Before we dig in and try to help you, have you performed the following:
<ul type="square">[*]Have you stepped through the tutorial on the section that covers adding an exception?[*]Have you read the User's Guide related to setting up an exception handling routine?[*]Have you gone through the TSL guide (online or manual) and reviewed the commands that relate to exception handling commands?[*]Have you determined what type of exception you need to implement? pop-up, custom, return code?[*]Have you decided if you want to implement this at the code level, or are you desiring to use the built in repository to hold the exception information?[/list]
Also, what have you tried to this point to implement the handling? That would be a good start for helping as you are asking a very broad question that would take much more time than a single post to offer up what you would need to know if you haven't taken any time of your own to delve into the provided information provided with the installation of WinRunner.
I started by reading the User guide and tried to follow the steps, ie. Tools, Recovery Manager,Compound Scenario for Pop up window. Completed all the steps upto Finish. Saved and restarted WinRunner and ran the test again. Recovery Manager did not kick in, it stopped at the pop up window and did not close the application as I had indicated in the Recovery Manager.