Summary of WALTER INDUSTRIES INC /NEW/

Item 1.01 Entry into a Material Definitive Agreement

On April 17, 2009, Walter Industries, Inc. (the "Company") completed the spin-off of Walter Investment Management LLC ("Spinco"), the legal entity that held the Company's Financing segment. In connection with the spin-off, the Company and Spinco entered into several agreements regarding their ongoing relationship following the spin-off, as described in more detail below. On April 17, 2009, following the spin-off and a subsequent taxable dividend paid by Spinco to holders of units of its limited liability company interests distributed by the Company in the spin-off, Spinco merged (the "Merger") into Hanover Capital Mortgage Holdings, Inc. ("Hanover"), a Maryland corporation, pursuant to the Second Amended and Restated Agreement and Plan of Merger, dated February 6, 2009, among the Company, Hanover, Spinco and JWH Holding Company LLC ("JWHHC"), a wholly-owned subsidiary of the Company, as amended on February 17, 2009 (the "Merger Agreement"). In connection with the Merger, Hanover changed its name to Walter Investment Management Corp. ("Walter Investment").

Trademark License Agreement. On April 17, 2009, the Company and Spinco entered into a Trademark License Agreement (the "Trademark License"), pursuant to which the Company granted Spinco, and Walter Investment acquired by operation of law as successor to the rights and obligations of Spinco, a paid-up, perpetual, non-exclusive, non-transferable (except to affiliates) license to use certain variations and/or acronyms of the "Walter", "Best Insurors" and "Mid-State" names in connection with mortgage finance, lending, insurance and reinsurance services, and financial services related thereto, in the United States. In addition, the Company caused to be granted to Spinco and its subsidiaries a paid-up, non-transferable right to maintain certain domain name registrations for the purpose of operating websites directed to customers in the United States in connection with the above services. Spinco and its subsidiaries may sublicense to third parties only in connection with the operation of their own businesses. The Company agreed not to use or license others to use the ''Walter'' name immediately adjacent to words that would convey services like those to be offered by Spinco, including ''Mortgage,'' ''Reinsurance,'' ''Investment,'' ''Finance,'' or ''Bank,'' for use in connection with such services. The foregoing description of the Trademark License does not purport to be complete and is qualified in its entirety by the terms and conditions of the Trademark License, which is filed as Exhibit 10.1 hereto, and incorporated into this report by reference.

Transition Services Agreement. On April 17, 2009, the Company entered into a Transition Services Agreement with Spinco (the "Transition Services Agreement") pursuant to which the Company and certain of its subsidiaries will provide to Walter Investment (as successor to Spinco), and Walter Investment will provide to the Company and its subsidiaries, certain transitional services. Prior to the Merger, the Company and its subsidiaries provided to, or shared with, the financing business of Spinco, a range of management, operational and technical services related to the conduct of the Spinco financing business. Following the spin-off and Merger, the Company will provide to Walter Investment certain tax, legal, treasury and accounting services, human resources services, information technology and communications systems and support, and Walter Investment will provide certain accounting services and tax-related services to the Company. Each of the Company and Walter Investment will provide these services for a limited duration, in all cases not expected to exceed 24 months, with the precise term of each service set forth in the Transition Services Agreement. However, the Company and Walter Investment, in their respective capacities as recipients of services provided under the agreement, have the right to terminate any or all services they are receiving upon 30 days written notice. The foregoing description of the Transition Services Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Transition Services Agreement, which is filed as Exhibit 10.2 hereto, and incorporated into this report by reference.

Tax Separation Agreement. On April 17, 2009, the Company entered into a Tax Separation Agreement with Spinco ( the "Tax Separation Agreement"), pursuant to which Walter Investment, as successor to Spinco, will make payments to the Company with respect to the 2008 tax year and the portion of the 2009 tax year ending on the date of the spin-off, during which Spinco and its subsidiaries, Walter Mortgage Company ("WMC"), Walter Investment Reinsurance Co. Ltd ("WIRC") and Best Insurors, Inc. ("Best") were included in, or were members of, the consolidated federal income tax group or any combined state or local income tax group with the Company or any subsidiary of the Company, equal to the amount of taxes such entities would have paid if they had filed separate tax returns in such jurisdictions rather than having been a consolidated or combined subsidiary of the Company with respect to such taxes. With respect to any other taxable years in which WMC, WIRC and Best were included in, or were members of, the consolidated federal income tax group or any combined state or local income tax group with the Company or any subsidiary of the Company, the Company retains any liability for adjustments to the U.S. federal income or state combined income taxes of the applicable group for such years (including any interest or penalties applicable thereto) resulting from an audit or other settlement or compromise with any taxing authority, even if such taxes relate to Spinco, WMC, WIRC or Best. Walter Investment, as successor to Spinco, is responsible for Spinco's share of any such income tax liabilities (including any interest or penalties applicable thereto) attributable to adjustments other than as a result of an audit or other settlement or compromise with any tax authority but only where such liabilities are attributable to misleading or inaccurate information provided by Spinco or any of its subsidiaries to the Company (or the failure by any such entity to provide material information to the Company).

Additionally, Walter Investment, as successor to Spinco, will remain liable for any taxes imposed on Spinco or its subsidiaries in jurisdictions in which Spinco did not join with the Company in a combined or consolidated group for income tax purposes (and with respect to any taxes other than income taxes). The Tax Separation Agreement also provides that if, as a result of certain adjustments, Spinco (or Walter Investment, as successor to Spinco) is required to pay an additional dividend (other than the taxable dividend declared in connection with . . .