November 6, 2002
Mr. ▇▇▇▇ ▇▇▇▇▇▇▇▇
AFC
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▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: Ugly Duckling Corporation / Automotive Finance Inventory Line, Loan and
Security Agreement dated as of August 24, 2001
Dear Sir:
In the quarter and month ending September 2002 and the month ending October 2002
we breached the Debt to Tangible Net Worth covenant of the Duck Auto Owner Trust
2002-B, resulting in an event of default under such trust. In turn, this default
caused an event of default under the above referenced agreement under Article
VIII (C) Events of Default.
The breach of the covenant in the Duck Auto Owner Trust 2002-B was a result of
an error in the determination of the covenant test in the drafting of the
related deal documentation. The insurer, XL Capital, has agreed the covenant
test was set in error and has agreed to waive the covenant until the test can be
amended in the related deal documentation.
With this letter DriveTime Automotive Group, Inc. requests Automotive Finance
Corporation to waive the event of default under their agreement triggered by the
breaches in the Duck Auto Owner Trust 2002-B Debt to Tangible Net Worth
covenant. If you need any additional information to evaluate this request,
please contact me at ▇▇▇-▇▇▇-▇▇▇▇. Your prompt attention to this matter will be
appreciated.
Sincerely,
▇▇▇ ▇▇▇▇▇▇
Vice President - Treasurer
DriveTime Automotive Group, Inc.
cc: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
The undersigned hereby waives the covenants requested:
Automotive Finance Corporation
By: _________________________
Name: _________________________
Title: _________________________
