EXHIBIT 99.4

         
   To:      Ed Porter

 From:      Don Boyce

 Date:      August 16, 2000



Dear Ed,

    This will confirm today's conversation regarding your employment as an
officer of Walter Industries, Inc.

    1.  Your title has been changed to Senior Vice President, General Counsel
       and Secretary. Beginning September 5, 2000 you will report directly to
       the Chairman and CEO of the Company.

    2.  Your salary has been increased to $250,000 per annum effective
       August 15, 2000, and your targeted annual bonus amount is 70% of base
       pay. The actual amount of your bonus may vary based on achievement of
       goals in the bonus plan for officers and key employees as in effect from
       time to time.

    3.  You will receive a monthly car allowance of $1500, subject to usual tax
       withholding.

    4.  In the event of your involuntary termination from service with Walter
       Industries, Inc., other than for "cause", or your resignation following a
       significant diminution in compensation or responsibilities, you will be
       entitled to receive:

       - Eighteen months of continuing salary and bonus at the rate in effect at
         the time of termination.

       - Eighteen months of continuing fringe benefits to the extent plans
         permit continued participation. In any event, health and life insurance
         will continue for the period of your contractual severance and the
         COBRA election period will not commence until the expiration of that
         period.

       - Three years from termination to exercise all vested stock options or
         awards.

    "Cause" shall mean your (i) conviction or guilty plea of a felony involving
fraud or dishonesty, (ii) theft or embezzlement of property from the company or
(iii) willful and continued refusal to perform the duties of your position
(other than any such failure resulting from your incapacity due to physical or
mental illness).

    For purposes of this agreement, a significant diminution in pay shall not
have occurred by reason of fluctuations in the amount of bonus paid due to
performance considerations under the company's then current bonus plan.

    Ed, we appreciate your support and wise counsel, and look forward to your
signing and returning one copy of this letter agreement.

Sincerely,

Donald N. Boyce

Agreed and Accepted

Edward A. Porter

Date