exv10w7






EXHIBIT 10.7




USG CORPORATION




RESTRICTED STOCK UNITS AGREEMENT



     WHEREAS, the “Grantee” is an employee of USG Corporation, a Delaware corporation (the
“Company”) or a Subsidiary;



     WHEREAS, the Board of Directors of the Company (the “Board”) has granted to the Grantee, as
set forth in the Award Summary on the Morgan Stanley Smith Barney website on the “Date of Grant”,
Restricted Stock Units (as defined in the Plan) (the “RSUs”) pursuant to the Company’s Long-Term
Incentive Plan, as amended (the “Plan”), subject to the terms and conditions of the Plan and the
terms and conditions hereinafter set forth; and



     WHEREAS, the execution of this Restricted Stock Units Agreement to evidence the RSUs (the
“Agreement”) has been authorized by a resolution of the Board.



     NOW, THEREFORE, the Company and the Grantee agree as follows:




	1.	 	Payment of RSUs. The RSUs covered by this Agreement shall become payable to the Grantee if
they become nonforfeitable in accordance with Section 2, Section 3, or Section 4 hereof.
	 
	2.	 	Vesting of RSUs. Subject to the terms and conditions of Sections 3, 4 and 5 hereof, the
Grantee’s right to receive the Common Shares subject to the RSUs shall become nonforfeitable
if the Grantee remains continuously employed until May 1, 2013, or if the Board determines
prior to May 1, 2013 and prior to the termination of the Grantee’s employment that the RSUs
shall be nonforfeitable.
	 
	3.	 	Effect of Change in Control. In the event of a Change in Control prior to the RSUs becoming
nonforfeitable as provided in Section 2 above, a pro rata number of the RSUs covered by this
Agreement shall become nonforfeitable and payable to the Grantee, and the remaining RSUs shall
be forfeited. Such pro rata number shall be based on the number of days that have elapsed
between the Date of Grant and the Change in Control (as compared to the number of days between
the Date of Grant and May 1, 2013). However, if the Change in Control does not constitute a
“change in control” for purposes of Section 409A(a)(2)(A)(v) of the Code, then issuance of the
Common Shares underlying the RSUs that become nonforfeitable upon the Change in Control (or
payment of any other form of consideration into which the Common Shares underlying such RSUs
may have been converted in connection with the Change in Control) will be made upon the
earliest of (a) the Grantee’s “separation from service” with the Company and its Subsidiaries
(determined in accordance with Section 409A(a)(2)(A)(i) of the Code) (or, if the Grantee is a
“specified employee” as determined pursuant to procedures adopted by the Company in compliance
with Section 409A of the Code, the date of issuance or payment shall be the first day of the
seventh month after the date of the Grantee’s separation from service with




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	 	 	the Company and its Subsidiaries within the meaning of Section 409A(a)(2)(A)(i) of the
Code), (b) May 1, 2013, (c) the Grantee’s death, or (d) the Grantee’s permanent and total
disability as determined under Section 4 hereof.
	 
	4.	 	Effect of Death or Disability. Notwithstanding Section 2 above, if the Grantee should die or
become permanently and totally disabled while in the employ of the Company or any Subsidiary
and at a time when the RSUs remain forfeitable, a pro rata number of the RSUs covered by this
Agreement shall immediately become nonforfeitable and payable to the Grantee, and the
remaining RSUs shall be forfeited. Such pro rata number shall be based on the number of days
that have elapsed between the Date of Grant and the date of the Grantee’s death or disability
(as compared to the number of days between the Date of Grant and May 1, 2013). The Grantee
shall be considered to have become permanently and totally disabled if the Grantee has
suffered a total disability within the meaning of the Company’s Long Term Disability Plan for
Salaried Employees and is “disabled” within the meaning of Section 409A(a)(2)(C) of the Code.
	 
	5.	 	Forfeiture. In the event (i) that the Grantee’s employment shall, at a time when the RSUs
remain forfeitable, terminate in a manner other than any specified in Section 4 hereof or (ii)
of a finding by the Board (or a committee of the Board) that the Grantee has engaged in any
fraud or intentional misconduct as described in Section 20 hereof, the Grantee shall forfeit
any RSUs that have not become nonforfeitable by such Grantee at the time of such termination
or finding, as applicable.
	 
	6.	 	Form and Time of Payment of RSUs. Except as otherwise provided for in Section 9, payment for
the RSUs, after and to the extent they have become nonforfeitable, shall be made in the form
of Common Shares. Payment shall be made upon the first to occur of the following: (a) the
Grantee’s “separation from service” with the Company and its Subsidiaries (determined in
accordance with Section 409A(a)(2)(A)(i) of the Code) (or, if the Grantee is a “specified
employee” as determined pursuant to procedures adopted by the Company in compliance with
Section 409A of the Code, the date of issuance or payment shall be the first day of the
seventh month after the date of the Grantee’s separation from service with the Company and its
Subsidiaries within the meaning of Section 409A(a)(2)(A)(i) of the Code), (b) May 1, 2013, (c)
the Grantee’s death, or (d) the Grantee’s permanent and total disability as determined under
Section 4 hereof. To the extent that the Company is required to withhold federal, state,
local or foreign taxes in connection with the delivery of Common Shares to the Grantee or any
other person under this Agreement, the number of Common Shares to be delivered to the Grantee
or such other person shall be reduced (based on the Market Value per Share as of the date
Common Shares are delivered to the Grantee) to provide for the minimum amount of taxes
required to be withheld, with any fractional shares that would otherwise be delivered being
rounded up to the next nearest whole share. The Board (or a committee of the Board) may, at
its discretion, adopt any alternative method of providing for taxes to be withheld.
	 
	7.	 	Payment of Dividend Equivalents. From and after the Date of Grant and until the earlier of
(a) the time when the RSUs become nonforfeitable and payable in accordance with the terms
hereof or (b) the time when the Grantee’s right to receive Common Shares upon payment of RSUs
is forfeited, on the date that the Company pays a cash dividend (if any) to




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	 	 	holders of Common Shares generally, the Grantee shall be entitled to a number of additional
whole RSUs determined by dividing (i) the product of (A) the dollar amount of the cash
dividend paid per Common Share on such date and (B) the total number of RSUs (including
dividend equivalents paid thereon) previously credited to the Grantee as of such date, by
(ii) the Market Value per Share on such date. Such dividend equivalents (if any) shall be
subject to the same terms and conditions and shall be settled or forfeited in the same
manner and at the same time as the RSUs to which the dividend equivalents were credited.
	 
	8.	 	RSUs Nontransferable. Neither the RSUs granted hereby nor any interest therein or in the
Common Shares related thereto shall be transferable other than by will or the laws of descent
and distribution prior to payment.
	 
	9.	 	Adjustments. In the event of any change in the aggregate number of outstanding Common Shares
by reason of (a) any stock dividend, extraordinary dividend, stock split, combination of
shares, recapitalization or other change in the capital structure of the Company, or (b) any
Change in Control, merger, consolidation, spin-off, split-off, spin-out, split-up,
reorganization or partial or complete liquidation, or other distribution of assets, issuance
of rights or warrants to purchase securities, or (c) any other corporate transaction or event
having an effect similar to any of the foregoing, then the Board (or a committee of the Board)
shall adjust the number of RSUs then held by the Grantee in such manner as to prevent dilution
or enlargement of the rights of the Grantee that otherwise would result from such event.
Moreover, in the event of any such transaction or event, the Board (or a committee of the
Board), in its discretion, may provide in substitution for any or all of the Grantee’s rights
under this Agreement such alternative consideration as it may determine to be equitable in the
circumstances.
	 
	10.	 	Compliance with Section 409A of the Code. To the extent applicable, it is intended that this
Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the
income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Grantee.
This Agreement and the Plan shall be administered in a manner consistent with this intent.
Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986,
as amended, and will also include any regulations or any other formal guidance promulgated
with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue
Service.
	 
	11.	 	No Right to Future Grants; No Right of Employment; Extraordinary Item: In accepting the
grant, Grantee acknowledges that: (a) the Plan is established voluntarily by the Company, it
is discretionary in nature and it may be modified, suspended or terminated by the Company at
any time, as provided in the Plan and this Award Agreement; (b) the grant of the RSUs is
voluntary and occasional and does not create any contractual or other right to receive future
grants of RSUs, or benefits in lieu of RSUs, even if RSUs have been granted repeatedly in the
past; (c) all decisions with respect to future grants, if any, will be at the sole discretion
of the Company; (d) Grantee’s participation in the Plan is voluntary; (e) the RSUs are an
extraordinary item that does not constitute compensation of any kind for services of any kind
rendered to the Company, its Affiliates and/or Subsidiaries, and which is outside the scope of
Grantee’s employment contract, if any; (f) the RSUs are not




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	 	 	part of normal or expected compensation or salary for any purposes, including, but not
limited to, calculating any severance, resignation, termination, redundancy, end of service
payments, bonuses, long-service awards, pension or retirement benefits or similar payments;
(g) in the event that Grantee is an employee of an Affiliate or Subsidiary of the Company,
the grant will not be interpreted to form an employment contract or relationship with the
Company; and furthermore, the grant will not be interpreted to form an employment contract
with the Affiliate or Subsidiary that is Grantee’s employer; (h) the future value of the
underlying Shares is unknown and cannot be predicted with certainty; (i) no claim or
entitlement to compensation or damages arises from forfeiture or termination of the RSUs or
diminution in value of the RSUs or the Common Shares and Grantee irrevocably releases the
Company, its Affiliates and/or its Subsidiaries from any such claim that may arise; and (j)
notwithstanding any terms or conditions of the Plan to the contrary, in the event of
involuntary termination of Grantee’s employment, Grantee’s right to receive RSUs and vest in
RSUs under the Plan, if any, will terminate effective as of the date that Grantee is no
longer actively employed and will not be extended by any notice period mandated under local
law (e.g., active employment would not include a period of “garden leave” or similar period
pursuant to local law); furthermore, in the event of involuntary termination of employment,
Grantee’s right to vest in the RSUs after termination of employment, if any, will be
measured by the date of termination of Grantee’s active employment and will not be extended
by any notice period mandated under local law.
	 
	12.	 	Employee Data Privacy: Grantee hereby explicitly and unambiguously consents to the
collection, use and transfer, in electronic or other form, of Grantee’s personal data as
described in this document by and among, as applicable, the Company, its Affiliates and its
Subsidiaries (“the Company Group”) for the exclusive purpose of implementing, administering
and managing Grantee’s participation in the Plan. Grantee understands that the Company Group
holds certain personal information about Grantee, including, but not limited to, Grantee’s
name, home address and telephone number, date of birth, social insurance number or other
identification number, salary, nationality, job title, any Shares of stock or directorships
held in the Company, details of all RSUs or any other entitlement to Shares of stock awarded,
canceled, exercised, vested, unvested or outstanding in Grantee’s favor, for the purpose of
implementing, administering and managing the Plan (“Data”). Grantee understands that Data may
be transferred to any third parties assisting in the implementation, administration and
management of the Plan, that these recipients may be located in Grantee’s country or
elsewhere, and that the recipient’s country may have different data privacy laws and
protections than Grantee’s country. Grantee understands that Grantee may request a list with
the names and addresses of any potential recipients of the Data by contacting Grantee’s local
human resources representative. Grantee authorizes the recipients to receive, possess, use,
retain and transfer the Data, in electronic or other form, for the purposes of implementing,
administering and managing Grantee’s participation in the Plan, including any requisite
transfer of such Data as may be required to a broker or other third party with whom Grantee
may elect to deposit any Shares acquired. Grantee understands that Data will be held only as
long as is necessary to implement, administer and manage Grantee’s participation in the Plan.
Grantee understands that Grantee may, at any time, view Data, request additional information
about the storage and processing of Data, require any necessary amendments to Data or refuse
or withdraw the




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	 	 	consents herein, in any case without cost, by contacting in writing Grantee’s local human
resources representative. Grantee understands, however, that refusing or withdrawing
Grantee’s consent may affect Grantee’s ability to participate in the Plan. For more
information on the consequences of Grantee’s refusal to consent or withdrawal of consent,
Grantee understand that Grantee may contact Grantee’s local human resources representative.
	 
	13.	 	Continuous Employment. For purposes of this Agreement, the continuous employment of the
Grantee with the Company or a Subsidiary shall not be deemed to have been interrupted, and the
Grantee shall not be deemed to have ceased to be an employee of the Company or Subsidiary, by
reason of (a) the transfer of the Grantee’s employment among the Company and its Subsidiaries
or (b) an approved leave of absence.
	 
	14.	 	Relation to Plan. This Agreement is subject to the terms and conditions of the Plan. In the
event of any inconsistency between the provisions of this Agreement and the Plan, the Plan
shall govern. All terms used herein with initial capital letters and not otherwise defined
herein that are defined in the Plan shall have the meanings assigned to them in the Plan. The
Board (or a committee of the Board) acting pursuant to the Plan, as constituted from time to
time, shall, except as expressly provided otherwise herein, have the right to determine any
questions which arise in connection with the grant of the RSUs.
	 
	15.	 	Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement
to the extent that the amendment is applicable hereto; provided, however, that
no amendment shall adversely affect the rights of the Grantee under this Agreement without the
Grantee’s consent. Notwithstanding the foregoing, the limitation requiring the consent of a
Grantee to certain amendments shall not apply to any amendment that is deemed necessary by the
Company to ensure compliance with Section 409A of the Code.
	 
	16.	 	Severability. Subject to Section 20, if any provision of this Agreement or the application
of any provision hereof to any person or circumstances is held invalid, unenforceable or
otherwise illegal, the remainder of this Agreement and the application of such provision to
any other person or circumstances shall not be affected, and the provisions so held to be
invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the
extent) necessary to make it enforceable, valid and legal.
	 
	17.	 	Successors and Assigns. Without limiting Section 8 hereof, the provisions of this Agreement
shall inure to the benefit of, and be binding upon, the successors, administrators, heirs,
legal representatives and assigns of the Grantee, and the successors and assigns of the
Company.




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	18.	 	Governing Law. This Agreement shall be governed by and construed in accordance with the
internal substantive laws of the State of Delaware, without giving effect to any principle of
law that would result in the application of the law of any other jurisdiction.
	 
	19.	 	The Grantee acknowledges that by clicking on the “Accept” button on the Morgan Stanley Smith
Barney web page titled “Step 3: Confirm the Review/Acceptance of your Award,” the Grantee
agrees to be bound by the electronic execution of this Award Agreement.
	 
	20.	 	In accordance with Section 20(d) of the Plan, if the Board (or a committee of the Board) has
determined that any fraud or intentional misconduct by the Grantee was a significant
contributing factor to the Company having to restate all or a portion of its financial
statement(s), to the extent permitted by applicable law the Grantee shall: (a) return to the
Company all Common Shares that the Grantee has not disposed of that were paid out pursuant to
this Agreement; and (b) with respect to any Common Shares that the Grantee has disposed of
that were paid out pursuant to this Agreement, pay to the Company in cash the value of such
Common Shares on the date such Common Shares were paid out. The remedy specified herein shall
not be exclusive, and shall be in addition to every other right or remedy at law or in equity
that may be available to the Company. Notwithstanding any other provision of this Agreement
or the Plan to the contrary, if this Section 20 is held invalid, unenforceable or otherwise
illegal, the remainder of this Agreement shall be deemed to be unenforceable due to a failure
of consideration, and the Grantee’s rights to the RSUs that would otherwise be granted under
this Agreement shall be forfeited.




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     Executed in the name and on behalf of the Company at Chicago, Illinois as of the 24th day of
September, 2010.



	 	 	 	 	 
	 	USG CORPORATION

 	 
	 	/s/ Brian J. Cook
 	 
	 	Name:  	Brian J. Cook 	 
	 	Title:  	Senior Vice President, Human Resources 	 
	 




     The undersigned Grantee hereby accepts the award of RSUs evidenced by this Restricted Stock
Units Agreement on the terms and conditions set forth herein and in the Plan.


PLEASE PRINT AND KEEP A COPY FOR YOUR RECORDS.








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