EXHIBIT 10.4


                                 March 25, 1999


                                      VIA FACSIMILE (847-277-6996, 847-277-5978)
                                                                  & REGULAR MAIL
Mr. Jeff Batka
Mr. W. Jerome McDermott
Asset Based Financing
General Electric Capital Corporation
540 W Northwest Hwy
Barrington, Illinois  60010

         Re:      GE Approval of Y2K Date Change

Dear Jerry and Jeff:

         The  purpose  of this  letter  is to obtain  the  approval  of  General
Electric Capital Corporation ("GE") to amend Section 13.16(B) of the Amended and
Restated Motor Vehicle Installment Contract Loan and Security Agreement. Section
13.16(B)  currently  provides that Ugly Duckling shall be year 2000 compliant by
no later than March 31, 1999.  Ugly  Duckling has  requested an extension of the
March 31,  1999 date to June 30,  1999.  I  understand  you have  agreed to this
extension. The purpose of this letter is to confirm the agreement between GE and
Ugly  Duckling to amend  Section  13.16(B) of the Amended and Restated  Loan and
Security  Agreement to extend the year 2000  compliance  date from March 31st to
June 30th, 1999. Please  acknowledge your agreement to this amendment by signing
this  letter  and  returning  it to me at  your  convenience.  If you  have  any
questions or instructions  regarding this matter, please contact me at any time.
Your cooperation is appreciated.

                                   Sincerely,

                                   /S/ JON D. EHLINGER
                                   -------------------

                                   Jon D. Ehlinger
                                   General Counsel
                                   Ugly Duckling Car Sales

JDE:ag
















UDH.GE:CWJM4.DOC





Mr. Jeff Batka
Mr. W. Jerome McDermott
March 25, 1999
Page Two



Cc:      Don Addink
         Mike Kasten

GE's approval to extend Ugly Duckling  "shall be year 2000 compliant by no later
than  March  31,  1999"  to June  30,  1999 is  contingent  upon  Ugly  Duckling
delivering to GE within five days after each month and starting  March 31, 1999,
progress  updates  (memos,  gnat  charts,   contingency  strategy,  etc.)  which
highlight significant deadline misses and the impact of such misses.

Accepted and approved this 23 day of March, 1999.

General Electric Capital Corporation

By:      /s/ JEFF BATKA
         ---------------
Name:    Jeff Batka
Its:     Account Executive