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VI.DAE:CJVE2

                                                     September 14, 2000


                                                      VIA FACSIMILE 520-577-7441

John Van Egmond
President & CEO
Ozona Corporation

6900 North Ozona Drive
Tucson, Arizona  85718

         Re:      Don Addink

Dear John:

         The  purpose  of this  letter  is to state  the  material  terms of the
agreements  between  Ugly  Duckling  Corporation  ("UDC") and the  beneficiaries
and/or  representative  of the estate of Don Addink  ("Addink").  UDC and Addink
have agreed to the following:

1.            Addink holds  approximately  96,000  shares of common stock of UDC
              (the "UDC Stock").  The UDC Stock is held by the brokerage firm of
              Roth Capital  Partners,  Inc.  ("Roth").  Provided UDC obtains the
              required  approval of its creditor - General  Electric,  UDC shall
              purchase and Addink  shall sell all UDC Stock  pursuant to a trade
              executed by Roth  within 30 days after UDC  obtains  the  required
              approval. The purchase price of the UDC Stock shall be $672,000.00
              ($7.00/share).  UDC shall pay the purchase price for the UDC Stock
              directly to Roth for application and disbursement by Roth.

2.            Addink holds  options to acquire  78,500 shares of common stock of
              UDC (the  "UDC  Options").  UDC  agrees to vest all  unvested  UDC
              Options so that all UDC  Options  held by Addink are fully  vested
              and  may  be  exercised  at the  prices  provided  in  the  Option
              Agreements.  The current  value of the UDC Options is estimated to
              be  approximately  $86,250.00  (the "UDC Options  Value").  Addink
              hereby   waives,   releases   and   cancels  the  UDC  Options  in
              consideration  of a payment by UDC to Addink of an amount equal to
              the UDC Options Value.  The UDC Options Value amount shall be paid
              by UDC to Addink within 10 days after the date of this Agreement.

3.            Addink is indebted to UDC under two Promissory  Notes,  one in the
              original principal amount of $100,000.00, dated November 24, 1997,
              and one in the original  principal  amount of  $200,000.00,  dated
              September 3, 1998 (the "Promissory  Notes"). The principal balance
              due  under  the  Promissory  Notes is  $300,000.00.  The  interest
              accrued and due under the  Promissory  Notes due through  June 30,
              2000, is $51,392.89.  UDC hereby waives all principal and interest
              due under the Promissory Notes.

Page Two
John Van Egmond
September 14, 2000

         If this letter  accurately  states the material terms of our agreements
regarding the transactions between UDC and Addink, please acknowledge acceptance
by signing this letter and returning it to me at your earliest  convenience.  If
you have any  questions  or comments  regarding  this  statement of the material
terms of the agreements, please contact me at 602-778-5003.

         John,  your  assistance  and  cooperation  in these  matters is greatly
appreciated by everyone at Ugly Duckling Corporation.

                                                     Very truly yours,



                                                     Ernie Garcia
                                                     Chairman

cc:      Greg Sullivan
         Steven P. Johnson

Accepted this ___ day of September, 2000.

-----------------------------
John Van Egmond
Under Power of Attorney for
Mary Addink