June 6, 2007, Dallas, TX - (Business Wire) - Home Solutions of America, Inc. (NASDAQ: HSOA; the “Company” or “Home Solutions"), a provider of recovery, restoration and rebuilding/remodeling services, responded today to investor inquiries for further details related to two recently announced contracts valued at approximately $100 million each.
Under the first contract, which is between the Company’s Fireline Restoration, Inc. subsidiary ("Fireline") and Blue Diamond Construction, Inc. ("Blue Diamond"), a New York-based construction management firm, Fireline will assist in the development and construction of three projects including 339 residential condominiums and 160,000 square feet of mixed use retail space in New York. The first project is located on the Upper East Side of Manhattan, the second in the Williamsburg section of Brooklyn and the third in the Whitestone section of Queens. Fireline will provide restoration and rehabilitation services, which Fireline has provided to its customers for more than 10 years. The Company and Blue Diamond expect to announce additional details on the projects, including the selection of a development partner for the project that may be one of the largest multinational construction and engineering services companies in the world. The Blue Diamond contract is expected to be worth more than $100 million to Home Solutions.
An internet blog questioned the Company’s second $100 million contract, under which Fireline will provide construction management, general contracting and development services for a 600,000 plus square foot retail center and corporate office site located in Hillsborough County, Florida. The blog falsely alleged that the contract was with Burton Katzman. However Katzman’s company is not involved in any way with Fireline’s project. The Company is currently unable to release additional details on the project due to confidentiality provisions with the contract. Many developers wait to publicly announce projects until they have negotiated the best deal possible with local municipalities for tax and other incentives.
An internet blog alleged that Rick Holowchak, the President of Blue Diamond, was charged by the New York Attorney General for not paying day laborers, but fails to mention that the case was dismissed. Mr. Holowchak and Blue Diamond have provided construction management/consulting services on numerous New York-city based projects similar to the projects announced in the Company’s May 18th press release.
“We have worked hard to transition Home Solutions from a company relying on catastrophic events to a broad-based diversified construction services company,” said Frank J. Fradella, Chairman and CEO of Home Solutions. “We are confident that investors will continue to see the results of these initiatives throughout the course of the year. While we are unable to currently provide additional details on these contracts due to confidentiality provisions, we are certainly willing to provide copies of these contracts to any regulatory agency. We believe that over the coming weeks, as additional details on these contracts and other corporate developments are announced, that investors will recognize the progress the Company has made and value it accordingly.”
The stock blog’s website includes reports on other companies in which it defames management but fails to follow up the story when these same companies have appreciated in value.
“It is unfortunate that a nameless stock blog, without any contact information, attempts to intimidate investors for self-serving reasons,” added Mr. Fradella. “While the blog is quick to accuse other companies of fraud, its self-serving statements, failure to disclose its trading positions and dubious track record on its stock selections suggests that investors should be cautious in considering such information. The Company intends to contact the regulatory agencies and file a complaint against the blog and those behind it whom we believe have attempted to benefit financially by manipulating our securities to the detriment of our shareholders.”
About Home Solutions of America, Inc.
Home Solutions of America, Inc. is a provider of restoration, construction and interior services to commercial and residential customers. Its Fireline subsidiary is involved in providing construction services, rebuilding, catastrophic storm response and contents restoration for commercial, industrial and residential properties. Based in Tampa, Fireline is certified in multiple aspects of the restoration industry, including smoke, fire, water and mold. The Company has operations in California, Texas, Florida, Alabama, Georgia, Louisiana, Mississippi and North Carolina. Home Solutions Restoration of Louisiana, Inc., which does business as Associated Contractors ("Associated"), is a Louisiana based commercial, industrial and residential contractor working in the governmental and private arenas. Associated has been one of the larger players in redeveloping public schools in the aftermath of Hurricane Katrina. Its clients include the State of Louisiana, the City of New Orleans, the Louisiana National Guard, the historic French Market, Louis Armstrong International Airport and the N.A.S.A. Stennis Space Center in Mississippi. For additional information, please visit the Company’s Web site at http://www.hsoacorp.com.
Cautionary Notice
This press release contains forward-looking statements made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The statements contained herein which are not historical facts are considered forward-looking statements under federal securities laws. Such forward-looking statements are based on the beliefs of our management as well as assumptions made by and information currently available to them. The Company has no obligation to update such forward-looking statements. Actual results may vary significantly from these forward-looking statements based on a variety of factors. These risks and uncertainties include our future financial performance, business prospects, ability to win new contracts, our performance under existing contracts, the timing of completion of projects, as well as our future revenues and our ability to collect accounts receivable. In addition, there can be no assurance that the actions taken or to be taken by the Company as described herein will result in increased revenues. Other important factors are described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 in the section entitled “Risk Factors”.
