Offer Letter from Owens Corning to Duncan Palmer, dated as of August 15, 2007



 Exhibit 10.3 
 OWENS CORNING WORLD HEADQUARTERS 
 ONE OWENS CORNING PARKWAY 
 TOLEDO, OHIO 43659 
 JOSEPH C, HIGH 
 SENIOR VICE
PRESIDENT 
 HUMAN RESOURCES 
 419 248 6007 phone 
 419 825 1007 fax 
 joseph.high@owenscorning.com 
 419 248 6352 
 

 
 August 15, 2007 
 Mr. Duncan Palmer 
 2304-B Albans Road 
 Houston.
TX 77005 
 Dear Duncan: 
 After our many conversations,
meetings and interviews, we are pleased to confirm our final offer to you for the position of Senior Vice President and Chief Financial Officer for Owens Corning. The key components of our offer are described below and are consistent with your
conversation yesterday with Mike Thaman. 
 BASE SALARY 
 Your base salary will be $41,666 per month, which equates to $500,000 per year, and is subject to annual review. 
 ANNUAL INCENTIVE

 You will participate in the Owens Corning (OC) Corporate Incentive Plan. Annual cash awards under this Plan are based on the Company’s success
in meeting specific annual goals as approved by the Compensation Committee, and on your contribution toward meeting these goals. 
 Your participation in
this Plan will be set at 65% of your base salary at Target Company Performance or “Funding” (i.e., $325,000), and will be 130% of base salary at Maximum Funding (i.e., $650,000). Your funded award can be increased or decreased based on
your personal performance, with the maximum award being limited to 200% of the funded award. 
 Your participation in this Plan for 2007 will be prorated
based upon the number of months you are employed by the Company in 2007. 
 LONG TERM INCENTIVE 
 You will also participate in OC’s Long Term Incentive (LTI) Program. The LTI Program uses overlapping 3-Year Performance Cycles, and awards under the Program are
based on the Company’s success in meeting specific goals approved by our Compensation Committee of the Board of Directors for the performance period. 
 Your target participation level in the LTI Program will be 210% of base salary. The Program’s 2007-2009 performance cycle consists of discretionary grants of Restricted Stock and Performance Share Units. Your 2007 grant under this
performance cycle will consist of:- 
  

	 	•	 	 10,482 Restricted Shares of OC Stock, which will cliff-vest on 12/31/2009; and 


  

	 	•	 	 20,346 Performance Share Units, with performance goals set by the Compensation Committee. 


 OWENS CORNING 








					
	Mr. Duncan Palmer	 	Page 2	 	August 15, 2007

 EQUITY 
 We recognize that to accept our offer you must resign your employment at Shell and forfeit a significant amount of unvested equity and incentive awards. In view of this and certain other benefits offered by Shell and not OC, we are pleased
to offer you a one-time equity grant valued at $1,750,000. 
 This grant will consist of 37,051 Restricted Shares with 3-year cliff vesting (valued at
$1,000,000), and 69,470 Stock Options with 3-year cliff vesting and a strike price of $26.99 (valued at $750,000 using yesterday’s closing price). 
 SEVERANCE 
 You are eligible to receive the Company’s standard Executive Officer Severance Agreement that affords you with two
(2) years of base pay, two (2) years of annual bonus, and one (1) year of health care coverage, in the case of your involuntary termination from the Company. 
 BENEFITS 
 You are eligible to participate in our employee benefit programs, which include: 
  

	 	•	 	 Comprehensive health care, life and disability plans; 


  

	 	•	 	 401 (k) Plan where OC matches your contributions dollar-for-dollar up to the first 5% of base and annual incentive earnings; 


  

	 	•	 	 Cash Balance Pension Plan where OC annually contributes an amount equal to 4% of your 


 credited earnings into a notional account that earns interest; 
  

	 	•	 	 “Top Hat” Pension Plan which continues the Cash Balance Pension Plan after the regulatory cap is reached; 


  

	 	•	 	 Officer Deferred Compensation Program; 


  

	 	•	 	 Relocation Plan, which will remain available to you for up to one year following your hire; and 


  

	 	•	 	 25 days of paid vacation per year. 


 ADDITIONAL
BENEFITS 
 In accordance with the Company’s policies for similarly situated Officers, you will also be eligible for $10,000,000 in Personal
Excess Liability Insurance, and $4,000 in annual financial planning/tax preparation assistance. 
 We would also like to confirm your successful completion
of the Company security clearance, background review, physical examination and drug screen. Duncan, we believe this offer positions you competitively relative to experienced Chief Financial Officer’s in our Comparator group. 
 Please confirm your acceptance of our offer by signing below. 
 Sincerely,

 Joseph C. High 
 Senior Vice President 
 Human Resources 
  

	cc:	Mr. Dave Brown, Owens Corning 


	 	Mr. Mike Thaman, Owens Corning 


	 	Mr. Jeff Wilke, Owens Corning 

  

					
	Agreed to and accepted;	 		 	
			
	/s/ Duncan Palmer	 		 	August 19th 2007
	Duncan Palmer	 		 	Date

 OWENS CORNING