Exhibit 10.3





SECURITY
AGREEMENT






            THIS SECURITY AGREEMENT ("Agreement")
dated March ___, 2005, is made and entered into on the terms and conditions
hereinafter set forth, by and between HOME SOLUTIONS OF AMERICA, INC., a
Delaware corporation ("Borrower"), the Subsidiaries and other
Affiliates of the Borrower now or hereafter becoming a Guarantor under the Loan
Agreement (as hereinafter defined) (such Subsidiaries and Affiliates are
sometimes hereinafter referred to individually as a "Guarantor"
and individually and collectively as the "Guarantors"; the
Guarantors and the Borrower are sometimes herein referred individually and
collectively as the "Debtor" or "Debtors"),
and PETRA MEZZANINE FUND, L.P., a Delaware limited partnership, as
Administrative Agent (in such capacity, the "Administrative Agent").






RECITALS:




            1.         Pursuant to a Loan Agreement of even
date herewith, by and between the Lenders named therein, the Administrative
Agent and Borrower (together with any and all amendments, modifications,
supplements, extensions, renewals, substitutions and/or replacements thereof,
herein referred to as the "Loan Agreement"; capitalized terms
used but not otherwise defined herein shall have the same meanings as in the
Loan Agreement), Lenders have agreed to make a term loan in the aggregate
original principal amount of FOUR MILLION and No/100ths Dollars ($4,000,000.00)
(the "Loan") to Borrower.




            2.         The Loan is evidenced by one or more
promissory notes of even date with the Loan Agreement, in the Loan amount, made
and executed by Borrower, payable to the order of each Lender, respectively
(together with any and all amendments, modifications, supplements, extensions,
renewals, substitutions and/or replacements thereof, herein referred to
collectively as the "Notes").




            3.         As a condition to the making of the
Loan, Lenders have required that Debtors execute and deliver this Agreement to
the Administrative Agent.






AGREEMENTS:




            NOW, THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:




            1.         Grant of Security Interest. 
Each Debtor hereby grants to and creates in favor of the Administrative Agent a
security interest in the following properties, assets and rights of such
Debtor, whether now owned or hereafter acquired or arising, and wherever
located (collectively the "Collateral"):




(a)        accounts,




 




 















 





  	(b)	chattel paper,
	(c) 	deposit accounts,
	(d)	documents,
	(e)	equipment,
	(f) 	fixtures,
	(g)	general intangibles,
	(h)	goods not otherwise described herein with greater particularity,
	(i)	instruments,
	(j)	inventory,
	(k)	investment property,
	(l)	letter-of-credit rights,
	(m)	money, and
	(n)	oil, gas and other minerals, including as-extracted collateral.







            2.         Secured Indebtedness.  This
Agreement secures the full and prompt payment and performance of (a)  the
indebtedness and other obligations of Debtors to Lenders pursuant to the Loan
Agreement, the Notes and the other Loan Documents, (b) any and all other
indebtedness and other obligations of Debtors to Lenders and the Administrative
Agent, direct or contingent (including but not limited to obligations incurred
as indorser, guarantor or surety), however evidenced or denominated, and
however and whenever incurred, including but not limited to indebtedness
incurred pursuant to any present or future commitment of Lenders to Debtors,
and (c) all future advances made by Lenders or the Administrative Agent for
taxes, levies, insurance and preservation of the Collateral and all attorney's
fees, court costs and expenses of whatever kind incident to the collection of
any of said indebtedness or other obligations and the enforcement and
protection of the security interest created hereby.




            3.         Representations, Warranties and
Agreements of Borrower.  Each Debtor represents, warrants and agrees as
follows:




                        (a)        The
location of Debtors' chief executive offices and other places of business, and
the locations of all tangible Collateral and of all records concerning the
Collateral, are identified on attached Schedule 3(a).  Except as set
forth on Schedule 3(a), during the five (5) years preceding the date of
this Agreement, Debtors have not had any other places of business or location
of assets.  Debtors will promptly notify the Administrative Agent, in writing,
of any new place or places of business and of any change in the location of the
Collateral or any records pertaining thereto.




                        (b)        Debtors
are the owner of the Collateral free and clear of any Liens other than
Permitted Liens.  Debtors will defend the Collateral against the claims and
demands of all persons other than those in respect of Permitted Liens.




                        (c)        Debtors
will at all times keep the Collateral insured against all insurable hazards in
amounts equal to the full insurable value of the Collateral.  Such insurance
shall be in such companies as are acceptable to the Administrative Agent, with
provisions satisfactory to the Administrative Agent for payment of all losses
thereunder to the Administrative Agent as its interests appear.  If required by
the Administrative Agent, Debtors shall deposit the policies (or duplicate
originals of such policies) with the Administrative Agent.  Any money received
by the Administrative Agent under said policies may be applied to the payment
of any indebtedness or obligation secured hereby, regardless of whether then
due and payable; or at the Administrative Agents' option may be delivered by
the Administrative Agent to Debtors for the purpose of repairing or restoring
the Collateral.  Debtors assign to the Administrative Agent all right to receive
proceeds of insurance not exceeding the amounts secured hereby, direct any
insurer to pay all proceeds directly to the Administrative Agent, and appoint
the Administrative Agent Debtors' attorney in fact to endorse any draft or
check made payable to any Debtor in order to collect the benefits of such
insurance.  If Debtors fail to keep the Collateral insured as required by the
Administrative Agent, the Administrative Agent shall have the right to obtain
such insurance at Debtors' expense and add the cost thereof to the other
amounts secured hereby.




 




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                        (d)        Borrower
shall, and shall cause each of the Guarantors to, at their sole cost and
expense, execute and deliver to the Administrative Agent all such further
documents, instruments and agreements and perform all such other acts that
reasonably may be required in the opinion of the Administrative Agent to enable
the Administrative Agent to exercise and enforce its rights as the secured
party under this Agreement and the other Security Documents and to carry out
the provisions or effectuate the purposes of this Agreement and the other
Security Documents.  To the extent permitted by applicable law, Debtors hereby
authorize the Administrative Agent to file financing statements and
continuation statements with respect to the security interests granted or
assigned under this Agreement and the other Security Documents, and to do all
other things it deems appropriate to perfect and continue perfection of the
security interests created hereby and to protect the Collateral.  




            4.         Special Agreements With Respect to
Tangible Collateral.  Debtors additionally agree and warrant as follows:




                        (a)        Debtors
will not permit any of the Collateral to be removed from the location(s)
specified herein, except for temporary periods in the normal and customary use
thereof, without the prior written consent of the Administrative Agent, and
will permit the Administrative Agent to inspect the Collateral at any time.




                        (b)        If
any of the Collateral is equipment or goods of a type normally used in more
than one jurisdiction (regardless of whether actually so used), Debtors will
contemporaneously with the execution and delivery of this Agreement furnish to
the Administrative Agent a list of the jurisdictions wherein such equipment or
goods are or will be used, and hereafter will notify the Administrative Agent
promptly in writing (1) of any other jurisdictions in which such equipment or
goods are so used, and (2) of any change in the location of any Debtor's chief
executive office.




                        (c)        Except
as permitted by the Loan Agreement, Debtors will not sell, exchange, lease or
otherwise dispose of any of the Collateral or any interest therein without the
prior written consent of the Administrative Agent.




 




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                        (d)        Debtors
will keep the Collateral in good condition and repair and will pay and
discharge all taxes, levies and other impositions levied thereon as well as the
cost of repairs to or maintenance of same, and will not permit anything to be
done that may impair the value of any of the Collateral.  If Debtors fail to
pay such sums, the Administrative Agent may do so for Debtors' account and add
the amount thereof to the other amounts secured hereby.




                        (e)        Prior
to the occurrence of an Event of Default, Debtors shall be entitled to
possession of the Collateral and to use the same in any lawful manner, provided
that such use does not cause excessive wear and tear to the Collateral, cause
it to decline in value at an excessive rate, or violate the terms of any policy
of insurance thereon.




                        (f)         Debtors
will not allow the Collateral to be attached to real estate in such manner as
to become a fixture or a part of any real estate.




            5.         Special Agreements With Respect to
Intangible and Certain Tangible Collateral.  Debtors additionally warrants
and agrees as follows:




                        (a)        Prior
to the occurrence of an Event of Default, Debtors shall have the right to
process and sell Debtors' inventory in the regular course of business.  The
Administrative Agent's security interest hereunder shall attach to all proceeds
of all sales or other dispositions of the Collateral.  If at any time any such
proceeds shall be represented by any instruments, chattel paper or documents of
title, then such instruments, chattel paper or documents of title shall be
promptly delivered to the Administrative Agent and subject to the security
interest granted hereby.  If at any time any of Debtors' inventory is
represented by any document of title, such document of title will be delivered
promptly to the Administrative Agent and subject to the security interest
granted hereby.




                        (b)        By
the execution of this Agreement, the Administrative Agent shall not be
obligated to do or perform any of the acts or things provided in any contracts
covered hereby that are to be done or performed by Debtors, but upon the
occurrence and during the continuance of an Event of Default, the
Administrative Agent may, at its election, perform some or all of the
obligations provided in said contracts to be performed by Debtors, and if the
Administrative Agent incurs any liability or expenses by reason thereof, the
same shall be payable by Debtors upon demand and shall also be secured by this
Agreement.




                        (c)        Upon
the occurrence and during the continuance of an Event of Default, the
Administrative Agent shall have the right to notify the account debtors
obligated on any or all of Debtors' accounts to make payment thereof directly
to the Administrative Agent, and to take control of all proceeds of any such
accounts.  Until such time as the Administrative Agent elects to exercise such
right by notice to Debtors, Debtors are authorized, as agent of the
Administrative Agent, to collect and enforce said accounts.




 




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            6.         Protection of Collateral. 
Except for Permitted Liens, Debtors will not permit any liens or security interests
other than those created by this Agreement to attach to any of the Collateral,
nor permit any of the Collateral to be levied upon under any legal process, nor
permit anything to be done that may impair the security intended to be afforded
by this Agreement, nor permit any tangible Collateral to become attached to or
commingled with other goods without the prior written consent of the
Administrative Agent.




            7.         Inspection and Verification of
Collateral.  The Administrative Agent shall have the right, at any time, by
its own auditors, accountants or other agents, to examine or audit any of the
books and records of Debtors, or the Collateral, all of which will be made
available upon request.  Such auditors, accountants or other representatives of
the Administrative Agent will be permitted to make any verification of the
existence of the Collateral or accuracy of the records that the Administrative
Agent deems necessary or proper.  Any reasonable expenses incurred by the
Administrative Agent in making such examination, inspection, verification or
audit shall be paid by Debtors promptly on demand and shall be secured by the
security interest granted hereby.




            8.         Default and Remedies.  Upon
the occurrence of an Event of Default, the Administrative Agent may proceed to
exercise any and all rights and remedies provided by the Tennessee Uniform
Commercial Code or other applicable law, as well as all other rights and
remedies possessed by the Administrative Agent, all of which shall be
cumulative.  Upon the occurrence of an Event of Default, and upon demand by the
Administrative Agent, Debtors shall assemble the Collateral and make it
available to the Administrative Agent at a place reasonably convenient to the
Administrative Agent and Debtors.  Any notice of sale, lease or other intended
disposition of the Collateral by the Administrative Agent sent to Debtors at
the address set forth for the Borrower in the Loan Agreement, or at such other
address of Borrower as may be shown on the Administrative Agent's records, at
least five (5) days prior to such action, shall constitute reasonable notice to
Debtors.




            The Administrative Agent may waive any default
before or after the same has been declared without impairing its right to
declare a subsequent default hereunder, this right being a continuing one.




            9.         Power of Attorney.  Each
Debtor hereby constitutes the Administrative Agent or its designee, as such
Debtor's attorney-in-fact with power, upon the occurrence and during the
continuance of an Event of Default, to endorse such Debtor's name upon any
notes, acceptances, checks, drafts, money orders or other evidences of payment
or Collateral that may come into either its or the Administrative Agent's
possession; to sign the name of such Borrower on any invoice or bill of lading
relating to any of the accounts receivable, drafts against customers,
assignments and verifications of accounts receivable and notices to customers;
to send verifications of accounts receivable; to notify the Post Office
authorities to change the address for delivery of mail addressed to such Debtor
to such address as the Administrative Agent may designate; to execute any of
the documents referred to in subsection 3(d) hereof in order to perfect and/or
maintain the security interests and liens granted herein by Debtors to the
Administrative Agent; and to do all other acts and things necessary to carry
out this Security Agreement.  All acts of said attorney or designee are hereby
ratified and approved, and said attorney or designee shall not be liable for
any acts of commission or omission (other than acts of gross negligence or
willful misconduct), nor for any error of judgment or mistake of fact or law. 
This power, being coupled with an interest, is irrevocable until all of the
indebtedness and other obligations secured hereby have been fully paid or
performed.




 




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            10.       Notices.  Any and all notices,
elections or demands permitted or required to be made under this Agreement
shall be given as provided in the Loan Agreement, with the address of each
Guarantor being the same as the address set forth for the Borrower in the Loan
Agreement, or at such other address of Borrower as may be shown on the
Administrative Agent's records.




            11.       Severability.  If any
provision(s) of this Agreement or the application thereof to any person or
circumstance shall be invalid or unenforceable to any extent, the remainder of
this Agreement and the application of such provisions to other persons or
circumstances shall not be affected thereby and shall be enforced to the greatest
extent permitted by law.




            12.       Binding Effect.  This Agreement
shall inure to the benefit of the Administrative Agent's successors and assigns
and shall bind Borrower's heirs, representatives, successors and assigns.  If
Debtors are composed of more than one Person, their obligations hereunder shall
be joint and several.




            13.       Termination Statement. 
Borrower agrees that, notwithstanding the payment in full of all indebtedness
secured hereby and whether or not there is any outstanding obligation of the Lenders
to make future advances, the Administrative Agent shall not be required to send
Debtors termination statements with respect to any financing statement filed to
perfect the Administrative Agent's security interest(s) in any of the
Collateral, unless and until Debtors shall have made written demand therefor. 
Upon receipt of proper written demand, the Administrative Agent may at its
option, in lieu of sending a termination statement to Debtors, cause said
termination statement to be filed with the appropriate filing officer(s).




            14.       Governing Law.  This Agreement
shall be construed and enforced under the law of the State of Tennessee.




            15.       General Construction.  All
terms used but not otherwise defined herein that are defined or used in Article
9 of the Tennessee Uniform Commercial Code shall have the respective meanings
assigned to them in such Article.  As used in this Agreement, the masculine,
feminine and neuter genders and the plural and singular numbers shall be deemed
to include the others in all cases in which they would so apply. 
"Includes" and "including" are not limiting, and shall be
deemed to be followed by "without limitation" regardless of whether
such words or words of like import in fact follow same.  The word
"or" is not intended and shall not be construed to be exclusive.




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            IN WITNESS WHEREOF,
the parties hereto have executed this Security Agreement, or have caused this
Security Agreement to be executed by their duly authorized officers or other
representatives, as of the date first above written.






                                                                       





  	 DEBTORS:
	  
	HOME
SOLUTIONS OF AMERICA, INC.
	  
	By:_______________________________________
	              Title:_______________________________
	  
	  
	CORNERSTONE BUILDING AND


      REMODELING, INC.
	   
	By:_______________________________________
	              Title:_______________________________
	   
	P.W.
STEPHENS, INC.
	  
	By:_______________________________________
	              Title:_______________________________
	   
	   
	 ADMINISTRATIVE
AGENT:
	  
	PETRA
MEZZANINE FUND, L.P.
	  
	By: 
Petra Partners, LLC, its general partner
	  
	     By:___________________________ 
	           Michael W.
Blackburn,
	           Managing Member




 

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SCHEDULE 3(a)


[Places of
Business; Locations of Collateral and Records]











































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