EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (this "Agreement") is made and entered into
as of January 10, 2006 (the "Effective Date"), by and among  Home Solutions of
America, Inc., a Delaware corporation (the "Employer") and Jeffrey M. Mattich,
an individual resident of the State of Texas (the "Executive").

WITNESSETH

WHEREAS, the Executive has certain skills, experience, and abilities that may be
valuable to the success of the Employer's operations and future profitability;

WHEREAS, the Employer desires to employ and retain the services of the Executive
as a full-time employee in the positions of Senior Vice President and Chief
Financial Officer of Employer, and the Executive desires to work for and be
employed by Employer in such positions; and

WHEREAS, the Employer and the Executive desire to set forth the terms and
conditions pursuant to which the Executive will be employed by the Employer.

NOW, THEREFORE, in consideration of the foregoing premises and of the mutual
covenants and undertakings contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Agreement hereby agree as follows:

Section 1:         EMPLOYMENT TERM AND DUTIES

1.01     Employment.  The Employer hereby employs the Executive, and the
Executive hereby accepts employment by the Employer, upon the terms and
conditions set forth in this Agreement.

1.02     Term.  Unless earlier terminated as herein provided, the Executive's
employment  with the Employer pursuant to this Agreement shall commence on the
Effective Date and shall end on the final day of the Term (as defined in this
Section 1.02).  For purposes of this Agreement, the "Term" shall mean a period
of time commencing on the Effective Date and continuing until December 31, 2007
(the "Expiration Date").

1.03     Duties and Services.  The Executive will be employed as the Senior Vice
President and Chief Financial Officer of Parent in Dallas, Texas, and will have
such duties and perform such services as are customary with such positions, or
as otherwise requested by management officials senior in authority to the
Executive.  The Executive will devote at 100% of his business time, attention,
skill, and energy exclusively to the business of the Employer.  The Executive
will comply with all applicable Employer policies and procedures as well as with
all applicable laws in performing his duties for the Employer.  The Executive
will be available to travel on Employer business as the needs of the Employer
may reasonably require.

 

 

 

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Section 2:         COMPENSATION

2.01     Salary. Subject to the provisions of Section 4 of this Agreement that
relate to compensation of the Executive following the termination of the
Employment Period (as defined in Section 8 of this Agreement), the Executive
will be paid an annual base salary of $190,000 (such amount, as it may be
increased from time to time, is hereinafter referred to as "Salary") for the
duration of the Term.  The Employer shall withhold from each installment of the
Salary all applicable federal, state, and local income and other payroll taxes. 
The Board of Directors of the Parent will consider annually, whether or not to
increase the salary of the Executive.  Executive will be eligible for an annual
bonus of up to 40% of Salary (Bonus).  The criteria for the Bonus will be both
subjective and objective and the criteria will be established between Executive
and the Prsident of Employer at the beginning of each calendar year.  Executive
will also be paid a one time sign-on bonus of $25,000 at the end of the first
pay period of Executive's tenure (paid on 1-15-06).

2.02     Benefits.  For the duration of the Employment Period and as otherwise
set forth herein, the Executive and his dependents (if applicable), will be
permitted to participate in such pension, bonus, health insurance, disability
income insurance, and other employee benefit plans of the Employer
(collectively, "Benefits") that may be in effect from time to time to the extent
the Executive and his dependents are eligible for participation under the terms
of such plans. 

2.03     Stock Options.  Upon the execution of this Agreement and the stock
option agreement in the form attached hereto as Exhibit A (the "Stock Option
Agreement"), and upon the Executive's compliance with the Form ID and Form 3
filing requirements promulgated under Section 16 of the Securities Act of 1934,
as amended, the Executive shall receive a stock option to purchase 250,000
shares of common stock, $.001 par value, of the Parent, at a per share exercise
price equal to the Market Price on the date of grant, vested over a three-year
period, subject to the terms and conditions contained within the Stock Option
Agreement. 

Section 3:         FACILITIES AND EXPENSES

The Executive will use the office space, equipment, supplies, and such other
facilities, property, and personnel as are currently being provided by the
Employer for such purposes to perform his duties under this Agreement.  The
Employer will reimburse the Executive for reasonable expenses incurred by the
Executive in the performance of his duties in accordance with the Employer's
employment policies in effect from time to time; provided, however, that the
Executive must file written expense reports with respect to such expenses, in
accordance with the Employer's employment policies, before the Executive may
receive such reimbursement.

 

 

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Section 4:         TERMINATION

4.01     Termination of Employment Period.

(a)         Death of the Executive.  The Employment Period shall terminate
immediately and automatically upon the death of the Executive.

(b)        Termination by the Employer.  The Employer may terminate the
Employment Period (i) immediately upon the delivery of a Notice of Termination
(as defined in Section 4.01(d) of this Agreement) by the Employer to the
Executive setting forth the facts that indicate that a determination has been
made that the Executive has a Disability in accordance with Section 4.02 of this
Agreement; (ii) immediately upon delivery of a Notice of Termination by the
Employer to the Executive setting forth the facts that indicate that an event
constituting Cause (as defined in Section 4.03 of this Agreement) has occurred,
or on such later date as may be set forth in such Notice of Termination; or
(iii) at any time without Cause effective as of the 30th day following the
delivery of a Notice of Termination by the Employer to the Executive, or on such
later date as may be set forth in such Notice of Termination.

(c)        Termination by the Executive.  The Executive may terminate the
Employment Period (i) immediately upon delivery of a Notice of Termination by
the Executive to the Employer setting forth facts that indicate that an event
constituting Good Reason (as defined in Section 4.04 of this Agreement) has
occurred within the 30 days immediately prior to the date of delivery of such
Notice of Termination, or (ii) immediately upon his resignation for any reason
other than Good Reason.

(d)        Notice of Termination.  For purposes of this Agreement, a "Notice of
Termination" shall mean a written notice (delivered in accordance with Section
7.06 herein) that indicates the specific termination provision in this Agreement
upon which the person intending to terminate the Employment Period is relying
and sets forth in reasonable detail the facts and circumstances that provide a
basis for termination of the Employment Period under such termination provision.

4.02     Definition of "Disability."  For purposes of this Agreement, the
Executive will be deemed to have a "Disability" under any of the following
conditions: (a) for physical or mental reasons, the Executive is unable to
render and perform substantially and continuously the Executive's duties and
services as required by this Agreement for 12 consecutive weeks, or for 16
nonconsecutive weeks during any 12-month period, or (b) the prognosis or
recommendations of the Examining Doctor (as defined in this Section 4.02) are
such that the Executive would be unable to render and perform substantially and
continuously the Executive's duties and services under this Agreement for 12
consecutive weeks, or for 16 nonconsecutive weeks during any 12-month period. 
Upon the request of either party hereto following written notice to the other,
the Disability of the Executive will be determined by a medical doctor (the
"Examining Doctor") who shall be selected as follows: the Employer and the
Executive shall each select a medical doctor, and those two medical doctors will
select a third medical doctor who will be the Examining Doctor.  The
determination of the Examining Doctor as to whether or not the Executive has a
Disability will be binding on both parties hereto.  The Executive must submit to
a reasonable number of examinations by the Examining Doctor, and the Executive
hereby authorizes the disclosure and release to the Employer of such
determination and the results of such examinations.  If the Executive is not
legally competent, the Executive's legal guardian or duly authorized
attorney-in-fact will act in the Executive's stead under this Section 4.02 for
the purposes of submitting the Executive to examinations and providing any such
authorizations of disclosure.

 

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4.03     Definition of "Cause."  For purposes of this Agreement, "Cause" shall
mean: (a) the Executive's material and persistent failure to perform his duties
and services in accordance with this Agreement, unless such failure is due to
the Executive's Disability, or the Executive's material violation of this
Agreement or any material inaccuracy of any representation or warranty of the
Executive contained herein, unless, for any such failure, violation, or
inaccuracy that is capable of being cured, the Executive cures such failure,
violation, or inaccuracy within 10 days of the Employer providing written notice
to the Executive of such failure, violation, or inaccuracy; (b) the
appropriation (or attempted appropriation) by Executive of a material business
opportunity of the Employer, including, but not limited to, attempting to secure
or securing any personal profit in connection with any transaction entered into
on behalf of the Employer; (c) the theft, fraud, or embezzlement by the
Executive of any of the real or personal property, tangible or intangible, of
the Employer or any of its Affiliates; (d) the commission of an act of fraud by
the Executive upon, or bad faith or willful misconduct toward, the Employer or
any of its Affiliates; (e) conduct by the Executive constituting gross
negligence or recklessness, as determined by the  Employer in its sole but
reasonable discretion, that is materially injurious to the Employer, a customer
of the Employer, or any of the Employer's Affiliates; or (f) the conviction of,
the indictment for (or its procedural equivalent), or the entering of a guilty
plea or plea of no contest by the Executive with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a
possible punishment.  The Board of Directors of Parent shall determine on behalf
of Employer whether "Cause" exists.  "Cause" relating to FIBER-SEAL or Parent
shall constitute "Cause" as to the other company as well.

4.04     Definition of "Good Reason."  For the purposes of this Agreement, the
phrase "Good Reason" means (i) the Employer's material breach of this Agreement
and the Employer's failure to remedy such breach within 10 days following the
delivery of written notice of such breach by the Executive to the Employer; (ii)
the assignment by the Employer to the Executive, without the prior written
consent of the Executive, of responsibilities or duties that are substantially
different from the duties and services set forth in Section 1.03 of this
Agreement; (iii) the relocation of the Executive from Dallas, Texas, or (iv)
demotion of the Executive in rank, title or duties.

4.05     Effect of Termination of Employment Period; Post-Termination Benefits. 
Upon the termination of the Employment Period in accordance with Section 4.01 of
this Agreement, the Executive's obligation to render to the Employer the
services described in Section 1.03 of this Agreement shall cease and the
Employer shall pay the Executive or, in the event of his death while amounts
remain payable hereunder, his Designated Beneficiary (as defined in this Section
4.05), if at all, as follows:

 

 

 

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(a)        Termination by the Employer with Cause or by the Executive without
Good Reason.  If the Employment Period is terminated in accordance with Section
4.01(b)(ii) or Section 4.01(c)(ii) of this Agreement, the Executive will be
entitled to receive solely that portion of his Salary, payable in accordance
with the Employer's normal payroll practices, accrued by the Executive as of the
date of the termination of the Employment Period.  The Executive shall not
receive, and shall not be entitled to receive, any Salary or Benefits
thereafter, except as otherwise required in accordance with federal or state law
or the terms of the plans governing the benefits provided hereunder.

(b)        Termination by the Employer without Cause or by the Executive with
Good Reason.  If the Employment Period is terminated in accordance with Section
4.01(b)(iii) or Section 4.01(c)(i) of this Agreement, the Employer shall pay the
Executive the Salary and the Benefits for the lesser of (i) the remainder of the
Term, or (ii) six months from the date of termination.  In addition, Section 6
of this Agreement shall immediately become null and void upon a termination by
the Employer without Cause or by the Executive with Good Reason.

(c)        Termination upon Death or Disability. If the Employment Period is
terminated in accordance with Section 4.01(a) or Section 4.01(b)(i), the
Employer will pay to the disabled Executive or to the Executive's Designated
Beneficiary, as the case may be, in accordance with its normal payroll
practices, the customary installments of the Salary and the Benefits that were
provided to the Executive during the Employment Period, if applicable, until the
earlier of the Expiration Date or the 90th day following the date of the
Executive's death or the date of the determination by the Examining Doctor that
the Executive has a Disability.  Following such date, the Executive or the
Executive's Designated Beneficiary shall have no right to receive, and the
Employer shall have no further obligation to pay to the Executive, further
monthly installments of Salary or Benefits; provided, however, that, in the
event the Executive is determined to have a Disability, the Employer has
maintained the disability income insurance referred to in Section 2.02 of this
Agreement and the Executive is entitled to benefits under that insurance.  In
the event the Employer has not maintained such disability income insurance, then
the Employer shall continue to pay the Salary and the Benefits to the Executive
for the remainder of the Term.  For the purposes of this Agreement, the
Executive's "Designated Beneficiary" means such individual beneficiary or trust,
located at such address as the Executive may designate by written notice to the
Employer from time to time or, if the Executive fails to give written notice to
the Employer of such a beneficiary, the Executive's estate; provided, however,
that, notwithstanding the preceding sentence, the Employer shall have no duty
under any circumstances to attempt to open an estate on behalf of the Executive,
to determine whether any beneficiary designated by the Executive is alive, to
determine the existence of any trust, to determine whether any person or entity
purporting to act as the Executive's personal representative (or the trustee of
a trust established by the Executive) is duly authorized to act in that
capacity, or to locate or attempt to locate any beneficiary, personal
representative, or trustee.

(d)        Accrued Benefits.  Unless otherwise required by this Agreement,
federal or state law, or the terms of the relevant plans providing Benefits
hereunder, the Executive's accrual of the Benefits pursuant to Section 2.02
hereof will cease on the date of the termination of the Employment Period, and
the Executive will thereafter be entitled to accrued Benefits pursuant to such
plans only as provided in such plans.

 

 

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(e)        Release.  No amount shall be payable to the Executive under Section
4.05(b) or (c) following the termination of the Employment Period unless the
Executive signs and delivers to the Employer, promptly after the termination of
the Employment Period, a release and waiver of claims in a form prepared by the
Employer.

Section 5:         NON-DISCLOSURE COVENANT

5.01     Confidential Information Defined.  For the purposes of this Section 5,
the phrase "Confidential Information" means any and all of the following: trade
secrets concerning the business and affairs of the Employer or its Affiliates,
product specifications, data, know-how, formulae, compositions, processes,
designs, sketches, photographs, graphs, drawings, samples, inventions and ideas,
past, current, and planned research and development, current and planned
distribution methods and processes, customer lists, current and anticipated
customer requirements, price lists, market studies, business plans, computer
software and programs (including object code, machine code, and source code),
computer software and database technologies, systems, structures, and
architecture (and related formulae, compositions, processes, improvements,
devices, know-how, inventions, discoveries, concepts, ideas, designs, and
methods); information concerning the business and affairs of the Employer or its
Affiliates (which includes historical financial statements, financial
projections and budgets, historical and projected sales, capital spending
budgets and plans, the names and backgrounds of key personnel, personnel
training techniques and materials, however documented); and notes, analysis,
compilations, studies, summaries, and other material prepared by or for the
Employer or its Affiliates containing or based, in whole or in part, on any
information included in the foregoing.  Notwithstanding the foregoing,
Confidential Information shall not include any information that the Executive
demonstrates was or became generally available to the public other than as a
result of a disclosure of such information by the Executive or any other person
under a duty to keep such information confidential. 

5.02     Executive's Access to the Confidential Information.  Immediately upon
the Executive's execution of this Agreement and continuing throughout his
employment with the Employer, the Employer shall provide the Executive with
access to the Confidential Information.  The Executive acknowledges:  (a) that
the Employer has devoted substantial time, effort, and resources to develop and
compile the Confidential Information; (b) public disclosure of such Confidential
Information would have an adverse effect on the Employer and its business; (c)
the Employer would not disclose such information to the Executive, nor employ or
continue to employ the Executive without the agreements and covenants set forth
in this Section 5; and (d) the provisions of this Section 5 are reasonable and
necessary to prevent the improper use or disclosure of Confidential Information.

5.03     Executive's Nondisclosure Duties Regarding the Confidential
Information.  The Executive agrees to use his best efforts to preserve and
protect the Confidential Information to the greatest degree possible and
therefore agrees as follows:

 

 

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(a)        Nondisclosure Commitment.  The Executive will hold in strictest
confidence the Confidential Information and will not disclose it to any Person
(defined below) except with the specific prior written consent of the Employer
or as may be required by court order, law, government agencies with which the
Employer deals in the ordinary course of its business, or except to the extent
such disclosure is necessary for Executive to perform his duties under this
Agreement.  Any trade secrets of the Employer will be entitled to all of the
protections and benefits afforded under applicable laws.  If any information
that the Employer deems to be a trade secret is ruled by a court of competent
jurisdiction not to be a trade secret, such information will, nevertheless, be
considered Confidential Information for purposes of this Agreement.  The
Executive hereby waives any requirement that the Employer submit proof of the
economic value of any trade secret or post a bond or other security.  The
Executive will not remove from the Employer's premises or record (regardless of
the media) any Confidential Information of the Employer or its Affiliates,
except to the extent such removal or recording is necessary for the Executive to
perform his duties.  The Executive acknowledges and agrees that all Confidential
Information, and physical embodiments thereof, whether or not developed by the
Executive, are the exclusive property of the Employer or its Affiliates, as the
case may be.

(b)        Third Party Information.  The Executive recognizes that the Employer
and its Affiliates have received and in the future will receive from third
parties their confidential or proprietary information subject to a duty on their
parts to maintain the confidentiality of such information and to use it only for
certain limited purposes.  The Executive agrees that he owes the Employer, its
Affiliates, and such third parties, during the Employment Period and thereafter,
a duty to hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any Person (except as necessary in carrying
out his duties for the Employer consistent with the Employer's agreement with
such third party) or to use it for the benefit of anyone other than for the
Employer or such third party (consistent with the Employer's agreement with such
third party) without the express written authorization of the Employer or its
Affiliate, as the case may be.

(c)        Returning Employer Documents.  The Executive agrees that, at the time
of the termination of the Employment Period, he will deliver to the Employer 
(and will not keep in his possession or deliver to any other Person) any and all
devices, records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any of the aforementioned items
belonging to the Employer or any of its Affiliates, and their respective
successors or assigns, regardless of whether such items are represented in
tangible, electronic, digital, magnetic or any other media.  In the event of the
termination of the Employment Period, the Executive agrees to sign and deliver
the "Termination Certification" attached hereto as Exhibit B.

5.04     Disputes or Controversies.  The Executive recognizes that should a
dispute or controversy arising from or relating to this Agreement be submitted
for adjudication to any court or other third party, the preservation of the
secrecy of Confidential Information may be jeopardized.  All pleadings,
documents, testimony, and records relating to any such adjudication will be
maintained in secrecy and will be available for inspection by the Employer, the
Executive, and their respective attorneys and experts, who will agree, in
advance and in writing, to receive, use, and maintain all such Confidential
Information in secrecy, except as may be agreed by them in writing.

 

 

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Section 6:         NON-COMPETITION AND NON-INTERFERENCE

6.01     Restrictive Covenants.  The Executive agrees that the Employer's
commitment described in Section 5.02 above to provide its Confidential
Information to him gives rise to the Employer's interest in restraining
Executive from competing against it and that the restrictions in this Section
are designed to enforce Executive's promise in Section 5.03 not to use or
disclose Confidential Information belonging to the Employer, except in the
performance of Executive's duties for the Employer.  The Executive agrees that
the restrictions in this Section are reasonable and do not impose a greater
restraint than is necessary to protect the goodwill or other business interests
of the Employer.  For these reasons, the Executive agrees to the following:

(a)        Noncompete.  During the Restricted Period the Executive will not,
directly or indirectly, on behalf of himself or any other person or entity,
engage or invest in, own, manage, operate, finance, control, or participate in
the ownership, management, operation, financing, or control of, be employed by,
associated with, or in any manner connected with, lend the Executive's name or
any similar name to, lend the Executive's credit to or render services that are
similar to the services he rendered to the Employer under this Agreement to any
business engaged or about to become engaged in the Business of the Employer, or
any of its Affiliates, in the Market Area.  For purposes of this Agreement, the
"Business" of the Employer is licensing, franchising, and providing fabric
protection systems.

(b)        Solicitation of Customers.  During the Restricted Period the
Executive will not, directly or indirectly, on behalf of himself or any other
person or entity, solicit a Current Customer (defined below) of the Employer or
its Affiliates with whom he had contact during the Employment Period, for
purposes of selling products or services to such Current Customer that are in
competition with the products and services offered or sold by the Employer or
its Affiliates.

(c)        Solicitation of Employees.  During the Restricted Period the
Executive will not, directly or indirectly, on behalf of himself or any other
person or entity, employ any current employee of the Employer or its Affiliates
or any individual who was an employee of the Employer or its Affiliates at any
time during Term, and will not solicit, or contact in any manner that could
reasonably be construed as a solicitation, any employee of the Employer or its
Affiliates for the purpose of encouraging such employee to leave or terminate
his or her employment with the Employer or its Affiliates.

(d)        Solicitation of Vendors.  During the Restricted Period the Executive
will not, either directly or indirectly, on behalf of himself or any other
person or entity, solicit a current vendor or supplier of the Employer or its
Affiliates for purposes of encouraging such vendor or supplier to cease or
diminish providing products or services to the Employer or its Affiliates, or to
change adversely the terms under which such vendor or supplier provides such
products or services to the Employer or its Affiliates.

 

 

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(e)        Non-interference.  During the Restricted Period the Executive will
not, directly or indirectly, interfere with the Employer's relationship with any
person who at the relevant time is an employee, contractor, supplier, or
customer of the Employer or its Affiliates.  Following the termination of the
Employment Period, the Executive will not, either directly or indirectly, access
the Employer's computer systems, download files or any other information from
the Employer's computer systems or in any way interfere, disrupt, modify or
change any computer program used by the Employer or any data stored on the
Employer's computer systems.

(f)         Restricted Period.  For purposes of this Section 6.01, the term
"Restricted Period" means the period commencing with the Effective Date and
terminating one year after the termination of the Employment Period.

(g)        Market Area.  For purposes of this Section 6.01, the term "Market
Area" means the State of Texas and any other state or province in which the
Employer has provided goods or services within the twelve months prior to the
last day of the Employment Period.

6.02     Scope.  The Executive acknowledges and agrees that the geographic area,
length and scope of the restrictions contained in Section 6.01 are reasonable
and necessary to protect the legitimate business interests of the Employer.  The
duration of the agreements contained in Section 6.01 shall be extended for the
amount of any time of any violation thereof and the time, if greater, necessary
to enforce such provisions or obtain any relief or damages for such violation
through the court system.  The Employer may, at any time on written notice
approved by its Board of Directors, reduce the geographic area, length or scope
of any restrictions contained in Section 6.01 and, thereafter, the Executive
shall comply with the restriction as so reduced, subject to subsequent
reductions.  If any covenant in Section 6.01 of this Agreement is held to be
unreasonable, arbitrary, or against public policy, such covenant will be
considered to be divisible with respect to scope, time, and geographic area, and
such lesser scope, time, or geographic area, or all of them, as an arbitrator or
a court of competent jurisdiction may determine to be reasonable, not arbitrary,
and not against public policy, will be effective, binding, and enforceable
against the Executive.  In the event of termination of the Executive's
employment with the Employer for any reason, the Executive consents to the
Employer communicating with the Executive's new employer, any entity in the
Business or through or in connection with which the Executive is restricted
hereunder, or any other party about the restrictions and obligations imposed on
the Executive under this Agreement.

Section 7:         GENERAL PROVISIONS

7.01     Injunctive Relief and Additional Remedy.  The Executive acknowledges
that the injury that would be suffered by the Employer as a result of a breach
of the provisions of Sections 5 or 6 hereof might be irreparable and that an
award of monetary damages to the Employer for such a breach would be an
inadequate remedy.  Consequently, the Employer will have the right, in addition
to any other rights it may have, to obtain injunctive relief to restrain any
breach or threatened breach or otherwise to specifically enforce the provisions
of Sections 5 and 6 hereof.

 

 

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7.02     Covenants of Sections 5 and 6 are Essential and Independent Covenants. 
The covenants by the Executive in Sections 5 and 6 are essential elements of
this Agreement, and without the Executive's agreement to comply with such
covenants, the Employer would not have entered into this Agreement or employed
or continued the employment of the Executive.  The Employer and the Executive
have independently consulted their respective counsel and have been advised in
all respects concerning the reasonableness and propriety of such covenants, with
specific regard to the nature of the business conducted by the Employer.

7.03     Representations and Warranties by the Executive.  The Executive
represents and warrants to the Employer that (a) the Executive has never taken
any action of the types set forth in Section 4.03(b) though (f) and (b) the
execution and delivery by the Executive of this Agreement does not, and the
performance by the Executive of the Executive's obligations hereunder will not,
with or without the giving of notice or the passage of time, or both: (i)
violate any judgment, writ, injunction, or order of any court, arbitrator, or
governmental agency applicable to the Executive; or (ii) conflict with, result
in the breach of any provisions of or the termination of, or constitute a
default under, any agreement to which the Executive is a party or by which the
Executive is or may be bound.

7.04     Obligations Contingent on Performance.  The obligations of the Employer
hereunder, including its obligation to pay the compensation provided for herein,
are contingent upon the Executive's performance of the Executive's obligations
hereunder.

7.05     Binding Effect; Delegation of Duties Prohibited.  This Agreement shall
inure to the benefit of, and shall be binding upon, the parties hereto and their
respective successors, assigns, heirs, and legal representatives, including any
entity with which the Employer may merge or consolidate or to which all or
substantially all of its assets may be transferred.  The covenants of the
Executive under this Agreement, being personal, may not be delegated.

7.06     Notices.  All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by facsimile (with written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service
(receipt requested) or, (d) mailed by registered or certified mail, postage
prepaid and return receipt requested, in each case to the appropriate addresses
and facsimile numbers set forth below (or to such other addresses and facsimile
numbers as a party may designate by notice to the other parties):

           

  If to Employer:

Home Solutions of America, Inc.
1500 Dragon Street Suite B
Dallas, TX 75207
Facsimile: (214) 333-9435

        With a copy to:

Melissa Youngblood, Esq.
Hallett & Perrin, P.C.
2001 Bryan Street, Suite 3900
Dallas, TX 75201
Facsimile: (214) 922-4170

                                               

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  If to the Executive: Jeffrey M. Mattich
1500 Dragon Street Suite B
Dallas, TX 75207
Facsimile: (214) 333-9435

                              

7.07     Entire Agreement; Amendments.  This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, between the
parties hereto with respect to the subject matter hereof.  This Agreement may
not be amended orally; but only by an agreement in writing signed by the parties
hereto.

7.08     GOVERNING LAW; VENUE.  THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS RULES OR CHOICE OF LAWS RULES THEREOF.  VENUE FOR
ANY ACTION BROUGHT HEREUNDER SHALL BE AS DETERMINED UNDER THAT CERTAIN
PARTNERSHIP INTEREST PURCHASE AGREEMENT BY, AMONG OTHERS, THE EMPLOYER AND
MERRITT COMPUTER PRODUCTS, L.P., A TEXAS LIMITED PARTNERSHIP DATED AS OF THE
DATE OF THIS AGREEMENT.

7.09     Headings; Construction.  The headings in this Agreement are provided
for convenience only and will not affect its construction or interpretation. 
All references to "Section" or "Sections" refer to the corresponding Section or
Sections of this Agreement unless otherwise specified.  All words used in this
Agreement will be construed to be of such gender or number as the circumstances
require.

7.10     Severability.  If any provision of this Agreement is held invalid or
unenforceable by an arbitrator or any court of competent jurisdiction, the other
provisions of this Agreement will remain in full force and effect.  Any
provision of this Agreement held invalid or unenforceable only in part or degree
will remain in full force and effect to the extent not held invalid or
unenforceable.

7.11     Counterparts.  This Agreement may be executed in one or more
counterparts, including by facsimile signature, each of which will be deemed to
be an original copy of this Agreement and all of which, when taken together,
will be deemed to constitute one and the same agreement.

7.12     Survival of Obligations.  The obligations of the Employer and the
Executive under this Agreement which by their nature may require either partial
or total performance after the expiration of the Term shall survive such
expiration.

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7.13     Withholding and Set Off.  All payments and benefits made or provided
under this Agreement shall be subject to withholding as required under
applicable law.  The Employer is further authorized to withhold and setoff
against any such payments and benefits any amounts that the Executive may come
to owe the Employer, whether as a result of any breach of this Agreement or
otherwise.

7.14     Arbitration.  Any controversy or claim arising out of or relating to
this Agreement, or the Executive's employment by the Employer under this
Agreement, shall be settled by arbitration in accordance with the Rules of the
American Arbitration Association, and judgment rendered by the arbitrator may be
entered in any court having jurisdiction thereover. The arbitration shall be
conducted in either Houston, Texas or Dallas, Texas, unless otherwise agreed by
the parties thereto. The arbitrator shall be deemed to possess the power to
issue mandatory orders and restraining orders in connection with such
arbitration; provided, however, that nothing in this Section shall be construed
as to deny the Employer the right and power to seek and obtain injunctive relief
in a court of competent jurisdiction for any breach or threatened breach by
Executive of the covenants in Sections 5 or 6 of this Agreement.  A party hereto
shall initiate arbitration by sending written notice of its intention to
arbitrate to the other party and to the AAA office located in Dallas, Texas. 
Parties shall have the same period of time to file claims as provided by the
applicable statute of limitation for such claim.  Such written notice will
contain a description of the dispute and the remedy sought.  In the event that
the parties have not mutually agreed on an acceptable arbitrator within thirty
(30) days after the demand for arbitration is filed, the arbitrator shall be
appointed in the manner provided by the Commercial Arbitration Rules of the
AAA.  The decision of the arbitrator will be final and binding on the parties
hereto and their successors and assignees.  Where consistent with applicable
law, the arbitrator shall have the authority to order the non-prevailing party
to pay the prevailing party's attorney's fees and all costs of the arbitration. 
The parties will participate in good faith in a non-binding mediation of their
dispute at least 60 days prior to the date of the arbitration hearing.  The
parties shall jointly select the mediator but if they are unable to agree on a
mediator, then the arbitrator shall appoint the mediator.  The parties hereto
intend that this agreement to arbitrate be irrevocable.

Section 8:         CERTAIN DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings
indicated below:

"Affiliate" shall mean, as to any Person, any Person controlled by, controlling,
or under common control with such Person, and, in the case of a Person who is an
individual, a member of the family of such individual consisting of a spouse,
sibling, in-law, lineal descendant, or ancestor (including by adoption), and the
spouses of any such individuals.  For purposes of this definition, "control"
(including the terms "controlling", "controlled by" and "under common control
with") of a Person means the possession, directly or indirectly, alone or in
concert with others, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of
securities, by contract or otherwise, and no Person shall be deemed in control
of another solely by virtue of being a director, officer or holder of voting
securities of any entity.  A Person shall be presumed to control any partnership
of which such Person is a general partner.

 

 

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"Current Customer" shall mean any person or entity who is currently utilizing
any product or service sold or provided by the Employer through the facility
managed by the Executive; any person or entity who utilized any such product or
service within the previous 12 months; and any person or entity with whom the
Employer or any of its Affiliates is currently conducting negotiations
concerning the utilization of such products or services.

"Employment Period" shall mean the period during which the Executive has an
obligation to render to the Employer all or any portion of the services
described in Section 1.03 of this Agreement.  The Employment Period shall in no
event, however, extend past the Expiration Date.

"Person" shall have the meaning given in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended, as modified and used in Sections 13(d)(3) and
14(d)(2) of such act. 

 

 

 

 

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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first written above.

EMPLOYER:

 

HOME SOLUTIONS OF AMERICA, INC.

 

By:       /s/ Rick J. O'Brien                               
Name: Rick J. O'Brien                                  
Title:   President and Chief Operating Officer

 

EXECUTIVE:

/s/ Jeffrey M. Mattich                                       
                                                                        Jeffrey
M. Mattich

 

 

 

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