<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>3
<FILENAME>exhibit13.txt
<DESCRIPTION>EXHIBIT 13
<TEXT>
                              COLLATERAL AGREEMENT

     This Collateral  Agreement (this  "Agreement") is made by and between Dixie
Rice Agricultural  Corporation,  Inc., a Louisiana  corporation  ("Dixie"),  and
Valhi Holding Company,  a Delaware  corporation  ("VHC"),  as of the 25th day of
August, 2005.

                                    Recitals

     A. Dixie and Southern  Methodist  University ("SMU") have entered into that
certain Loan and Pledge Agreement dated August 18, 1986 (the "Loan  Agreement"),
pursuant to which SMU has agreed to advance Dixie up to $1,500,000.00 in loans.

     B. SMU requires, among other things, that Dixie pledge shares of stock with
a market value of not less than two hundred  percent  (200%) of the  outstanding
principal balance of the loans advanced under the Loan Agreement.

     C. Dixie does not currently hold securities that will qualify as collateral
under the Loan Agreement.

     D. On August 24, 2005, in order to assist Dixie with its pledge obligation,
Contran  Corporation,  a Delaware  corporation and an affiliate of Dixie and VHC
("Contran"),  had pledged  50,000 shares (the "Old Shares") of the common stock,
par value $0.01 per share (the "Valhi Common Stock"), of Valhi, Inc., a Delaware
corporation, for a collateral fee Dixie paid to Contran.

     E. On August 25, 2005, Contran contributed the Old Shares to VHC subject to
all existing liens.

     F. VHC has  agreed to pledge  50,000  shares of the Valhi  Common  Stock as
collateral under the Loan Agreement in exchange for the Old Shares.

                                    Agreement

     In  consideration  of the mutual  premises,  representations  and covenants
herein contained, the parties hereto mutually agree as follows.

     Section 1. VHC agrees to pledge,  as collateral  under the Loan  Agreement,
50,000  shares of Valhi  Common  Stock owned by VHC, or such  greater  number of
shares  that shall  have from time to time a market  value of at least the value
required by the Loan Agreement (the "New Shares").

     Section 2. As consideration for pledging the New Shares, Dixie shall pay to
VHC a fee equal to an annual rate of 0.5% of the average  daily  principal  loan
balance  outstanding,  during periods in which any portion of the New Shares are
pledged, under the Loan Agreement,  payable quarterly on each March 31, June 30,
September 30, and December 31.

     Section 3. Dixie  agrees to indemnify  VHC against any loss or  incremental
cost resulting from the pledge of the New Shares under the Loan Agreement.

     Section 4. Dixie  agrees   to   use  its  best  efforts  to  deliver  stock
certificates  representing  the Old Shares to VHC shortly  after the delivery of
the New Shares to SMU.

     Section 5. The Agreement may be terminated by either party hereto by giving
the other party thirty (30) days written notice of such termination.

     Executed as of the date first above written.

                                DIXIE RICE AGRICULTURAL CORPORATION, INC.




                                By:/s/ Bobby D. O'Brien
                                   --------------------------------------
                                   Bobby D. O'Brien, Vice President


                                VALHI HOLDING COMPANY




                                By:/s/ Gregory M. Swalwell
                                   --------------------------------------
                                   Gregory M. Swalwell, Vice President

</TEXT>
</DOCUMENT>
