UNDERWRITING AGREEMENT

FRANKLIN AUTO TRUST 2006-1

$65,000,000 5.36% CLASS A-1 ASSET-BACKED NOTES

$96,000,000 5.20% CLASS A-2 ASSET-BACKED NOTES

$93,000,000 5.04% CLASS A-3 ASSET-BACKED NOTES

$61,950,000 5.03% CLASS A-4 ASSET-BACKED NOTES

$22,187,000 5.14% CLASS B ASSET-BACKED NOTES

$16,863,000 5.41% CLASS C ASSET-BACKED NOTES

FRANKLIN RECEIVABLES LLC

(DEPOSITOR)

UNDERWRITING AGREEMENT

October 4, 2006

Deutsche Bank Securities Inc.

60 Wall Street
New York, New York 10005

Citigroup Global Markets Inc.

390 Greenwich Street, 6 ^th Floor

New York, New York 10013

Ladies and Gentlemen:

1.

Introductory .  Franklin Receivables LLC (the “Depositor”) has previously filed a registration statement with the Securities and Exchange Commission (the “Commission”) relating to the issuance and sale from time to time of up to $2,000,000,000 of asset-backed notes and/or asset-backed certificates and proposes to cause Franklin Auto Trust 2006-1 (the “Trust”) to issue and sell to Deutsche Bank Securities Inc. and Citigroup Global Markets Inc. (the “Underwriters”) $65,000,000 principal amount of its 5.36% Class A-1 Asset-Backed Notes (the “Class A-1 Notes”), $96,000,000 principal amount of its 5.20% Class A-2 Asset-Backed Notes (the “Class A-2 Notes”), $93,000,000 principal amount of its 5.04% Class A-3 Asset-Backed Notes (the “Class A-3 Notes”), $61,950,000 principal amount of its 5.03% Class A-4 Asset-Backed Notes (the “Class A-4 Notes”), $22,187,000 principal amount of its 5.14% Class B Asset-Backed Notes (the “Class B Notes”), and $16,863,000 principal amount of its 5.41% Class C Asset-Backed Notes (the “Class C Notes” and together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes, the “Notes”).  The Trust will also issue Certificates (the “Certificates” and together with the Notes, the “Securities”) which will be retained by the Depositor.  The assets of the Trust will include, among other things, a pool of prime, non-prime and sub-prime motor vehicle retail installment sale contracts (the “Receivables”) secured by new and used automobiles and light trucks financed thereby (the “Financed Vehicles”), and certain monies received thereunder on or after September 1, 2006 (the “Cutoff Date”) and the other property and the proceeds thereof to be conveyed to the Trust pursuant to the Sale and Servicing Agreement to be dated as of September 1, 2006 (the “Sale and Servicing Agreement”) among the Trust, the Depositor, Franklin Capital Corporation (“Franklin Capital”) in its individual capacity, and as servicer (the “Servicer”), and Franklin Resources, Inc. (“Franklin Resources”).  Pursuant to the Sale and Servicing Agreement, the Depositor will sell the Receivables to the Trust and the Servicer will service the Receivables on behalf of the Trust.  In addition, pursuant to the Sale and Servicing Agreement, the Servicer will agree to perform certain administrative tasks on behalf of the Trust imposed on the Trust under the Indenture.  The Notes will be issued pursuant to the Indenture to be dated as of September 1, 2006 (the “Indenture”), between the Trust and Citibank, N.A., as indenture trustee and as indenture collateral agent (the “Indenture Trustee“ and the “Indenture Collateral Agent,” respectively). The Depositor will form the Trust pursuant to a Trust Agreement dated as of October 4, 2006 (the “Short-Form Trust Agreement”), as amended and restated by the Amended and Restated Trust Agreement to be dated as of October 10, 2006 (the “Amended and Restated Trust Agreement” and together with the Short-Form Trust Agreement, the “Trust Agreement”) between the Depositor and Deutsche Bank Trust Company Delaware, as owner trustee (the “Owner Trustee”).  The Certificates, each representing a fractional undivided equity interest in the Trust, will be issued pursuant to the Trust Agreement.

The Receivables were or will be originated or acquired by Franklin Capital.  Franklin Capital will sell the Receivables owned by it, and Franklin SPE LLC, a Delaware limited liability company, will sell the Receivables owned by it, to the Depositor pursuant to the terms of the Purchase Agreement dated as of September 1, 2006 (the “Purchase Agreement”) among the Depositor, Franklin Capital (a “Seller”) and Franklin SPE LLC (a “Seller” and together with Franklin Capital, the “Sellers”).

Capitalized terms used and not otherwise defined herein shall have the meanings given them in the Sale and Servicing Agreement.  As used herein, the term “Basic Documents” refers to the Sale and Servicing Agreement, Indenture, Trust Agreement, Purchase Agreement, the letter agreement in the form of Exhibit A hereto (the “Letter Agreement”), Letter of Credit, Letter of Credit Reimbursement Agreement and Note Depository Agreement.

At or prior to the time when sales to purchasers of the Notes were first made to investors by the Underwriters, which was approximately 1:46 p.m. EST on October 4, 2006 (the “Time of Sale”), the Depositor had prepared the following information (collectively, the “Time of Sale Information”): the preliminary prospectus supplement dated September 22, 2006 (the “Preliminary Prospectus Supplement”) to the base prospectus dated September 22, 2006 (the “Preliminary Base Prospectus”) (together with information referred to under the caption “Appendix A—Static Pools” therein regardless of whether it is deemed a part of the Registration Statement or Prospectus, the “Preliminary Prospectus”).  If, subsequent to the Time of Sale and prior to the Closing Date, such information included an untrue statement of material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and as a result investors in the Notes may terminate their prior “Contracts of Sale” (within the meaning of Rule 159 under the Securities Act of 1933, as amended (the “Act”)) for any Notes and the Underwriters enter into new Contracts of Sale with investors in the Notes, then “Time of Sale Information” will refer to the information conveyed to investors at the time of entry into the first such new Contract of Sale, in an amended Preliminary Prospectus approved by the Depositor and the Underwriters that corrects such material misstatements or omissions (a “Corrected Prospectus”) and “Time of Sale” will refer to the time and date on which such new Contracts of Sale were entered into.

2.

Representations and Warranties of the Depositor and Franklin Capital .  Each of the Depositor and Franklin Capital jointly and severally represents and warrants to and agrees with the Underwriters that:

(a)

A registration statement on Form S-3 (No. 333-134782), including a prospectus, relating to the Notes has been filed with the Commission and has become effective and is still effective as of the date hereof under the Act.  The Depositor proposes to file with the Commission pursuant to Rule 424(b) of the rules and regulations of the Commission under the Act (the “Rules and Regulations”) a prospectus supplement dated October 4, 2006 (together with information referred to under the caption “Appendix A—Static Pools” therein regardless of whether it is deemed a part of the Registration Statement or Prospectus, the “Prospectus Supplement”) to the prospectus dated September 22, 2006 (the “Base Prospectus”), related to the Notes and the method of distribution thereof.  Such registration statement, including exhibits thereto, and such Base Prospectus, as amended as of the date of the Agreement, and as further supplemented by the Prospectus Supplement, are hereinafter referred to as the “Registration Statement” and the “Prospectus,” respectively.  Any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Base Prospectus or the Prospectus Supplement shall include, without limitation, any document filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Base Prospectus and the Prospectus Supplement, as the case may be, deemed to be incorporated therein pursuant to the Act.

The conditions to the use of a registration statement on Form S-3 under the Act have been satisfied.  The Depositor has filed the Preliminary Prospectus and it has done so within the applicable period of time required under the Act and the Rules and Regulations.  

(b)

The Registration Statement, at the time it became effective, any post-effective amendment thereto, the Preliminary Prospectus, as of its date, and the Prospectus, as of the date of the Prospectus Supplement, complied and on the Closing Date will comply in all material respects with the requirements of the Act and the Rules and Regulations and the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), and the rules and regulations of the Commission thereunder.  The Registration Statement, as of the applicable effective date as to each part of the Registration Statement and any amendment thereto pursuant to Rule 430B(f)(2), did not include any untrue statement of a material fact and did not omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.  The Prospectus, as of the date of the Prospectus Supplement and as of the Closing Date, does not and will not contain an untrue statement of a material fact and did not and will not omit to state any material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The representations and warranties in the two preceding sentences do not apply to statements in or omissions from such documents based upon written information furnished to the Depositor by the Underwriters specifically for use therein, it being understood that such information consists of the Underwriters’ Information (as defined in Section 7(f)) only.

(c)

The Notes are “asset backed securities” within the meaning of, and satisfy the requirements for use of, Form S-3 under the Act.

(d)

The computer tape of the Receivables created as of September 1, 2006 and made available to the Underwriters by the Servicer, was complete and accurate in all material respects as of the date thereof and includes a description of the Receivables that are described in the Schedule attached to the Purchase Agreement.

(e)

The Time of Sale Information, at the Time of Sale, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Depositor makes no representation and warranty with respect to statements in or omissions from such documents based upon written information furnished to the Depositor by the Underwriters specifically for use therein, it being understood that such information consists of the Underwriters’ Information (as defined in Section 7(f)) only.  As of the Time of Sale, the Depositor was not and as of the Closing Date is not, an “ineligible issuer,” as defined in Rule 405 under the Act.

(f)

The documents incorporated by reference in the Registration Statement, the Preliminary Prospectus and Prospectus, at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the Act or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as applicable, and the rules and regulations of the Commission thereunder; and any further documents so filed and incorporated by reference in the Registration Statement or the Prospectus, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder.

(g)

Each of the Depositor, Franklin SPE LLC, Franklin Capital and Franklin Resources is a corporation or limited liability company, as applicable, duly organized, validly existing and in good standing under the laws of its respective state of incorporation or formation, as applicable, is duly qualified to transact business as a foreign corporation or limited liability company, as applicable, in each jurisdiction in which it is required to be so qualified and has all necessary licenses, permits and consents to conduct its business as presently conducted and as described in the Prospectus and to perform its obligations under the Basic Documents.

(h)

This Agreement and each of the Basic Documents to which it is a party has been duly authorized, executed and delivered by the Depositor, Franklin SPE LLC, Franklin Capital and Franklin Resources, constitutes a valid and binding agreement of each of the Depositor, Franklin SPE LLC, Franklin Capital and Franklin Resources, enforceable against the Depositor, Franklin SPE LLC, Franklin Capital and Franklin Resources in accordance with its terms, subject as to the enforcement of remedies (x) to applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors’ rights generally, (y) to general principles of equity (regardless of and whether the enforcement of such remedies is considered in a proceeding in equity or at law) and (z) with respect to rights of indemnity under this Agreement, the Letter Agreement and the Indemnification Agreement, to limitations of public policy under applicable securities laws.

(i)

None of the Depositor, Franklin SPE LLC, Franklin Capital or Franklin Resources is in breach or violation of any credit or security agreement or other agreement or instrument to which it is a party or by which it or its properties may be bound, or in violation of any applicable law, statute, regulation or ordinance or any governmental body having jurisdiction over it, which breach or violation would have a material and adverse effect on its ability to perform its obligations under this Agreement or any of the Basic Documents, in each case, to which it is a party.

(j)

Other than as contemplated by this Agreement or as disclosed in the Prospectus, there is no broker, finder or other party that is entitled to receive from the Depositor, Franklin Capital or any affiliate thereof or the Underwriters, any brokerage or finder’s fee or other fee or commission as a result of any of the transactions contemplated by this Agreement.

(k)

None of Franklin Capital, Franklin Resources or the Depositor has entered into, nor will it enter into, any contractual arrangement with respect to the distribution of the Notes, except for this Agreement.

(l)

The Trust is not an “investment company” and is not required to be registered as an “investment company,” as such term is defined in the Investment Company Act of 1940, as amended (the “Investment Company Act”).

(m)

As of the Closing Date (as defined below), the representations and warranties of the Depositor, Franklin SPE LLC, Franklin Capital and Franklin Resources, in each of its capacities under each of the Basic Documents to which it is a party, will be true and correct in all material respects and each such representation and warranty is so incorporated herein by this reference.

(n)

On or before the Closing Date, the Basic Documents will have been duly authorized, executed and delivered by each of the parties thereto.

(o)

The Certificates, when duly and validly executed by the Owner Trustee, authenticated and delivered in accordance with the Trust Agreement, and delivered to and paid for pursuant hereto will be validly issued and outstanding and entitled to the benefits of the Trust Agreement.

(p)

The Trust’s assignment of the Collateral to the Indenture Collateral Agent pursuant to the Indenture will vest in the Indenture Collateral Agent, for the benefit of the Noteholders, a first priority perfected security interest therein, subject to no other outstanding Lien.

(q)

The Notes, when duly and validly executed by the Indenture Trustee, authenticated and delivered in accordance with the Indenture, and delivered and paid for pursuant hereto will be enforceable in accordance with their terms, subject as to enforceability to the effects of applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and similar laws now or hereafter in effect relating to creditors’ rights generally and subject to general principles of equity (whether in a proceeding at law or in equity).

(r)

Neither the execution, delivery or performance of any of the Basic Documents by the Depositor, Franklin SPE LLC, or Franklin Capital, nor the issuance, sale and delivery of the Notes or Certificates, nor the fulfillment of the terms of the Notes or Certificates, will conflict with, or result in a breach, violation or acceleration of, or constitute a default under, any term or provision of the organizational documents of the Depositor, Franklin SPE LLC, or Franklin Capital, any material indenture or other material agreement or instrument to which the Depositor, Franklin SPE LLC, or Franklin Capital is a party or by which either of them or their properties is bound or result in a violation of or contravene the terms of any statute, order or regulation applicable to the Depositor, Franklin SPE LLC, or Franklin Capital of any court, regulatory body, administrative agency, governmental body or arbitrator having jurisdiction over the Depositor, Franklin SPE LLC, or Franklin Capital, or will result in the creation of any lien upon any material property or assets of the Depositor, Franklin SPE LLC, or Franklin Capital (other than pursuant to the Basic Documents).

(s)

There are no legal or governmental proceedings pending to which the Depositor, Franklin SPE LLC, Franklin Capital or Franklin Resources is a party or of which any of its properties is the subject, which if determined adversely to the Depositor, Franklin SPE LLC, Franklin Capital or Franklin Resources would individually or in the aggregate have a material adverse effect on the financial position, shareholders’ equity or results of operations of any of them; and to the best of the Depositor’s, Franklin SPE LLC’s, Franklin Capital’s or Franklin Resources’ knowledge, no such proceedings are threatened or contemplated by governmental authorities or others.

(t)

No consent, license, approval, authorization or order of or declaration or filing with any governmental authority is required for the issuance of the Notes and Certificates or sale of the Notes or the consummation of the other transactions contemplated by this Agreement or the Basic Documents, except such as have been duly made or obtained.

(u)

Since the respective dates as of which information is given in the Registration Statement, the Preliminary Prospectus and the Prospectus, there has not been any material adverse change, or any development which could reasonably be expected to result in a material adverse change, in or affecting the financial position, shareholders’ equity or results of operations of the Depositor, Franklin SPE LLC, Franklin Capital or Franklin Resources, or the Depositor’s, Franklin SPE LLC’s, Franklin Capital’s or Franklin Resources’ ability to perform its obligations under this Agreement or any of the Basic Documents to which it is a party.

(v)

Any taxes, fees and other governmental charges due on or prior to the Closing Date (including, without limitation, sales taxes) in connection with the execution, delivery and issuance of this Agreement, the Basic Documents and the Securities have been or will have been paid at or prior to the Closing Date.

(w)

The Receivables transferred by Franklin Capital and Franklin SPE LLC to the Depositor are tangible chattel paper as defined in the Uniform Commercial Code as in effect in the State of Utah.  The Receivables transferred by the Depositor to the Trust are tangible chattel paper as defined in the Uniform Commercial Code as in effect in the States of Delaware and Utah.

(x)

Under generally accepted accounting principles, (i) each of Franklin Capital and Franklin SPE LLC will report its transfer of the Receivables transferred by it to the Depositor pursuant to the Purchase Agreement and (ii) the Depositor will report its transfer of the Receivables to the Indenture Trustee pursuant to the Sale and Servicing Agreement as a sale of the Receivables for financial accounting purposes.

(y)

Immediately prior to the transfer of the Receivables to the Depositor pursuant to the Purchase Agreement, each of Franklin Capital and Franklin SPE LLC was the sole owner of all right, title and interest in, and had good and marketable title to the Receivables and the other property to be transferred to the Depositor by it.  Each of Franklin Capital and Franklin SPE LLC, pursuant to the Purchase Agreement, is transferring to the Depositor ownership of the Receivables, the security interest in the Financed Vehicles securing the Receivables and the proceeds of each of the foregoing, and, immediately prior to the transfer thereof to the Trust, the Depositor will be the sole owner of all right, title and interest in, and will have good and marketable title to, the Receivables and the other property to be transferred by it to the Trust pursuant to the Sale and Servicing Agreement.  The assignment of the Receivables, all documents and instruments relating thereto and all proceeds thereof to the Trust pursuant to the Sale and Servicing Agreement vests in the Trust all interests which are purported to be conveyed thereby, free and clear of any liens, security interests or encumbrances.

(z)

Immediately prior to the transfer of the Receivables to the Depositor, each seller’s interest in the Receivables and the proceeds thereof shall be perfected upon the filing of UCC-1 financing statements (the “Financing Statements”) in the offices specified in Schedule I for each Seller and there shall be no unreleased statements affecting the Receivables filed in such offices other than the Financing Statements.  If a court concludes that the transfer of the Receivables from a Seller to the Depositor is a sale, the interest of the Depositor in the Receivables and the proceeds thereof will be perfected upon the filing of the Financing Statements in the offices specified in Schedule I for such Seller.  If a court concludes that such transfer is not a sale, the Purchase Agreement and the transactions contemplated thereby constitute a grant by such Seller to the Depositor of a valid security interest in the Receivables and the proceeds thereof, which security interest will be perfected upon the filing of the Financing Statements in the offices specified in Schedule I for such Seller.  No filing or other action, other than the filing of the Financing Statements in the offices specified in Schedule I for such Seller, is necessary to perfect and maintain the interest or the security interest of the Depositor in the Receivables and the proceeds thereof against third parties.

(aa)

Immediately prior to the transfer of the Receivables to the Trust pursuant to the Sale and Servicing Agreement, the Depositor’s interest in the Receivables and the proceeds thereof shall be perfected upon the filing of the Financing Statements in the offices specified in Schedule I for Franklin Capital and there shall be no unreleased statements affecting the Receivables filed in such offices other than the Financing Statements.  If a court concludes that the transfer of the Receivables from the Depositor to the Trust is a sale, the interest of the Trust in the Receivables and the proceeds thereof will be perfected upon the filing of the Financing Statements in the offices specified in Schedule I for the Depositor.  If a court concludes that such transfer is not a sale, the Sale and Servicing Agreement and the transactions contemplated thereby constitute a grant by the Depositor to the Trust of a valid security interest in the Receivables and the proceeds thereof, which security interest will be perfected upon the filing of the Financing Statements in the offices specified in Schedule I for the Depositor.  No filing or other action, other than the filing of the Financing Statements in the offices specified in Schedule I for the Depositor and Franklin Capital referred to above and any related continuation statements, is necessary to perfect and maintain the interest or the security interest of the Trust in the Receivables and the proceeds thereof against third parties.

(bb)

The Trust Agreement need not be qualified under the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”).

(cc)

The Indenture has been qualified under the Trust Indenture Act.

(dd)

As of the Closing Date, each of the respective representations and warranties of the Depositor, Franklin SPE LLC, and Franklin Capital set forth in the Basic Documents will be true and correct, and the Underwriters may rely on such representations and warranties as if they were set forth herein in full.

3.

Purchase, Sale and Delivery of the Notes .  On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Depositor agrees to cause the Trust to sell to each Underwriter, and each Underwriter severally agrees to purchase from the Trust, the principal amount of each class of Notes set forth on Schedule II hereto at a purchase price equal to “Price $” as specified on Schedule II hereto.

The Depositor will deliver the Notes to the Underwriters, against payment of the purchase price to or upon the order of the Depositor by wire transfer or check in Federal (same day) Funds, at the office of McKee Nelson LLP, One Battery Park Plaza, New York, NY 10004, at 10:00 a.m., New York time on October 10, 2006, or at such other time not later than seven full business days thereafter as the Underwriters and the Depositor determine, such time being herein referred to as the “Closing Date.”  The Notes to be so delivered will be initially represented by one or more Notes registered in the name of Cede & Co., the nominee of The Depository Trust Company (“DTC”).  The interests of beneficial owners of the Notes will be represented by book entries on the records of DTC and participating members thereof.  Definitive Notes will be available only under the limited circumstances specified in the Basic Documents.

4.

Offering by Underwriters .  It is understood that, the Underwriters proposes to offer the Notes for sale to the public (which may include selected dealers), on the terms set forth in the Prospectus.  

5.

Covenants of the Depositor and Franklin Capital .  Each of the Depositor and Franklin Capital, jointly and severally, covenants and agrees with the Underwriters that:

(a)

The Depositor will file the Prospectus, properly completed, with the Commission pursuant to and in accordance with subparagraph (2) (or, if applicable and if consented to by the Underwriters, subparagraph (5)) of Rule 424(b) no later than the second business day following the date it is first used.  The Depositor and Franklin Capital will advise the Underwriters promptly of any such filing pursuant to Rule 424(b).  

(b)

The Depositor and Franklin Capital will advise the Underwriters promptly of any proposal to amend or supplement the Registration Statement, the Preliminary Prospectus or the Prospectus and will not effect such amendment or supplement without the prior written consent of the Underwriters, which consent shall not be unreasonably withheld or delayed; and the Depositor and Franklin Capital will advise the Underwriters promptly of any amendment of, or supplement to, of the Registration Statement or the Prospectus and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued.  

(c)

If, at any time when a prospectus relating to the Notes is required to be delivered by the Underwriters or dealer either (i) any event occurs as a result of which the Prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made not misleading, or (ii) for any other reason it shall be necessary to amend or supplement the Prospectus to comply with the Act, the Depositor and Franklin Capital promptly will notify the Underwriters of such event and promptly will prepare, at their own expense, an amendment or supplement which will correct such statement or omission.  Neither the Underwriters’ consent to, nor the Underwriters’ distribution of any amendment or supplement to the Prospectus shall constitute a waiver of, or limitation on, any right of the Underwriters hereunder.

(d)

The Depositor and Franklin Capital will furnish to the Underwriters copies of the Preliminary Prospectus, the Prospectus, the Registration Statement and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Underwriters reasonably request.

(e)

The Depositor and Franklin Capital will comply with the Act and the Rules and Regulations, the Exchange Act and the rules and regulations thereunder and the Trust Indenture Act and the rules and regulations thereunder so as to permit the completion of the distribution of the Notes as contemplated in this Agreement, the Basic Documents, the Registration Statement and the Prospectus.  

(f)

The Depositor and Franklin Capital will take all actions that are reasonably necessary to arrange for the qualification of the Notes for offering and sale under the laws of such jurisdictions as the Underwriters designates and will maintain such qualifications in effect so long as required under such laws for the distribution of the Notes; provided , however , that in no event shall the Depositor be obligated to qualify as a foreign corporation or to execute a general or unlimited consent to service of process in any such jurisdiction.  The Depositor and Franklin Capital will promptly advise the Underwriters of the receipt by the Depositor or Franklin Capital of any notification with respect to the suspension of the qualification of the Notes for offer or sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose.

(g)

On or prior to the Closing Date, the Depositor and Franklin Capital shall enter into, and shall cause the Trust to enter into, each Basic Document to which any of the Depositor, Franklin Capital or the Trust are contemplated to be a party pursuant to this Agreement or any Basic Document.

(h)

The Depositor and Franklin Capital shall furnish or make available to the Underwriters or their counsel such additional documents and information regarding the Depositor and Franklin Capital and their respective affairs as the Underwriters may from time to time reasonably request, including any and all documentation reasonably requested in connection with its due diligence efforts regarding information in the Registration Statement and the Prospectus and in order to evidence the accuracy or completeness of any of the conditions contained in this Agreement; and all actions taken by the Depositor to authorize the sale of the Notes shall be reasonably satisfactory in form and substance to the Underwriters,

(i)

The Depositor and Franklin Capital shall, at all times upon request of the Underwriters or their advisors, or both, from the date hereof through the Closing Date, (i) make available to the Underwriters or their advisors, or both, prior to acceptance of its purchase, such information (in addition to that contained in the Registration Statement and the Prospectus) concerning the offering, the Depositor and any other relevant matters as they possess or can acquire without unreasonable effort or expense and (ii) provide the Underwriters or their advisors, or both, prior to acceptance of its subscription, the opportunity to ask questions of, and receive answers from, the Depositor and Franklin Capital with respect to such matters.

(j)

The Depositor and Franklin Capital shall cause the Trust to make generally available to Noteholders, as soon as practicable, but no later than sixteen months after the date hereof, an earnings statement of the Trust covering a period of at least twelve consecutive months beginning after the later of (i) the effective date of the Registration Statement relating to the Notes and (ii) the effective date of the most recent post-effective amendment to the Registration Statement to become effective prior to the date of this Agreement and, in each case, satisfying the provisions of Section 11(a) of the Act (including Rule 158 promulgated thereunder).

(k)

Until the retirement of the Notes, the Depositor will deliver to the Underwriters the annual statements of compliance and the annual independent certified public accountants’ reports furnished to the Indenture Trustee or the Owner Trustee pursuant to the Basic Documents, as soon as such statements and reports are furnished to the Indenture Trustee or the Owner Trustee.

(l)

So long as any of the Notes are outstanding, the Depositor will furnish to the Underwriters (i) as soon as practicable after the end of the fiscal year all documents required to be distributed to Noteholders or filed with the Commission on behalf of the Trust pursuant to the Exchange Act, or any order of the Commission thereunder and (ii) from time to time, any other information concerning the Depositor or Franklin Capital as the Underwriters may reasonably request only insofar as such information reasonably relates to the Registration Statement or the Prospectus or the transactions contemplated by the Basic Documents.

(m)

On or before the Closing Date, the Depositor and Franklin Capital shall cause the computer records of the Depositor and Franklin Capital relating to the Receivables to show the absolute ownership by the Owner Trustee on behalf of the Trust of the Receivables, and from and after the Closing Date neither the Depositor nor Franklin Capital shall take any action inconsistent with the ownership by the Owner Trustee on behalf of the Trust of such Receivables, other than as permitted by the Sale and Servicing Agreement.

(n)

To the extent, if any, that any of the ratings provided with respect to the Notes by the rating agency or agencies that initially rate any of the Notes are conditional upon the furnishing of documents or the taking of any other actions by the Depositor or Franklin Capital on or prior to the Closing Date, one of the Depositor or Franklin Capital shall furnish such documents and take any such other actions.  A copy of any such document shall be provided to the Underwriters at the time it is delivered to the rating agencies.

(o)

Franklin Capital will pay all expenses incident to the performance of its obligations under this Agreement, including (i) the printing and filing of the documents (including the Registration Statement and the Prospectus), (ii) the preparation, issuance and delivery of the Notes to the Underwriters, (iii) the fees and disbursements of Franklin Capital’s, the Depositor’s and Franklin Resources’ counsel (including without limitation, local counsel in the State of Utah) and accountants, (iv) the qualification of the Notes under state securities laws, including filing fees and the fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of any blue sky or legal investment survey, if any is requested, (v) the printing and delivery to the Underwriters of copies of the Registration Statement, the Preliminary Prospectus and the Prospectus and each amendment thereto, (vi) the fees and reasonable expenses of the Underwriters and their counsel, (vii) any fees charged by rating agencies for the rating of the Notes, (viii) the fees and expenses of the Indenture Trustee and its counsel,  (ix) the fees and expenses of the Owner Trustee, the Trust and each of their counsel, (x) the fees and expenses of the Letter of Credit Provider and its counsel and (xi) the costs and expenses (including any damages or other amounts payable in connection with legal and contractual liability) associated with reforming any Contracts for Sale of the Notes made by the Underwriters caused by a Defective Prospectus or a breach of any representation in Section 1(b) or Section 1(e), unless the Defective Prospectus arose solely as a result of an untrue statement or omission of a material fact in the Underwriters’ Information.  

6.

Conditions of the Obligations of the Underwriters.  The obligations of the Underwriters to purchase and pay for the Notes will be subject to the accuracy, as of the date hereof and as of the Closing Date, of the representations and warranties on the part of the Depositor and Franklin Capital herein, to the accuracy of the written statements of officers of the Depositor and Franklin Capital made pursuant to the provisions of this Section, to the performance by the Depositor and Franklin Capital of its obligations hereunder and to the following additional conditions precedent:

(a)

The Underwriters shall have received a letter, dated the date hereof, of PricewaterhouseCoopers LLP, confirming that such accountants are independent public accountants within the meaning of the Act and the Rules and Regulations, and substantially in the form of the drafts to which the Underwriters has previously agreed and otherwise in form and substance reasonably satisfactory to the Underwriters (i) regarding certain numerical information contained in the Prospectus and the Time of Sale Information and (ii) relating to certain agreed-upon procedures.

(b)

Each of the Preliminary Prospectus, the Prospectus and any supplements thereto shall have been filed with the Commission in the manner and within the applicable time period required under Rule 424(b) under the Act (without reference to Rule 424(b)(8)) in accordance with the Rules and Regulations and Section 5(a) hereof.  On or prior to the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or, to the knowledge of the Depositor or Franklin Capital, shall be contemplated by the Commission; and any requests for additional information from the Commission with respect to the Registration Statement shall have been complied with.

(c)

Subsequent to the execution and delivery of this Agreement, or if earlier, the dates as of which information is given in the Preliminary Prospectus, there shall not have occurred (i) any change, or any development involving a prospective change, in or affecting the Receivables or particularly the business or properties of the Trust, the Depositor, Franklin Capital or Franklin Resources which, in the reasonable judgment of the Underwriters, materially impairs the investment quality of the Notes; (ii) any downgrading in the rating of any securities of Franklin Resources by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the Act), or any public announcement that any such organization has under surveillance or review its rating of any such debt securities (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (iii) any suspension or limitation of trading in securities generally on the New York or American Stock Exchanges, or any setting of minimum prices for trading on such exchange; (iv) any suspension of trading of any securities of Franklin Resources on any exchange, the NASDAQ National Market or in the over-the-counter market; (v) any banking moratorium declared by Federal or New York authorities; (vi) any outbreak or escalation of hostilities in which the United States is involved, any declaration of war by Congress or any other substantial national or international calamity or emergency if, in the judgment of the Underwriters, the effect of any such outbreak, escalation, declaration, calamity or emergency makes it impractical or inadvisable to proceed with completion of the sale of and payment for the Notes; or (vii) a material disruption has occurred in securities settlement or clearance services in the United States.

(d)

On the Closing Date, each of the Basic Documents and the Securities shall have been duly authorized, executed and delivered by the parties thereto, shall be in full force and effect and no default shall exist thereunder, and the Owner Trustee shall have received a fully executed copy thereof or, with respect to the Notes, a conformed copy thereof.  The Basic Documents and the Securities shall be substantially in the forms heretofore provided to the Underwriters.

(e)

The Underwriters shall have received an opinion of McKee Nelson LLP, special counsel to Franklin Capital, the Depositor and Franklin Resources, dated the Closing Date, satisfactory in form and substance to the Underwriters, to the effect that:

(i)

The Depositor is validly existing and in good standing under the laws of the State of Delaware.

(ii)

Each Basic Document (other than the Trust Agreement) to which it is a party is, when executed and delivered, a valid and binding obligation of each of the Depositor, Franklin SPE LLC, Franklin Capital, Franklin Resources and the Trust, enforceable against each such party in accordance with its terms, except as enforceability thereof may be limited by (x) the effect of bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights generally, (y) general principles of equity regardless of whether such enforceability is considered in a proceeding at law or in equity and (z) with respect to rights or indemnity thereunder, limitations of public policy under applicable securities laws.

(iii)

When the Notes have been validly executed, authenticated and delivered in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters pursuant to this Agreement, the Notes will constitute valid and binding obligations of the Trust enforceable in accordance with their terms and entitled to the benefits of the Indenture, except that enforceability thereof may be subject to (a) the effect of bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights generally and (b) general principles of equity regardless of whether such enforceability is considered in a proceeding at law or in equity.

(iv)

The execution and delivery by the Depositor of the Basic Documents to which it is a party, the consummation of the transactions contemplated thereby and compliance with any of the provisions thereof by the Depositor will not violate (i) any of the terms, conditions or provisions of the certificate of formation or the limited liability company operating agreement of the Depositor, each as amended, (ii) any federal or State of New York statute, rule or regulation applicable to the Depositor or the Delaware Limited Liability Company Act (other than federal and s