Document:

Exhibit 4.1
                                 PROMISSORY NOTE

$ 250,000                                                            Atlanta, GA
                                                                 January 5, 2001

              FOR VALUE  RECEIVED,  Fullnet  Communications,  Inc.  an  Oklahoma
corporation (the Borrower),  promises to pay to the order of Generation  Capital
Associates,  a New  York  limited  partnership  and  assigns  (Lender)  at  1085
Riverside  Trace,  Atlanta,  GA  30328,  or at such  other  place  as  might  be
designated in writing by the Lender,  the principal sum of $250,000.00 in lawful
money of the  United  States of  America,  on March 31,  2001  (Maturity  Date),
together with interest on the unpaid principal  balance of said principal sum at
the rate of ten per cent  (10%)  per annum  (computed  on the basis of a 365 day
year) from the date hereof  until such  principal  sum is fully paid;  provided,
however,  Borrower  shall reduce the principal  amount  outstanding by fifty per
cent (50%) of the net proceeds  collected by Borrower  from its ongoing  private
placement.  Such  principal  reductions  shall  be made at the  closing  of each
additional investment in such private placement.

              Borrower  has  also  agreed  to  pay  to  Lender,  in  lieu  of an
origination  fee, an equity kicker  (Kicker) in the form and amount as set forth
on Exhibit A attached hereto.

              Borrower and Lender  acknowledge  that Bathgate  McColley  Capital
Group, LLC have acted as placement agents  (Placement Agent) in this transaction
and Lender agrees to pay a placement  agent fee to Placement Agent in accordance
with the  terms of a  separate  agreement  dated as of the date  hereof  between
borrower and Placement Agent.

              The Borrower will have the right at any time and from time to time
to prepay the unpaid principal  balance of this Note in whole or in part without
penalty,  but with interest on the unpaid principal  balance accrued to the date
of prepayment.

              This Note shall be governed and construed in  accordance  with the
internal  laws of the  state of  Georgia  without  regard to the  principles  of
conflict of laws. Borrower consents to the jurisdiction of the Superior Court of
the State of Georgia, Fulton County and/or any Federal District Court located in
the state of Georgia for any suit brought under this Note.

              The Borrower agrees that a facsimile of this Note signed on behalf
of Borrower shall constitute an enforceable obligation against Borrower. If suit
is brought for the  collection  of this Note  Borrower  shall not be entitled to
raise as a defense  that a facsimile  of this Note and not an original  has been
placed in evidence.

              The Borrower  agrees that if, and as often as, this Note is placed
in the hands of an attorney  for  collection  or to defend or enforce any of the
Lender's  rights under this Note the Borrower  will pay the Lender's  reasonable
attorneys'  fees, all court costs and all other expenses  incurred by the Lender
in connection therewith.

       IN WITNESS WHEREOF,  the Borrower has executed this instrument  effective
the 5th day of January 2001.

                                 Fullnet Communication, Inc.

                                 By:
                                     -------------------------------------------
                                     Timothy J. Kikkenny, President and CEO

                                 By:
                                     -------------------------------------------
                                     Roger Baresel, Chief Financial Officer

Attest:

----------------------

----------------------
 (Print Name & Title)

<PAGE>

                                    EXHIBIT A

                                  EQUITY KICKER

This Exhibit A constitutes  part of the  Promissory  Note dated  January  5,2001
issued  by  Fullnet  Communications,   Inc.  (Borrower)  to  Generation  Capital
Associates (Lender) in the principal amount of $250,000.

         1. Borrower hereby issues to Lender warrants to purchase 125,000 shares
of the  common  stock of  Lender at an  exercise  price of $0.01 per share for a
period of five years from the date hereof.  These  warrants shall be exercisable
immediately for cash.

         2. Borrower hereby issues to Lender warrants to purchase 125,000 shares
of the  common  stock of  Lender at an  exercise  price of $1.00 per share for a
period of five years from the date hereof.  These  warrants shall be exercisable
immediately for cash, unless at the time of exercise the common stock underlying
the  warrants  has not been  registered  for  resale  with a current  prospectus
available, in which case the warrants shall be exercised on a "cashless basis."

IN WITNESS WHEREOF,  the Borrower has executed this Exhibit A effective  January
5, 2001

                                   Fullnet Communication, Inc.

                                   By:
                                       -----------------------------------------
                                       Timothy J. Kikkenny, President and CEO

                                   By:
                                       -----------------------------------------
                                       Roger Baresel, Chief Financial Officer

Attest:

----------------------

----------------------
 (Print Name & Title)Exhibit 4.2
                                 PROMISSORY NOTE

$ 320,000.00                                                        Atlanta, GA
                                                                  March 31, 2001

              FOR VALUE RECEIVED, the undersigned Fullnet  Communications,  Inc.
an Oklahoma corporation  (Borrower),  promises to pay to the order of Generation
Capital Associates,  a New York limited partnership and assigns (Lender) at 1085
Riverside  Trace,  Atlanta,  GA  30328,  or at such  other  place  as  might  be
designated  in writing by the Lender,  the  principal  sum of $320,000 in lawful
money of the  United  States of  America,  on July 31,  2001,  (Maturity  Date),
together with interest on the unpaid principal  balance of said principal sum at
the rate of ten per cent  (10%)  per annum  (computed  on the basis of a 365 day
year) from the date hereof  until such  principal  sum is fully paid:  provided,
however,  Borrower  shall reduce the principal  amount  outstanding by fifty per
cent  (50%) of the net  proceeds  collected  from any  private  placement.  Such
principal reductions shall be made at the closing of each additional  investment
in such private placement.

              The Borrower will have the right at any time and from time to time
to prepay the unpaid principal  balance of this Note in whole or in part without
penalty with  interest on the unpaid  principal  balance  accrued to the date of
prepayment.

              This Note shall be governed and construed in  accordance  with the
internal  laws of the  State of  Georgia  without  regard to the  principals  of
conflict of laws. Borrower consents to the jurisdiction of the Superior Court of
the State of Georgia, Fulton County and/or any Federal District Court located in
the state of Georgia for any suit brought under this Note.

              The Borrower agrees that a facsimile of this Note signed on behalf
of Borrower shall constitute an enforceable obligation against Borrower. If suit
is brought for the  collection  of this Note  Borrower  shall not be entitled to
raise as a defense  that a facsimile  of this Note and not an original  has been
placed in evidence.

              The Borrower  agrees that if, and as often as, this Note is placed
in the hands of an attorney  for  collection  or to defend or enforce any of the
Lender's  rights under this Note the Borrower  will pay the Lender's  reasonable
attorneys'  fees, all court costs and all other expenses  incurred by the Lender
in connection therewith.

         IN WITNESS WHEREOF, the Borrower has executed this instrument effective
the date first above written. Fullnet Communications, Inc.

                                      By
                                         ---------------------------------------
                                         Timothy J. Kilkenny, President and CEO

                                      By
                                         ---------------------------------------
                                         Roger Baresel, Chief Financial Officer
Attest:

-----------------------

-----------------------
 (Print Name & Title)May 9, 2001

KZH Soleil - 2 LLC
c/o The Chase Manhattan Bank
140 East 45th Street - 11th Floor
New York, NY 10017

Galaxy CLO 1999-1, Ltd.
c/o Chase Bank of Texas, National Association
600 Travis Street - 48th Floor, 48-CTH-304
Houston, TX  77002

Sun America Life Insurance Company
1 SunAmerica Center - 34th Floor
Century City
Los Angeles, CA  90067-6002

RE: Ugly Duckling  Corporation Senior Secured Loan Agreement Dated as of
    January 11, 2001

Dear Sirs:

With  this  letter we are  requesting  a waiver of the  Minimum  Other  Interest
coverage ratio contained in Section 6.18 of the above  referenced loan agreement
for the  quarter  ended  March 31,  2001.  We are in  compliance  with all other
covenants of the agreement.

The reason for the  shortfall in this covenant in the quarter is due to a number
of  changes  we are  making in the  business  to  improve  long  term  portfolio
performance. These changes include:

1. Enhancing  underwriting  criteria  by  increasing  down  payment requirements
   beginning  in  January   of 2001,  resulting  in  slower  sales,   a  smaller
   portfolio  than  forecasted  and  lower  interest  income  from  the  smaller
   portfolio.

2. The moving of our 31 to 60 day collectors to the dealership, resulting in the
   closure of two  collection  centers and an after-tax  charge of  $368,000 for
   the quarter.

3. The increase of loan loss reserves to the balance sheet resulting from higher
   than expected losses from older portfolios and a smaller base of originations
   in the first quarter of 2001, as previously discussed.

In light of these changes and the impact to our  profitability in the first four
months of 2001, the "B-piece"  contracts  securing your loan continue to perform
at historically high levels.  Cash generated from these loans through April 2001
was $34.1  million or a 14% increase  over last year.  Overall in April of 2001,
the portfolio showed improvements versus year ago of 1.5% in the current bucket,
1.79%  in the 1 to 30 day  bucket  and  .02%  in  the 31 to 60 day  bucket.  The
portfolio  declined  .32%  in the 61 to 90 day  bucket.  With  the  movement  of
collectors  to the  dealerships  we expect to see continued  improvement  in our
delinquencies throughout the year.

In addition  to the  improvements  in the  portfolio,  we closed our  nineteenth
receivables  securitization at the end of March with a loan principal balance of
$117.7 million and Class A bonds issued of $83.6 million. In early April we also
entered into an agreement with Greenwich  Capital  Financial  Products,  Inc. to
provide up to $100 million in a warehouse receivables line of credit.

Thank you for your time and  consideration.  I have  provided  an area below for
your signature authorizing the waiver. Please call me with any further questions
at 602-852-6635.

Sincerely,

/s/ BOB FULTON
-------------------------
Bob Fulton
Treasurer
Ugly Duckling Corporation

<PAGE>

The undersigned hereby waive the covenant requested:

KZH Soleil - 2 LLC

By:      /s/ KIMBERLEY ROWE
         -------------------------
Name:    KIMBERLEY ROWE
         -------------------------
Title:   Authorized Agent
         -------------------------

Galaxy CLO 1999-1, Ltd.
By:      SAI Investment Advisors, Inc.
         its Collateral Manager

By:      /s/ JOHN G. LAPHAM
         -------------------------
Name:    JOHN G. LAPHAM
         -------------------------
Title:   Authorized Agent
         -------------------------

Sun America Life Insurance Company

By:      /s/ JOHN G. LAPHAM
         -------------------------
Name:    JOHN G. LAPHAM
         -------------------------
Title:   Authorized Agent
         -------------------------

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