Sent: Via Facsimile (000) 000-0000 and FEDEX
May 14, 2001
Mr. C. Xxxxxx Xxxxxx, Treasurer
Ugly Duckling Corporation
0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Re: Amended and Restated Motor Vehicle Installment Contract Loan and Security
Agreement by and between General Electric Capital Corporation ("GECC") and Ugly
Duckling Corporation and affiliates ("UDC") dated as of August 15, 1997, as
amended (the "LSA"). All capitalized terms not defined herein shall have the
same meaning as in the LSA.
Dear Xxx:
You have requested for GECC to waive the Interest Coverage requirement under
section 13.6 of the LSA for the first quarter 2001, which states that UDC shall
maintain a minimum Interest Coverage of 1.30:1. Based on the information that
you have provided to GECC, UDC had Interest Coverage for the quarter ended March
31, 2001 of 1.26:1, which is a violation of the LSA.
Pursuant to your request, GECC has agreed to waive the Interest Coverage for the
quarter ended March 31, 2001 (the "Waiver") subject to all of the following
conditions:
o Waiver is only for Interest Coverage for the period ended March 31, 2001.
The 1.30:1 Interest Coverage requirement will be in effect for all
subsequent calendar quarters
o All other covenants, terms and conditions of the LSA remain unchanged
o Waiver is only effective to the extent that UDC has received a waiver for
similar violations with its other creditors and is in compliance with all
other material agreements
This Waiver shall not become effective if it is not accepted by 5:00PM Chicago
time on May 15, 2001. The terms of the Waiver shall become effective upon our
receipt and your signature of this letter by such time. If all of the terms
above terms are acceptable to Ugly Duckling Corporation please so signify by
acknowledging so in the space provided below and return an executed copy to GE
Capital.
Very truly yours,
General Electric Capital Corporation
By: /s/ XXXXXXX XXXXXXXX
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XXXXXXX XXXXXXXX
Title: Account Executive
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Acknowledge and Agreed by:
Ugly Duckling Corporation and affiliates
By: /s/ C. XXXXXX XXXXXX
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C. XXXXXX XXXXXX
Title: Treasurer
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