Gisa Holdings' Discount Car and Truck Rentals Files Lawsuit against MAII Holdings and CAR RENTAL DIRECT for Non Payment

    PHOENIX--Feb. 27, 2003--Gisa Holdings Inc., JMG Holdings, LLC and Jack and Marty Gunion, former owners of the Discount Car and Truck Rentals franchise in Maricopa County, Ariz., today announced that they filed a lawsuit in the Superior Court of the State of Arizona (Case No. CV2003-002976), against MAII Holdings Inc. a Texas corporation; CRD Holdings Inc., a Delaware corporation; and CAR RENTAL DIRECT of Central Arizona Inc., an Arizona corporation. The complaint alleges: Breach of Agency; Constructive Fraud/Breach of Fiduciary Duty; Breach of Implied Covenant of Good Faith and Fair Dealing; Fraudulent Transfer; Unjust Enrichment; Promissory Estoppel; Negligence; Gross Negligence; Breach of Contract; Declaratory Judgment on Indemnity Liability; Constructive Trust; Specific Performance; and Punitive Damages, all related to the purchase of substantially all of Gisa's assets.
    MAII and CAR RENTAL DIRECT, through its chairman and CEO, Christie S. Tyler, announced in a press release on Aug. 29 they were canceling the terms of an Asset Purchase Agreement entered into with Gisa on May 1, 2002. In addition to the Asset Purchase Agreement between the parties, an Operating Agreement, entered into on the same date, obligated CAR RENTAL DIRECT to act as agent to Gisa in the operation of the business.
    The lawsuit alleges that MAII Holdings or CAR RENTAL DIRECT has never paid Gisa Holdings Inc., JMG Holdings or the Gunions for their business. Rental income or profits generated by CAR RENTAL DIRECT from the more than 600-vehicle fleet was never credited to Gisa. In addition to withholding all rental income and profits, CAR RENTAL DIRECT has yet to pay much of the Gisa debt incurred during the operation of the business, for which they were responsible as Gisa's agent.
    Numerous other allegations and Claims for Relief against MAII and CAR RENTAL DIRECT are spelled out in the formal complaint, filed in Maricopa County Superior Court on Feb. 13, 2002. In August 2002, Gisa filed a Chapter 11 petition in the Federal Bankruptcy Court in an effort to force CAR RENTAL DIRECT to immediately return all vehicles titled in Gisa's name. In October 2002, Gisa withdrew the Chapter 11 petition. Many attempts were then made to collect the vehicles through the beginning of 2003 by Gisa's creditors, but CAR RENTAL DIRECT continued to rent them and retained all rental proceeds and profits.

    Discount Car and Truck Rentals was the second largest company in Maricopa County, servicing the replacement vehicle market segment of the automobile rental industry. Ford Motor Credit, knowing that CAR RENTAL DIRECT specifically wanted to grow in the Phoenix market and in Gisa's segment of the industry, introduced CAR RENTAL DIRECT to Gisa. Following execution of the Operating Agreement by both parties on May 1, 2002, CAR RENTAL DIRECT substantially altered the business to the point where Gisa could no longer take it back. Signs were changed to the CAR RENTAL DIRECT name; computer systems were replaced; vehicles were sold from Gisa's fleet; customer relationships and certain leases were cancelled; and CAR RENTAL DIRECT subsequently discharged most of Gisa's former employees.

    Gisa, JMG Holdings and the Gunions are asking that MAII and CAR RENTAL DIRECT honor the terms of the Asset Purchase Agreement and Operating Agreement, entered into on May 1, 2002.