluding, however, any such sale, contribution or
     other disposition that would result in such TV Shopping
     Company no longer being a Subsidiary, unless
     (x) immediately prior thereto and after giving effect
     thereto, no Default or Event of Default shall have
     occurred and be continuing and (y) if substantially all
     of the capital stock of any of the TV Shopping
     Companies held by the Company or any Subsidiary shall
     have been sold, contributed or otherwise disposed of to
     a person other than the Company or a Subsidiary, all of
     the Indebtedness of such TV Shopping Company held by
     the Company or any Subsidiary shall at such time have
     been sold, contributed or otherwise disposed of to a
     person other than the Company or a Subsidiary;

          (c) sales or other dispositions in which all
     shares of stock and all Indebtedness of any Subsidiary
     at the time owned by the Company and all other
     Subsidiaries are sold or otherwise disposed of as an
     entirety for a consideration which represents the fair
     value at the time of sale of the shares and
     Indebtedness so sold, provided that in the case of
     transactions pursuant to this clause (c):

                    (i) immediately after such sale or other
          disposition (such sale or other disposition being
          herein called the "8.4 Transaction") and after
          giving effect thereto, no Default shall have
          occurred and be continuing;

                    (ii) at the time of the 8.4 Transaction,
          such Subsidiary shall not own, directly or
          indirectly, any shares of stock or any
          Indebtedness of the Company or of any other
          Subsidiary (unless all shares of stock and all
          Indebtedness of such other Subsidiary at the time
          owned, directly or indirectly, by the Company and
          all Subsidiaries are simultaneously being sold or
          otherwise disposed of as permitted by this
          clause (c)); and

                    (iii) the sum of the net book values of
          (x) the assets of such Subsidiary, plus (y) the
          assets of each other Subsidiary, if any, the stock
          and Indebtedness of which were sold or otherwise
          disposed of pursuant to this clause (c) during the
          12-month period ending on the close of business on
          the date of the 8.4 Transaction, plus (z) the
          assets of the Company and of each Subsidiary, if
          any, which were sold, leased, or otherwise
          disposed of, and the assets of each Subsidiary, if
          any, which merged or consolidated, pursuant to
          clause (d) of Section 8.5 during the 12-month
          period ending on the close of business on the date
          of the 8.4 Transaction, did not, after giving
          effect to the 8.4 Transaction, constitute more
          than 10% of the Consolidated Net Tangible Assets
          of the Company and the Subsidiaries as of the end
          of the then most recently completed fiscal year of
          the Company, provided that if the proceeds from an
          8.4 Transaction or an 8.5 Transaction (x) are
          reinvested within one year after the consummation
          of the 8.4 Transaction or the 8.5 Transaction in a
          similar line of business, or (y) are applied
          within 180 days of the consummation of the
          8.4 Transaction or the 8.5 Transaction to the
          prepayment of senior Indebtedness of the Company,
          such assets shall not be included in such 10%
          calculation; and provided, further, that, in the
          case of an 8.4 Transaction with respect to an MWD
          Subsidiary, the proceeds of such 8.4 Transaction
          that are subject to the preceding proviso shall be
          limited to an amount equal to the aggregate amount
          of all outstanding loans and advances and all
          capital contributions (including the ownership of
          Preferred Stock) made by the Company and the
          Subsidiaries to such MWD Subsidiary or to
          Montgomery Ward Direct; and

          (d) (i) sales, contributions or other dispositions
     or all of a portion of the capital stock or
     Indebtedness of any of the Financial Services Companies
     or (ii) a dividend of all or a portion of the capital
     stock of any of the Financial Services Companies to the
     shareholders of the Company, provided that, immediately
     prior thereto and after giving effect thereto, no
     Default or Event of Default shall have occurred and be
     continuing."

          SECTION 3.05.  Section 8.8 of the Purchase
Agreements is hereby amended by restating such section in
its entirety as follows:

          "Section 8.8  INTEREST COVERAGE RATIO.  (a)  At
     any time prior to the initial public offering of the
     common stock of the Financial Services Companies, the
     Company will not at any time permit Consolidated Net
     Earnings Before Interest and Taxes of the Company and
     the Subsidiaries for the period of the four then most
     recently completed fiscal quarters of the Company to be
     less than 250% of Consolidated Interest Expense of the
     Company and the Subsidiaries for the period of the four
     then most recently completed fiscal quarters of the
     Company.

          (b)  At any time after the later to occur of
     (x) December 27, 1996, and (y) the initial public
     offering of the common stock of the Financial Services
     Companies, the Company will not at any time permit
     Consolidated Net Earnings Before Interest and Taxes of
     the Company and the Subsidiaries for the period of the
     four (4) then most recently completed fiscal quarters
     of the Company to be less than two hundred fifty
     percent (250%) of Consolidated Interest Expense of the
     Company and the Subsidiaries for the period of the four
     (4) then most recently completed fiscal quarters of the
     Company; provided that for the purposes of any
     calculations pursuant to this Section 8.8(b), (x) the
     amount of any Interest Expense of the Financial
     Services Companies shall be included in Consolidated
     Interest Expense of the Company and the Subsidiaries
     only to the extent that the related Indebtedness of the
     Financial Services Companies is guaranteed by the
     Company or any Subsidiary, (y) the Net Earnings of the
     Financial Services Companies shall be included in the
     determination of such Consolidated Net Earnings Before
     Interest and Taxes; provided that the amount of such
     Net Earnings of the Financial Services Companies so
     included shall not exceed the lesser of (A) 250% of the
     aggregate Interest Expense related to Indebtedness of
     the Financial Services Companies that is included in
     the calculation of such Consolidated Interest Expense
     and (B) the amount of Net Earnings of the Financial
     Services Companies excluding any cash dividends paid
     during such period by the Financial Services Companies
     to the Company and the Subsidiaries (other than the
     Financial Services Companies), and (z) cash dividends
     paid during such period by the Financial Services
     Companies to the Company and the Subsidiaries (other
     than the Financial Services Companies) shall be
     included in the determination of such Consolidated Net
     Earnings Before Interest and Taxes."

          SECTION 3.06.  Section 8.9 of the Purchase
Agreement is hereby amended by restating paragraph (a)
thereof in its entirety as follows:

          (a) (i) make and permit to remain outstanding
     investments in the capital stock of any Subsidiary or
     any person which immediately after such investment is
     made will be a Subsidiary, provided that, immediately
     after the making of any investment in the capital stock
     of any person which immediately after such investment
     is made will be a Subsidiary and after giving effect
     thereto, no Default shall have occurred and be
     continuing and the Company would be permitted to incur
     at least One Dollar ($1) of additional Indebtedness
     pursuant to clause (d) of Section 8.1 hereof, and
     provided further that, if any Subsidiary shall cease to
     be a Subsidiary, then for purposes of this Agreement,
     every investment by the Company or any other Subsidiary
     in such former Subsidiary which remains outstanding
     shall be deemed to have been made immediately after
     such former Subsidiary ceased to be a Subsidiary; or

          (ii) make and permit to remain outstanding
     investments in any of the Financial Services Companies,
     provided that (A) in the event that any person acquires
     shares of capital stock of any of the Financial
     Services Companies pursuant to the exercise of any
     options or pursuant to any employee stock purchase,
     compensation or incentive plan, additional investments
     by the Company or any Subsidiary that is not one of the
     Financial Services Companies in the capital stock of
     any of the Financial Services Companies shall be
     permitted pursuant to this clause (ii) of
     Section 8.9(a) hereof only in order to maintain the
     Company's ownership of such capital stock such that the
     shares of capital stock of such Financial Services
     Companies owned by the Company represent at least 80%
     of the outstanding capital stock of such Financial
     Services Companies and (B) any loans or advances from
     the Company or any Subsidiary that is not one of the
     Financial Services Companies to any of the Financial
     Services Companies shall not exceed Ten Million Dollars
     ($10,000,000) in the aggregate.

          SECTION 3.07.  Section 8.13 of the Purchase
Agreements is hereby amended by restating such section in
its entirety as follows:

          "SECTION 8.13.  Transactions with Affiliates.
     Except as set forth in Schedule 8.13, the Company will
     not, and will not permit any Subsidiary to, sell or
     transfer any property or assets (except for the
     Transferred Assets) to, or purchase or acquire any
     property or assets (except for the Transferred Assets)
     from, or otherwise engage in any other transactions
     with, any of its Affiliates, other than Fingerhut
     Financial Services Corporation, except:

          (a) (i) so long as no Default or Event of Default
     shall have occurred and be continuing, any transactions
     between the Company and any Significant Subsidiary or
     transactions between Significant Subsidiaries;
     provided, however, that the Company may not sell or
     transfer assets related to the direct retail marketing
     business of the Company with a book value in the
     aggregate for all such sales and transfers in excess of
     5% of the Company's Consolidated Net Worth at the time
     of any such sale or transfer to any of the Financial
     Services Companies, and

                    (ii) during the continuance of a Default
          or Event of Default, only such transactions
          entered into in the ordinary course of business
          and upon fair and reasonable terms no less
          favorable than the Company or any Subsidiary, as
          applicable, could obtain or could become entitled
          to in an arm's-length transaction with a person
          which was not an Affiliate;

          (b) so long as no Default or Event of Default
     shall have occurred and be continuing, any transactions
     between the Company or any Subsidiary and any Affiliate
     (other than the Company or a Subsidiary) entered into
     in the ordinary course of business and upon fair and
     reasonable terms no less favorable than the Company or
     such Subsidiary, as applicable, could obtain or could
     become entitled to in an arm's-length transaction with
     a person which was not an Affiliate;

          (c) so long as no Default or Event of Default
     shall have occurred and be continuing, any transactions
     between the Company or any Significant Subsidiary and
     any Subsidiary that is not a Significant Subsidiary or
     transactions between Subsidiaries that are not
     Significant Subsidiaries entered into in the ordinary
     course of business and upon fair and reasonable terms
     no less favorable than the Company or any such
     Subsidiary, as the case may be, could obtain or could
     become entitled to in an arm's-length transaction with
     a person which was not an Affiliate; provided, however,
     that nothing in this clause (c) shall, so long as no
     Default or Event of Default shall have occurred and be
     continuing, prohibit any such transactions that are not
     entered into upon such fair and reasonable and no less
     favorable terms, so long as any such transaction (such
     as, without limitation, transactions involving the
     sharing of computer services) does not involve the
     transfer or sale of assets or property;

          (d) any transaction between the Company or any
     Subsidiary and Montgomery Ward Direct permitted by
      8.9(j), 8.14(e) or 8.14(f) and any other
     transactions between the Company or any Subsidiary and
     Montgomery Ward Direct entered into in the ordinary
     course of business and upon fair and reasonable terms
     no less favorable than the Company or such Subsidiary,
     as applicable, could obtain or could become entitled to
     in an arm's-length transaction with a person other than
     Montgomery Ward Direct; provided, however, that any
     determination with respect to whether any transaction
     between the Company or any Subsidiary and Montgomery
     Ward Direct satisfies the foregoing requirements shall
     be made by considering the relationship taken as a
     whole between the Company and its Subsidiaries, on the
     one hand, and Montgomery Ward Direct, on the other;

          (e) any transactions between the Company or any
     Subsidiary and FRI, the Fingerhut Master Trust or any
     transferee thereunder pursuant to the Receivables
     Transfer Agreement;

          (f) at any time the Company owns, directly or
     indirectly, at least 10% of the capital stock of any of
     the TV Shopping Companies that is not a Subsidiary, any
     transactions between the Company or any Subsidiary and
     such TV Shopping Company entered into in the ordinary
     course of business and upon fair and reasonable terms
     no less favorable than the Company or such Subsidiary,
     as applicable, could obtain or become entitled to in an
     arm's-length transaction with a person that is not an
     Affiliate; provided, however, that any determination
     with respect to whether any transaction between the
     Company or any Subsidiary and such TV Shopping Company
     satisfies the foregoing requirements shall be made by
     considering the relationship taken as a whole between
     the Company and the Subsidiaries, on the one hand, and
     such TV Shopping Company, on the other; and

          (g) (i) the transfer of the Transferred Assets in
     connection with or in contemplation of an initial
     public offering of the common stock of the Financial
     Services Companies, (ii) any of the transactions among
     the Company or any Subsidiary and any of the Financial
     Services Companies contemplated by the Intercompany
     Agreements, provided that any extension or renewal by
     the Company or any Subsidiary of any of the
     Intercompany Agreements shall be (A) upon terms no less
     favorable to the Company than the original terms of
     such Intercompany Agreements or (B) upon fair and
     reasonable terms no less favorable than the Company or
     such Subsidiary, as applicable, could obtain or could
     become entitled to in an arm's-length transaction with
     a person which was not an Affiliate, (iii) any sale or
     transfer of assets among the Company or any Subsidiary
     and any of the Financial Services Companies entered
     into in the ordinary course of business and upon fair
     and reasonable terms no less favorable than the Company
     or such Subsidiary, as applicable, could obtain or
     could become entitled to in an arm's-length transaction
     with a person which was not an Affiliate and (iv) any
     transaction between any of the Financial Services
     Companies; provided that, notwithstanding any other
     provision of this Section 8.13, the Company may not
     sell or transfer any customer accounts receivable
     generated by the Company or any Subsidiary that is not
     one of the Financial Services Companies to any of the
     Financial Services Companies."

          SECTION 3.08.  Section 8.14 of the Purchase
Agreements is hereby amended by restating such section in
its entirety as follows:

          "SECTION 8.14.  Guarantees.  The Company will not,
     and will not permit any Subsidiary, other than
     Fingerhut Financial Services Corporation and its
     subsidiaries, to, create, incur, assume or permit to
     exist any Guarantee, except

          (a) the Guaranty;

          (b) the Guarantees of the Subsidiaries incurred
     (i) as guarantors of the Existing Notes under the
     Existing Guarantees and any Guarantee of the
     Subsidiaries that may be required to be incurred
     pursuant to the Existing Purchase Agreements and
     (ii) as guarantors of the Obligations under the Bank
     Credit Agreement;

          (c) Guarantees of Indebtedness of the Subsidiaries
     permitted by Section 8.2 and Guarantees of Operating
     Leases of the Subsidiaries not prohibited by
     Section 8.12;

          (d) Guarantees of additional Indebtedness of the
     Company permitted by clause (d) of Section 8.1,
     provided that the instrument representing any such
     Guarantee contains an acknowledgement of the existence
     of the Guaranty and an agreement on the part of the
     beneficiary of such Guarantee not to contest the
     validity of the Guaranty or the Notes;

          (e) Guarantees by the MWD Subsidiaries of
     Indebtedness of Montgomery Ward Direct; provided that
     immediately after the creation, incurrence, assumption
     or existence of any such Guarantee and after giving
     effect thereto the aggregate amount of Indebtedness of
     Montgomery Ward Direct guaranteed by the outstanding
     Guarantees permitted under this clause (e) and under
     clause (f) of  8.14, without duplication, shall not
     exceed an amount equal to the difference between
     $30,000,000 and the aggregate amount of all outstanding
     loans and advances and all capital contributions made
     by the MWD Subsidiaries to Montgomery Ward Direct;

          (f) Guarantees by the Company of Indebtedness of
     Montgomery Ward Direct, provided that such Guarantees
     are permitted by clause (d) of  8.1 and that
     immediately after the creation, incurrence, assumption
     or existence of any such Guarantee and after giving
     effect thereto the aggregate amount of Indebtedness of
     Montgomery Ward Direct guaranteed by the outstanding
     Guarantees permitted under this clause (f) and under
     clause (e) of  8.14, without duplication, shall not
     exceed an amount equal to the difference between
     $30,000,000 and the aggregate amount of all outstanding
     loans and advances and all capital contributions made
     by the Company or any Subsidiary to Montgomery Ward
     Direct;

          (g) (i) Guarantees by the Company or any
     Subsidiary of Indebtedness or other obligations of any
     of the Financial Services Companies, provided that such
     Guarantees are permitted by clause (d) of Section 8.1
     hereof and (ii) Guarantees by any of the Financial
     Services Companies of Indebtedness or other obligations
     of any of the Financial Services Companies;

          (h) additional Guarantees by the Company of
     Indebtedness or other obligations, provided that such
     Guarantees are permitted by clause (d) of  8.1 and
     that immediately after the creation, incurrence,
     assumption or existence of such additional Guarantee
     and after giving effect thereto the aggregate amount of
     all Indebtedness and other obligations guaranteed by
     the outstanding Guarantees of the Company permitted
     under this clause (h) does not exceed $5,000,000; and

          (i) Notwithstanding anything in the foregoing, no
     Guarantee of Indebtedness shall at any time be
     permitted to be made by FRI, any of the TV Shopping
     Companies, either of the MWD Subsidiaries, the Credit
     Card Bank or any Subsidiary that is a subsidiary of
     FRI, any of the TV Shopping Companies, either of the
     MWD Subsidiaries or the Credit Card Bank, other than
     (i) as permitted under clause (e) with respect to the
     MWD Subsidiaries and (ii) Guarantees of Indebtedness of
     one or more of the TV Shopping Companies by one of such
     TV Shopping Companies."

          SECTION 3.09.  The following Section 8.18 shall be
added to the Purchase Agreement immediately following
Section 8.17 thereof:

          "SECTION 8.18.  Funding Ratio.  A violation of
     Section 6.07 of the Bank Credit Agreement shall
     constitute a Default under this Agreement, regardless
     of whether the Banks shall have waived any default
     resulting from any such violation under the Bank Credit
     Agreement."

                         ARTICLE IV

     Amendments to Article X of the Purchase Agreement

          Section 10.2 of the Purchase Agreement is hereby
amended by (i) replacing the definition of "Net Worth" and
(ii) inserting the following additional definitions in
alphabetical order:

          "Financial Services Companies--shall mean,
     collectively, (i) a newly formed Delaware corporation
     into which the Company will transfer the Transferred
     Assets in connection with or in contemplation of the
     initial public offering of the common stock of such
     entity, (ii) Direct Merchants Credit Card Bank,
     National Association, (iii) Fingerhut Financial
     Services Receivables, Inc., (iv) DMCCB, Inc.,
     (v) Fingerhut Financial Services Corporation and
     (vi) any subsidiary of such newly formed Delaware
     corporation hereafter formed.

          Intercompany Agreements--shall mean any agreements
     entered into between the Company or any Subsidiary that
     is not one of the Financial Services Companies and any
     of the Financial Services Companies prior to or as of
     the date of closing of, and in connection with or in
     contemplation of, the initial public offering of the
     common stock of the Financial Services Companies
     (including, without limitation, the Database Access
     Agreement, the Co-Brand Agreement, the Administrative
     Services Agreement, the Data Sharing Agreement, the Tax
     Sharing Agreement, the Extended Service Plan Agreement,
     the Services Agreement, the Transfer Agreement and the
     Registration Rights Assessment).

          Net Worth--(i) of any person other than the
     Company shall mean, as of any date as of which the
     amount thereof is to be determined, the stockholders'
     equity of such person and (ii) of the Company shall
     mean, as of any date as of which the amount thereof is
     to be determined, the sum of (A) the stockholders'
     equity of the Company immediately following the initial
     public offering of the common stock of the Financial
     Services Companies, excluding any minority equity
     interest in any of the Financial Services Companies,
     (B) the cumulative Net Earnings of the Company,
     excluding the Net Earnings of the Financial Services
     Companies, from the date of the initial public offering
     of the common stock of the Financial Service Companies
     to the date as of which the amount thereof is to be
     determined, and (C) the aggregate amount of cash
     dividends received by the Company or any of the
     Subsidiaries from any of the Financial Services
     Companies from the date of the initial public offering
     of the common stock of the Financial Services Companies
     to the date as of which the amount thereof is to be
     determined; provided that, for the purposes of
     clauses (i) and (ii) above, any computation of
     Consolidated Net Worth of the Company and the
     Subsidiaries shall not include the equity interest of
     the Company or any Subsidiary in the undistributed
     earnings of Montgomery Ward Direct.

          Transferred Assets--shall mean, collectively
     (i) the capital stock of (A) Direct Merchants Credit
     Card Bank, National Association, (B) Fingerhut
     Financial Services Receivables, Inc., (C) DMCCB, Inc.
     and (D) Fingerhut Financial Services Corporation and
     (ii) certain assets of the Company related to its
     extended service plan, third-party insurance and
     financial services businesses with an aggregate book
     value not to exceed (A) in the case of MasterCard
     credit card receivables, One Billion, Two Hundred
     Million Dollars ($1,200,000,000) in receivables
     existing as of July 7, 1996, plus the amount of any
     additional receivables arising subsequent to July 7,
     1996, and prior to the closing date of the initial
     public offering of the common stock of the Financial
     Services Companies, and (B) in the case of all other
     assets related to the extended service plan, third-
     party insurance and financial services businesses, One
     Hundred Fifty Million Dollars ($150,000,000)."

                         ARTICLE V

               Representations and Warranties

          SECTION 5.01.  The Company hereby represents and
warrants to the Noteholders as of the Effective Date:

          (a)  Each of the Company, the Guarantors and the
Significant Subsidiaries is duly organized, validly existing
and in good standing in its jurisdiction of incorporation.

          (b)  The Company has the power to enter into this
Amendment and to perform its obligations hereunder.

          (c)  The execution and delivery by the Company of
this Amendment and the performance of its obligations
hereunder have been duly authorized, and this Amendment
will, upon execution and delivery thereof, be duly executed
and delivered thereby and will constitute the legal, valid
and binding obligation of the Company enforceable against
the Company in accordance with its terms, subject to
applicable laws affecting the enforcement of creditors'
rights generally and principles of equity.

          (d)  Neither the execution nor delivery by the
Company of this Amendment nor the performance by it of its
obligations hereunder or under the Purchase Agreement (as
amended as contemplated hereby), the Notes or the Guaranty
of each Guarantor:

          (1) will adversely affect the enforceability
     against the Company of the Purchase Agreement or the
     Notes, or against the Guarantors of the Guaranty;

          (2) will require the taking of any action or the
     giving of any consent or approval by, or the making or
     any registration or filing with, any Governmental
     Authority or other person other than such actions,
     consents, approvals, registrations and filings as have
     heretofore been taken, given or made (as the case may
     be);

          (3) will violate any provision of the articles of
     incorporation or by-laws of any of the Company or any
     Guarantor or any provision of any law, rule,
     regulation, order or decree of any Governmental
     Authority applicable thereto;

          (4) will violate or constitute a default under any
     material agreement to which any of the Company or any
     Guarantor is a party or by which any of its properties
     or assets is or may be bound; or

          (5) will result in the creation or imposition of
     any Lien on the properties or assets of the Company or
     any Guarantor other than as contemplated by the
     Receivables Transfer Agreement.

          (e)  Neither this Amendment nor any certificate
furnished in connection herewith nor any other document or
statement furnished to the Noteholders in connection with
the transactions contemplated hereby, contains any untrue
statement of a material fact or omits to state a material
fact necessary in order to make the statements contained
herein and therein not misleading.  Except as expressly
disclosed in documents filed by the Company or any
Subsidiary with the Commission and delivered by the Company
to the Noteholders prior to the Effective Date, there is no
fact known to the Company (except for general economic or
political conditions) which materially adversely affects,
or, so far as the Company can now reasonably foresee, would
be likely to materially and adversely affect, the business,
properties, prospects, operations or condition, financial or
otherwise, of the Company and the Subsidiaries taken as a
whole or the ability of the Company or any Significant
Subsidiary to perform any material obligation under the
Purchase Agreement, which has not been disclosed in writing
to the Noteholders.

          (f)  There exists no Default or Event of Default
under the Purchase Agreement either before or after giving
effect to this Amendment.

          (g) The businesses operated by (A) Direct
Merchants Credit Card Bank, National Association, (B)
Fingerhut Financial Services Receivables, Inc., (C) DMCCB,
Inc. and (D) Fingerhut Financial Services Corporation are
substantially as described in Schedule I attached hereto.


                         ARTICLE VI

                       Miscellaneous

          SECTION 6.01.  This Amendment shall not be valid
and binding upon the Company or any Noteholder under the
Purchase Agreement until the execution hereof by a Majority-
in-Interest of Noteholders and complete satisfaction by the
Company of the conditions precedent set forth in Article I,
and upon the execution hereof by such Noteholders, and
compliance by the Company with said conditions precedent,
this Amendment shall be valid and binding upon the Company
and each Noteholder under the Purchase Agreement with
respect to each provision of this Amendment.

          SECTION 6.02.  This Amendment embodies the entire
agreement and understanding of the parties hereto and
supersedes all prior agreements and understandings relating
to the subject matter hereof.  In case any one or more of
the provisions contained in this Amendment, or in the
Purchase Agreement as amended hereby, or in any Note, or any
application thereof, shall be invalid, illegal or
unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein
and therein, and any other applications thereof, shall not
be in any way be affected or impaired thereby.

          SECTION 6.03.  This Amendment is intended to be
governed by the laws of the State of New York and shall be
construed and enforced in accordance with, and the rights of
the parties shall be governed by, the laws of such State.

          SECTION 6.04.  This Amendment shall bind and inure
to the benefit of the respective successors and assigns of
the Company and the Noteholders.

          SECTION 6.05.  Except as otherwise expressly
provided herein, nothing contained in this Amendment shall,
or shall be construed to, modify, invalidate or otherwise
affect any provision of the Purchase Agreement or any right
of the Noteholders arising thereunder.

          SECTION 6.06.  The execution of this Amendment by
the Noteholder shall not in any way constitute, or be
construed as, a waiver of any provision of, or of any
Default or Event of Default otherwise existing under, the
Purchase Agreement, nor shall it constitute an agreement or
obligation of the Noteholders to give their consent to any
future amendment of the Purchase Agreement or to any future
transaction which would, absent consent of the Noteholders,
constitute a Default or Event of Default under the Purchase
Agreement.

          SECTION 6.07.  Except as specifically provided
herein, the Purchase Agreement is in all respects ratified
and confirmed, and all the terms, conditions and provisions
thereof shall be and remain in full force and effect.  For
any and all purposes, from and after the Effective Date, any
and all references hereafter to any Purchase Agreement, and
all references to "this Agreement" in the Purchase
Agreement, shall refer to such Purchase Agreement as hereby
amended.

          SECTION 6.08.  This Amendment may be executed in
as many counterparts as may be deemed necessary or
convenient and by the different parties hereto on separate
counterparts (provided that the Company will execute each
counterpart), and each of which, when so executed, shall be
deemed to be an original, but all such counterparts shall
constitute but one and the same agreement.

          SECTION 6.09.  The Company will pay, or cause to
be paid, the reasonable out-of-pocket costs and expenses of
the Noteholder in connection with entering into this
Amendment and the consummation of all transactions
contemplated hereby, and the Company will also indemnify and
hold each Noteholder harmless from and against all liability
and loss with respect to or resulting from all claims on
account of brokers' or finders' fees or commissions in
connection with this Amendment or any of the transactions
contemplated hereby.  The obligations of the Company under
this Section 6.09 shall survive payment of any Note issued
under any Purchase Agreement.


          IN WITNESS WHEREOF, the Company and the
Noteholders have caused this Amendment to be executed by
their respective officers thereto duly authorized.


                              FINGERHUT COMPANIES, INC.,
                              
                                by
                              
                                  Name:
                                  Title:
                              
                                by
                              
                                  Name:
                                  Title:
                              
                              
                              TEACHERS INSURANCE AND ANNUITY
                              ASSOCIATION OF AMERICA,
                              
                                by
                              
                                  Name:
                                  Title:
                              
                              
                              THE EQUITABLE LIFE ASSURANCE
                              SOCIETY OF THE UNITED STATES,
                              
                                by
                              
                                  Name:
                                  Title:
                              
                              
                              AMERICAN FAMILY LIFE INSURANCE COMPANY,
                              
                                by
                              
                                  Name:
                                  Title:
                              
                              
                              GENERAL AMERICAN LIFE INSURANCE COMPANY,

                              by

                              Name:
                              Title:


                              ST. LOUIS REINSURANCE COMPANY,

                              by

                              Name:
                              Title:


                              BERKSHIRE LIFE INSURANCE COMPANY,

                              by

                              Name:
                              Title:


                              SOUTHERN FARM BUREAU LIFE INSURANCE COMPANY,

                              by

                              Name:
                              Title:

                              STATE MUTUAL INSURANCE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              GUARANTEE RESERVE LIFE INSURANCE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              SECURITY LIFE INSURANCE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              UNITED OF OMAHA LIFE INSURANCE COMPANY,

                              by

                              Name:
                              Title:


                              THE MINNESOTA MUTUAL LIFE INSURANCE COMPANY,
                              by  MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:

                              MIMLIC FUNDING, INC.,
                              by  MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              NATIONAL TRAVELERS LIFE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              THE RELIABLE LIFE INSURANCE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              MUTUAL TRUST LIFE INSURANCE COMPANY,
                              by MIMLIC ASSET MANAGEMENT COMPANY,

                              by

                              Name:
                              Title:


                              INDIANAPOLIS LIFE INSURANCE COMPANY,

                              by

                              Name:
                              Title:


                                              Schedule I

Direct Merchants Credit Card Bank, National Association

A limited purpose credit card bank.


Fingerhut Financial Services Receivables, Inc.

A bankruptcy-remote special
purpose subsidiary that is the transferor under the
Receivables Transfer Program relating to credit card
receivables.


DMCCB, Inc.

A subsidiary holding lease obligations for the office of Direct 
Merchants Credit Card Bank, National Association.


Fingerhut Financial Services Corporation

A subsidiary that provides marketing and administrative services to 
Direct Merchants Bank and markets and services extended product 
service plans and other financial services products.