On a FL 120 with that number of hours it would be nice if you had a decent history of oil analysis. You might be able to see wear patterns,water in the oil and what not. As far as the number of hours on the engine I personally would say that 5000 hours would probable be considered half life. The Lehman is a pretty basic and not real high end engine. Just My opinion! I have a FL 120 in my Willard 40 and burn 1.6 gal per hour @ 1550, I simply don't see that much advantage running the engine*much faster on our full displacement boat. One thing that you should look at might be the injection pump, I have seen several of these that have had there lube oil contaminated with fuel. Just look for very thin oil. This pump should have the lube oil changed every 50 hours, so if it has recently been changed you won't see any problem.
Rob Hays
Lady Anne, Willard 40 PH