ROYALTY
      AGREEMENT

     

    This
      Royalty Agreement (this “Agreement”),
      which
      is made to be effective as of the Effective Date (as defined herein), is by
      and
      between Home Solutions of America, Inc., a Delaware corporation (“HSOA”),
      and
      RG Risk Management, Inc., a Texas corporation (“RGRM”).
      

     

    WHEREAS,
      HSOA and
      RGRM are parties to that certain Asset Purchase and Indemnity Agreement (the
      “Asset
      Purchase Agreement”)
      by and
      among the Seller (as defined therein) and the Purchaser (as defined therein)
      dated as of October 16, 2007, pursuant to which the Seller and the Purchaser
      have agreed to consummate a transaction (the “Transaction”)
      whereby the Purchaser shall acquire certain assets of the Seller, subject to
      the
      terms and conditions of the Asset Purchase Agreement; and

     

    WHEREAS,
      upon the
      closing of the Transaction, HSOA has agreed to enter into this Agreement with
      RGRM pursuant to which HSOA agrees to pay the Royalty (as defined below) to
      RGRM, subject to the terms and conditions hereof; and

     

    WHEREAS, the
      parties desire to enter into this Agreement in order to confirm the terms and
      conditions upon which HSOA will pay such Royalty to RGRM.

     

    NOW,
      THEREFORE,
      in
      consideration of the premises and the mutual covenants and agreements set forth
      in this Agreement, and other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties to this Agreement
      agree as follows:

     

    1. Royalty.
      Subject
      to the other provisions of this Agreement, HSOA agrees to pay to RGRM a royalty
      equal to seven percent (7%) of all gross written premiums actually collected
      by
      HSOA or its subsidiaries, less reasonable costs of collection (“Collected
      Premiums”)
      that
      are generated under the PropertySMARTTM
      risk
      management program or a substantially similar property insurance program created
      by HSOA or any of its subsidiaries and derived from the
      PropertySMARTTM
      risk
      management program (the “Royalty”)
      during
      the Term (as defined herein). Notwithstanding anything else to the contrary
      contained herein, RGRM acknowledges and agrees that HSOA has no obligation
      whatsoever to operate or maintain the PropertySMARTTM
      risk
      management program or any other similar risk management program and that HSOA
      may discontinue the PropertySMARTTM
      risk
      management program or any other similar risk management program at any time
      and
      for any reason, as determined by HSOA in its sole discretion. 

     

    2. Payments.
      HSOA
      will make a Royalty payment to RGRM within 15 calendar days following the end
      of
      each fiscal quarter occurring during the Term for all Collected Premiums
      received by HSOA or its subsidiaries in such fiscal quarter. The Royalty is
      payable in immediately available funds and payment shall be made to the address
      provided for RGRM in Section 8 of this Agreement or such other place as
      RGRM may designate from time to time. HSOA and RGRM acknowledge and agree that
      the Royalty due to RGRM hereunder is fair and equitable and constitutes part
      of
      the consideration to the Seller for the Transaction.

     

    
      
        
        

      

      
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    3. Term.
      The
      term
      of this Agreement will commence upon the date that the transactions contemplated
      by the Asset Purchase Agreement close (the “Effective
      Date”)
      and
      will terminate on the tenth (10th)
      anniversary of the Effective Date (the “Term”),
      unless earlier terminated by the mutual agreement of the parties or by HSOA
      upon
      RGRM’s material breach of any provision of this Agreement that is not cured by
      RGRM within thirty (30) days after HSOA’s written notice to RGRM of such breach.
      After the expiration of the initial Term, this Agreement may be renewed upon
      such terms and conditions as are mutually agreed to by the parties.

     

    4. Reporting.
      HSOA
      will provide RGRM with a report showing Collected Premiums by client, on a
      fiscal quarter basis.

     

    5. Audits.
      HSOA
      will provide RGRM with a copy of its audited financial statements on an annual
      basis.

     

    6. Representations
      and Warranties.
      To the
      best of its knowledge, RGRM represents and warrants that:

     

    (a) Except
      pursuant to the Asset Purchase Agreement, Restoration Group America, Inc.,
      a
      Texas corporation (“Restoration
      Group America”),
      has
      not assigned, transferred, conveyed or otherwise encumbered any right, title
      and
      interest under any license or other agreements relating to the
      PropertySMARTTM
      risk
      management program. 

     

    (b) Immediately
      prior to the Effective Date, Restoration Group America was the sole and
      exclusive owner of the PropertySMARTTM
      risk
      management program, free and clear of any liens, charges and encumbrances.
      No
      other person or entity other than HSOA and its subsidiaries has any claim with
      respect to the PropertySMARTTM
      risk
      management program whatsoever. 

     

    (c) Immediately
      prior to the Effective Date, Restoration Group America had the sole, full and
      clear title to the patents shown on Schedule
      A
      hereto
      for the goods and services covered by the registrations thereof or applications
      therefor. None of such trademarks and patents have been abandoned or dedicated
      to the public. RGRM, however, makes no representation that the applications
      currently filed with the United States Patent and Trademark Office will actually
      result in registrations.

     

    (d) Restoration
      Group America has not granted any license or entered into any contract or
      agreement or granted any security interest that in any way hinders or prohibits
      its right, power, and authority to grant all of the right, title, and interest
      the PropertySMARTTM
      risk
      management program to the Purchaser under the Asset Purchase Agreement.


     

    (e) The
      PropertySMARTTM
      risk
      management program does not infringe any rights owned or possessed by any third
      party, nor is there any valid ground for a claim that challenges the validity,
      enforceability, ownership or right of Restoration Group America to
      PropertySMARTTM
      risk
      management program. There are no claims, judgments or settlements to be paid
      by
      Restoration Group America or pending claims or litigation or threatened,
      relating to the PropertySMARTTM
      risk
      management program.

     

    
      
        
        

      

      
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    7. Indemnity.
      RGRM
      shall indemnify and hold harmless HSOA, its subsidiaries and their respective
      officers directors, affiliates employees and agents from and against any claim
      or loss, and any cost associated therewith (including but not limited to
      reasonable attorneys' fees), with respect to the breach of any representation,
      warranty or covenant of RGRM contained herein.

     

    8. Notices.
      All
      notices, requests, demands and other communications hereunder shall be in
      writing and shall be deemed to have been duly given (a) on the date of delivery
      if personally delivered, delivered by nationally recognized overnight delivery
      service guaranteeing at least second business day delivery, or (b) on the date
      of delivery as evidenced by the return receipt or similar evidence or on the
      fifth calendar day after mailing, whichever is earlier in time, if mailed,
      by
      registered or certified mail or delivered by any express delivery service,
      postage prepaid, and properly addressed as set forth below or at such other
      address as the addressee may have previously specified by notice delivered
      in
      accordance with this paragraph.

    


    If
      to
      RGRM:

     

    RG
      Risk
      Management, Inc.

    Attention:
      James Rea

    1507
      Capital Avenue, Suite 101

    Plano,
      Texas 75074

    Facsimile:
      (972) 665-0865

    


    With
      a
      copy (which shall not constitute notice) to:

    


    Hughes
      & Luce LLP

    1717
      Main
      Street

    Suite
      2800

    Dallas,
      Texas 75201

    Attention:
      I. Bobby Majumder, Esq.

    Facsimile:
      (214) 939-5849

    


    If
      to
      HSOA:

     

    Home
      Solutions of America, Inc.

    Attention:
      Jeffrey M. Mattich, CFO

    1500
      Dragon Street, Suite B

    Dallas,
      Texas 75207

    Facsimile:
      (214) 333-9435

     

    9. Force
      Majeure. For the period and to the extent that a
      party is disabled from fulfilling in whole or in part its obligations under
      this
      Agreement where such disability arises by reason of an event of force majeure
      (including any law or government regulation or any act of God, flood, war,
      revolution, civil commotion, political disturbance, strike, lockout, fire,
      explosion, breakdown of plant or machinery, shortages of transportation,
      facilities, fuel, energy, labor or materials or any other cause whatsoever
      over
      which such party has no direct control), such party will be released from such
      obligations until the abatement of such disability. Notice of any such
      disability and any abatement will be promptly given to the other party by the
      party claiming the benefit of this Section 9.

     

    
      
        
        

      

      
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    10. Severability.
      To the
      extent permitted by law, if it should ever be held that any provision contained
      in this Agreement does not contain reasonable limitations as to time,
      geographical area or scope of activity to be restrained, then the court so
      holding will at the request of either party hereto reform such provisions to
      the
      extent necessary to cause them to contain reasonable limitations as to time,
      geographical area, and scope of activity to be restrained and to give the
      maximum permissible effect to the intentions of the parties as set forth in
      this
      Agreement; and the court will enforce such provisions as so reformed. If,
      notwithstanding the foregoing, any provision contained in this Agreement will
      be
      held to be invalid, illegal or unenforceable under present or future laws
      effective during the term of this Agreement, then such provisions will be fully
      severable; this Agreement will be construed and enforced as if such illegal,
      invalid, or unenforceable provision had never comprised a part of this
      Agreement; and the remaining provisions of this Agreement will remain in full
      force and effect and will not be affected by the illegal, invalid, or
      unenforceable provision or by its severance from this Agreement. Furthermore,
      in
      lieu of such illegal, invalid, or unenforceable provision, there will be added
      automatically by the parties as a part of this Agreement a provision as similar
      in terms to such illegal, invalid or unenforceable provision as may be possible
      and be legal, valid and enforceable.

     

    11. Amendment;
      Waiver.
      No
      amendment, modification or waiver of any of the provisions of this Agreement,
      or
      any future representation or promise, will be binding upon the parties unless
      agreed to in writing by the party to be bound thereby. The waiver by either
      party hereto of a breach or violation of any provision of this Agreement will
      not operate as, or be construed to be, a waiver of any subsequent breach of
      the
      same or other provision of this Agreement.

     

    12. Binding
      on Successors.
      The
      provisions of this Agreement will be binding upon and inure to the benefit
      of
      the parties, their successors and assigns. HSOA may assign its obligations
      under
      this Agreement to any successor of HSOA or to any purchaser acquiring the
      PropertySMARTTM
      risk
      management program upon written notice to RGRM.

     

    13. Captions;
      Facsimile Signatures.
      Captions
      contained in this Agreement are solely for convenience of reference and will
      not
      be deemed to affect the interpretation or meaning of any of the provisions
      of
      this Agreement. A photographic,
      photostatic,
      facsimile or similar reproduction of a signature of this Agreement by or on
      behalf of any party hereto will be regarded as signed by that party for the
      purposes of this Agreement.

     

    14. Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which will be
      deemed an original, and all of which together constitute one and the same
      instrument.

     

    15. Governing
      Law. This Agreement will be governed by and
      construed in accordance with the laws of the State of Texas applicable to
      contracts made and to be performed therein, exclusive of the conflict of laws
      provisions thereof. Any action or proceeding arising out of or related in any
      way to this Agreement may be brought in any state or federal court of competent
      jurisdiction sitting in Dallas County, Texas. 

     

    
      
        
        

      

      
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    16. Attorneys’
      Fees.
      If any
      action or proceeding is brought under this Agreement, the prevailing party
      will
      be entitled to recover all costs and expenses, including reasonable attorneys’
fees.

     

    17. No
      Third Party Beneficiaries.
      None of
      the obligations hereunder of either party shall run to or be enforceable by
      any
      party other than a party to this Agreement or by a party deriving rights
      hereunder as a result of an assignment permitted pursuant to the terms
      hereof.

     

    18. Offset
      - Legal Fees.
      RGRM
      hereby grants HSOA the right to offset and credit against the quarterly Royalty
      payments due to RGRM hereunder, up to $50,000 in legal fees paid by HSOA on
      behalf of RG America, Inc. and its subsidiaries in accordance with Section
      2.01
      of the
      Asset Purchase Agreement. The amount of offset to be deducted from each Royalty
      payment due to RGRM hereunder shall not exceed twenty percent (20%) of such
      Royalty payment. HSOA’s offset rights hereunder shall continue until HSOA is
      repaid in full for all legal fees paid by HSOA on behalf of RG America, Inc.
      and
      its subsidiaries in accordance with Section
      2.01
      of the
      Asset Purchase Agreement.

     

    19. Entire
      Agreement.
      This
      Agreement sets forth the entire agreement and understanding between the parties
      relating to the subject matter hereof.

     

    [Remainder
      of page intentionally left blank.]

     

    
      
        
        

        
        

      

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

     

    
      	
              HOME
                SOLUTIONS OF AMERICA, INC.

            
	 
	
              By:

            	
              /s/
                Jeff Mattich

            
	
              Name:

            	
              Jeff
                Mattich

            
	
              Title:

            	
              Chief
                Financial Officer

            


    

    


    
      	
              RG
                RISK MANAGEMENT, INC.

            
	 
	
              By:

            	
              /s/
                James A. Rea

            
	
              Name:

            	
              James
                A. Rea

            
	
              Title:

            	
              President