**Dated as of:  June 2, 2004**

**THIS NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES ANDEXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE AND IS ISSUED INRELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFEREDOR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THESECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTIONNOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND INACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.**

No. 1                                                                                                                                    $800,000

**Home Solutions of America, Inc.**

**Amended and Restated Promissory Note**

 

            This Amended andRestated Promissory Note (the "Note") is issued jointly and severally  byHome Solutions of America, Inc. formerly known as Nextgen CommunicationsCorporation,****a Delaware corporation ("HOM"), and P.W. Stephens, Inc., aCalifornia corporation ("Stephens" and together with HOM, collectively,individually, jointly and severally an "Obligor") to Jane C. Barber, anindividual (the "Holder"), pursuant to Section 2 of that certain FourthAmendment to Stock Purchase Agreement and Global Settlement and ReleaseAgreement (the "Fourth Amendment") of even date herewith, pursuant towhich each Obligor and the Holder, among others, have settled certain disputesamong themselves and other parties.  Pursuant to the Fourth Amendment, thisNote is being issued in exchange (in full substitution for and replacement of) forthat certain Promissory Note (the "Original Note") dated as of November1, 2002, in the original principal amount of $1,444,100, issued by HOM to theHolder, which currently has an outstanding balance of $970,677.81, as of May26, 2004.  The Original Note was issued in connection with the sale (the "Sale") by the Holder of all of the outstanding capital stock of Stephens.  ThisNote evidences a portion of the consideration owed to the Holder in connectionwith the Sale.

**            FOR VALUE RECEIVED**, each Obligorhereby promises to pay to the Holder or her registered assigns the aggregate principalsum of $800,000, together with accrued interest thereon, on the followingterms:

*           Payments*.  Payments ofprincipal and interest on the outstanding principal balance hereof shall be dueand payable as follows:  (i) $75,000 shall be paid on the date hereof, (ii) elevenequal monthly installments of $62,346 shall be paid on the 26th day of themonth, commencing June 26, 2004, and (iii) all remaining principal and interestshall be due and payable on May 26, 2005 (the "Maturity Date").  Allpayments in respect of the indebtedness evidenced hereby shall be made incollected funds, and shall be applied to accrued interest before principal. This Note may be prepaid at any time without penalty.  

 

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*           Interest*.  Interest shallaccrue on the outstanding principal balance hereof at an annual rate equal to sixpercent (6%), commencing on the date hereof.  Interest shall be calculated onthe basis of a 360-day year and the actual number of days elapsed, to theextent permitted by applicable law.  Interest hereunder will be paid to thePerson (as defined in Section 4) in whose name this Note is registered on therecords of each Obligor regarding registration and transfers of Notes (the "NoteRegister").  Notwithstanding any provision hereof, until an assignment ofthis Note by the Holder, this Note shall be registered in the name of Jane C.Barber on the records of each Obligor in the Note Register, and after suchassignment in the name of all holder of this Note.

This Note is subject to the following additional provisions:

*Section 1*.        This Note is exchangeable for anequal aggregate principal amount of Notes of different authorizeddenominations, as requested by the Holder surrendering the same. No servicecharge will be made for such registration of transfer or exchange.

*Section 2*.       Events of Default.

(a)        An "Event of Default", wherever used herein,means any one of the following events (whatever the reason and whether it shallbe voluntary or involuntary or effected by operation of law or pursuant to anyjudgment, decree or order of any court, or any order, rule or regulation of anyadministrative or governmental body):

(i)         Any default in the payment of the principalof, interest on or other charges in respect of this Note, free of any claim ofsubordination, as and when the same shall become due and payable (whether on aninstallment, an Interest Payment Date, or the Maturity Date or by accelerationor otherwise), upon 10 days' notice from the Holder to HOM; or

(ii)        An Obligor shall commence, or there shall becommenced against an Obligor under any applicable bankruptcy or insolvency lawsas now or hereafter in effect or any successor thereto, or an Obligor commencesany other proceeding under any reorganization, arrangement, adjustment of debt,relief of debtors, dissolution, insolvency or liquidation or similar law of anyjurisdiction whether now or hereafter in effect relating to an Obligor or thereis commenced against an Obligor any such bankruptcy, insolvency or otherproceeding which remains undismissed for a period of 61 days; or an Obligor isadjudicated insolvent or bankrupt; or any order of relief or other orderapproving any such case or proceeding is entered; or an Obligor suffers anyappointment of any custodian or the like for it or any substantial part of itsproperty which continues undischarged or unstayed for a period of 61 days; or anObligor makes a general assignment for the benefit of creditors; or an Obligorshall fail to pay, or shall state that it is unable to pay, or shall be unableto pay, its debts generally as they become due; or an Obligor shall call ameeting of its creditors with a view to arranging a composition, adjustment orrestructuring of its debts; or an Obligor shall by any act or failure to actexpressly indicate its consent to, approval of or acquiescence in any of theforegoing; or any corporate or other action is taken by an Obligor for thepurpose of effecting any of the foregoing.

 

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(iii)       Any Obligor shall default under any term or provisionsof any agreement, note or instrument by and between or among any Obligor andthe Holder, including, but not limited to, the Fourth Amendment, or deliveredor held by or for the benefit of the Holder, and such default remains uncuredfor ten days following delivery of written notice from or on behalf of theHolder to HOM.

(b)        During the time that any portion of this Note isoutstanding, if any Event of Default occurs and is continuing, the fullprincipal amount of this Note, together with interest and other amounts owingin respect thereof, to the date of acceleration shall become at the Holder'selection, immediately due and payable in cash.  The Holder need not provide andeach Obligor hereby waives any presentment, demand, protest or other notice ofany kind, and the Holder may immediately and without expiration of any graceperiod enforce any and all of its rights and remedies hereunder and all otherremedies available to it under applicable law. Such declaration may berescinded and annulled by Holder at any time prior to payment hereunder. Nosuch rescission or annulment shall affect any subsequent Event of Default orimpair any right consequent thereon.

*Section 3*.       Notices.  Any notices,consents, waivers or other communications required or permitted to be givenunder the terms hereof must be in writing and will be deemed to have beendelivered:  (i) upon receipt, when delivered personally; (ii) upon receipt,when sent by facsimile (provided confirmation of transmission is mechanicallyor electronically generated and kept on file by the sending party); or (iii)one (1) Business Day (defined below) after deposit with a nationally recognizedovernight delivery service, in each case properly addressed to the party toreceive the same.  The addresses and facsimile numbers for such communicationsshall be:

| If to Obligor:    | Home Solutions of  America, Inc.                                                              |
|-------------------|-----------------------------------------------------------------------------------------------|
|                   | 5565 Red Bird Center    Drive			Suite 150                                                     |
|                   | Dallas, Texas 75237                                                                           |
|                   | Attn: Rick J. O'Brien,  CFO                                                                   |
|                   | Facsimile No.: (214) 333-9435                                                                 |
|                   |                                                                                          |
|                   |                                                                                          |
| With Copy to:     | J. Paul Caver, Esq.			2724 Routh Street			Dallas, Texas 75201			Facsimile No.: (214) 468-8867 |
|                   |                                                                                          |
| If to the Holder: | Jane C. Barber                                                                                |
|                   | 1633 Chandelle Lane                                                                           |
|                   | Fallbrook, California 92028                                                                   |
|                   | Facsimile No.: (760)  723-9207                                                                |
|                   |                                                                                               |

 

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| With Copy to: | Joel J. Thomas, Esq.		Law Officer of Joel Thomas		46 Windjammer Court		Long Beach, CA 90803		Facsimile No.: (562) 493-8850 |
|---------------|----------------------------------------------------------------------------------------------------------------------------|
|               |                                                                                                                            |

or at such other address and/orfacsimile number and/or to the attention of such other person as the recipientparty has specified by written notice given to each other party three (3)business days prior to the effectiveness of such change.  Written confirmationof receipt (i) given by the recipient of such notice, consent, waiver or othercommunication, (ii) mechanically or electronically generated by the sender'sfacsimile machine containing the time, date, recipient facsimile number and animage of the first page of such transmission or (iii) provided by a nationallyrecognized overnight delivery service, shall be rebuttable evidence of personalservice, receipt by facsimile or receipt from a nationally recognized overnightdelivery service in accordance with clause (i), (ii) or (iii) above,respectively.

*Section 4*.       Definitions.  For thepurposes hereof, the following terms shall have the following meanings:

"Business Day" means any day except Saturday, Sunday andany day which shall be a federal legal holiday in the United States or a day on which banking institutions are authorized or required by law orother government action to close.

"Person" means a corporation, an association, apartnership, organization, a business, an individual, a government or politicalsubdivision thereof or a governmental agency.

*Section 5*.        If this Note is mutilated, lost,stolen or destroyed, each Obligor shall execute and deliver, in exchange andsubstitution for and upon cancellation of the mutilated Note, or in lieu of orin substitution for a lost, stolen or destroyed Note, a new Note for theprincipal amount of this Note so mutilated, lost, stolen or destroyed but onlyupon receipt of evidence of such loss, theft or destruction of such Note, andof the ownership hereof, and indemnity, if requested, all reasonablysatisfactory to each Obligor.

*Section 6*.         Should any litigation becommenced between the parties hereto or their personal representativesconcerning any provision of this Note or the rights and duties of any person inrelation thereto, the party prevailing in such litigation shall be entitled to,in addition to such other relief that may be granted, a reasonable sum as andfor her or its attorneys' fees in such litigation.

*Section 7*.        Any waiver by the Holder of abreach of any provision of this Note shall not operate as or be construed to bea waiver of any other breach of such provision or of any breach of any otherprovision of this Note. The failure of the Holder to insist upon strictadherence to any term of this Note on one or more occasions shall not beconsidered a waiver or deprive that party of the right thereafter to insistupon strict adherence to that term or any other term of this Note. Any waivermust be in writing.

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*Section 8*.        If any provision of this Note isinvalid, illegal or unenforceable, the balance of this Note shall remain ineffect, and if any provision is inapplicable to any person or circumstance, itshall nevertheless remain applicable to all other persons and circumstances. Ifit shall be found that any interest or other amount deemed interest duehereunder shall violate applicable laws governing usury, the applicable rate ofinterest due hereunder shall automatically be lowered to equal the maximumpermitted rate of interest. Each Obligor covenants (to the extent that it maylawfully do so) that it shall not at any time insist upon, plead, or in anymanner whatsoever claim or take the benefit or advantage of, any stay,extension or usury law or other law which would prohibit or forgive an Obligorfrom paying all or any portion of the principal of or interest on this Note ascontemplated herein, wherever enacted, now or at any time hereafter in force,or which may affect the covenants or the performance of this indenture, and eachObligor (to the extent it may lawfully do so) hereby expressly waives allbenefits or advantage of any such law, and covenants that it will not, byresort to any such law, hinder, delay or impeded the execution of any powerherein granted to the Holder, but will suffer and permit the execution of everysuch as though no such law has been enacted.

*Section 9*.        Whenever any payment or otherobligation hereunder shall be due on a day other than a Business Day, suchpayment shall be made on the next succeeding Business Day.

*Section 10*.     No Usury.  Each Obligordoes not intend or expect to pay, nor does the Holder intend or expect tocharge, collect or accept, any interest greater than the highest legal rate ofinterest that may be charged under any applicable law.  Should the accelerationhereof or any charges made hereunder result in the computation or earning ofinterest in excess of such legal rate, any and all such excess shall be and thesame is hereby waived by the Holder, and any such excess shall be credited bythe Holder to the principal balance hereof.

*Section11*.      INTENTIONALLY OMITTED

*Section12**.*      Jurisdiction; Service of Process.  Any action orproceeding seeking to enforce any provision of, or based on any rights arisingout of, this Note may be brought against any of the parties in the courts ofthe State of California, County of Orange, and each of the parties consents tothe jurisdiction of such courts (and of the appropriate appellate courts) inany such action or proceeding and waives any object to venue laid therein. Process in any action or proceeding referred to in the preceding sentence maybe served on any party anywhere in the world.

**Notwithstanding any other provisionof this Note or any other document or agreement between the Holder and anObligor, neither Obligor may reduce the amount of any payment obligation underthis Note or any other Agreement Documentation, as defined in the FourthAmendment (each a "Payment Obligation") as an off set against any allegedand/or actual obligation of the Holder to any Obligor or any third party ("HolderObligation").  Any attempt to reduce the amount of any Payment Obligation inreduction or payment of or otherwise in connection with any Holder Obligation(such reduction or attempted reduction being referred to herein as a "PaymentOffset") shall be null and void and constitute a default by each Obligor and anevent of default under any and all document(s) or agreement(s) by and between oramong the Holder and either Obligor or to which the Holder is a beneficiary,including, without limitation, this Note, or under which an Obligor has anobligation under or in connection with the Agreement Documentation, as definedin the Fourth Amendment or the transactions contemplated thereby, including,without limitation, any Stock Purchase Documentation, as defined in the FourthAmendment.  Upon the occurrence of an Payment Offset or an attempted PaymentOffset, the Holder and any assign of the Holder may avail herself, himself oritself any and all rights the same may have at law or in equity.**

 

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**THE OBLIGATIONS OF EITHER OBLIGOR TOTHE HOLDER UNDER THIS INSTRUMENT SHALL NOT BE SUBORDINATED TO ANY OTHEROBLIGATION OF THE OBLIGOR.**

[Remainderof page intentionally left blank.]

 

 

 

 

 

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**IN WITNESS WHEREOF**, each Obligor  has executed this Amendedand Restated Promissory Note as of the date set forth above.

|  | The Obligor:

Home Solutions of America, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | By:                                                                  				Name:                                                             		Title:                                                                 |
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

|        | The Obligor:

P.W. Stephens, Inc., a California Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|        | By:                                                                  		Name:                                                             		Title:                                                                 |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

 

 

 

 

 

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