exv10w3






Exhibit 10.3




 





GUARANTEE AGREEMENT




dated as of



January 7, 2009



among



USG CORPORATION,



THE SUBSIDIARIES OF USG CORPORATION

IDENTIFIED HEREIN



and



JPMORGAN CHASE BANK, N.A.,



as Administrative Agent



 




 









 





TABLE OF CONTENTS




	 	 	 	 	 

	ARTICLE I

	 
	 	 	 	 
	Definitions

	 
	 	 	 	 
	SECTION 1.01. Credit Agreement
	 	 	1	 
	SECTION 1.02. Other Defined Terms
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II

	 
	 	 	 	 
	Guarantee

	 
	 	 	 	 
	SECTION 2.01. Guarantee
	 	 	2	 
	SECTION 2.02. Guarantee of Payment
	 	 	2	 
	SECTION 2.03. No Limitations
	 	 	2	 
	SECTION 2.04. Reinstatement
	 	 	3	 
	SECTION 2.05. Agreement To Pay; Subrogation
	 	 	3	 
	SECTION 2.06. Information
	 	 	3	 
	 
	 	 	 	 
	ARTICLE III

	 
	 	 	 	 
	Indemnity, Subrogation and Subordination

	 
	 	 	 	 
	SECTION 3.01. Indemnity and Subrogation
	 	 	4	 
	SECTION 3.02. Contribution and Subrogation
	 	 	4	 
	SECTION 3.03. Subordination
	 	 	4	 
	 
	 	 	 	 
	ARTICLE IV

	 
	 	 	 	 
	Miscellaneous

	 
	 	 	 	 
	SECTION 4.01. Notices
	 	 	5	 
	SECTION 4.02. Waivers; Amendment
	 	 	5	 
	SECTION 4.03. Administrative Agent’s Fees and Expenses; Indemnification
	 	 	5	 
	SECTION 4.04. Successors and Assigns
	 	 	6	 
	SECTION 4.05. Survival of Agreement
	 	 	6	 
	SECTION 4.06. Counterparts; Effectiveness; Several Agreement
	 	 	6	 
	SECTION 4.07. Severability
	 	 	7	 
	SECTION 4.08. Right of Set-Off
	 	 	7	 
	SECTION 4.09. Governing Law; Jurisdiction; Consent to Service of Process
	 	 	7	 
	SECTION 4.10. WAIVER OF JURY TRIAL
	 	 	8	 
	SECTION 4.11. Headings
	 	 	8	 
	SECTION 4.12. Guarantee Absolute
	 	 	8	 
	SECTION 4.13. Termination or Release
	 	 	9	 
	SECTION 4.14. Additional Subsidiaries
	 	 	9	 






 









 






	 	 	 
	Schedules	 	 
	 
	Schedule I

	 	Guarantors






	 	 	 
	Exhibits	 	 
	 
	Exhibit I

	 	Form of Supplement






 









 







     GUARANTEE AGREEMENT dated as of January 7, 2009 (this
“Agreement”), among USG CORPORATION, a Delaware corporation (the
“Borrower”), each Subsidiary of the Borrower from time to time
party hereto and JPMORGAN CHASE BANK, N.A., as Administrative Agent.



          Reference is made to the Second Amended and Restated Credit Agreement dated as of January 7,
2009 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among the Borrower, the Lenders party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, and Goldman Sachs Credit Partners, L.P., as Syndication Agent. The Lenders
have agreed to extend credit to the Borrower subject to the terms and conditions set forth in the
Credit Agreement. The obligations of the Lenders to extend such credit are conditioned upon, among
other things, the execution and delivery of this Agreement. The Subsidiaries party hereto are
affiliates of the Borrower, will derive substantial benefits from the extension of credit to the
Borrower pursuant to the Credit Agreement and are willing to execute and deliver this Agreement in
order to induce the Lenders to extend such credit. Accordingly, the parties hereto agree as
follows:




ARTICLE I




Definitions



          SECTION 1.01. Credit Agreement. (a) Capitalized terms used in this Agreement and not
otherwise defined herein have the meanings specified in the Credit Agreement.




          (b) The rules of construction specified in Section 1.03 of the Credit Agreement also apply to
this Agreement.




          SECTION 1.02. Other Defined Terms. As used in this Agreement, the following terms
have the meanings specified below:




          “Borrower” has the meaning assigned to such term in the preliminary statement of this
Agreement.




          “Claiming Party” has the meaning assigned to such term in Section 3.02.




          “Contributing Party” has the meaning assigned to such term in Section 3.02.




          “Credit Agreement” has the meaning assigned to such term in the preliminary statement
of this Agreement.




          “Guaranteed Parties” has the meaning assigned to the term “Secured Parties” in the
Credit Agreement.







 









 








          “Guarantors” means (a) the Borrower, (b) the Subsidiaries identified on Schedule I
hereto and (c) each other Subsidiary that becomes a party to this Agreement after the Restatement
Effective Date, in each case except with respect to the Secured Obligations of such Person (other
than the Obligations of such Person described in clause (c) of the definition of the term
“Obligations”).




ARTICLE II




Guarantee



          SECTION 2.01. Guarantee. Each Guarantor unconditionally guarantees, jointly with the
other Guarantors and severally, as a primary obligor and not merely as a surety, the due and
punctual payment and performance of the Secured Obligations. Each of the Guarantors further agrees
that the Secured Obligations may be extended or renewed, in whole or in part, without notice to or
further assent from it, and that it will remain bound upon its guarantee notwithstanding any
extension or renewal of any Secured Obligation. Each of the Guarantors waives presentment to,
demand of payment from and protest to the Borrower or any other Loan Party of any of the Secured
Obligations, and also waives notice of acceptance of its guarantee and notice of protest for
nonpayment.




          SECTION 2.02. Guarantee of Payment. Each of the Guarantors further agrees that its
guarantee hereunder constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Administrative Agent or any other Guaranteed
Party to any security held for the payment of the Secured Obligations or to any balance of any
deposit account or credit on the books of the Administrative Agent or any other Guaranteed Party in
favor of the Borrower or any other Person.




          SECTION 2.03. No Limitations. (a) Except for termination of a Guarantor’s
obligations hereunder as expressly provided in Section 4.13, the obligations of each Guarantor
hereunder shall not be subject to any reduction, limitation, impairment or termination for any
reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not
be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Secured Obligations or otherwise. Without
limiting the generality of the foregoing, the obligations of each Guarantor hereunder shall not be
discharged or impaired or otherwise affected by (i) the failure of the Administrative Agent or any
other Guaranteed Party to assert any claim or demand or to enforce any right or remedy under the
provisions of any Loan Document or otherwise; (ii) any rescission, waiver, amendment or
modification of, or any release from any of the terms or provisions of, any Loan Document or any
other agreement, including with respect to any other Guarantor under this Agreement; (iii) the
release of any security, if any, held by the Administrative Agent or any other Guaranteed Party for
the Secured Obligations or any of them; (iv) any default, failure or delay, wilful or otherwise, in
the performance of the Secured Obligations; or (v) any other act or omission that may or might in
any manner or to any extent vary the risk of any Guarantor or otherwise operate as a discharge of
any






2









 







Guarantor as a matter of law or equity (other than the payment in full in cash of all the
Secured Obligations).




          (b) To the fullest extent permitted by applicable law, each Guarantor waives any defense based
on or arising out of any defense of the Borrower or any other Loan Party or the unenforceability of
the Secured Obligations or any part thereof from any cause, or the cessation from any cause of the
liability of the Borrower or any other Loan Party, other than the payment in full in cash of all
the Secured Obligations. The Administrative Agent may, at its election, foreclose on any security
held by it by one or more judicial or nonjudicial sales, accept an assignment of any such security
in lieu of foreclosure, compromise or adjust any part of the Secured Obligations, make any other
accommodation with the Borrower or any other Loan Party or exercise any other right or remedy
available to it against the Borrower or any other Loan Party, without affecting or impairing in any
way the liability of any Guarantor hereunder except to the extent the Secured Obligations have been
paid in full in cash. To the fullest extent permitted by applicable law, each Guarantor waives any
defense arising out of any such election even though such election may operate, pursuant to
applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of such Guarantor against the Borrower or any other Loan Party, as the case may be, or
any security.




          SECTION 2.04. Reinstatement. Each of the Guarantors agrees that its guarantee
hereunder shall continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Secured Obligation is rescinded or must otherwise be restored
by the Administrative Agent or any other Guaranteed Party upon the bankruptcy or reorganization of
the Borrower, any other Loan Party or otherwise.




          SECTION 2.05. Agreement To Pay; Subrogation. In furtherance of the foregoing and not
in limitation of any other right that the Administrative Agent or any other Guaranteed Party has at
law or in equity against any Guarantor by virtue hereof, upon the failure of the Borrower or any
other Loan Party to pay any Secured Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises
to and will forthwith pay, or cause to be paid, to the Administrative Agent for distribution to the
applicable Guaranteed Parties in cash the amount of such unpaid Secured Obligation. Upon payment
by any Guarantor of any sums to the Administrative Agent as provided above, all rights of such
Guarantor against the Borrower or any other Loan Party arising as a result thereof by way of right
of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be
subject to Article III.




          SECTION 2.06. Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of the Borrower’s and each other Loan Party’s financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of the Secured
Obligations and the nature, scope and extent of the risks that such Guarantor assumes and incurs
hereunder, and agrees that none of the Administrative Agent or the other Guaranteed Parties will
have any duty to advise such Guarantor of information known to it or any of them regarding such
circumstances or risks.







3









 








ARTICLE III




Indemnity, Subrogation and Subordination



          SECTION 3.01. Indemnity and Subrogation. In addition to all such rights of indemnity
and subrogation as the Guarantors may have under applicable law (but subject to Section 3.03), each
Guarantor agrees that in the event a payment of a Secured Obligation of such Guarantor shall be
made by any other Guarantor under this Agreement, such Guarantor shall indemnify such other
Guarantor for the full amount of such payment and such other Guarantor shall be subrogated to the
rights of the Person to whom such payment shall have been made to the extent of such payment.




          SECTION 3.02. Contribution and Subrogation. Each Guarantor (a “Contributing
Party”) agrees (subject to Section 3.03) that, in the event a payment shall be made by any
other Guarantor hereunder in respect of any Secured Obligation and such other Guarantor (the
“Claiming Party”) shall not have been fully indemnified by the applicable Guarantor as
provided in Section 3.01, the Contributing Party shall indemnify the Claiming Party in an amount
equal to the amount of such payment multiplied by a fraction of which the numerator shall be the
net worth of the Contributing Party on the date hereof (or, in the case of any Guarantor becoming a
party hereto pursuant to Section 4.14, the date of the supplement hereto executed and delivered by
such Guarantor) and the denominator shall be the aggregate net worth of all the Guarantors on the
date hereof (or, in the case of any Guarantor becoming a party hereto pursuant to Section 4.14, the
date of the supplement hereto executed and delivered by such Guarantor). Any Contributing Party
making any payment to a Claiming Party pursuant to this Section 3.02 shall be subrogated to the
rights of such Claiming Party under Section 3.01 to the extent of such payment.




          SECTION 3.03. Subordination. (a) Notwithstanding any provision of this Agreement to
the contrary, all rights of the Guarantors under Sections 3.01 and 3.02 and all other rights of
indemnity, contribution or subrogation under applicable law or otherwise shall be fully
subordinated to the payment in full in cash of the Secured Obligations. No failure on the part of
any Guarantor to make the payments required by Sections 3.01 and 3.02 (or any other payments
required under applicable law or otherwise) shall in any respect limit the obligations and
liabilities of any Guarantor with respect to its obligations hereunder, and each Guarantor shall
remain liable for the full amount of the obligations of such Guarantor hereunder.




          (b) Each Guarantor hereby agrees that all Indebtedness owed by it to any other Subsidiary that
is not a Loan Party shall be fully subordinated to the payment in full in cash of the Secured
Obligations.







4









 








ARTICLE IV




Miscellaneous



          SECTION 4.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in Section 9.01 of the
Credit Agreement. All communications and notices hereunder to any Guarantor shall be given to it
in care of the Borrower as provided in Section 9.01 of the Credit Agreement.




          SECTION 4.02. Waivers; Amendment. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any other right or power.
The rights and remedies of the Administrative Agent, the Issuing Bank and the Lenders hereunder and
under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or consent to any
departure by any Guarantor therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section 4.02, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. Without limiting the generality
of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as
a waiver of any Default, regardless of whether the Administrative Agent, any Lender or the Issuing
Bank may have had notice or knowledge of such Default at the time. No notice or demand on any
Guarantor in any case shall entitle any Guarantor to any other or further notice or demand in
similar or other circumstances.




          (b) Neither this Agreement nor any provision hereof may be waived, amended or modified except
pursuant to an agreement or agreements in writing entered into by the Administrative Agent and the
Guarantor or Guarantors with respect to which such waiver, amendment or modification is to apply,
subject to any consent required in accordance with Section 9.02 of the Credit Agreement.




          SECTION 4.03. Administrative Agent’s Fees and Expenses; Indemnification. (a) The
parties hereto agree that the Administrative Agent shall be entitled to reimbursement of its
expenses incurred hereunder as provided in Section 9.03 of the Credit Agreement.




          (b) Without limitation of its indemnification obligations under the other Loan Documents, each
Guarantor jointly and severally agrees to indemnify the Administrative Agent and the other
Indemnitees (as defined in Section 9.03 of the Credit Agreement) against, and hold each Indemnitee
harmless from, any and all out-of-pocket losses, claims, damages, liabilities and related
reasonable expenses, including the reasonable fees, charges and disbursements of any counsel for
any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with,
or as a result of,






5









 







the execution, delivery or performance of this Agreement or any claim, litigation,
investigation or proceeding relating to this Agreement or any instrument contemplated hereby,
whether or not any Indemnitee is a party thereto, provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of such Indemnitee.




          (c) Any such amounts payable as provided hereunder shall be additional Secured Obligations
guaranteed hereby. The provisions of this Section 4.03 shall remain operative and in full force
and effect regardless of the termination of this Agreement or any other Loan Document, the
consummation of the transactions contemplated hereby, the repayment of any of the Secured
Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any
other Loan Document, or any investigation made by or on behalf of the Administrative Agent or any
other Guaranteed Party. All amounts due under this Section 4.03 shall be payable not later than
three Business Days after written demand therefor setting forth the basis for such claim in
reasonable detail.




          SECTION 4.04. Successors and Assigns. Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the permitted successors and
assigns of such party; and all covenants, promises and agreements by or on behalf of any Guarantor
or the Administrative Agent that are contained in this Agreement shall bind and inure to the
benefit of their respective successors and assigns.




          SECTION 4.05. Survival of Agreement. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this Agreement or any other
Loan Document shall be considered to have been relied upon by the Lenders and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any Lender or on its behalf and
notwithstanding that the Administrative Agent, the Issuing Bank or any Lender may have had notice
or knowledge of any Default or incorrect representation or warranty at the time any credit is
extended under the Credit Agreement, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount payable under any
Loan Document is outstanding and unpaid or any Letter of Credit is outstanding and so long as the
Commitments have not expired or terminated.




          SECTION 4.06. Counterparts; Effectiveness; Several Agreement. This Agreement may be
executed in counterparts, each of which shall constitute an original but all of which when taken
together shall constitute a single contract. Delivery of an executed signature page to this
Agreement by facsimile or other electronic transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement. This Agreement shall become effective as to any
Guarantor when a counterpart hereof executed on behalf of such Guarantor shall have been delivered
to the Administrative Agent and a counterpart hereof shall have been executed on behalf of the
Administrative






6









 







Agent, and thereafter shall be binding upon such Loan Party and the Administrative Agent and
their respective permitted successors and assigns, and shall inure to the benefit of such
Guarantor, the Administrative Agent and the other Guaranteed Parties and their respective
successors and assigns, except that no Guarantor shall have the right to assign or transfer its
rights or obligations hereunder or any interest herein (and any such assignment or transfer shall
be void) except as expressly contemplated by this Agreement or the Credit Agreement. This
Agreement shall be construed as a separate agreement with respect to each Guarantor and may be
amended, modified, supplemented, waived or released with respect to any Guarantor without the
approval of any other Guarantor and without affecting the obligations of any other Guarantor
hereunder.




          SECTION 4.07. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability without affecting the validity, legality
and enforceability of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. The
parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.




          SECTION 4.08. Right of Set-Off. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other obligations at any
time owing by such Lender or Affiliate to or for the credit or the account of any Guarantor against
any of and all the obligations of such Guarantor now or hereafter existing under this Agreement
owed to such Lender, irrespective of whether or not such Lender shall have made any demand under
this Agreement and although such obligations may be unmatured. The rights of each Lender under
this Section 4.08 are in addition to other rights and remedies (including other rights of set-off)
which such Lender may have.




          SECTION 4.09. Governing Law; Jurisdiction; Consent to Service of Process. (a) This
Agreement shall be construed in accordance with and governed by the law of the State of New York.




          (b) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and
its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting
in New York County and of the United States District Court of the Southern District of New York,
and any appellate court from any thereof, in any action or proceeding arising out of or relating to
this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect
of any such action or proceeding may be heard and determined in such New York State or, to the
extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be






7









 







enforced in other jurisdictions by suit on the judgment or in any other manner provided by
law.




          (c) Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection which it may now or hereafter have to
the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement
or any other Loan Document in any court referred to in paragraph (b) of this Section 4.09. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any such court.




          (d) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 4.01. Nothing in this Agreement or any other Loan Document will
affect the right of any party to this Agreement to serve process in any other manner permitted by
law.




          SECTION 4.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 4.10.




          SECTION 4.11. Headings. Article and Section headings and the Table of Contents used
herein are for convenience of reference only, are not part of this Agreement and are not to affect
the construction of, or to be taken into consideration in interpreting, this Agreement.




          SECTION 4.12. Guarantee Absolute. All rights of the Administrative Agent hereunder
and all obligations of each Guarantor hereunder shall be absolute and unconditional irrespective of
(a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document, any
agreement or instrument governing or evidencing any of the Secured Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or
place of payment of, or in any other term of, all or any of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan
Document or any other agreement or instrument governing or evidencing any Secured Obligations, (c)
any release or amendment or waiver of or consent under or departure from any guarantee guaranteeing
all or any of the Secured Obligations, or (d) any other






8









 







circumstance that might otherwise constitute a defense available to, or a discharge of, any
Guarantor in respect of the Secured Obligations or this Agreement (other than the payment in full,
in cash, of the Secured Obligations).




          SECTION 4.13. Termination or Release. (a) Subject to Section 2.04, this Agreement
and the Guarantees made herein shall terminate when all the Obligations (as distinguished from the
Secured Obligations) have been paid in full, in cash, and the Lenders have no further commitment to
lend under the Credit Agreement, the LC Exposure has been reduced to zero and the Issuing Bank has
no further obligations to issue Letters of Credit under the Credit Agreement.




          (b) A Guarantor shall automatically be released from its obligations hereunder upon the
consummation of any transaction permitted by, or that would not otherwise result in a Default
under, the Credit Agreement as a result of which such Guarantor ceases to be a Subsidiary,
provided that the Required Lenders shall have consented to such transaction (to the extent
required by the Credit Agreement) and the terms of such consent did not provide otherwise.




          (c) In connection with any termination or release pursuant to paragraph (a) or (b) of this
Section 4.13, the Administrative Agent shall execute and deliver to any Guarantor, at such
Guarantor’s expense, all documents that such Guarantor shall reasonably request to evidence such
termination or release. Any execution and delivery of documents pursuant to this Section 4.13
shall be without recourse to or warranty by the Administrative Agent.




          SECTION 4.14. Additional Subsidiaries. Pursuant to the Credit Agreement, certain
Domestic Material Subsidiaries that were not in existence or not Domestic Material Subsidiaries on
the date of the Credit Agreement (as well as certain other Domestic Subsidiaries specified by the
Borrower) are required to enter in this Agreement as a Guarantor upon becoming such a Domestic
Material Subsidiary (or upon such designation). Upon execution and delivery by the Administrative
Agent and a Subsidiary of an instrument in the form of Exhibit I hereto, such Subsidiary shall
become a Guarantor hereunder with the same force and effect as if originally named as a Guarantor
herein. The execution and delivery of any such instrument shall not require the consent of any
other Guarantor hereunder. The rights and obligations of each Guarantor hereunder shall remain in
full force and effect notwithstanding the addition of any new Guarantor as a party to this
Agreement.




          SECTION 4.15. Existing Guarantee Agreement. Each Guarantor that was party to the
Guarantee Agreement dated as of November 11, 2008 (the “Existing Guarantee Agreement”),
among the Borrower, the Subsidiaries party thereto and the Administrative Agent, hereby consents to
the termination of the Existing Guarantee Agreement in accordance with Section 3 of the Amendment
and Restatement Agreement and acknowledges that this Agreement shall supersede the Existing
Guarantee Agreement on and after the Restatement Effective Date.








9









 








[Signature Pages Follow]







10









 








          IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.




	 	 	 	 	 
	 	USG CORPORATION,

 	 
	 	by  	/s/ Karen L. Leets
 	 
	 	 	Name:  	Karen L. Leets 	 
	 	 	Title:  	Vice President & Treasurer 	 



11









 






	 	 	 	 	 



	 	 	 	 	 
	 	EACH OF THE SUBSIDIARIES

LISTED ON SCHEDULE I HERETO,

 	 
	 	by  	/s/ Karen L. Leets
 	 
	 	 	Name:  	Karen L. Leets 	 
	 	 	Title:  	In the capacity listed on Schedule I corresponding
to such Subsidiary 	 



12









 






	 	 	 	 	 



	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A., as

Administrative Agent,

 	 
	 	by  	/s/ Peter S. Predun
 	 
	 	 	Name:  	Peter S. Predun 	 
	 	 	Title:  	Executive Director 	 



13









 






	 	 	 	 	 



Schedule I to the

Guarantee Agreement




GUARANTORS




	 	 	 
	 	 	Title of Karen L. Leets with
	Company	 	respect to such Company
	L&W Supply Corporation
	 	Vice President and Treasurer
	United States Gypsum Company
	 	Vice President and Treasurer
	USG Foreign Investments, Ltd.
	 	Vice President and Treasurer
	USG Interiors, Inc.
	 	Vice President and Treasurer
	California Wholesale Material Supply, LLC
	 	Vice President and Treasurer
	Livonia Building Materials, LLC
	 	Vice President and Treasurer of L & W Supply Corporation, the Sole Member of Livonia Building Materials, LLC.
	Otsego Paper, Inc.
	 	Vice President and Treasurer
	River City Materials, Inc.
	 	Vice President and Treasurer






 









 






Exhibit I to the

Guarantee Agreement





     SUPPLEMENT NO. __ dated as of _________, 20__ (this
“Supplement”), to the Guarantee Agreement dated as of January 7,
2009 (as amended, supplemented or otherwise modified from time to time,
the “Guarantee Agreement”), among USG CORPORATION, a Delaware
corporation (the “Borrower”), the Subsidiaries of the Borrower
from time to time party thereto (together with the Borrower, the
“Guarantors”) and JPMORGAN CHASE BANK, N.A., as Administrative
Agent (in such capacity, the “Administrative Agent”).



          A. Reference is made to the Second Amended and Restated Credit Agreement dated as of January
7, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), among the Borrower, the lenders from time to time party thereto, the
Administrative Agent, and Goldman Sachs Credit Partners, L.P., as Syndication Agent.




          B. Capitalized terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement and the Guarantee Agreement referred to therein.




          C. The Guarantors have entered into the Guarantee Agreement in order to induce the Lenders to
make Loans and the Issuing Bank to issue Letters of Credit. Section 4.14 of the Guarantee
Agreement provides that additional Subsidiaries may become Guarantors under the Guarantee Agreement
by execution and delivery of an instrument in the form of this Supplement. The undersigned
Subsidiary (the “New Subsidiary”) is executing this Supplement in accordance with the
requirements of the Credit Agreement to become a Guarantor under the Guarantee Agreement in order
to induce the Lenders to make additional Loans and the Issuing Bank to issue additional Letters of
Credit and as consideration for Loans previously made and Letters of Credit previously issued.




          Accordingly, the Administrative Agent and the New Subsidiary agree as follows:




          SECTION 1. In accordance with Section 4.14 of the Guarantee Agreement, the New Subsidiary by
its signature below becomes a Guarantor under the Guarantee Agreement with the same force and
effect as if originally named therein as a Guarantor and the New Subsidiary hereby (a) agrees to
all the terms and provisions of the Guarantee Agreement applicable to it as a Guarantor thereunder
and (b) represents and warrants that the representations and warranties made by it as a Guarantor
thereunder are true and correct on and as of the date hereof. Each reference to a “Guarantor” in
the Guarantee Agreement shall be deemed to include the New Subsidiary. The Guarantee Agreement is
hereby incorporated herein by reference.




          SECTION 2. The New Subsidiary represents and warrants to the Administrative Agent and the
other Guaranteed Parties that this Supplement has been






 









 







duly authorized, executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms.




          SECTION 3. This Supplement may be executed in counterparts (and by different parties hereto
on different counterparts), each of which shall constitute an original, but all of which when taken
together shall constitute a single contract. This Supplement shall become effective when the
Administrative Agent shall have received a counterpart of this Supplement that bears the signature
of the New Subsidiary and the Administrative Agent has executed a counterpart hereof. Delivery of
an executed signature page to this Supplement by facsimile or other electronic transmission shall
be as effective as delivery of a manually signed counterpart of this Supplement.




          SECTION 4. Except as expressly supplemented hereby, the Guarantee Agreement shall remain in
full force and effect.




          SECTION 5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.




          SECTION 6. In case any one or more of the provisions contained in this Supplement should be
held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein and in the Guarantee Agreement shall not in any way be
affected or impaired thereby (it being understood that the invalidity of a particular provision in
a particular jurisdiction shall not in and of itself affect the validity of such provision in any
other jurisdiction). The parties hereto shall endeavor in good-faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable provisions.




          SECTION 7. All communications and notices hereunder shall be in writing and given as provided
in Section 4.01 of the Guarantee Agreement.




          SECTION 8. The New Subsidiary agrees to reimburse the Administrative Agent for its reasonable
out-of-pocket expenses in connection with this Supplement, including the reasonable fees, other
charges and disbursements of counsel for the Administrative Agent.




[Signature Pages Follow]







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          IN WITNESS WHEREOF, the New Subsidiary and the Administrative Agent have duly executed this
Supplement to the Guarantee Agreement as of the day and year first above written.




	 	 	 	 	 
	 	[NAME OF NEW SUBSIDIARY],

 	 
	 	by  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.,

as Administrative Agent,

 	 
	 	by  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 




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