SALE AGREEMENT
                                      among
                               LINC CAPITAL, INC.,
                                    as Seller
                                       and
                      LINC EQUIPMENT RECEIVABLES ONE, LLC,
                                  as Purchaser


                            Dated as of July 29, 1999




<PAGE>
                       TABLE OF CONTENTS

ARTICLE 1.  DEFINITIONS; INTERPRETATION......................................  1
          SECTION 1.1       Definitions......................................  1
          SECTION 1.2       General Interpretive Principles..................  2

ARTICLE 2.  SALE OF ASSETS...................................................  2

          SECTION 2.1       Sale and Contribution of Assets..................  2
          SECTION 2.2       Purchase Price...................................  3
          SECTION 2.3       Conditions Precedent.............................  3

ARTICLE 3.  REPRESENTATIONS, WARRANTIES AND COVENANTS........................  4

          SECTION 3.1       Seller Representations, Warranties and Covenants
                              as to Seller...................................  4
          SECTION 3.2       Seller Representations, Warranties and Covenants
                              as to Leases, Lease Receivables and Equipment..  7
          SECTION 3.3       Representations and Warranties Continue.......... 12

ARTICLE 4.  ADDITIONAL COVENANTS............................................. 13

          SECTION 4.1         ............................................... 13

ARTICLE 5.  ADMINISTRATION AND PAYMENTS...................................... 15

          SECTION 5.1       Collection of Lease Receivables.................. 15
          SECTION 5.2       Prompt Remittance of Receipts.................... 15
          SECTION 5.3       Shared Reserves; Shared Residuals................ 16

ARTICLE 6.  REPURCHASE AND SUBSTITUTION OF LEASES AND
                  EQUIPMENT.................................................. 17

          SECTION 6.1       Repurchase of Purchase or Renew Leases; Sales to
                            ReplacePrepaid Leases............................ 17
          SECTION 6.2       Repurchase or Substitution of Defaulted Leases... 18
          SECTION 6.3       Repurchase or Substitution of Non-conforming
                              Leases; Dilution; Northern Leases...............18
          SECTION 6.4       Repurchase or Substitution of Leases............. 19
          SECTION 6.5       Transfer Following Repurchase or Substitution.... 20
          SECTION 6.6       Limitation on Substitutions...................... 20

ARTICLE 7.  NOTICES.......................................................... 20

          SECTION 7.1       Notices.......................................... 20

ARTICLE 8.  TERMINATION...................................................... 21

          SECTION 8.1       Termination...................................... 21
          SECTION 8.2       Effect of Termination............................ 21

ARTICLE 9.  MISCELLANEOUS PROVISIONS......................................... 21

          SECTION 9.1       Amendment........................................ 21
          SECTION 9.2       Governing Law.................................... 22
          SECTION 9.3       Transfer of Assets to Trust...................... 22
          SECTION 9.4       Severability of Provisions....................... 22
          SECTION 9.5       Assignment....................................... 22
          SECTION 9.6       Further Assurances............................... 22
          SECTION 9.7       No Waiver; Cumulative Remedies................... 22
          SECTION 9.8       Counterparts..................................... 22
          SECTION 9.9       Binding Effect; Third-Party Beneficiaries........ 23
          SECTION 9.10      Merger and Integration........................... 23
          SECTION 9.11      True Sale........................................ 23

          Exhibit A                    -      Definitions
          Exhibit B                    -      Lease Schedule
          Exhibit C                    -      Schedule of Security Deposits
          Exhibit D                    -      Trade Names


<PAGE>
                               SALE AGREEMENT

     THIS SALE AGREEMENT,  dated as of July 29, 1999, is entered into among LINC
CAPITAL,  INC.  ("LINC"),  a  Delaware  corporation  (the  "Seller"),  and  LINC
EQUIPMENT  RECEIVABLES ONE, LLC, a Delaware limited  liability  company (herein,
the "Transferor"), as purchaser.
                                   WITNESSETH

     WHEREAS,  the Seller  desires to sell,  transfer,  assign,  contribute  and
otherwise  convey  all of its  right,  title and  interest  in and to the Leases
listed on the Lease Schedule  attached hereto as Exhibit B and the related Lease
Receivables  and  Equipment  to the  Transferor  upon the terms  and  conditions
hereinafter set forth; and

     WHEREAS, it is contemplated that following such sale, transfer, assignment,
contribution  and  conveyance  of the Leases  listed on the Lease  Schedule  the
Servicer and certain  Subservicers  will  administer  and service the Leases and
manage and remarket the Equipment  upon the  expiration or other  termination of
the terms of the Leases pursuant to the Pooling and Servicing Agreement dated as
of the date hereof (as amended or modified from time to time in accordance  with
the  provisions  thereof,  the  "Pooling  and  Servicing  Agreement")  among the
Transferor, the Servicer and U. S. Bank Trust National Association,  as Trustee;
and

    WHEREAS, it is contemplated that following such sale, transfer, assignment,
contribution  and conveyance,  the Transferor will convey to the Trust,  for the
benefit of the  Certificateholders,  its right, title and interest in and to the
Leases,  the Lease  Receivables,  the Equipment and certain  related  rights and
interests acquired by the Transferor  hereunder and all rights of the Transferor
under this Agreement, and the Seller agree that all representations, warranties,
covenants and agreements made by the Seller herein shall also be for the benefit
of the Trust and the Certificateholders;

     NOW, THEREFORE,  in consideration of the mutual covenants contained herein,
and other good and valuable consideration,  the receipt and adequacy of which is
hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1.  DEFINITIONS; INTERPRETATION

     SECTION 1.1 Definitions. Whenever used in this Agreement, capitalized terms
shall have the  meanings  specified in Exhibit A hereto,  which is  incorporated
herein by this  reference.  The  definitions of such terms are applicable to the
plural as well as the singular  forms of such terms and to the masculine as well
as the feminine and neuter genders of such terms.

     SECTION 1.2 General Interpretive Principles. For purposes of this Agreement
except as otherwise expressly provided or unless the context otherwise requires:

         (a)  accounting  terms not otherwise  defined  herein have the meanings
assigned to them in accordance with generally accepted accounting  principles as
in effect on the date hereof;

         (b)  references  herein  to  "Articles,"   "Sections,"   "Subsections,"
"paragraphs," "clauses" and other subdivisions,  or to "Exhibits" or "Schedules"
or  other  attachments,  are  to  designated  Articles,  Sections,  Subsections,
paragraphs,  clauses and other subdivisions of, or Exhibits,  Schedules or other
attachments to, this  Agreement,  and references in any Section or definition to
"Subsections,"   "paragraphs,"  clauses"  and  other  subdivisions  are  to  the
designated  Subsections,  paragraphs,  clauses  and other  subdivisions  of that
Section or definition;

         (c) the  words  "herein,"  "hereof,"  "hereunder"  and  other  words of
similar  import  refer to this  Agreement  as a whole and not to any  particular
provision;

         (d) the term  "including"  means  "including  without  limitation," and
other forms of the verb "to include" have correlative meanings;

         (e) except as otherwise  provided in this Agreement,  all interest rate
calculations  and present  value  determinations  will be made on the basis of a
360-day year and twelve 30-day months and will be carried out to at least seven
decimal places; and

         (f) captions or headings are for convenience only and in no way define,
limit or  describe  the scope or intent of any  provisions  of  sections of this
Agreement.
<PAGE>
ARTICLE 2.  SALE OF ASSETS

    SECTION 2.1 Sale and Contribution of Assets. (a) Conveyance. Subject to all
the  terms  and  conditions  of  this  Agreement,   and  in  reliance  upon  the
representations,  warranties  and covenants set forth herein,  the Seller hereby
sells or contributes to the Transferor (without recourse,  except as provided in
Section 6.3) and the  Transferor  hereby  purchases or accepts as a contribution
from the Seller,  as of the Closing Date, all of the Seller's  right,  title and
interest in, to, and under (i) each of the Leases  listed on the Lease  Schedule
and the Lease Files relating to such Leases,  (ii) the Lease Receivables and the
right to receive  all other  payments  on or with  respect to such Leases due or
becoming due on or after the Cut-Off  Date,  (iii) all  guaranties  of and other
agreements  providing credit  enhancement with respect to each such Lease to the
extent related to such Lease, (iv) all rights,  powers, and remedies under or in
connection with each such Lease,  whether arising under the terms of such Lease,
by statute,  at law or in equity, or otherwise arising out of any default by the
Obligor  under such  Lease,  including  all rights to exercise  any  election or
option  or to make any  decision  or  determination  or to give or  receive  any
notice,  consent,  approval or waiver thereunder,  (v)(A) each item of Equipment
subject to any such Lease and owned by the Seller and (B) any security  interest
of the Seller in any item of  Equipment  subject to any such Lease and not owned
by the Seller,  including in the case of either of clauses (v)(A) or (v)(B), all
Residual  Realizations  with  respect to all such  Equipment  other than  Shared
Residual  Proceeds,  except to the extent  such  Shared  Residual  Proceeds  are
payable to the Seller (or the  Transferor  or the  Trustee,  as  assignee of the
Seller) pursuant to the applicable Shared Residual Agreement,  (vi) any Casualty
Insurance  Policy or Insurance  Proceeds with respect to each such Lease,  (vii)
the Originator Agreements,  the Subservicing Agreements,  the Vendor Agreements,
and all other  agreements  pursuant to which the Seller acquired any rights with
respect to the foregoing insofar, and only insofar, as such agreement relates to
the foregoing (and, in the case of the Shared Enhancement Agreements, subject to
the  provisions of Section  5.3),  and (viii) any and all income and proceeds of
any of the foregoing. The foregoing sale, transfer, assignment, contribution and
conveyance does not constitute and is not intended to result in an assumption by
the  Transferor of any  obligation  (except for the obligation not to disturb an
Obligor 's right of quiet enjoyment) of the Seller or the Servicer in connection
with the Leases.

     (b)  Financing  Statements.  In connection  with the sale and  contribution
pursuant to Section 2.1(a),  to the extent relating to any Leases subject to the
terms and conditions of this Agreement, the Seller agrees to record and file, at
its own expense,  all requisite  Financing  Statements and other  documents (and
thereafter  timely  continuation  statements  with  respect  to  such  Financing
Statements) in such manner and in such jurisdictions as are necessary to perfect
and to maintain the  perfection of the sale and  contribution  of the Leases and
related Lease  Receivables  and interest in the Equipment from the Seller to the
Transferor (except that no such Financing  Statements need be filed in any State
which is not one of the Filing States and no action will be taken to perfect the
Transferor's  interest in Leased Vehicles) and to deliver a file-stamped copy of
such Financing Statements or other evidence of such filings to the Transferor.

     (c)  Seller  Records.  The Seller  shall on the  Closing  Date,  at its own
expense,  cause its computer records to be marked to show that the Leases, Lease
Receivables,  Equipment  and other assets  subject to this Section 2.1 have been
sold and  contributed  to the  Transferor  and then  transferred to the Trust in
accordance  with the Pooling and Servicing  Agreement and,  within 30 days after
the Closing  Date or the  applicable  Transfer  Date,  as the case may be, shall
segregate  the  Lease  Files  from all  other  files  held by the  Seller on the
Seller's premises.

     SECTION 2.2 Purchase Price. The purchase price to be paid by the Transferor
for a portion of the Leases and the related Lease Receivables and Equipment sold
to it  pursuant  to  Section  2.1(a)  shall be equal to the  Initial  Discounted
Present Value of such Leases.  The remainder of the Leases and the related Lease
Receivables  and Equipment  shall be a contribution by the Seller to the capital
of the Transferor on the Closing Date.  References herein and in the Pooling and
Servicing  Agreement  to sales by LINC  hereunder  shall  include both sales and
contributions.

     SECTION 2.3  Conditions  Precedent.  The  obligation  of the  Transferor to
purchase the Leases,  Lease  Receivables and Equipment on the Closing Date shall
be subject to the  satisfaction  of the  conditions  set forth in the  Placement
Agency Agreement and the issuance of the Certificates on such date.
<PAGE>


     ARTICLE 3.     REPRESENTATIONS, WARRANTIES AND COVENANTS

     SECTION 3.1 Seller Representations,  Warranties and Covenants as to Seller.
The Seller hereby represents, warrants and covenants to the Transferor that:

         (a) Organization and Good Standing.  The Seller has been duly organized
and is validly existing and in good standing as a corporation  under the laws of
the State of Delaware,  with all requisite corporate power and authority and all
necessary licenses and permits to own and operate its properties and to transact
the  business  in which it is now  engaged  and to enter  into and  perform  its
obligations under this Agreement and the transactions  contemplated  hereby, and
the  Seller is duly  qualified  and  authorized  to do  business  and is in good
standing as a foreign  corporation  in each State of the United States where the
character of its  properties or the nature of its business  requires it to be so
qualified, except where the failure to be so qualified would not have a material
adverse effect on the Seller.

         (b) No Violation.  The sale and  contribution of the Leases and related
Lease Receivables and interests in the related Equipment sold and contributed by
the  Seller  pursuant  to  this  Agreement,  the  performance  of  the  Seller's
obligations  under this Agreement and the consummation of the transactions by it
herein  contemplated  will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, or result in the creation
or  imposition  of any Lien upon any of the  property or assets of the Seller or
any of its subsidiaries pursuant to the terms of, any indenture,  mortgage, deed
of trust, loan agreement or other agreement (including the Leases) or instrument
to which it or any of its  subsidiaries  is a party or by which it or any of its
subsidiaries is bound or to which any part of its property or assets is subject,
nor will any such  action  result  in any  violation  of the  provisions  of its
charter  or  bylaws or any  statute  or any  injunction,  writ,  order,  rule or
regulation of any court or governmental  agency or body having jurisdiction over
it or any of its properties;  and no consent,  approval,  authorization,  order,
registration  or  qualification  of or with any  court  or any  such  regulatory
authority  or  other  governmental  agency  or body  (except  for  any  required
compliance  with  federal  and  state   securities  laws  with  respect  to  the
Certificates  to  be  issued  by  the  Trust)  is  required  for  the  sale  and
contribution  of the Leases and the Equipment  hereunder or the  consummation of
the other transactions contemplated by this Agreement.

         (c) Binding  Obligation.  This  Agreement  has been  duly  authorized,
executed  and  delivered  by the Seller and such  authorization,  execution  and
delivery  did not and will not require any  stockholder  approval or approval or
consent of any trustee or holders of any  indebtedness  of the Seller  except as
have been duly  obtained;  and this  Agreement is the valid and legally  binding
obligation of the Seller,  enforceable against the Seller in accordance with its
terms, subject as to enforcement to bankruptcy,  insolvency,  reorganization and
other  similar  laws  now  or  hereafter  in  effect  relating  to or  affecting
creditors' rights generally and general principles of equity.

         (d) Place of Business.  As of the date hereof,  and at all times during
the four-month  period preceding such date, the chief executive office and place
of  business  of the  Seller is and has been  located at the  address  listed in
Article 7, and the Seller  does not have,  and during  such period did not have,
any other chief executive offices.

         (e) Trade  Names.  Except as set forth on  Exhibit D, as of the date of
this Agreement and at all times during the six-year period  preceding such date,
the Seller's  legal name has been as set forth in this  Agreement and the Seller
has used no trade names, fictitious names or assumed names and is not doing, and
during such period has not done, business under any other name.

         (f) No Proceedings.  The Seller is not subject to any injunction, writ,
restraining  order or other  order of any nature  and there is no action,  suit,
proceeding  or  investigation  pending,  or,  to the  knowledge  of the  Seller,
threatened,  against or affecting the Seller or any  subsidiary of the Seller in
or before any court,  governmental  authority or agency or arbitration  board or
tribunal,  including any such action,  suit,  proceeding or  investigation  with
respect to any environmental or other liability  resulting from the ownership or
use of any of the Equipment, which, individually or in the aggregate, materially
and  adversely  affects or will affect the  properties,  business  or  financial
condition of the Seller and its  subsidiaries,  as a whole,  or  materially  and
adversely  affects or will  affect the  payment of Lease  Payments  or any other
payment due under a Lease or the  enforceability of any Lease, or the ability of
the Seller to perform its obligations  under this  Agreement.  The Seller is not
and,  by  entering  into  this  Agreement  and   performing   the   transactions
contemplated herein, will not be in default with respect to any injunction, writ
or order of any court,  governmental authority or agency or arbitration board or
tribunal.
<PAGE>
         (g) Taxes.  All material tax returns required to be filed by the Seller
or any  subsidiary of the Seller in any  jurisdiction  have been filed,  and all
taxes,  assessments,  fees and other governmental charges upon the Seller or any
subsidiary of the Seller, or upon any of their respective properties,  income or
franchises, shown to be due and payable on such returns have been paid. All such
tax returns  were true and  correct in all  material  respects,  and neither the
Seller nor any  subsidiary  of the Seller knows of any proposed  additional  tax
assessment against it in any material amount nor of any basis therefor.

         (h)      No Violations of Law.  The Seller:

                  (i) is not in  violation of any laws, ordinances, governmental
         rules or regulations to which it is subject, and

                  (ii)    is  not in violation  in any  material  respect of any
         term of any agreement, charter document,  by-law or other instrument to
         which it is a party or by which it is bound,

which  violation  would  materially  adversely  affect the business or financial
condition of the Seller and its subsidiaries, as a whole.

        (i) Ordinary  Business   Purpose.   The  transactions  by   the  Seller
contemplated  by  this  Agreement  are  being   consummated  by  the  Seller  in
furtherance  of  the  Seller's  ordinary  business  purposes  and  constitute  a
practical and reasonable  course of action by the Seller designed to improve the
financial  position of the Seller,  with no contemplation of insolvency and with
no intent to hinder,  delay or defraud any of its  present or future  creditors.
The Seller has valid business  reasons for selling and  contributing  the Leases
and the related Lease  Receivables  and Equipment to the Transferor  rather than
securing a loan  collateralized  by the Leases and the related Lease Receivables
and  Equipment.  Neither as a result of the  transactions  contemplated  by this
Agreement nor immediately before or after giving effect to any such transactions
was or will the Seller be insolvent or did or will the Seller have  unreasonably
small capital for the conduct of its business and the payment of its anticipated
obligations.

         (j)      Assets and Liabilities.

                  (i)  Both   immediately   before   and   after  the  sale  and
         contribution  of the  Leases  and the  related  Lease  Receivables  and
         Equipment  contemplated  by this  Agreement,  the present  fair salable
         value of the  Seller's  assets  was and will be in excess of the amount
         that was and will be required to pay the Seller's probable  liabilities
         as they then existed or will then exist and as they become absolute and
         matured; and

                  (ii)  both   immediately   before   and  after  the  sale  and
         contribution  of the  Leases  and the  related  Lease  Receivables  and
         Equipment  contemplated  by this  Agreement,  the  sum of the  Seller's
         assets was and will be greater  than the sum of the  Seller's  debts at
         such time, valuing the Seller's assets at a fair salable value.

         (k) Incurrence  of  Debts.  Neither  as a result  of  the  transactions
contemplated  by this  Agreement nor otherwise  does the Seller  believe that it
will incur debts beyond its ability to pay or which would be  prohibited  by its
charter  documents or by-laws.  The  Seller's  assets and cash flow enable it to
meet its present  obligations in the ordinary  course of business as they become
due.

         (l) Bulk Transfer Laws. No sale, transfer, assignment,  contribution or
conveyance of Leases,  the related Lease  Receivables or Equipment by the Seller
to the  Transferor  contemplated  by this  Agreement will be subject to the bulk
transfer laws or any similar  statutory  provisions in effect at the time in any
applicable jurisdiction.
<PAGE>
        (m) Transfer  Taxes.  No sale,  transfer,  assignment,  contribution or
conveyance of Leases or related Lease  Receivables or Equipment  contemplated by
this  Agreement  is subject to or will  result in any tax,  fee or  governmental
charge  payable by the Seller or the  Transferor to any federal,  state or local
government  ("Transfer  Taxes").  In the event that the Seller or the Transferor
receives  actual notice of any Transfer Taxes arising out of the transfer of any
Leases or Lease  Receivables or Equipment,  on written demand by the Transferor,
or upon the Seller  otherwise being given notice thereof,  the Seller shall pay,
and  otherwise  indemnify  and  hold  harmless,   on  an  after-tax  basis,  the
Transferor,  the Trustee, the Trust and each Holder of the Certificates,  as the
assignees of Transferor's  rights  hereunder,  from and against any and all such
Transfer  Taxes  (it  being   understood  that  neither  the   Transferor,   the
Certificateholders,  the Trust nor the Trustee shall have any  obligation to pay
such Transfer Taxes).

         (n) Substantive  Consolidation.  The  Seller shal  at all times operate
and conduct its business  affairs in such a manner that the Transferor would not
be  substantively  consolidated  with the Seller in the event of a bankruptcy or
insolvency of the Seller.

         (o) As of the Cut-Off  Date,  Leases  representing  at least 88% of the
aggregate  Discounted  Present Value of all Leases with Financed Residual Values
relate to Equipment located in the Filing States.

         (p) The Discounted  Present Value of all Leases with any one Obligor as
of the Cut-Off  Date does not exceed 1.25% of the Initial  Aggregate  Discounted
Present Value.

     SECTION 3.2 Seller Representations,  Warranties and Covenants as to Leases,
Lease  Receivables  and  Equipment.  With  respect  solely to each Lease sold or
contributed by it hereunder,  and the related Lease  Receivables  and Equipment,
the Seller hereby represents, warrants and covenants to the Transferor that:

         (a) Title.  Immediately  prior  to  the  sale  or  contribution  to the
Transferor,  the Seller was (and upon such transfer,  the Transferor was or will
be, as the case may be) the legal owner of all right,  title and interest in and
to such  Lease  (including  the  related  Lease  Receivables)  and  the  related
Equipment,  except that (1) with respect to the Equipment  subject to Dollar Out
Leases,  Required Purchase or Renew Leases, and Leases which are in form secured
loan  agreements  and other finance  leases,  the Seller may be deemed to have a
security interest in such Equipment rather than an ownership interest,  (2) with
respect to the Shared Residual  Leases,  ownership of the related  Equipment has
been retained by the related  Contractual  Third Party Originator (each of which
has  granted  the Seller a security  interest  in such  Equipment)  and (3) with
respect to Leased Vehicles, no actions will be taken with respect to the related
certificates of title (or similar  documents).  Immediately prior to the sale or
contribution  to  the  Transferor,  each  Lease  (including  the  related  Lease
Receivables) and the Equipment  subject to each Lease was or is, as the case may
be,  free  from any Lien or  other  right,  title  or  interest  of any  Person,
including the manufacturer,  supplier or any Obligor , subject,  however, to (1)
the rights of the Obligors under the Leases in the  Equipment,  (2) with respect
to the Shared Residual Leases, the rights of the related Contractual Third Party
Originators  under the related  Originator  Agreements and (3) certain  inchoate
liens for taxes not yet payable and  mechanics'  liens for services or materials
supplied  with  respect  to the  Equipment  and the  payment of which is not yet
overdue;  and the  Seller  shall  defend  the  Transferor's  title to the Leases
(including the Lease Receivables) and the Transferor's title (or, in the case of
Shared Residual Leases,  Dollar Out Leases,  Required  Purchase or Renew Leases,
Leases for Leased Vehicles, and Leases which in form are secured loan agreements
and other finance leases,  the  Transferor's  security  interest) in the related
Equipment  against all claims and  demands of all  Persons at any time  claiming
through the Seller the same as, or any interest  therein adverse to, that of the
Transferor.

         (b) Lease  Files.   Within  30  days  after  the  Closing  Date  or the
applicable  Transfer  Date,  as the case may be, the Seller will  segregate  the
Lease Files from all other files held by the Seller on the Seller's premises.

         (c) Legends.  The Seller will cause  (within 30 days after the  Closing
Date or the  applicable  Transfer  Date,  as the case may be) all copies of such
Lease in its possession to be separately  identified and distinguished  from the
Seller's other leases by an appropriate  legend clearly disclosing the fact that
such Lease (including the related Lease  Receivables) and the related  Equipment
have been sold and contributed to the Transferor and that such Lease  (including
the related Lease  Receivables) and related Equipment have been further assigned
by the  Transferor  to  the  Trustee,  and  any  original  copies  of any  Lease
subsequently  coming into the  possession  of the Seller will be  identified  as
described in this Section 3.2(c).
<PAGE>
         (d) No Lease  Defaults.  Such  Lease is in full  force  and  effect  in
accordance with its terms and neither the Seller nor, to the Seller's knowledge,
any  Obligor has done or failed to do  anything  that would or might  permit any
such  Obligor  or the  Seller to  terminate  such Lease or suspend or reduce any
payments or obligations  due or to become due thereunder by reason of default by
the other party to such Lease;  and (i) the Obligor  thereunder  (A) has made or
will make prior to the  Closing  Date,  or (B) has made prior to the  applicable
Transfer Date in the case of a Substitute  Lease,  at least one payment of Lease
Payments under such Lease in addition to any payment made at the time of signing
of such Lease,  and (ii) such Lease is not a  Defaulted  Lease nor was any Lease
Payment more than 30 days  delinquent as of the  Measurement  Date, or as of the
end of the calendar month immediately  preceding the applicable Transfer Date in
the case of a Substitute Lease; provided,  however, that Leases representing not
more than 2.75% of the aggregate Gross Contract Balance may be more than 30 days
but not more than 60 days past due as of the Measurement Date.

         (e) Binding  Obligation.  Such Lease  is a valid,  binding  and legally
enforceable  obligation of each party thereto. All parties to each Lease had all
requisite  authority  and  capacity to execute such Lease and no such Lease will
violate any applicable  law or contravene any other  agreement to which any such
party is subject.

        (f) Equipment Financing Statements. The Seller (or the applicable Third
Party  Originator)  has filed  Financing  Statements  against  the  Obligors  in
accordance  with the  Seller's  UCC filing  policy as  described  in the Private
Placement   Memorandum   under  the   heading   "Risk   Factors--Certain   Legal
Aspects--Financing  Statements",  and such Financing  Statements  filed by Third
Party  Originators  have been assigned to the Seller all in order to perfect the
Seller's security interest in any Equipment covered by such Financing Statements
which is deemed to be owned by the Obligor,  and such Financing  Statements have
not been  terminated,  released  or  assigned  (except as  contemplated  by this
Agreement).  Other than  Financing  Statements or other similar  instruments  of
registration  under the law of any  jurisdiction  which (A) will be  released or
assigned to the  Transferor on or prior to the Closing Date,  or, in the case of
any Substitute Lease, on or prior the Transfer Date therefor,  (B) will be filed
pursuant  hereto in order to  perfect  the  interest  of the  Transferor  in the
Leases,  Lease  Receivables  and  Equipment  or (C) will be filed to perfect the
Trustee's  rights  therein  under the Pooling and  Servicing  Agreement  for the
benefit  of  the  Certificateholders,  there  are  no  Financing  Statements  or
instruments  on file,  and the Seller has not and will not execute or  authorize
there to be on file any  Financing  Statement or similar  instrument,  under the
laws  of any  jurisdiction  relating  to the  Seller's  interests  in the  Lease
Receivables, Leases or Equipment.

         (g) Perfection.  All filings and recordings required to perfect (i) the
title of the  Transferor  and the  Trustee to such Lease and the  related  Lease
Receivables  will be  accomplished  and in full force and effect on the  Closing
Date and (ii) the title or security  interest of the  Transferor and the Trustee
in the related Equipment will be accomplished  within 10 Business Days after the
Closing  Date,  except that (x) no actions  (including  the  retitling of Leased
Vehicles) with respect to the perfection of the Transferor's  security  interest
in Leased  Vehicles  will be  required  to be taken  (other  than the  filing of
Financing Statements otherwise required herein), and (y) no filings will be made
other than in the Filing States.

         (h) Form of  Lease.  Such  Lease is  substantially  in one of the forms
provided  to the  Transferor  and Mayer,  Brown & Platt,  counsel to  Prudential
Securities  Incorporated,  as placement  agent for the initial  placement of the
Class A Certificates,  Class B-1 Certificates and the Class B-2 Certificates and
constitutes  "chattel  paper"  within the meaning of the UCC as in effect in any
applicable jurisdiction.

         (i) Accuracy of Lease Schedule.  The Lease Schedule contains a complete
and correct statement of the Lease Payments (other than variable payments) under
such  Lease  and the  Estimated  Residual  Value  with  respect  to the  related
Equipment.

         (j) Hell or High Water Leases. Such Lease is and will be noncancellable
and the  obligation of the Obligor to pay rent  thereunder  (as reflected on the
Lease  Schedule)  is and will be  unconditional,  without  regard  to any  event
affecting  the  Equipment or any change in  circumstance  of such Obligor or any
other  circumstance  whatsoever,  including by reason of the obsolescence of the
Equipment  or any right or claim of  setoff,  counterclaim  or other  defense or
claim that any such  Obligor  may have  against any Person  except that  certain
Leases may  require  or permit  the  Obligor  thereunder  to pay an  accelerated
amount,  not less than the Discounted Present Value of such Lease at the time of
payment, in the event of the loss or destruction of the Equipment thereunder.

         (k) Selection Procedures.  Such Lease has been entered into or acquired
by the Seller in the Seller's ordinary course of business and in accordance with
the Seller's regular credit approval process in effect at the time such Lease is
entered  into or  acquired  as  generally  described  in the  Private  Placement
Memorandum  and no  selection  procedures  adverse to the credit  quality of the
Leases have been  employed  in  selecting  the Leases for sale and  contribution
under this Agreement.
<PAGE>
        (l) Insurance of Equipment.  Such Lease requires the Obligor thereunder
to maintain at its sole cost and expense property damage insurance covering loss
or damage to the Equipment leased by such Obligor in an amount at least equal to
the Discounted Present Value of such Lease.

         (m) Security  Deposits.   Exhibit C contains an accurate  statement  of
those  Leases  with  respect  to which the  Obligor  has been  required  to make
security deposits and the amount of such security deposits.

         (n) Maintenance Requirements.Such Lease requires the Obligor thereunder
at  its  sole cost  and expense to  maintain  the  Equipment  leased or financed
thereunder in good operating order, repair and condition (ordinary wear and tear
excepted),  and  the  Seller  is not aware of any  breach  of  this requirement.

         (o) Triple Net Lease. Such Lease requires the Obligor thereunder to pay
all fees,  taxes,  and other charges or liabilities  arising with respect to the
Equipment  leased  or  financed  thereunder  or the use  thereof,  to  keep  the
Equipment  free  and  clear  of any and all  Liens,  and to  indemnify  and hold
harmless the lessor  thereunder  and its assigns  against the  imposition of any
such fees, taxes, charges, liabilities and Liens.

         (P) Subleasing.  Such  lease prohibits the subleasing or other transfer
of  the equipment by the obligor to any other person  without the prior  written
consent of the lessor  thereunder or its assigns and prohibits the relocation of
the  equipment  without  the prior  written  consent  of or notice to the lessor
thereunder or its assigns.

         (q) Transferability.  Such Lease permits transfers of such Lease by the
lessor or its  assigns,  including  grants of security  interests  in and to the
Lease by the lessor or its assigns.

         (r) Accessions  Included.  The Equipment  leased or financed under such
Lease and transferred (or in which a security  interest has been transferred) by
the  Seller  to  the  Transferor   hereunder  includes  all  replacement  parts,
modifications,  repairs, alterations,  additions and accessories incorporated in
or affixed to the  Equipment,  whether before or after the  commencement  of the
Lease,  which  become  the  property  of the  lessor  thereunder  upon  being so
incorporated or affixed.

         (s) No Defenses. No facts or circumstances exist which reasonably could
give  rise  at any  time in the  future  to any  right  of  rescission,  offset,
counterclaim  or defense,  including the defense of usury, to the obligations of
the Obligor under such Lease,  including  the  obligation of such Obligor to pay
all amounts due with respect to such Lease,  and neither the operation of any of
the terms of such Lease nor the  exercise  of any right  thereunder  will render
such  Lease  unenforceable  in  whole  or in part or  subject  to any  right  of
rescission, offset, counterclaim or defense, including the defense of usury, and
no such right of  rescission,  offset,  counterclaim  or defense  will have been
asserted with respect thereto.

         (t) No  Modifications.  Such  Lease has not been  amended,  altered  or
modified in any respect and no provision of such Lease has been waived,  except,
in each case,  in writing,  and copies of all such  writings will be attached to
the Lease.

         (u) No Release. The Obligor has not been released, in whole or in part,
from any of its  obligations  in respect of such Lease;  such Lease has not been
satisfied,  canceled or subordinated,  in whole or in part, or rescinded, and no
Equipment  covered by such Lease has been released from such Lease,  in whole or
in part;  and no  instrument  has  been  executed  that  would  effect  any such
satisfaction, release, cancellation, subordination or rescission.

         (v) Transfer Not Unlawful.  Such Lease was not originated in and is not
subject to the laws of any  jurisdiction  whose laws would make the transfer and
sale or contribution thereof under this Agreement unlawful.

         (w) Fair Consideration.  The consideration  received and to be received
by the Seller in  exchange  for the sale of the Leases  (including  the  related
Lease  Receivables)  and the Equipment  hereunder is fair  consideration  having
value  equivalent to or in excess of the value of the assets  transferred by the
Seller.

         (x) Originator  Agreements.  No  material event of default has occurred
and is continuing under any Originator Agreement or Vendor Agreement.  Except as
identified  on Exhibit F to the Pooling and  Servicing  Agreement,  there are no
other Originator Agreements.

         (y) Eligible  Leases.  Such Lease is to an Obligor which (i) is located
at an address in the United  States or Puerto Rico,  (ii) is not an Affiliate of
the Transferor and (iii) is not an agency, a department, an instrumentality or a
political  subdivision of the United States or of any state or local  government
or any foreign government or an agency or instrumentality thereof.
<PAGE>
         (z) No Substitutions;  Acceleration  Upon Default.  Such Lease (i) does
not  provide  for the  substitution,  exchange or addition of any other items of
Equipment pursuant to such Lease that would result in any reduction or extension
of payments due under such Lease and (ii) permits the Seller to declare (subject
to any applicable grace, cure and notice periods) all payments  thereunder to be
immediately due and payable if the Obligor is in default of such Lease.

         (aa)  Original  Term.  Such Lease has an original  term of 72 months or
less;  provided  that  Leases  aggregating  to no more  than  5% of the  Initial
Aggregate  Discounted Present Value may have an original term of greater than 72
months and less than 87 months.

         (bb)  Discounted  Present  Value.  Such Lease has a Discounted  Present
Value not in excess of $400,000;  provided that Leases representing no more than
7.25% of the Initial  Aggregate  Discounted  Present Value may have a Discounted
Present Value in excess of $400,000.

       (cc) Tax-Exempt.  Such Lease is not a tax-exempt lease.

         (dd) Duly  Assigned.  If such Lease was  originated by Alan  Acceptance
Corporation,  such Lease is not a true lease and the UCC-1 financing  statement,
if any,  filed  against  the  Obligor  with  respect to such Lease has been duly
assigned to the Seller.

         (ee) Software. Such Lease does not relate solely to software;  provided
that Leases  representing  no more than 2% of the Initial  Aggregate  Discounted
Present Value may relate solely to software.

         (ff) Original.  The Seller  has possession  of and will  provide to the
Servicer  the  original  of such  Lease on the  Closing  Date or the  applicable
Transfer Date, in the case of a Substitute Lease. As to such Lease, if more than
one original is executed,  then either i) the Lease contains a provision stating
that  only  counterpart   number  one  shall   constitute   "chattel  paper"  or
"collateral"  within  the  meaning  of the UCC as in  effect  in any  applicable
jurisdiction,  and counterpart  number one will be held by the Servicer,  or ii)
each and every  counterpart  will have been  stamped or  otherwise  annotated to
reflect the respective  interests of the Transferor and the Trust within 30 days
after the Closing Date or Transfer Date, as the case may be.

         (gg) Financial  Residual Value. If there is a Financial  Residual Value
with respect to such Lease and such Lease is a FMV Lease or a Fixed Price Option
Lease, such Lease was originated by the Seller or an Affiliate of the Seller.

         (hh) As of the Cut-Off Date and using an assumed  Discount Factor equal
to 7.25%,  the  Discounted  Present Value of Leases  originated by the following
Third Party Originators or divisions or subsidiaries of LINC will not exceed the
following  percentages  of  the  Initial  Aggregate  Discounted  Present  Value:
Northern  (23.41%),  Golden Eagle (12.70%),  LINC Spectra  (12.97%),  LINC Monex
(11%),  LINC Quantum  (3.44%),  Select Growth  (8.98%),  LINC Comstock  (9.77%),
Traditional  (3.77%),  Leasing  Corporation of America (1.56%),  Alan Acceptance
Corporation (3.5%), Cura Capital Corporation (0.45%), and Great American Leasing
Company, LLC (1.34%).
<PAGE>
     SECTION   3.3    Representations   and   Warranties    Continue.

     The  representations,  warranties  and covenants of the Seller set forth in
Section 3.2 with  respect to each Lease and the  related  Lease  Receivable  and
Equipment  conveyed  by  it  shall  continue  so  long  as  such  Lease  remains
outstanding or until  repurchased or substituted  for pursuant to Article 6. The
Seller shall be deemed to make such representations, warranties and covenants as
to each Substitute Lease, and the related Lease Receivables and Equipment at the
time of  Substitution.  Upon discovery by the Seller or the Transferor  that any
such  representation  or warranty was  incorrect as of the time made,  the party
making such  discovery  shall give prompt notice to the other,  the Servicer and
the Trustee.

ARTICLE 4.  ADDITIONAL COVENANTS

     SECTION 4.1 In addition to its covenants set forth in Sections 3.1 and 3.2,
the Seller hereby covenants and agrees with the Transferor as follows:

         (a)      Leases and Equipment.

                  (i) The  Seller's  copies of originals  or  duplicates  of all
         documents evidencing all Leases are and shall be kept by the Seller at,
         and only at, the Seller's chief executive  offices which are located at
         the  address  listed  below in Article 7. The Seller will not move such
         offices or such  documents  or  related  records  and books  unless the
         Seller shall have given to the Transferor and the Trustee not less than
         30 days' written notice of its intention to do so,  clearly  describing
         the new location,  and the Seller will not move such offices out of the
         United States in any event.

                  (ii) The Seller will duly perform all  obligations on its part
         to be fulfilled  under or in connection  with the Leases and the Seller
         will do nothing to impair the rights of the  Transferor  or the Trustee
         in the Leases, the Lease Receivables or the Equipment.

                  (iii) The  Seller  will at its own  expense  make,  execute or
         endorse,  acknowledge,  and file or deliver to the  Transferor  and the
         Trustee  from time to time such  schedules,  confirmatory  assignments,
         conveyances,  reports and other  reassurances  or instruments  and take
         such further steps relating to the Leases, the Lease  Receivables,  the
         Equipment and the rights covered by this Agreement as the Transferor or
         the Trustee may request and reasonably require.

                  (iv) The Seller  agrees to  indemnify  and hold  harmless  the
         Transferor,  the Trustee and the Trust  (each an  "Indemnified  Party")
         against any and all liabilities,  losses, damages, penalties, costs and
         expenses  (including  reasonable  costs of  defense  and legal fees and
         expenses) which may be incurred or suffered by such  Indemnified  Party
         (except to the extent caused by gross negligence or willful  misconduct
         on the part of the Indemnified  Party) as a result of claims,  actions,
         suits or judgments  asserted or imposed  against it and resulting  from
         any use, operation,  maintenance,  repair, storage or transportation of
         any Equipment  subject to a Lease sold or  transferred  by it hereunder
         and any  tort  claims  and any  fines  or  penalties  arising  from any
         violation of the laws or  regulations of the United States or any state
         or local  government  or  governmental  authority  with  respect to the
         origination  or  acquisition  of any Lease  sold or  transferred  by it
         hereunder;  provided  that the foregoing  indemnity  shall in no way be
         deemed to impose on the Seller any  obligation to make any payment with
         respect to  principal or interest on the  Certificates  or to reimburse
         the Transferor, the Trustee or the Trust for any payments on account of
         the  Certificates  or,  except as provided in Sections  5.4 and 6.3, to
         make any payment with respect to the Leases.

        (b)      Maintenance of Existence; Merger.

                  (i) The  Seller  will  keep  in  full  force  and  effect  its
         existence,  rights and franchise as a corporation under the laws of its
         jurisdiction of incorporation and will preserve its qualification to do
         business as a foreign  corporation in each  jurisdiction  in which such
         qualification  is necessary to protect the validity and  enforceability
         of any of the Leases or to permit  performance  of the Seller's  duties
         under this Agreement.

                  (ii) The Seller shall not  consolidate  with or merge into any
         Person or convey,  transfer or lease substantially all of its assets as
         an   entirety  to  any  Person   unless  the  Person   formed  by  such
         consolidation  or into which the Seller has merged or the Person  which
         acquires by conveyance,  transfer or lease substantially all the assets
         of the Seller as an  entirety  (i) is  organized  under the laws of the
         United States or a state thereof, (ii) has, after giving effect to such
         merger,  consolidation or transfer,  a net worth at least equal to that
         of the  Seller  immediately  prior  to such  merger,  consolidation  or
         transfer  and any  transaction  in  contemplation  thereof,  and  (iii)
         executes and delivers to the Transferor,  the Servicer and the Trustee,
         in form and substance  reasonably  satisfactory to each of them, (A) an
         agreement which contains an assumption by such successor  entity of the
         due and  punctual  performance  and  observance  of each  covenant  and
         condition  to be  performed  or  observed  by  the  Seller  under  this
         Agreement  and (B) an Opinion of Counsel  (who shall not be an employee
         of the Seller or any of its  Affiliates) to the effect that such Person
         is a corporation  or other  organization  of the type  described in the
         foregoing clause (i) and has effectively assumed the obligations of the
         Seller hereunder.
<PAGE>
         (c)      Inspection; Additional Information.

                  (i) The Seller will permit,  on reasonable  prior notice,  the
         representatives  of the  Transferor,  the Servicer,  the Trustee or any
         Holder of the  Certificates  to  examine  all of the books of  account,
         records,  reports and other  papers of the  Seller,  to make copies and
         extracts therefrom,  and to discuss its affairs,  finances and accounts
         with its officers, employees and independent public accountants (and by
         this provision the Seller  authorizes  said  accountants to discuss the
         finances and affairs of the Seller) all at such reasonable times and as
         often as may be  reasonably  requested  for the purpose of reviewing or
         evaluating  the  financial  condition  or  affairs of the Seller or the
         Seller's  performance  of its duties  and  obligations  hereunder.  Any
         expense  incident  to the  exercise by the Trustee or any Holder of the
         Certificates during the continuance of any default by the Seller in any
         of its obligations hereunder shall be borne by the Seller.

                  (ii) The Seller will provide the  Transferor,  the Trustee and
         each Holder, with reasonable promptness, any other data and information
         which may be  reasonably  requested  from time to time,  including  any
         information   required  to  be  made  available  at  any  time  to  any
         prospective  transferee  of any  Certificates  in order to satisfy  the
         requirements of Rule 144A under the 1933 Act.

        (d) No Bankruptcy Petition Against the Transferor. The Seller will not,
prior to the date that is one year and one day after the  payment in full of all
amounts  owing on or with  respect to the  Certificates,  institute  against the
Transferor, or join any other Person in instituting against the Transferor,  any
bankruptcy,  reorganization,  arrangement, insolvency or liquidation proceedings
or other similar proceedings under the laws of the United States or any state of
the United  States.  This Section  4.1(d) shall survive the  termination of this
Agreement.

         (e)   Accounting.   The  Seller  will  account  for  the   transactions
contemplated  by  this  Agreement  on its  books  and  records  as a sale to the
Transferor of the Leases and related Lease  Receivables  and the Seller's right,
title and interest in the related Equipment.

         (f)  Modifications.  The  Seller  will not agree to amend or  otherwise
modify the Northern  Agreement in any manner which would result in a decrease in
the  amount  of  Specified  Northern  Insurance  Premiums  paid to the Trust (as
assignee of the  Transferor)  or an increase in the amount of the  servicer  fee
payable to Northern Leasing Systems, Inc., as collections servicer thereunder.
<PAGE>
ARTICLE 5.  ADMINISTRATION AND PAYMENTS

     SECTION 5.1       Collection of Lease Receivables.

         (a) Collections.  The Seller shall take all reasonable steps consistent
with its normal business practices and procedures to assist the Transferor,  the
Servicer and the Trustee in collecting  any amounts owing under or on account of
the Leases as and when due.

         (b)  Payments  to  Lockbox  Facility.  If i) the  Insurer,  in its sole
discretion,  in  accordance  with the  Insurance  Agreement,  delivers  a notice
instructing the Seller to do so, or ii) an Event of Servicing  Termination shall
have  occurred  and the Seller  shall have been removed as Servicer , the Seller
shall  take all steps  necessary,  including  notifying  Obligors,  to cause the
Obligors to make all Lease  Payments and any other payments due or to become due
under the Leases to the Lockbox Facility  established pursuant to Section 5.1(b)
of the Pooling and Servicing Agreement.

     SECTION 5.2     Prompt  Remittance  of Receipts.  All amounts  collected or
received  by the Seller in  respect  of amounts  due under or on account of each
Lease and the related Lease  Receivables  and Equipment  which are payable after
the Cut-Off Date shall be held by the Seller in trust for the Transferor and the
Trustee and the Seller  shall  segregate  such payment from its own property and
promptly  (but in no event  later  than two  Business  Days  following  receipt)
deposit  any amounts so  collected  or  received  to the  Collection  Account in
immediately  available funds.  Notwithstanding the foregoing,  the Seller is not
required to remit to the Trustee Shared Residual Proceeds,  except to the extent
such Shared  Residual  Proceeds are payable to the Seller (or the  Transferor or
Trustee as assignee of the Seller)  pursuant to the applicable  Shared  Residual
Agreement.

     SECTION 5.3       Shared Reserves; Shared Residuals.

         (a) Shared Reserves.  The Seller holds the Shared Reserves  pursuant to
the Shared  Reserve  Agreements  and will  continue to hold the Shared  Reserves
pursuant to the Shared Reserve  Agreements  (which may include  Shared  Residual
Proceeds with respect to the Leases purchased under any Shared Reserve Agreement
which also is a Shared Residual Agreement), unless and until required to deposit
the  same in a  separate  account  in  accordance  with  the  provisions  of the
applicable Shared Reserve  Agreement.  The Seller has assigned all of its rights
under the Shared Reserve  Agreements insofar as such rights relate to the Shared
Reserve Leases being sold and contributed to the Transferor  hereunder,  and the
Transferor has assigned all of its rights under the Shared Reserve Agreements to
the Trust pursuant to the Pooling and Servicing  Agreement.  As a consequence of
such  assignments,  the Seller agrees that from and after the Closing Date, upon
the  occurrence  of any Shared  Reserve Loss with respect to any Shared  Reserve
Lease  being  sold to the  Transferor  hereunder  (unless  such  Lease  has been
repurchased  or  substituted),  shall  pay to the  Trustee  (by  deposit  to the
Collection  Account)  from the related  Shared  Reserves an amount equal to such
Shared  Reserve Loss, or such lesser amount as shall be available in the related
Shared  Reserves.  It is understood that the amount of the Shared Reserves under
each Shared Reserve  Agreement which will be available for any such payment will
depend on whether such reserves have  previously been applied in accordance with
the applicable Shared Reserve Agreement to Shared Reserve Losses with respect to
leases  not sold to the  Transferor.  The  Seller  agrees  to apply  the  Shared
Reserves under each Shared Reserve Agreement to related Shared Reserve Losses in
the  order  incurred  and  not to  discriminate  against  the  Leases  sold  and
contributed to the Transferor  hereunder in making such application.  The Seller
further agrees not to amend any Shared Reserve  Agreement in a manner adverse to
the  Transferor  or the Trust and to send to the Trustee a copy of any amendment
to any Shared Reserve Agreement promptly following the execution thereof.

<PAGE>
         (b) Shared Residual Agreements.  The Shared Residual Agreements provide
for certain sharing  arrangements  between the related  Contractual  Third Party
Originators  and  the  Seller  party  thereto  of  residual  proceeds  (as  more
particularly  identified  in  each  Shared  Residual  Agreement)  of the  Shared
Residual Leases and other leases subject to the Shared Residual Agreements (such
proceeds,  the "Shared Residual  Proceeds").  The Seller has assigned all of its
rights under the Shared  Residual  Agreements  and all related  Shared  Residual
Proceeds  insofar as such rights relate to the Shared Residual Leases being sold
and contributed to the Transferor hereunder, and the Transferor has assigned all
of its rights  under the  Shared  Residual  Agreements  and all  related  Shared
Residual Proceeds to the Trust pursuant to the Pooling and Servicing  Agreement.
As a consequence of such assignments,  the Seller agrees that from and after the
Closing Date,  upon the  occurrence of any Shared  Residual Loss with respect to
any Shared  Residual  Lease being sold and  contributed  by it to the Transferor
hereunder  (unless such Lease has been repurchased or  substituted),  the Seller
shall pay to the Trustee (by deposit to the Collection Account) from the related
Shared  Residual  Proceeds an amount equal to such Shared Residual Loss, or such
lesser  amount as shall be  available  pursuant to the related  Shared  Residual
Agreement.  It is  understood  that the amount of the Shared  Residual  Proceeds
under  each  Shared  Residual  Agreement  which will be  available  for any such
payment will depend on whether such  proceeds  have  previously  been applied in
accordance  with the applicable  Shared  Residual  Agreement to Shared  Residual
Losses with respect to leases not sold to the  Transferor.  The Seller agrees to
apply any Shared Residual Proceeds under each Shared Residual Agreement to which
it is a party  to  Shared  Residual  Losses  in the  order  incurred  and not to
discriminate against the Leases sold and contributed to the Transferor hereunder
in making such  application.  The Seller  further agrees not to amend any Shared
Residual  Agreement in a manner  adverse to the  Transferor  or the Trust and to
send to the Trustee a copy of any  amendment  to any Shared  Residual  Agreement
promptly following the execution thereof.

         (c) Other Shared Enhancement Agreements. The Seller has assigned all of
its rights under each other Shared Enhancement  Agreement to which it is a party
insofar as such rights  relate to the Leases being sold and  contributed  to the
Transferor  hereunder,  and the  Transferor has assigned all of its rights under
each such Shared Enhancement  Agreement to the Trust pursuant to the Pooling and
Servicing  Agreement.  As a consequence of such  assignments,  the Seller agrees
that  from and after  the  Closing  Date,  upon the  occurrence  of any loss (as
defined in such Shared  Enhancement  Agreement) or any other event which permits
the Seller to make  drawings  on, or  otherwise  have access to, the recourse or
other enhancement provided under such Shared Enhancement Agreement, with respect
to any Lease being sold and contributed to the Transferor hereunder (unless such
Lease has been repurchased or substituted),  the Seller shall pay to the Trustee
(by deposit to the  Collection  Account) from the related  enhancement an amount
equal to such  amount as shall be  available  thereunder.  The Seller  agrees to
apply any such  enhancement  or  protection  as provided in the relevant  Shared
Enhancement  Agreement in the order in which losses or other compensable  events
are  incurred  without  discrimination  against  Leases  sold to the  Transferor
hereunder.  The  Seller  further  agrees  not to amend  any  Shared  Enhancement
Agreement in a manner  adverse to the Transferor or the Trust and to send to the
Trustee a copy of any  amendment to any Shared  Enhancement  Agreement  promptly
following the execution thereof.

ARTICLE 6.  REPURCHASE AND SUBSTITUTION OF LEASES AND EQUIPMENT

     SECTION 6.1    Repurchase of Purchase or Renew Leases; Sales to Replace
Prepaid Leases.

         (a) Seller Repurchase of Required Purchase or Renew Leases.  The Seller
agrees to  Repurchase  any  Required  Purchase  or Renew  Lease and the  related
Equipment  sold by the Seller to the  Transferor if the Obligor  elects to renew
rather than purchase the related  Equipment upon expiration of the original term
of such Required Purchase or Renew Lease.

        (b) Seller  Substitution for Prepaid Leases.  The Seller agrees that if
it has an Eligible  Lease  available  at the time of any  prepayment  of a Lease
pursuant to Section  5.1(b)(iv)  of the Pooling and Servicing  Agreement  (other
than  prepayment in connection with a casualty or the liquidation of a Defaulted
Lease), the Seller will sell to the Transferor, at the option of the Transferor,
for an amount equal to the  Discounted  Present  Value  thereof,  such  Eligible
Lease.  Any such sale shall be subject  to the same  terms and  conditions,  and
occur at the same time, as Substitutions pursuant to Section 6.4(b).
<PAGE>
     SECTION  6.2  Repurchase  or  Substitution  of  Defaulted  Leases.  On  the
Determination Date following the calendar month in which any Lease first becomes
a Defaulted Lease, the Seller may, with the consent of the Transferor, but shall
have no obligation to either (a) Repurchase such Defaulted Lease and the related
Equipment or (b) Substitute a Substitute Lease and related equipment therefor.

     SECTION 6.3  Repurchase or Substitution of Non-conforming Leases; Dilution;
Northern Leases.

         (a)  Non-conforming  Leases.  Upon  discovery  by  the  Seller  or  the
Transferor of a breach of any of the representations or warranties of the Seller
set forth in Section 3.2 that materially and adversely  affects any Lease or the
related  Equipment (as described in Section  7.3(c) of the Pooling and Servicing
Agreement),  the party  discovering such breach shall give prompt written notice
to the other  party.  Unless  within  thirty (30) days  following  the  Seller's
discovery or its receipt of notice of breach, such breach shall have been waived
by the  Transferor  (with the consent of the  Trustee) or cured in all  material
respects the Seller shall  provide a Substitute  Lease and related  equipment in
return for such Lease and the  related  Equipment;  provided  that if the Seller
shall not have an Eligible Lease  available for  Substitution,  the Seller shall
Repurchase the related Lease and Equipment from the Transferor or the Trust. Any
such non-conforming Lease so repurchased or replaced shall not be deemed to be a
Defaulted Lease.

         (b) Dilution.  Upon  discovery by the Seller or the  Transferor  that a
Lease has become  subject to a right or claim of setoff,  counterclaim  or other
defense  or claim by the  Obligor  thereunder  against  any  Person,  the  party
discovering  such event will give prompt  written  notice to the other  parties.
Upon  receipt of such notice,  the Seller will  provide a  Substitute  Lease and
related equipment in return for such Lease and the related  Equipment,  provided
that if the  Seller  shall  not  have  an  Eligible  Lease  available  for  such
Substitution,  then the  Seller  will  Repurchase  such  Lease  and the  related
Equipment  from the  Transferor or the Trust.  Any such Lease so  repurchased or
replaced shall not be deemed to be a Defaulted Lease.

         (c)  Certain  Northern  Leases.  Upon  discovery  by the  Seller or the
Transferor  that an Obligor under a Northern Lease has provided  evidence of its
own insurance and, consequently, will no longer pay Specified Northern Insurance
Premiums under such Northern Lease,  the party  discovering such event will give
prompt  written notice to the other  parties.  Upon receipt of such notice,  the
Seller will provide a Substitute Lease and related  equipment in return for such
Northern Lease and the related Equipment;  provided that if the Seller shall not
have an  Eligible  Lease  available  for  such  Substitution,  the  Seller  will
Repurchase such Northern Lease and the related  Equipment from the Transferor or
the Trust. Any such Lease so repurchased or replaced shall not be deemed to be a
Defaulted Lease.

        (d)  Limitation  of  Remedies.  It is  understood  and agreed  that the
obligation  of the Seller  pursuant  to Section  6.3 to  purchase or replace any
Lease as to which a breach has occurred and is continuing  shall  constitute the
sole remedies against the Seller for such breach available to the Trustee or the
Certificateholders  (except for any indemnities  provided under Section 4.1) for
any losses,  claims,  damages and liabilities arising from the inclusion of such
Lease in the Trust Property.
<PAGE>

     SECTION 6.4       Repurchase or Substitution of Leases.

         (a) Making of  Repurchases.  Any  Repurchase  of a Lease and  Equipment
pursuant  to this  Article  6 shall  be made by the  Seller  by  payment  to the
Transferor,  for the deposit in the Collection Account, of the Repurchase Amount
in such manner as will ensure that the Trustee will have  immediately  available
funds therefor on the  Determination  Date prior to the next succeeding  Payment
Date.

         (b) Making of Substitutions. To the extent that the Seller elects or is
required  to  deliver  a  Substitute  Lease for a Lease  and  related  Equipment
pursuant to this Article 6, such  Substitute  Lease  shall,  on the date of such
Substitution,  (i)  have a  Discounted  Present  Value  at least as great as the
Discounted  Present Value of the Deleted Lease (as calculated  immediately prior
to the event or condition requiring the substitution of the Deleted Lease), (ii)
have Lease  Payments at least equal in amount to and scheduled to be received in
the same  months  as the Lease  Payments  of the  Deleted  Lease,  (iii)  have a
residual  value of the related  Equipment at the  scheduled  termination  of the
Substitute  Lease no less than the Estimated  Residual Value with respect to the
Deleted  Lease and  scheduled  to be received no later than the  residual  value
respecting  the Deleted  Lease,  (iv) in accordance  with the Seller's  standard
credit  evaluation  policies,  be of equal or  better  credit  quality  than the
Deleted  Lease at the time when such  Deleted  Lease  was  originated,  (v) be a
Lease,  with  an  Obligor  and  involving  Equipment  as to  which  each  of the
representations  in Section 3.2 is true as of the date of  Substitution  (and on
the date of Substitution  the Seller shall be deemed to so represent),  (vi) not
result  in the  Discounted  Present  Value of all  Leases  with any one  Obligor
exceeding  1.25% of the Aggregate  Discounted  Present Value on the Payment Date
immediately following such Substitution,  (vii) not be originated by Northern or
Golden  Eagle if the related  Deleted  Lease was not  originated  by Northern or
Golden,  and (viii) not be Required Purchase or Renew Lease or Lease of a Leased
Vehicle  unless,  in each case,  the  Deleted  Lease was of such type.  Upon any
Substitution,  (x) a new Lease  Schedule  shall be prepared by the Seller or the
Servicer  and  delivered  to the  Transferor  and the  Trustee,  indicating  the
Substitution, together with a statement of the Seller that all of the conditions
precedent to such  Substitution  were met; and (y) the parties  shall enter into
such  agreements  as shall be  necessary  to make the new Lease  Schedule a part
hereof and the Seller and Servicer  shall take whatever  action may be necessary
to perfect the  interests of the  Transferor  and the Trustee in the  Substitute
Lease and, if the related  Equipment is located in a Filing  State,  the related
Equipment.  Any  Substitution  made in accordance with the terms hereof shall be
made on or before the next succeeding Determination Date.

         (c) Repurchase Price. Any Lease repurchased  pursuant to this Article 6
shall be at a repurchase  price equal to the sum of (i) the  Discounted  Present
Value for such Lease as of the Payment  Date next  succeeding  the date on which
the  Repurchase  is to be made  plus  (ii) all  Lease  Payments  for such  Lease
scheduled  to  be  received  by  the  Servicer  through  the  Collection  Period
immediately preceding such Payment Date which were not received from the Obligor

     SECTION  6.5  Transfer  Following  Repurchase  or  Substitution.  Upon  any
Repurchase  or  Substitution,  the  Transferor  shall  transfer,  or cause to be
transferred,  to the Seller title to the Lease and Equipment so  Repurchased  or
Substituted.

     SECTION 6.6 Limitation on Substitutions.  The Aggregate  Discounted Present
Value of all Defaulted Leases  Repurchased by the Seller or for which the Seller
Substitutes  other  Leases  pursuant  to  Section  6.2  (but not  Section  6.3),
determined  for each such  Defaulted  Lease as of the Payment  Date  immediately
following such Repurchase or  Substitution,  shall not exceed 10% of the Initial
Aggregate  Discounted  Present Value. The Aggregate  Discounted Present Value of
all Leases for which the Seller  Substitutes  other Leases,  determined for each
such  Substitute  Lease  as of  the  Payment  Date  immediately  following  such
Substitution,  shall not exceed 30% of the Initial Aggregate  Discounted Present
Value.
<PAGE>
ARTICLE 7.  NOTICES

     SECTION 7.1 Notices.

          (a) Any request, demand,  authorization,  direction, notice, consent,
waiver, or document  provided or  permitted by this  Agreement  to be made upon,
given or furnished to, or filed with, the Trustee, the Transferor, the Servicer,
the  Insurer  or  each Rating  Agency  shall  be sufficient  for  every  purpose
hereunder if in writing,  telecopied, mailed, by registered mail (return receipt
requested), hand  delivered  or sent by  courier. Unless  otherwise specifically
provided  herein, no such request,  demand,  authorization,  direction,  notice,
consent, waiver, or document shall be effective until received and any provision
hereof requiring  the  making,  giving, furnishing, or filing of the same on any
date shall be  interpreted  as  requiring  the same to be sent or  delivered  in
such fashion that it will be received on such date.  Any  such  request, demand,
authorization,  direction, notice, consent, waiver, or document shall be sent or
delivered to the following addresses:

                  (i)  If to the Seller, at 303 East Wacker Drive, Suite 1000,
         Chicago, IL 60601, Attention: Chief Financial Officer; Telecopier:(312)
         938-4290.

                  (ii) All notices,  demands or communications to the Transferor
         shall be at the following  address:  303 East Wacker Drive, Suite 1000,
         Chicago, IL 60601 Attention: Chief Financial Officer; Telecopier: (312)
         938-4290.

         (b) Any party may alter the  address to which communications  are to be
sent  by  giving  notice  of  such chang  of  address  in  conformity  with  the
provisions of this  Section  7.1  for  giving  notice and by otherwise complying
with  any applicable terms of this Agreement.

ARTICLE 8.  TERMINATION

     SECTION 8.1 Termination. The respective obligations and responsibilities of
the Seller and the Transferor created by this Agreement shall terminate upon the
termination of the Pooling and Servicing Agreement.

     SECTION 8.2 Effect of  Termination.  No termination or rejection or failure
to assume the executory  obligations  of this Agreement in the bankruptcy of the
Seller or the  Transferor  shall be deemed to impair or affect the  obligations,
including  breaches  of  representations  and  warranties  by the  Seller or the
Transferor  prior to the  termination of this  Agreement.  Without  limiting the
foregoing,  prior to  termination,  neither  the  failure of the Seller to pay a
Repurchase  Amount or deliver a Substitute  Lease shall render such  transfer or
obligation executory, nor shall the carrying out of the continuing duties of the
parties  pursuant to Articles 3 and 4 or Section 9.6 of this Agreement render an
executed sale executory.

ARTICLE 9.  MISCELLANEOUS PROVISIONS

     SECTION 9.1       Amendment.

         (a) Amendments.  This Agreement may be amended from time to time by the
Seller and the Transferor,  with the consent of the Trustee and the Insurer, and
the  Trustee's  consent  to any  amendment  of this  Agreement  shall  be at the
direction of the Requisite Holders. In addition,  notwithstanding the foregoing,
the Trustee may consent to any amendment to this Agreement,  without the consent
of any Holder,  (i) to cure any  ambiguity  in this  Agreement  or any  conflict
between the terms of this Agreement, the Pooling and Servicing Agreement and any
Related Document,  (ii) to correct or supplement any provision herein or therein
that may be  defective  or  inconsistent  with any  other  provision  herein  or
therein,  (iii) to add to the  covenants,  restrictions  or  obligations  of the
Servicer,  the Trust, the Trustee,  the Insurer or the Transferor,  and (iv) for
any other  purpose,  provided,  however,  that  with  respect  to any  amendment
pursuant  to  this  clause  (iv),  (x)  the  Transferor  delivers  an  Officers'
Certificate  to the Trustee to the effect that such amendment will not adversely
affect in any  material  respect  the  interest  of the  Holders  of the Class A
Certificates,  the Class B-1 Certificates or the Class B-2 Certificates, and (y)
each Rating Agency shall have provided written  confirmation that such amendment
will  not  result  in a  withdrawal  or  reduction  of the  then  rating  of any
Outstanding Class A Certificates,  any Outstanding Class B-1 Certificates or any
Outstanding Class B-2 Certificates. The Trustee is entitled to obtain an Opinion
of Counsel to the  effect set forth in clause (x) of the  immediately  preceding
sentence as a condition to the effectiveness of any amendment proposed to become
effective pursuant to clause (iv) of such preceding sentence.

         (b) Notice of  Amendments.  Promptly  after the  execution  of any such
amendment, the Transferor shall furnish, or cause the Trustee to furnish, either
a copy of such amendment or notice of the substance of such amendment  (prepared
by the  Transferor)  to the  Insurer,  each  Certificateholder  and each  Rating
Agency.
<PAGE>

     SECTION 9.2 Governing Law. This Agreement and any amendment hereof pursuant
to  Section  9.1 shall be  construed  in  accordance  with and  governed  by the
substantive  laws of the  State of  Illinois  (without  regard  to choice of law
principles)  applicable to agreements  made and to be performed  therein and the
obligations,  rights,  and remedies of the parties under this Agreement shall be
determined in accordance with such laws.

     SECTION 9.3 Transfer of Assets to Trust.  The Seller  understands  that the
Transferor  intends to transfer the Leases,  the related Lease  Receivables  and
Equipment  and its rights  under this  Agreement  to the Trust  pursuant  to the
Pooling and Servicing  Agreement and hereby consents to the assignment of all or
any portion of this Agreement by the Transferor to the Trust.  The Seller agrees
that the Trustee may exercise the rights of the  Transferor  hereunder and shall
be entitled to all of the  benefits of the  Transferor  hereunder  to the extent
provided for in the Pooling and Servicing Agreement.

     SECTION  9.4  Severability  of  Provisions.  If  any  one  or  more  of the
covenants,  agreements,  provisions,  or terms of this  Agreement  shall for any
reason whatsoever be held invalid, then such covenants, agreements,  provisions,
or terms  shall be deemed  severed  from the  remaining  covenants,  agreements,
provisions,  or terms of this  Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement.

     SECTION 9.5 Assignment.  Notwithstanding anything to the contrary contained
in this Agreement,  this Agreement may not be assigned by the Seller,  except as
provided  in  Section  4.1(b)(ii),  without  the prior  written  consent  of the
Transferor  and the  Trustee  and,  except as  provided  in  Section  9.3,  this
Agreement  may not be  assigned  by the  Transferor  without  the prior  written
consent of the Seller.

     SECTION 9.6 Further  Assurances.  The Seller agrees to do such further acts
and things and to execute  and  deliver  to the  Transferor  (or the  Trustee as
assignee of the Transferor) such additional assignments,  agreements, powers and
instruments as are required by the Transferor (or the Trustee, as applicable) to
carry into effect the purposes of this Agreement or to better assure and confirm
unto the  Transferor  (or the Trustee,  as  applicable)  the rights,  powers and
remedies hereunder.

     SECTION 9.7 No Waiver;  Cumulative Remedies.  No failure to exercise and no
delay in  exercising,  on the part of the  Transferor or the Seller,  any right,
remedy,  power or privilege  hereunder,  shall operate as a waiver thereof;  nor
shall any single or partial  exercise of any right,  remedy,  power or privilege
hereunder  preclude any other or further  exercise hereof or the exercise of any
other  right,  remedy,  power or  privilege.  The rights,  remedies,  powers and
privileges  herein  provided are  cumulative  and not  exhaustive of any rights,
remedies, powers and privileges provided by law.

     SECTION 9.8  Counterparts.  This  Agreement  may be executed in two or more
counterparts (and by different parties on separate counterparts),  each of which
shall  be an  original,  but all of  which  shall  constitute  one and the  same
instrument.


     SECTION 9.9 Binding Effect; Third-Party Beneficiaries.  This Agreement will
inure to the  benefit  of and be  binding  upon the  parties  hereto  and  their
respective successors and permitted assigns (including the Trust).

     SECTION 9.10 Merger and  Integration.  This Agreement sets forth the entire
understanding  of the parties  relating to the subject  matter  hereof,  and all
prior  understandings,  written or oral, are superseded by this Agreement.  This
Agreement  may not be  modified,  amended,  waived  or  supplemented  except  as
provided herein.

     SECTION  9.11  True  Sale.  It is the  intention  of  the  Seller  and  the
Transferor  that  each of the  transfer  of the  Leases  and the  related  Lease
Receivables  and  Equipment  hereunder  and the  transfer  of the Leases and the
related Lease  Receivables and Equipment from LINC  Receivables 1999 Corporation
to the Seller  immediately  prior to the transfer  hereunder  constitutes a true
sale and  contribution  or  distribution  of such  assets  conveying  good title
thereto, free and clear of all Liens, from the Seller to the Transferor and from
LINC  Receivables  1999  Corporation to the Seller,  respectively,  and that the
Leases  and the  related  Lease  Receivables  and  Equipment  not be part of the
Seller's  estate in the event of the  insolvency  or bankruptcy of the Seller or
part of LINC Receivable 1999 Corporation's estate in the event of the insolvency
or bankruptcy of LINC Receivables 1999 Corporation.  However, in the event that,
notwithstanding the intent of the Seller and the Transferor,  any Leases and the
related Lease  Receivables and Equipment are held to be property of the Seller's
estate,  or if for any  reason  this  Agreement  is held or  deemed  to create a
security  interest in such assets,  then (x) this Agreement shall also be deemed
to be a security  agreement  within the  meaning of Article 9 of the UCC and (y)
each sale or  contribution  provided  for in  Section  2.1 or Article 6 shall be
deemed to be a grant (or a complete and present assignment) by the Seller to the
Transferor of a valid first  priority  security  interest in all of the Seller's
right, title and interest in and to the Leases and the related Lease Receivables
and Equipment and proceeds thereof.
                            [Signature Pages Follow]
<PAGE>


     IN WITNESS  WHEREOF,  the Seller and the  Transferor  have caused this Sale
Agreement  to be duly  executed by their  respective  officers as of the day and
year first above written.
                                            LINC CAPITAL, INC.


                                            By:/s/ Marion Silverman
                                               --------------------
                                            Name: Marion Silverman
                                            Title: Vice President


                                            LINC EQUIPMENT RECEIVABLES
                                            ONE, LLC


                                            By:/s/ Marion Silverman
                                               --------------------
                                            Name: Marion Silverman
                                            Title:Vice President