8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) May 26, 2006

WALTER INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-13711	13-3429953
(State or other jurisdiction of	(Commission	(IRS Employer
incorporation or organization)	File Number)	Identification No.)

4211 W. Boy Scout Boulevard, Tampa, Florida	33607
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (813) 871-4811

NOT APPLICABLE
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13-4(c))

Item 1.01           Material Definitive Agreement

On May 26, 2006, an Amendment to the Amended and Restated Variable Funding Loan Agreement was entered into by and among YC SUSI Trust, a Lender, Atlantic Asset Securitization LLC, a Lender, Mid-State Trust IX, the Borrower, Wachovia Bank, National Association, the Custodian/Collateral Agent, Bank of America, National Association, an Agent, a Managing Agent and a Bank Investor and Calyon New York Branch, a Managing Agent and Bank Investor and the other signatories thereto. The Amendment reduces the Mid-State Trust IX Variable Funding Loan Facility from $200.0 million to $150.0 million. The Facility Limit reduction was requested by Mid-State Trust IX to reduce the carrying costs of having excess capacity in its mortgage asset loan facilities.

The Mid-State Trust IX Variable Funding Loan Facility and another $200.0 million loan facility, provide an aggregate of $350.0 million of temporary financing to Mid-State Homes, Inc. for its (i) purchase of installment notes from Jim Walter Homes, Inc. and its affiliated builders, and (ii) purchase of mortgage loans from Walter Mortgage Company. Mid-State Trust IX is a Delaware statutory trust whose assets are limited to pledged installment notes, mortgage notes and mortgages purchased from Mid-State Homes, Inc. Walter Industries, Inc. is not  a party to the Mid-State Trust IX Variable Funding Loan Facility, but the Loan Facility provides liquidity to Walter Industries, Inc. and its affiliates. The Mid-State Trust IX Variable Funding Loan Facility is renewable on January 30, 2007.

Item 9.01Financial Statements and Exhibits

The following exhibits are filed herewith:

(d)

Exhibits

10.13.2

Amendment dated as of May 26, 2006 Amended and Restated Variable Funding Loan Agreement entered into by and among YC SUSI Trust, a Lender, Atlantic Asset Securitization LLC, a Lender, Mid-State Trust IX, the Borrower, Wachovia Bank, National Association, the Custodian/Collateral Agent, Bank of America, National Association, an Agent, a Managing Agent and a Bank Investor and Calyon New York Branch, a Managing Agent and Bank Investor and the other signatories thereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

WALTER INDUSTRIES, INC.
By:	/s/ Victor P. Patrick
Title:	Victor P. Patrick
	Sr. Vice President, General Counsel and Secretary

Date:  May 31, 2006

EX-10.13.2

EXHIBIT 10.13.2

EXECUTION COPY

AMENDMENT

AMENDMENT (this “Amendment”), dated as of May 26, 2006, by and among MID-STATE TRUST IX, as borrower (the “Borrower”), YC SUSI TRUST, as a lender (a “Lender”), ATLANTIC ASSET SECURITIZATION LLC, as a lender (a “Lender”, and together with YC SUSI Trust, the “Lenders”), WACHOVIA BANK, NATIONAL ASSOCIATION, as custodian/collateral agent (the “Collateral Agent”), BANK OF AMERICA, NATIONAL ASSOCIATION, as agent (the “Agent”), a managing agent (a “Managing Agent”) and a bank investor (a “Bank Investor”), CALYON NEW YORK BRANCH, as a managing agent (a “Managing Agent”, and together with Bank of America, National Association, the “Managing Agents”) and a bank investor (a “Bank Investor”) and the other signatories hereto.

Capitalized terms used and not defined in this Amendment or in any of the Operative Documents shall have the meanings given such terms in Annex A to the Amended and Restated Variable Funding Loan Agreement, dated as of November 19, 2004, as amended from time to time (the “Loan Agreement”), among the Lenders, the Borrower, the Collateral Agent, the Agent, each Bank Investor and the Managing Agents.

PRELIMINARY STATEMENTS

WHEREAS, each of the signatories hereto is party to one or more of the Operative Documents; and

WHEREAS, each of the signatories hereto acknowledges and agrees that the Net Investment does not exceed $150,000,000 and therefore does not exceed the Maximum Net Investment as required by Section 2.1(a) of the Loan Agreement; and

WHEREAS, each of the signatories hereto wish to amend certain of the Operative Documents, as hereinafter provided;

NOW, THEREFORE, in consideration of the mutual covenants contained herein and in the Loan Agreement, and other good and valuable consideration, the receipt and adequacy of which is hereby expressly acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:

SECTION 1.           Amendments to the Loan Agreement. The Loan Agreement is hereby amended as follows:

(a)           The references to “Group Commitment” on the signature pages are amended by deleting the references to “$100,000,000” therein and replacing each with “$75,000,000.”

(b)           The definition of “Facility Limit” in Annex A is amended by deleting the reference to “$200,000,000” therein and replacing it with “$150,000,000.”

(c)           The definition of “Maximum Net Investment” in Annex A is amended by deleting the reference to “$200,000,000” therein  and replacing it with “$150,000,000.”

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SECTION 2.           Conditions Precedent. This Amendment shall become effective, as of the date hereof, on the date on which the following conditions precedent shall have been fulfilled:

(a)           This Amendment. Each Managing Agent shall have received counterparts of this Amendment, duly executed by each of the parties hereto.

(b)           Variable Funding Notes. Each Managing Agent shall surrender its Variable Funding Note in exchange for a new Variable Funding Note reflecting the amended Group Commitment for the related Group.

(c)           Additional Documents. Each Managing Agent shall have received all additional approvals, certificates, documents, instruments and items of information as each Managing Agent may reasonably request and all of the foregoing shall be in form and substance reasonably satisfactory to each Managing Agent.

(d)           Legal Matters. All instruments and legal and corporate proceedings in connection with the transactions contemplated by this Amendment shall be satisfactory in form and substance to each Managing Agent and each Managing Agent’s counsel and the fees and expenses of counsel to each Managing Agent incurred in connection with the execution of this Amendment and the transactions contemplated hereby shall have been paid in full.

SECTION 3.           Severability of Provisions. Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

SECTION 4.           Captions. The captions in this Amendment are for convenience of reference only and shall not define or limit any of the terms or provisions hereof.

SECTION 5.           Agreement to Remain in Full Force and Effect. Except as amended hereby, the Loan Agreement shall remain in full force and effect and is hereby ratified, adopted and confirmed in all respects. All references in the Loan Agreement to “herein,” or words of like import, and all references to the Loan Agreement in any agreement or document shall hereafter be deemed to refer to the Loan Agreement as amended hereby.

SECTION 6.           GOVERNING LAW. EXCEPT WITH RESPECT TO SECTION 8 AND ANY OTHER SECTIONS HEREIN TO THE EXTENT THAT THEY AFFECT THE TRUST AGREEMENT, WHICH SECTIONS SHALL BE GOVERNED BY THE LAWS OF THE STATE OF DELAWARE, THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

SECTION 7.           Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Amendment.

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SECTION 8.           Limitation of Liability. It is expressly understood and agreed by the parties hereto that (a) this Amendment is executed and delivered by Wilmington Trust Company, not individually or personally but solely as trustee of the Trust, in the exercise of the powers and authority conferred and vested in it under the Trust Agreement, (b) each of the representations, undertakings and agreements herein or therein made on the part of the Trust is made and intended not as personal representations, undertakings and agreements by Wilmington Trust Company but is made and intended for the purpose of binding only the Trust and (c) under no circumstances shall Wilmington Trust Company be personally liable for the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Trust under this Amendment.

SECTION 9.           Representations and Warranties. The Borrower hereby certifies that (i) the representations and warranties made by it in Section 3.1 of the Loan Agreement are true and correct as of the date hereof, as though made on and as of the date hereof and (ii) as of the date hereof, there is no Event of Default or event which, with the passage of time of the giving of notice, could result in an Event of Default.

SECTION 10.         Waiver of Notice. Each of the parties hereto hereby waives any notice in connection with the execution and delivery of this Amendment.

[signature pages omitted]

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