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Allied Systems Industries dba Home Store Plus / Failure & refusal to pay balance of refund

1 4560 S. Decatur Blvd., Suite 300 or 302Las Vegas, NV, United States
Contact information:
Phone: 702-891-8780

I entered into agreement in July of 2008 to purchase a 2500 square foot home store plus from Allied Systems Industries. I sent a $10, 000 down payment by registered mail with the signed agreement which included a back out clause stipulating full refund of down payment in the event that I could not find a suitable location. After a diligent search for available property, a suitable location could not be located and I executed my right to full refund. I was told that in order for the refund to be administered, I needed to submit a loan package. After consulting with my financial consultant regarding their request, I communicated to Fred Spindel, President of ASI that I was executing my right to full refund and that their request for a loan package was deemed unreasonable. Mr. Spindel sent a mutual release, which was reviewed by my attorney, and was found to be lacking language specifically addressing the refund payment schedule. An agreement was drawn by my attorney, forwarded to their attorney in Las Vegas for review, signed by both parties. Mr. Spindel indicated, as has been documented on the [redacted], that they had over $100, 000 in refunds to payout due to potential buyers not being able to qualify for financing and that they would have to pay the refund in three installments. A refund was received by me on December 1st and January 2nd, but the third and final payment, due February 1st was not received. After contacting Mr. Spindel about the third and final payment, I was told that they were closing down, yet not filing for bankruptcy. I was also told they were moving out of their offices on Decatur Blvd., in Las Vegas NV. Allied Systems appears to be continuing to operate via their website, soliciting potential customers for dollar stores, home stores plus and party stores. They have provided no documentation regarding inability to pay final payment of refund, all communication from them has been by phone.

October 16, 2008


Fred Spindel, President
Wholesales Systems Inc. DBA Allied Systems Industries
4560 W. Decatur Blvd., Suite #302
Las Vegas, NV 89103

Dear Fred,

After much consideration, I am electing to terminate my agreement to purchase a 1500 square foot discount home décor store from Allied Systems Industries. My decision was influenced by the devaluation of my financial position due to the current economic situation and the tightening credit market. A third consideration is the inconsistency of communication with the landlord of the site that had been identified, through my efforts, for the location of the store. I would not feel confident in entering into a contractual relationship based on these inconsistencies, therefore making this location unsuitable.

Therefore, I am requesting a full refund of the $10, 000.00 down payment, paid in July of this year. Gayle Cowger, merchandise manager, indicated this down payment would be fully refundable in the event that I changed my mind about the purchase of the store.
I regret that the economic climate has created such an environment of uncertainty and am therefore exercising the option for full refund.

Please contact me at your earliest convenience.

Sincerely,


Betty Corbitt
312 S. Highland Dr.
Kennewick, WA 99337

Home: [protected]
Cell: [protected]
Email: bcorbitt@charter.net

October 21, 2008


Fred Spindel, President
Wholesale Systems Inc. DBA Allied Systems Industries
4560 W. Decatur Blvd., Suite #302
Las Vegas, NV 89103

Dear Fred,

After consultation with my financial adviser and further review of the addendum to the purchase agreement, I feel that your request to furnish a loan package for the purpose of facilitating refund of my $10, 000.00 down payment is unreasonable. I have cooperated with Wholesale Systems Inc. DBA Allied Systems Industries in the pursuit of finding a location for a 1500 square foot store. On August 26, Gayle Cowger responded to my request for a time line:

“Hi Betty- From the time you sign the lease and get the date of occupancy from the landlord, then the final funding is due.”

Since there has been no final draft of the lease to review, the final funding has not been established. As I stated in the letter of termination, dated October 16, 2008, my decision to not pursue opening a discount home décor store was arrived at primarily due to the loss in value of my IRA, the tightening of the credit market and the financial crisis that has affected the nation. No where in the addendum does it state that I have to prove I cannot obtain funding. Gayle Cowger stated to me in July that, if at any time I changed my mind, the down payment would be refunded to me in full.

I have had conversations with several store owners, who have purchased discount home décor stores from Allied Systems Industries, regarding their experience and whether their store was meeting their financial expectations. Every store owner I spoke with indicated that sales were not generating enough money for them to pay themselves. There was a general consensus among the store owners that they wished there was more training and on-going support for marketing and business tools. Given the current economic climate, I hesitate to risk my home and retirement at this time of financial uncertainty. It is my desire, when I feel the time is appropriate, to enter into a business relationship where on-going support is in place to ensure the success of the business.

Although the location may have proven to be successful for a discount home décor store, the lack of communication from the landlord was cause for concern and deemed this location unacceptable. The landlord, through his agent, had the audacity to ask for the deposit and signature to the lease, which lacked crucial information provided in the exhibits, prior to review. I met with the landlord’s representative three weeks ago to go over details for the exhibits that should have been included in the lease proposal and have yet to see that information. There was no negotiation on the part of John George with respect to the rent. I could not in good conscience sign a lease that included a five year personal guarantee, which Johns said was standard language, but ultimately was negotiable. It was my impression that John was supposed to be working on my behalf. I could not consider entering into a contractual agreement with confidence.

During my visit to Las Vegas in September, I did not feel valued as a prospective client of Allied Systems. I was left waiting at the hotel after several commitments to a prearranged time to meet. I was informed by Gayle that John George had left the previous day for a conference in Miami. I returned to the Tri-Cities feeling as though there were many unresolved issues and that my visit had been an inconvenience rather than an opportunity to discuss the business.

I have encountered many red flags in this discovery process through the past several months and, after much thought and consideration, arrived at the decision that I could not pursue opening a store with a high level of confidence and that it would not be in my best financial interest. I am requesting, again, full refund of the $10, 000.00 down payment.

I attempted to email this information to you today, without success.

Sincerely,


Betty Corbitt
312 S. Highland Dr.
Kennewick, WA 99337

Home: [protected]
Cell: [protected]
Email: bcorbitt@charter.net

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