Document:

Exhibit 10.5

INVESTORS' RIGHTS AGREEMENT

THIS INVESTORS' RIGHTS AGREEMENT (the "Agreement") is made
as of March 31, 2005 by and among Home Solutions of American, Inc., a Delaware
corporation (the "Company"), Petra Mezzanine Fund, L.P. ("Petra"), Frank J.
Fadella and Rick J. O'Brien (collectively, the "Management Stockholders").  

RECITALS

WHEREAS, the Company has requested that Petra make available to
the Company a term loan in the original principal amount of Four Million
Dollars ($4,000,000) (the "Loan");  

WHEREAS, as consideration for Petra making the Loan
to the Company, the Company proposes to grant Petra warrants (the "Warrants")
to purchase an aggregate of 533,333 shares of the Company's common stock,
$0.001 par value per share (the "Common Stock"); 

WHEREAS,
to induce Petra to make the Loan, the Company has agreed to enter into this
Agreement to provide for certain rights, privileges and preferences in favor of
Petra; and

WHEREAS,
subsequent to the date hereof, the Company may borrow up to an additional $3,000,000
(the "Additional Loan") from a Person (or Persons) reasonably acceptable to
Petra and on terms reasonably acceptable to Petra (any such Person (or Persons)
to be referred to as the "Additional Investor" and together with Petra, the
"Investors"), and in the event that, as consideration for such Additional
Investor making the Additional Loan to the Company, the Company grants such
Additional Investor warrants to purchase shares of Common Stock, such warrants
to be exercisable for no more than 400,000 shares of Common Stock and shall be
on terms  reasonably acceptable to Petra (the "Additional Warrants"), each such
Additional Investor may become a party to this Agreement by executing a Joinder
Agreement in substantially the form attached hereto as Exhibit A (the
"Joinder Agreement"). 

NOW, THEREFORE, in
consideration of the premises and the mutual promises and covenants contained
in this Agreement, the receipt and sufficiency of which are hereby
acknowledged, the parties mutually agree as follows:

1.         
Registration Rights

1.1.     
Certain Definitions.  The following terms shall have the
following respective meanings:

"Holder" shall mean any
Investor so long as such Investor holds Registrable Securities and any Person
holding Registrable Securities to whom the rights under this Section 1 have
been transferred in accordance with Section 1.8.

"Person" means an individual,
corporation, trust, partnership, joint venture, unincorporated organization,
government agency, or any agency or political subdivision thereof, or other
entity.

 

 "Registrable Securities"
means (i) the Common Stock issued or issuable upon exercise of the
Warrants or the Additional Warrants, if any, or (ii) stock issued in
respect of the stock referred to in (i) as a result of a stock split,
stock dividend, recapitalization or the like, and in the case of (i) and (ii)
which has not been sold to the public or sold pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended (the "Securities
Act"), excluding in all cases, however, any Registrable Securities transferred
by any Person in a transaction in which the rights under this Section 1 are not
assigned in accordance with this Agreement; provided; however, that for
purposes of Sections 1 and 3 of this Agreement, for so long as the Company
complies with Section 1.7 of this Agreement,  "Registrable Securities" shall
not include any securities which may be sold without volume restrictions
pursuant to Rule 144(k) of the Securities Act.

The terms "register," "registered"
and "registration" refer to a registration effected by preparing and
filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.

"Registration Expenses" shall
mean all expenses, except as included in Selling Expenses or as otherwise
stated below, incurred by the Company in complying with Section 1.2 including,
without limitation, all registration, qualification and filing fees, printing
expenses, escrow fees, fees and disbursements of counsel for the Company, blue
sky fees and expenses, the expense of any special audits incident to or
required by any such registration (but excluding the compensation of regular
employees of the Company which shall be paid in any event by the Company) and
the reasonable fees and disbursements of one special counsel for all Holders as
selling stockholders in the event of each registration provided for in
Section 1.2.

"Selling Expenses" shall mean
all underwriting discounts, selling commissions and stock transfer taxes
applicable to the securities registered by the Holders. 

1.2.     
Company Registration.

(a)    
Notice of Registration.  If at any time or from time to time the
Company shall determine to register any of its securities, either for its own
account or the account of a security holder or holders, other than (i) a
registration relating solely to employee benefit plans, (ii) a
registration relating solely to a Securities and Exchange Commission ("SEC")
Rule 145 transaction, or (iii) a registration on any registration
form that does not permit secondary sales or does not include substantially the
same information as would be required to be included in a registration
statement covering the sale of Registrable Securities, the Company will:

(i)     promptly give to each Holder written notice thereof; and

(ii)    subject to Section 1.2(b), include in such registration (and any related
qualification under blue sky laws or other compliance requirements), and in any
underwriting involved therein, all the Registrable Securities specified in a
written request or requests, made within twenty (20) days after receipt of such
written notice from the Company, by any Holder.

 

2

(b)     
Underwriting.  If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to Section 1.2(a)(i) above.  In such event, the right of any
Holder to participate in such registration shall be conditioned upon such
Holder's participation in such underwriting to the extent provided herein.  All
Holders proposing to distribute their securities through such underwriting
shall (together with the Company and any other holders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter selected for such underwriting by
the Company.  Notwithstanding any other provision of this Section 1.2, if
the managing underwriter determines that marketing factors require limitation
of the number of shares to be underwritten, the managing underwriter may limit
the Registrable Securities to be included in such registration.  The Company
shall so advise in writing all Holders distributing their securities through
such underwriting and the number of shares of securities that may be included
in the registration and underwriting (other than on behalf of the Company)
shall be allocated among all Holders in proportion, as nearly as practicable,
to the respective amounts of Registrable Securities or other securities
requested to be included in such registration by such Holders.  To facilitate
the allocation of shares in accordance with the above provisions, the Company
may round the number of shares allocated to any Holder to the nearest one
hundred (100) shares.  

(c)      Right to Terminate Registration.  The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 1.2 prior to the effectiveness of such registration, whether or not any
Holder has elected to include securities in such registration.  

1.3.     
Expenses of Registration.  Except as otherwise provided herein,
all Registration Expenses incurred in connection with all registrations
pursuant to Section 1.2 shall be borne by the Company.  Unless otherwise
stated, all Selling Expenses relating to securities registered on behalf of the
Holders shall be borne by the Holders of such securities pro rata on the
basis of the number of shares so registered.

1.4.      Registration Procedures.  In the case of each registration,
qualification or compliance effected by the Company pursuant to this Section 1,
the Company will keep each Holder advised in writing as to the initiation of
each registration and as to the completion thereof.  At its expense, the
Company will:

(a)     Prepare and file with the SEC a registration statement with respect to
such Registrable Securities and use its reasonable best efforts to cause such
registration statement to become effective, and, upon the request of the
holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for the earlier of 180 days or until the
distribution described in the registration statement has been completed (or
until such Registrable Securities may be sold without volume restrictions
pursuant to Rule 144(k)); provided, however, that (i) such 180-day period shall
be extended for a period of time equal to the period the Holder refrains from
selling any securities included in such registration at the request of an underwriter
of Common Stock (or other securities) of the Company; and (ii) in the case of
any registration of Registrable Securities on Form S-3 which are intended to be
offered on a continuous or delayed basis, such 180-day period shall be
extended, if necessary, to keep the registration statement effective until all
such Registrable Securities are sold (or until such Registrable Securities may
be sold without volume restrictions pursuant to Rule 144(k)), provided that
Rule 415, or any successor rule under the Securities Act, permits an offering
on a continuous or delayed basis, and provided further that applicable rules
under the Securities Act governing the obligation to file a post-effective
amendment permit, in lieu of filing a post-effective amendment which (A)
includes any prospectus required by Section 10(a)(3) of the Securities Act or
(B) reflects facts or events representing a material or fundamental change in
the information set forth in the registration statement, the incorporation by
reference of information required to be included in (A) and (B) above to be
contained in periodic reports filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") in the
registration statement.

 

3

(b)     Prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by
such registration statement.

(c)     Furnish to the Holders, as expeditiously as reasonable, such numbers of
copies of the registration statement, each amendment and supplement thereto,
the prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.

(d)     Use its best efforts to register and qualify the securities covered by
such registration statement under such other securities or Blue Sky laws of
such jurisdictions as shall be reasonably requested by the Holders; provided
that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required
by the Securities Act.

(e)     In the event of any underwritten public offering, enter into and perform
its obligations under an underwriting agreement and any other customary
agreements, in usual and customary form, with the underwriters of such offering
and take all such actions reasonably requested to expedite or facilitate the
disposition of shares.  Each Holder participating in such underwriting shall
also enter into and perform its obligations under such an agreement.

(f)     Notify each Holder covered by such registration statement at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing.

 

4

(g)     Cause all such Registrable Securities to be listed, prior to the date of
the first sale of such Registrable Securities pursuant to such registration, on
each securities exchange on which similar securities issued by the Company are
then listed and, if not so listed, to be listed with the National Association
of Securities Dealers automated quotation system (NASDAQ).

(h)     Provide a transfer agent and registrar for all such Registrable
Securities and a CUSIP number for all such Registrable Securities, in each case
not later than the effective date of such registration statement.

(i)     Make available for inspection on a confidential basis by any
participating Holder, any underwriter participating in any disposition pursuant
to such registration statement, and the counsel to the participating Holders
whose expenses are being paid pursuant to Section 1.3 hereof, all financial and
other records, pertinent corporate documents and properties of the Company, and
cause the Company's officers, directors, employees, independent accountants and
other advisors to supply on a confidential basis all information reasonably
requested by any such participating Holder, underwriter or attorney in
connection with such registration statement.

(j)     Permit any participating Holder that, in its reasonable judgment, might
be deemed to be an underwriter or a controlling Person of the Company within
the meaning of Section 15 of the Securities Act, to participate in the
preparation of such registration or comparable statement and to permit the
insertion therein of material, furnished to the Company in writing, which in
the reasonable judgment of such participating Holder and its counsel should be
included, provided that such material shall be furnished under such
circumstances as shall cause it to be subject to the indemnification provisions
provided pursuant to Section 1.5 hereof.

(k)     In the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any Registrable Securities included in such registration statement for sale in
any jurisdiction, the Company will use its best efforts promptly to obtain the
withdrawal of such order.

(l)     Cooperate with the participating Holders and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legends) representing Registrable
Securities to be sold under such registration, and enable such Registrable
Securities to be in such denominations and registered in such names as the
managing underwriter or underwriters, if any, or such participating Holders may
reasonably request.

(m)      Furnish, at the request of any Holder requesting registration of Registrable Securities pursuant to this Section 1, on the date that such
Registrable Securities are delivered to the underwriters for sale in connection
with a registration pursuant to this Section 1, if such securities are being
sold through underwriters, or, if such securities are not being sold through
underwriters, on the date that the registration statement with respect to such
securities becomes effective, (i) an opinion, dated such date, of the counsel
representing the Company for the purposes of such registration, in form and
substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, and (ii) a letter, dated such date,
from the independent certified public accountants of the Company, in form and
substance as is customarily given by independent certified public accountants
to underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders requesting registration of Registrable
Securities.

 

5

(n)     Otherwise comply with all applicable rules and regulations of the SEC,
and make generally available to its security holders (as contemplated by
Section 11(a) under the Securities Act) an earnings statement satisfying the
provisions of Rule 158 under the Securities Act as soon as reasonably
practicable after the end of the twelve month period beginning with the first month
of the Company's first fiscal quarter commencing after the effective date of
the registration statement, which statement shall cover said twelve month
period.

1.5.      Indemnification.

(a)     In the event of any registration under the Securities Act pursuant to
Section 1.2 of any Registrable Securities covered by such registration, the
Company will, and hereby does, indemnify and hold harmless each Holder of
Registrable Securities to be sold under such registration statement, each such
Holder's legal counsel, each of its officers, directors and partners, and each
other person who participates as an underwriter in the offering or sale of such
securities (if so required by such underwriter as a condition to including the
Registrable Securities of the Holders in such registration) and each other
person, if any, who controls any such Holder or any such underwriter within the
meaning of the Securities Act (collectively, the "Indemnified Parties"),
against all expenses, claims, losses, damages or liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances in which they were
made, not misleading, or any violation by the Company of the Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law
applicable to the Company in connection with any such registration,
qualification or compliance, and the Company will reimburse each Indemnified
Person, as incurred, for any legal and any other expenses reasonably incurred
in connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, provided that the indemnity agreement contained in
this Section 1.5 shall not apply to amounts paid in settlement of any such
claim, loss, damage, liability or action if such settlement is effected without
the consent of the Company (which consent shall not be unreasonably withheld),
nor shall the Company be liable to any such Indemnified Person in any such case
to the extent that any such claim, loss, damage, liability or action arises out
of or is based on (i) any untrue statement or omission (or alleged untrue
statement or omission), made in reliance upon and in conformity with written
information furnished to the Company by such Indemnified Person and stated to
be specifically for use therein or the preparation thereby or (ii) use or
delivery by such Indemnified Person of a prospectus other than the most current
prospectus made available to such Holder, controlling Person or underwriter by
the Company.

 

6

(b)     To the extent permitted by law, each Holder will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers, each underwriter, if any, of the
Company's securities covered by such a registration statement, each Person who
controls the Company or such underwriter within the meaning of Section 15
of the Securities Act, and each other such Holder, each of its officers and
directors and partners and each Person controlling such other Holder within the
meaning of Section 15 of the Securities Act, against all expenses, claims,
losses, damages and liabilities (or actions in respect thereof), including any
of the foregoing incurred in settlement of any litigation, commenced or
threatened, arising out of or based on (i) any untrue statement (or
alleged untrue statement) of a material fact contained in any registration
statement, prospectus, offering circular or other document, or any amendment or
supplement thereto, incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (ii) use or delivery by such Holder of a
prospectus other than the most current prospectus made available to such Holder
by the Company, and will reimburse the Company, such other Holder, each of its
directors, officers, partners, and each Person controlling such Holder or the
Company, each such underwriter and each Person who controls any such
underwriter for any legal and any other expenses reasonably incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, in each case to the extent, but only to the
extent, that such untrue statement (or alleged untrue statement) or omission
(or alleged omission) is made in such registration statement, prospectus,
offering circular, other document, amendment or supplement in reliance upon and
in conformity with written information furnished to the Company by such Holder
and specifically requested by the Company for use therein or the preparation
thereby.  Notwithstanding the foregoing, the liability of each Holder under
this subsection (b) shall be limited to an amount equal to the aggregate
net proceeds received by such Holder from the shares sold by such Holder in the
offering in question.

(c)     Each party entitled to indemnification under this Section 1.5 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified
Party has actual knowledge of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such claim
or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
withheld unreasonably), and the Indemnified Party may participate in such
defense at such party's expense; provided however, that the
Indemnified Party shall have the right to retain its own counsel, with fees and
expenses to be paid by the Indemnifying Party, if representation of such
Indemnified Party by the counsel retained by the Indemnifying Party would not
be appropriate due to actual or potential differing interests between such
Indemnified Party and any other party represented by such counsel in such
proceeding, and provided further that the failure of any Indemnified Party to
give notice as provided herein shall relieve the Indemnifying Party of its
obligations under this Section 1.5 to the extent (but only to the extent)
that the failure to give such notice is materially prejudicial to an
Indemnifying Party's ability to defend such action, and provided further that
the Indemnifying Party shall not assume the defense for matters as to which
there is a conflict of interest or material separate and different defenses. 
No Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any judgment
or enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect to such claim or litigation.

 

7

(d)     If the indemnification provided for in this Section 1.5 is held by a
court of competent jurisdiction to be unavailable to an Indemnified Party with
respect to any loss, liability, claim, damage or expense referred to therein,
then the Indemnifying Party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, liability, claim, damage or expense in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and of the Indemnified Party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage or expense as well as any other relevant equitable considerations;
provided, that in no event shall any contribution by a Holder under this
Section 1.5(d) exceed the net proceeds from the offering received by such
Holder, except in the case of willful fraud by such Holder.  The relative fault
of the Indemnifying Party and of the Indemnified Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates
to information supplied by the Indemnifying Party or by the Indemnified Party
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.  No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.  

(e)     Notwithstanding the foregoing, to the extent that the provisions on
indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in
conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.

(f)      The obligations of the Company and Holders under this Section 1.5 shall
survive the completion of any offering of Registrable Securities pursuant to a
registration statement under this Section 1, and otherwise.

1.6.      Information by Holder.  The Holders of securities included in any
registration shall furnish to the Company such information regarding such
Holders, the Registrable Securities held by them and the distribution proposed
by such Holders as the Company may request in writing and as shall be required
in connection with any registration, qualification or compliance referred to in
this Section 1.

1.7.      Rule 144 Reporting.  With a view to making available the
benefits of certain rules and regulations of the SEC which may at any time
permit the sale of the Registrable Securities to the public without
registration, after such time as a public market exists for the Common Stock of
the Company, the Company agrees to use its best efforts to:

 

8

(a)      Make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all times
after the effective date that the Company becomes subject to the reporting
requirements of the Exchange Act;

(b)      File with the SEC in a timely manner all reports and other documents
required of the Company under the Exchange Act; and

(c)     So long as a Holder owns any Registrable Securities, furnish to the
Holder forthwith upon request a written statement by the Company as to its
compliance with the reporting requirements of the Exchange Act, and such other
reports and documents of the Company and other information in the possession of
or reasonably obtainable by the Company as the Holder may reasonably request,
unless otherwise obtainable through the SEC's website, in availing itself of
any rule or regulation of the SEC allowing the Holder to sell any such
securities without registration.

1.8.      Transfer of Registration Rights.  The rights to cause the Company
to register securities granted to the Holders under Section 1 may be assigned
to a transferee or assignee in connection with any transfer or assignment of
Registrable Securities by the Holder provided that the transferor provides the
Company with written notice of the proposed transfer, the transferee agrees in
writing to be bound by the provisions of this Section 1.

1.9.      Termination.  No Holder shall be entitled to exercise any rights
provided for in this Section 1 after the date that all shares of Registrable
Securities held or entitled to be held upon conversion by such Holder may
immediately be sold without volume limitations under Rule 144 during any 90-day
period.

2.         Preemptive Rights

2.1.      Right of Purchase.  The Company hereby grants to the Investors,
so long as such Investor shall own, of record or beneficially, or have the
right to acquire from the Company, any Registrable Securities, the preemptive
right to purchase all or part of such Investor's pro rata share of New
Securities (as defined in Section 2.2) which the Company, from time to
time, proposes to sell and issue to any Person (each a "Subsequent Investor"). 
Each Investor shall be entitled to apportion the preemptive rights hereby
granted it among itself and its partners and affiliates in such proportions as
it deems appropriate.

2.2.       Definition of New Securities.  "New Securities" shall mean any
capital stock of the Company or rights thereto, whether now authorized or not,
and options, warrants or other rights to purchase capital stock and securities
of any type whatsoever that are, or may become, convertible into capital stock;
provided, however, that "New Securities" does not include (i) securities
issuable upon exercise of the Warrants or the Additional Warrants, if any; (ii)
securities issued in a bona fide business acquisition of or by the Company,
whether by merger, consolidation, sale of assets, sale or exchange of stock or
otherwise, but excluding in all cases any securities issued by the Company in
connection with raising capital; (iii) shares of the Company's Common Stock (or
related options to purchase Common Stock) which are issued to employees,
directors or consultants of the Company or any subsidiary pursuant to the
Company's 1998 Stock Option Plan, as amended, the Company's 2001 Stock Plan or
any similar stock option or incentive plan approved by a majority of the
Company's Board of Directors and its stockholders (collectively, the "Stock
Plan"); (iv) securities issuable upon conversion or exercise of any options,
warrants or other rights to acquire capital stock of the Company outstanding as
of the date of this Agreement; (v) shares of the Company's capital stock issued
in connection with any stock split, stock dividend, reclassification or
recapitalization by the Company; (vi) securities issued to vendors or customers
or to other persons in similar commercial situations with the Company if such
issuance is approved by the Company's Board of Directors and is not for the
purpose of raising capital; (vii) securities issued in connection with
obtaining lease financing, whether issued to a lessor, guarantor or other
person, provided the securities are not issued for the purpose of raising
capital; (viii) securities issued in a firm commitment underwritten public
offering pursuant to a registration under the Securities Act; and (ix)
securities issued in connection with strategic alliances or transactions not
for the purpose of raising capital.

 

9

2.3.      Notice
from the Company.  In the event the Company proposes to
undertake an issuance of New Securities, it shall give the Investors written
notice of its intention, describing the type of New Securities and the price
and the terms upon which the Company proposes to issue the same.  Each Investor
shall have thirty (30) days from the date any such notice is given to agree to
purchase up to its pro rata share of such New Securities for the price
and upon the terms specified in the notice by giving written notice to the
Company and stating therein the quantity of New Securities to be purchased.  A pro
rata share, for purposes of this Section 2, is the ratio of the number of
shares of Registrable Securities issued and held by such Investor to the total
number of shares of Common Stock of the Company then outstanding on an as converted
and fully diluted basis (excluding shares reserved for option grants not yet
granted).  

2.4.      Over-Allotment.  In the event an Investor fails to exercise his
or its pro rata share within said thirty (30) day period, the Company
will give the Investor who did so agree to purchase all the shares available to
it (the "Fully-Exercising Investor") notice of the number of shares that were
not subscribed for.  Such notice may be by telephone if followed by written
confirmation (facsimile permitted) within two (2) business days.  The
Fully-Exercising Investor shall have ten (10) business days from the date of
such notice to agree to purchase the New Securities not purchased by the
non-purchasing Investor. 

2.5.      Sale by the Company.  In the event the Investors fail to exercise
in full their preemptive rights the Company shall have ninety (90) days
thereafter to sell the New Securities with respect to which the Investors'
preemptive rights were not exercised, at a price and upon terms no more
favorable to the Subsequent Investor thereof than specified in the Company's
original notice to the Investors.  To the extent the Company does not sell all
the New Securities offered within said ninety (90) day period, the Company
shall not issue or sell such New Securities without first again offering such
securities in the manner provided by this Section 2. 

2.6.      Termination of Rights.  The rights granted under this Section 2
will terminate with respect to each Investor at such time as such Investor no
longer holds any Registrable Securities.  

 

10

3.        
Co-Sale Rights.  

3.1.      Co-Sale Right.  Subject to the terms and conditions of Section
3.5 hereof, none of the Management Stockholders or any of their respective
affiliates (each a "Selling Stockholder") shall enter into any
transaction that would result in the sale by him of any capital stock or
securities exercisable or convertible into capital stock now or hereafter owned
by the Management Stockholders or any of their respective affiliates, unless at
least twenty (20) calendar days prior to the closing of such sale the Selling
Stockholder shall give notice to each Holder of its intention to effect such
sale in order that such Holder may exercise its rights under this Section 3 as
hereinafter described.  Such notice shall set forth (i) the number of shares to
be sold by the Selling Stockholder, (ii) the principal terms of the sale,
including the price at which the shares are intended to be sold, and (iii) an
offer by the Selling Stockholder to cause to be included with the shares to be
sold by it in the sale such Holder's Pro Rata Share on the same terms and
conditions.  For purposes of this Section 3, a Holder's "Pro Rata Share" will
be defined as a fraction, the numerator of which is the number of Registrable
Securities held by such Holder, including shares of Common Stock issuable upon
exercise of the Warrants or the Additional Warrants, as the case may be, and
the denominator of which is the sum of (i) the number of shares of capital
stock and securities exercisable or convertible into capital stock owned by the
Selling Stockholder plus (ii) the number of Registrable Securities held by all
Holders electing to participate under this Section 3.1, including shares of
Common Stock issuable upon exercise of the Warrants or the Additional Warrants,
as the case may be.  

3.2.      Rejection of Co-Sale Offer.  If such Holder has not accepted such
offer in writing within a period of fifteen (15) calendar days from the date of
receipt of the notice specified in subsection (a) of this Section, then the
Selling Stockholder shall thereafter be free for a period of ninety (90) days
to sell the number of shares specified in such notice, at a price no greater
than the price set forth in such notice and on otherwise no more favorable
terms to the Selling Stockholder than as set forth in such notice, without any
further obligation to such Holder in connection with such sale.  In the event
that the Selling Stockholder fails to consummate such sale within such
ninety-day period, the shares specified in such notice shall continue to be
subject to this Section 3.

3.3.     Acceptance of Co-Sale Offer.  If such Holder accepts such offer
in writing within a period of fifteen (15) calendar days from the date of
receipt of the notice specified in Section 3.1, such acceptance shall be
irrevocable unless the Selling Stockholder shall be unable to cause to be
included in the sale the number of Registrable Securities held by such Holder
and set forth in the written acceptance.

3.4.     Delivery Requirements.  Such Holder shall effect its
participation in the Selling Stockholder's sale by either promptly (i)
delivering to the Selling Stockholder the appropriate number of shares of
Common Stock which such Holder has elected to sell, or (ii) to the extent such
Holder does not hold any shares of Common Stock, exercising the Warrant or
Additional Warrant, as the case may be, held by such Holder for the appropriate
number of shares of Common Stock and then delivering to the Selling Stockholder
for transfer to the prospective purchaser, one or more certificates, properly
endorsed for transfer, which represent that number of shares of Common Stock
which such Holder has elected to sell.  The Company agrees to effect any such
exercise and/or conversion concurrent with the actual transfer of the Selling
Stockholder's shares to the purchaser.

 

11

3.5.     Exempt Transfers of Stock.  Notwithstanding anything to the
contrary contained herein, the terms and conditions of this Section 3 shall not
apply to the following transfers:

(a)      any transfers of Common Stock by gift during Management Stockholder's
lifetime or on a Management Stockholder's death by will or intestacy to (i)
Management Stockholder's "immediate family" (as defined below), (ii) a trust
for the benefit of such Management Stockholder or such Management Stockholder's
immediate family, or (iii) a partnership controlled, either directly or
indirectly, by such Management Stockholder, provided that each transferee or
other recipient executes a counterpart copy of this Agreement and becomes bound
by the terms and conditions of this Section 3 (as a "Selling Stockholder")
hereof; for purposes of this Section 3.5, the term "immediate family" means
such Management Stockholder's spouse, lineal descendant or antecedent (whether
natural or adopted), brother or sister;

(b)     any transfers of Common Stock by a Management Stockholder made (i)
pursuant to a statutory merger or statutory consolidation of the Company with
or into another corporation or corporations; or (ii) pursuant to the winding up
and dissolution of the Company; or

(c)     any transfers of Common Stock to the Company pursuant to any right of
repurchase by the Company.

In addition, a Management Stockholder may transfer or sell,
in a single transaction or series of transactions, up to 5% of the total shares
of Common Stock held by such Major Stockholder as of the date hereof without
subjecting such transfer or sales to the provisions of this Section 3
(excluding for purposes of the 5% threshold all transfers exempted pursuant to
subsections (a), (b) and (c) above); provided, however, that at such time as
the such Management Stockholder has sold or transferred 5% of the total shares
of Common Stock held by such Major Stockholder as of the date hereof, this
Section 3 shall apply to all subsequent sales or transfers by such Major
Stockholder. 

4.         Other Covenants of the Company. 

4.1.      Keeping of Records and Books of Account.  The Company shall keep,
and cause each subsidiary to keep, adequate records and books of account, in
which complete entries will be made in accordance with generally accepted
accounting practices consistently applied, reflecting all financial
transactions of the Company and its subsidiaries and in which, for each fiscal
year, all reserves for depreciation, depletion, obsolescence, amortization,
taxes, bad debts, and other purposes in connection with its business shall be
made.

4.2.      Information Rights.  

(a)      Upon the Company no longer being subject to the reporting requirements
of the Exchange Act, the Company shall furnish to the Investors the following
information:

 

12

(i)      as soon as practicable, but in any event within one hundred twenty (120)
days after the end of each fiscal year of the Company, a consolidated and
combined balance sheet of the Company and its subsidiaries as of the end of
such fiscal year and the related consolidated and combined statements of
operations, stockholders' equity, and cash flows for the fiscal year then
ended, such financial reports to be in reasonable detail, prepared in
accordance with generally accepted accounting principles consistently applied
and audited by a firm of independent public accountants reasonably
acceptable to the Investors, and any management letters or special reports by
auditors and any responses thereto;

(ii)      as soon as practicable, but in any event within forty-five (45) days
after the end of each fiscal quarter in each year (other than the last quarter
in each fiscal year), a consolidated and combined balance sheet of the Company
and its subsidiaries and the related consolidated and combined statements of
operations, stockholders' equity, and cash flows, unaudited but prepared in
accordance with generally accepted accounting principles consistently applied,
except for the absence of notes, and certified by the Chief Financial Officer
of the Company, such consolidated and combined balance sheet to be as of the
end of such quarter and such consolidated and combined statements of
operations, stockholders' equity, and cash flows to be for such quarter and for
the period from the beginning of the fiscal year to the end of such quarter, in
each case with comparative statements for (i) the prior fiscal year and (ii)
the current budget approved by the Board of Directors;

(iii)     as soon as practicable, but in any event within thirty (30) days after
the end of each month in each fiscal year (other than the last month in each
fiscal year), a consolidated and combined balance sheet of the Company and its
subsidiaries and the related consolidated and combined statements of
operations, stockholders' equity, and cash flows, unaudited but prepared in
accordance with generally accepted accounting principles consistently applied,
except for the absence of notes, and certified by the Chief Financial Officer
of the Company, such consolidated and combined balance sheet to be as of the
end of such month and such consolidated and combined statements of operations,
stockholders' equity, and cash flows to be for such month in each case with
comparative statements for (i) the prior fiscal year and (ii) the current
budget approved by the Board of Directors.

4.3.      Compliance with Laws.  The Company shall comply, and cause each
subsidiary to comply, with all applicable laws, noncompliance with which could
reasonably be expected to have a material adverse effect on the business,
operations or prospects of the Company.

4.4.      Compliance with Terms of Indebtedness.  The Company and its
subsidiaries will comply in all material respects with all terms and covenants
of all material debt obligations of the Company and the subsidiaries, including
without limitation the Loan, as the same may be amended from time to time.

 

13

5.         General Provisions

5.1.      Specific Enforcement.  The Company expressly agrees that the
Investors may be irreparably damaged if this Agreement is not specifically
enforced.  Upon a breach or threatened breach of the terms, covenants and/or
conditions of this Agreement by the Company, the Investors shall, in addition
to all other remedies, be entitled to apply for a temporary or permanent
injunction, and/or a decree for specific performance, in accordance with the
provisions hereof.

5.2.      Amendments and Waivers.  Except as otherwise provided herein, any
term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and
either retroactively or prospectively), only with the written consent of the
Company and the holders of not less than a majority of the outstanding shares
of Registrable Securities; provided, however, that Section 3 may only be
amended with the consent of the Company, the holders of not less than a
majority of the outstanding shares of Registrable Securities and the holders of
a majority of the outstanding shares of Common Stock held by the Management
Stockholders.  Any amendment or waiver effected in accordance with this Section
shall be binding upon any Person who is granted certain rights under this
Agreement and the Company.

5.3.      Expenses.  If any action at law or in equity is commenced to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees and disbursements in addition to any
other relief to which such party may be entitled.

5.4.      Successors and Assigns.  Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities).  Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.

5.5.      Notices.  Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given: (i) upon personal delivery to the party to be notified; (ii)
when sent by confirmed facsimile if sent during normal business hours of the
recipient, if not, then on the next business day; (iii) five days after
having been sent by registered or certified mail, return receipt requested,
postage prepaid; or (iv) one day after deposit with a nationally recognized
overnight courier, specifying next day delivery, with written verification of
receipt.  All communications shall be sent to the address noted below, or at
such other address as such party may designate by ten (10) days' advance
written notice to the Company (who shall provide such other address to the
Investors upon request):

(a)     if to the Company or any Management Stockholder, at 5565 Red Bird Center
Drive, Suite 150, Dallas Texas 75237, Attn: Rick J. O'Brien, with a copy to
Patton Boggs LLP, 2001 Ross, Suite 3000, Dallas, TX  75201, Attn: David P.
McLean, facsimile (214) 758 - 1550.

 

14

(b)     if to the Investors, at the addresses set forth on the signature page
hereto with a copy to Bass, Berry & Sims PLC, 315 Deaderick Street, Suite
2700, Nashville, Tennessee 37238, Attn: Howard H. Lamar III, facsimile (615)
742-2709.

5.6.      Governing Law.  This Agreement, and any dispute, controversy or
claim arising out of or relating to this Agreement or a breach thereof, shall
be governed by, and construed in accordance with, the laws of the State of
Delaware.  

5.7.      Entire Agreement.  This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes any and all prior agreements of the parties with respect to the
subject matter hereof.

5.8.      Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  Delivery by facsimile
or by electronic transmission of an executed counterpart of any signature page
to this Agreement to be executed hereunder shall have the same effectiveness as
the delivery of a manually executed counterpart thereof.

5.9.      Additional Parties.  The parties hereto acknowledge that (a)
other parties may hold Registrable Securities after the date hereof and (b)
such parties may be required, as a condition to the issuance or transfer of
Registrable Securities to them, to execute a Joinder Agreement or a counterpart
of this Agreement.  Upon execution of such Joinder Agreement or counterpart,
such new holder of Registrable Securities shall be deemed to be an Investor
under this Agreement and shall be entitled to all of the rights and benefits
afforded thereto hereunder.

5.10.     Severability.  If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.

5.11.     
Titles and Subtitles.  The titles and subtitles used in this
Agreement are for convenience only and are not to be considered in construing
or interpreting any term or provision of this Agreement.

5.12.     Aggregation of Stock.  All Registrable Securities held or
acquired by affiliated Persons shall be aggregated together for the purpose of
determining the availability of any rights under this Agreement.

[Signatures on
following page]

 

15

IN WITNESS
WHEREOF, the Company, the Management Stockholders and Petra have executed
this Investors' Rights Agreement as of the day and year first above written.

                                                            

  	

 HOME
SOLUTIONS OF AMERICA, INC.

      
	

By: 
____________________________________

      
	

Name:
Rick J. O'Brien

      
	

Title: 
Chief Financial Officer

      
	  
	  
	

 PETRA
MEZZANINE FUND, L.P.

      
	

  

      
	

By: 
Petra Partners, LLC, its General Partner

      
	  
	

By: 
____________________________________

      
	

Name:
Michael W. Blackburn

      
	

Title: 
Managing Member

      
	

  

      
	

  

      
	

MANAGEMENT STOCKHOLDERS

      
	

  

      
	

__________________________________________

      
	

Frank
J. Fadella

      
	  
	

_________________________________________

      
	

Rick
J. O' Brien

      

 

16

EXHIBIT A

JOINDER AGREEMENT

JOINDER AGREEMENT dated as of __________, 20__ between
_________________ (the "Additional Investor"), Petra Mezzanine Fund, L.P.
("Petra"),  Home Solutions of America, Inc. (the "Company") and Frank J.
Fadella and Rick J. O'Brien (collectively, the "Management Stockholders").  The
Company, Petra and the Management Stockholders are parties to an Investors'
Rights Agreement dated as of March ___, 2005  (the "Investors' Rights
Agreement") and wish to provide for the Additional Investor to become party
thereto.  Accordingly, the parties hereto hereby agree as follows:

1.Except as otherwise defined herein, terms defined in the
Investors' Rights Agreement are used herein as defined therein.

2. The Additional Investor is hereby (a) deemed to be a
party to the Investors' Rights Agreement and (b) granted the rights of and
bound in all respects by the terms of the Investors' Rights Agreement, as an
Investor thereunder.

3. This Joinder Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware.

4. This Joinder Agreement may be executed in any number of
counterparts, including counterparts transmitted by telecopier or telefax, and
by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and both of which taken together
shall constitute one and the same agreement.  

*          *          *

IN WITNESS WHEREOF, the undersigned have executed this
Joinder Agreement as of the date first above written.

  	THE COMPANY:
	  
	HOME SOLUTIONS OF AMERICA, INC.
	  
	By_________________________________
	      Name: 
	      Title:
	  
	PETRA:
	  
	

PETRA
MEZZANINE FUND, L.P.

      
	

  

      
	

By: 
Petra Partners, LLC, its General Partner

      
	

By: 
____________________________________

      
	

Name:
_______________

      
	

Title: 
_______________

      
	  
	____________________________
	Frank J. Fadella
	  
	____________________________
	Rick J. O'Brien 
	  
	ADDITIONAL INVESTOR:
	  
	[_______________________________]
	  
	By_________________________________
	      Name:
	      Title:

 17Exhibit 10.6

 

 

EXCLUSIVE
SUPPLY AGREEMENT

            This Exclusive Supply
Agreement (this "Agreement"), is entered into as of March 29, 2005, by
and between Cornerstone Building and Remodeling, Inc., a Florida corporation ("Customer")
and Cornerstone Granite & Marble Wholesale, Inc., a Florida corporation ("Supplier").

WITNESSETH:

            WHEREAS, Supplier is
a wholesaler of granite and marble slabs and related products, with first-right
relationships with stone quarries around the world;

WHEREAS,
Customer is a producer of granite and marble countertops;

WHEREAS,
Supplier is currently the exclusive supplier of certain products to Customer,
pursuant to that certain Exclusive Supply Agreement between Customer and
Supplier, as amended February 14, 2005 (the "Existing Agreement");

WHEREAS,
Customer and Supplier desire to amend and restate the Existing Agreement with
this Agreement, which shall supersede the Existing Agreement in its entirety,
and clarify the terms under which Supplier shall provide Customer with the
products set forth herein.

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

ARTICLE I

SUPPLY OF PRODUCTS

1.01     Retention
and Appointment.  Customer hereby retains and appoints Supplier as its
exclusive supplier of all raw granite and marble slabs, sinks, tiles, and
hardware, cabinet refaced products, and fabrication supplies used in the
installation of granite and marble countertops (collectively, the "Products"),
and Supplier hereby accepts such retention and appointment and assumes all
obligations associated herein.

            1.02     Order
Procedure; Delivery Timeframe.  Customer shall submit orders to purchase
Products to Supplier on Customer's standard purchase order form, which must
first be approved in writing and initialed by an authorized officer of
Customer, a list of which shall be provided to Supplier and updated as
necessary by Customer.  Supplier shall supply the ordered Products to Customer
within the time specified in the applicable purchase order, but Customer shall
give Supplier at least seven business days to deliver the Products.  Customer
shall have the right to accumulate supplies of Products as needed in order to
have sufficient quantities for manufacturing.

 

 

            1.03     Shipping. 
Supplier shall suitably package and ship the Products to Customer's Fort Myers,
Florida location, or such other location as directed by Customer, and the risk
of loss during transit shall be borne solely by Supplier until Products are
unloaded at Customer's facility and accepted by Customer.  Supplier agrees,
from time to time, to open additional warehouses as requested by Customer to
support the geographical growth of Customer.

1.04     Quality
Audits.  Customer shall have the right, upon three days prior notice
to Supplier, to inspect any of Supplier's facilities and operations to
determine whether Supplier is producing or supplying the Products in accordance
with this Agreement.

1.05     Right
to Purchase Products from Other Sources.  In the event that, for any
reason, Supplier cannot supply Customer with Products ordered by Customer
within the timeframes requested by Customer, Customer may obtain such Products
from another source; provided, however, that once Supplier can demonstrate that
Supplier is again able to supply the Products to Customer on a timely basis,
Customer shall return to purchasing the Products exclusively from Supplier
under the terms of this Agreement.

ARTICLE II

PRICING AND
QUANTITIES

            2.01      Product
Pricing.  The Products shall be priced to Customer at Supplier's necessary,
documented out-of-pocket costs of obtaining (direct costs of purchases and
shipping only, including foreign currency conversion, excluding any overhead
costs of Supplier) and shipping the Products to Customer, plus a 20.0% mark-up;
provided however Supplier assures Customer of its lowest pricing.  In the event
Supplier offers a lower price to any customer, it shall immediately notify
Customer and extend such price to Customer so long as any other customer of
Supplier has such lower pricing.  Supplier shall notify Customer at time of
Purchase Order of any factor that Supplier expects to cause an increase or
decrease of at least 15% in the cost of any Products or delivery thereof.

            2.02    Terms of
Payment.  Customer shall pay Supplier within 45 days of receiving
Supplier's invoice for Products delivered to and accepted by Customer. Customer
shall have 150 days from the Effective Date to bring all amounts currently owed
to Supplier that exceed 45 days to within the 45 days required by this Section
2.02.  All amounts invoiced by Supplier, and amounts paid by Customer, shall be
in U.S. currency.

 

 

	
  2

  

            2.03      Minimum
Quantities Purchased.  Customer hereby agrees to purchase at least $325,000
per month of Products from Supplier during the Term.  Customer will not be
obligated to pay Supplier for any shortfall of this minimum purchase
requirement, but Customer will make Supplier whole by purchasing the aggregate
shortfall of product from Supplier every 2 months.  Customer shall notify
Supplier as soon as possible of any factor that Supplier expects to cause an
increase or decrease of at least 10% in the historical quantities of Products
purchased.

            2.04      Record
Keeping.

(a) Monthly
Accounting.  Supplier shall maintain complete and correct records
containing all data required for Customer to verify the costs of Products for
purposes of calculating and verifying the prices for Products as set forth in
Section 2.01.  

(b) Audit. 
Customer shall have the right, during normal business hours and upon 10 days'
prior notice, to audit the records described in Section 2.04(a) hereof to
verify Supplier's compliance with this Agreement.  Any such audit shall be
conducted at Customer's expense unless the results of such audit establish
inaccuracies that have resulted in any overpayment by Customer to Supplier.  If
Customer establishes any such overpayment, Supplier shall pay all costs of the
audit and shall pay all amounts determined by Customer to have been overpaid to
Supplier, plus 2% interest on any such overpaid amounts, and such interest
shall accrue from the date such amounts were paid by Customer through the date
of Supplier's repayment to Customer.  Supplier shall pay all such amounts
overpaid by Customer, including the interest thereon, and Customer's costs of
the audit, no later than 45 days following written notice by Customer setting
forth the calculation of such amounts.  In the event that Supplier does not pay
such amounts to Customer within such 45-day timeframe, Customer shall have the
right to offset future amounts owed to Supplier by such amounts.

 

ARTICLE III

TERM AND
TERMINATION

            3.01      Expiration;
Renewal.  This Agreement shall have an initial term of 20 years commencing
on the date hereof and expiring on the 20th anniversary thereof (the "Initial
Term").  On or before the expiration of the Initial Term, Customer and
Supplier shall negotiate in good faith to renew this Agreement, and any such
renewal period that is agreed to shall constitute the "Renewal Term". 
For the purposes of this Agreement, the term "Expiration Date" shall
refer to (a) the last day of the Initial Term if the term of this Agreement is
not timely renewed, or (b) the last day of the Renewal Term in the event that
the parties hereto renew the Initial Term of this Agreement.

	
  3

  

3.02      Termination. 
This Agreement may be terminated prior to the Expiration Date (a) by both
parties hereto at any time upon the mutual written agreement of both parties
hereto; (b) by the non-breaching party to this Agreement upon a material breach
of any term or provision of this Agreement by the other party hereto, that is
not cured by the breaching party within 90 days of written notice by the
non-breaching party specifically describing such breach; or (c) by either party
at any time in the event (i) all or a substantial portion of the other party's
assets have been transferred or are subject to transfer for the benefit of
creditors; (ii) a proceeding has been commenced by or against the other party
for relief under bankruptcy, insolvency, or similar laws; (iii) any court of
competent jurisdiction adjudicates or otherwise determines that the other party
is insolvent or bankrupt; (iv) the other party ceases to do business in the
ordinary course; or (v) any court of competent jurisdiction or appropriate
government agency makes a non-appealable and legally binding determination that
the transactions contemplated hereby are unlawful.  The date upon which any
such termination becomes effective in accordance with this Section 3.02 shall
be set forth in any notice required hereunder and is referred to herein as the
"Termination Date."

3.03      Effect
of Expiration or Termination.  Upon the earlier of the Termination Date or
the Expiration Date, all rights and obligations of the parties to this
Agreement granted hereby shall cease; provided, however, that all payment and
record keeping obligations accrued and unpaid and/or unsatisfied through the
Termination Date or Expiration Date, as appropriate, and all rights and
obligations set forth in Articles IV and V and Section 3.04 below shall survive
the termination of this Agreement indefinitely, subject to any time limit
otherwise specified in such provisions or until fully satisfied in accordance
with the terms hereof.

3.04      Option
to Purchase Inventory.  In the event that this Agreement is terminated
pursuant to Section 3.02(c), due to the events described therein that pertain to
Supplier, Customer shall, upon written notice to Supplier, have the option to
purchase up to a 60 day supply, based upon a historical six month purchase
rate, of Supplier's remaining inventory at the agreed markup and subject to any
required consent or approval of a bankruptcy court or court appointed trustee. 

ARTICLE IV

REPRESENTATIONS,
WARRANTIES, AND COVENANTS

            4.01     Customer's
Representations, Warranties, and Covenants.  As an inducement to Supplier
to enter into this Agreement, Customer hereby represents, warrants, and
covenants the following to Supplier:

                        (a)        Organization
and Good Standing.  Customer is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Florida.

                        (b)        Authority. 
Customer has all requisite corporate power and authority to execute and deliver
this Agreement and any instruments and agreements contemplated herein and
required to be executed and delivered pursuant to this Agreement.  The person
signing this Agreement on behalf of Customer has been duly and properly
authorized to execute this Agreement.  This Agreement represents a valid and
binding obligation of Customer, enforceable against Customer in accordance with
its terms except as otherwise limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and similar laws affecting the enforcement of
creditors' rights generally, and to the application of general principles of
equity and judicial discretion.

	
  4

  

                        (c)        No
Violation.  Neither the execution of this Agreement nor the performance of
the transactions contemplated herein will conflict with, breach, or cause a
default under any agreement to which Customer is a party.

                        (d)         No
Exporting.  Customer will use reasonable commercial efforts to ensure that
the Products are not processed for ultimate export outside of North America,
since Supplier has the exclusive right to distribute the Products outside of
North America.

            4.02     Supplier's
Representations and Warranties.  As an inducement to Customer to enter into
this Agreement, Supplier hereby represents and warrants the following to
Customer:

                        (a)         Organization
and Good Standing.  Supplier is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Florida.

                        (b)        Authority.
 Supplier has all requisite corporate power and authority to execute and
deliver this Agreement and any instruments and agreements contemplated herein
and required to be executed and delivered pursuant to this Agreement.  The
person signing this Agreement on behalf of Supplier has been duly and properly
authorized to execute this Agreement.  This Agreement represents a valid and
binding obligation of Supplier, enforceable against Supplier in accordance with
its terms except as otherwise limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and similar laws affecting the enforcement of
creditors' rights generally, and to the application of general principles of
equity and judicial discretion.

                        (c)        No
Violation.  Neither the execution of this Agreement nor the performance of
the transactions contemplated herein will conflict with, breach, or cause a
default under any agreement to which Supplier is a party.

                        (d)         Quality
of Products Delivered.  Supplier represents and warrants that all Products
delivered to Customer will meet or exceed all industry quality standards for
such products, and if any Products have a manufacturer's warranty, such
warranty shall be assigned to Customer upon delivery of such Products to
Customer.

ARTICLE V

CONFIDENTIALITY

            
5.01     Confidentiality. 
Any party hereto receiving Confidential Information (as such term is
defined in this Section 5.01) in the negotiation of or performance of its
obligations under this Agreement shall keep such Confidential Information in strictest
confidence and shall not use for its own benefit (except as expressly permitted
under this Agreement) or disclose such Confidential Information to any person
except to persons retained or employed by such receiving party whose assistance
is necessary to perform the obligations contained in this Agreement, without
the prior written consent of the disclosing party.  The term "Confidential
Information" shall, for the purposes of this Agreement, mean all information
relating to the customers and projects undertaken by Customer, and all other
proprietary information owned by Customer or Supplier; provided, however, that
such term shall not include (a) information in the public domain, (b)
information generally available to the public, (c) information rightfully
received from a third party without a breach of an agreement restricting the
use or disclosure of such information, (d) information independently developed
by such receiving party without breach of this Agreement, or (e) information
approved for disclosure in writing by the disclosing party.

 

	
  5

  

            

            5.02     Return of
Confidential Information.  Each party hereto agrees to return to the other
party all documents or other materials constituting or containing Confidential
Information no later than 90 days following the earlier of the Termination Date
or the Expiration Date.

ARTICLE VI

MISCELLANEOUS

            6.01      Further
Assurances.  Each party hereto agrees to perform any further acts and to
execute and deliver any further documents reasonably necessary to carry out the
terms and intent of this Agreement.

            6.02      Severability. 
In the event any provision, or any portion of any provision, of this Agreement
is held to be illegal, unenforceable, or invalid by any court of competent
jurisdiction, the legality, enforceability, and validity of the remaining
provisions, or portions thereof, shall not be affected thereby, and, in lieu of
the illegal, unenforceable, or invalid provision, or portion thereof, there
shall be added a new legal, enforceable, and valid provision as similar in
scope and effect as is necessary to effectuate the results intended by such
deleted provision or portion.

            6.03      Governing
Law; Venue.  THIS AGREEMENT HAS BEEN EXECUTED IN AND SHALL BE GOVERNED BY
THE LAWS OF THE STATE OF FLORIDA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
RULES THEREOF OR OF ANY STATE.  VENUE FOR ANY ACTION BROUGHT HEREUNDER SHALL BE
PROPER EXCLUSIVELY IN LEE COUNTY, FLORIDA.

            6.04      Arbitration. 
Upon the mutual agreement of Customer and Supplier, and dispute arising
hereunder shall be submitted to arbitration under the AAA rules in Fort Myers,
Florida, and such arbitration shall be conducted in English. 

	
  6

  

            6.05      Legal
Remedies; Specific Performance.  Any damages that may accrue to either
party hereto as a result of a failure of either such party to perform its
obligations under this Agreement will not be readily subject to financial
measure.  As such, each party hereto shall be subject to the remedy of specific
performance as to any provision of this Agreement if such party is found to
have violated such provision by any court of competent jurisdiction.  The
parties hereto waive any claim or defense in any such action that the party
bringing such action has an adequate remedy at law.

            6.06      Court
Costs; Attorneys' Fees.  In the event an action is brought to enforce or
interpret the provisions of this Agreement by either party hereto, the
prevailing party in such action shall be entitled to recover all court costs
and reasonable attorneys' fees from the non-prevailing party to such action in
addition to any other relief awarded by the court in such action.

            6.07      Inurement;
Assignment.  Neither party shall have the right to assign or delegate any
of its rights and obligations under this Agreement for any purpose except with
the express written consent of the other party, which may be unreasonably
withheld; provided, however, that (a) Supplier hereby consents to the proposed
merger of Customer into a wholly-owned subsidiary of Home Solutions of America,
Inc., and acknowledges that this Agreement shall remain in full force and
effect following such merger, and (b) Customer hereby consents to the proposed
Reverse-Take-Over by Supplier into a wholly-owned subsidiary of BBC Capital
Management Corporation, and acknowledges that this Agreement shall remain in
full force and effect following such merger.

            6.08      Waivers. 
No waiver of any provision or condition of this Agreement shall be valid unless
executed in writing and signed by the party to be bound thereby.  No waiver of
any provision or condition of this Agreement shall be construed as a waiver of
any other provision or condition of this Agreement, and no present waiver of
any provision or condition of this Agreement shall be construed as a future
waiver of such provision or condition.

            6.09       Amendment. 
This Agreement may be amended solely upon the unanimous written consent of the
parties hereto.

            6.10     Entire
Agreement.  This Agreement contains the entire understanding between the
parties hereto concerning the subject matter herein.  No representations,
agreements, arrangements, or understandings, oral or written, exist between or
among the parties hereto that relate to the subject matter of this Agreement. 
This Agreement replaces and supersedes the Existing Agreement in its entirety.

            6.11       Mutual
Drafting.  Each party hereto and their counsel have participated fully in
the drafting, review, and revision of this Agreement.

            6.12     Notices. 
Any notice, consent, waiver, demand, payment, or other communication required
or permitted to be given by any provision of this Agreement shall be deemed to
have been given for all purposes if (i) delivered personally to the relevant
party, or (ii) sent by overnight delivery service, or registered or certified
mail, postage and charges prepaid, to the relevant address set forth below:

	
  7

  

If to Customer:             Cornerstone Building and Remodeling, Inc.

5642
Enterprise Parkway

Fort Myers,
FL 33905

If to Supplier:                Cornerstone Granite & Marble
Wholesale, Inc.

5642
Enterprise Parkway

Fort Myers, FL 33905

Any such notice shall be deemed
to have been given as of the date delivered, if delivered personally, or as of
the date on which the notice was deposited in the U.S. mail or with an
overnight delivery service, properly addressed and sent in accordance with this
Section 6.12 (whether or not actually received).

            6.13     Multiple
Counterparts.  This Agreement may be executed in multiple counterparts,
including by facsimile signature, each of which shall be deemed to be an
original but all of which together shall constitute one and the same
instrument.

[Remainder of page
intentionally left blank.]

 

 

 

 

 

 

 

	
  8

  

            IN WITNESS WHEREOF,
the parties to this Agreement have set their respective hands hereto as of the
date first above written.

CUSTOMER:

CORNERSTONE BUILDING AND
REMODELING, INC.

By:                                                                  

Name:                                                             

Title:                                                                 

 

SUPPLIER:

CORNERSTONE GRANITE &
MARBLE WHOLESALE, INC.

By:                                                                  

Name:                                                             

Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00082-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00082-of-00352.parquet"}]]