Filed by Bowne Pure Compliance





Exhibit 10.1




USG CORPORATION




EMPLOYMENT AGREEMENT




This EMPLOYMENT AGREEMENT (this “Agreement”) is effective as of October 1, 2008 (the
“Effective Date”) between USG Corporation, a Delaware corporation (the “Company”),
and                      (the “Executive”).



RECITALS:




WHEREAS, the Company desires to employ the Executive and the Executive desires to accept such
employment with the Company;



WHEREAS, as of the Effective Date, the Company shall employ the Executive on the terms and
conditions set forth in this Agreement, and the Executive shall be retained and employed by the
Company to perform services under the terms and conditions of this Agreement.



NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:




	1.	 	Certain Definitions. Certain words or phrases with initial capital letters not
otherwise defined herein shall have the meanings set forth in Section 9 hereof.






	2.	 	Employment. The Company shall employ the Executive, and the Executive accepts
employment with the Company, as of the Effective Date, upon the terms and conditions set forth
in this Agreement for the period beginning on the Effective Date and ending as provided in
Section 5 hereof (the “Employment Period”).






	3.	 	Position and Duties. During the Employment Period, the Executive shall serve as the
[Title] of the Company and shall have the normal duties, responsibilities and authority of an
executive serving in such position, subject to the power of the Chief Executive Officer to
expand or limit such duties, responsibilities and authority, either generally or in specific
instances. The Executive shall perform the Executive’s duties and responsibilities to the
best of the Executive’s abilities in a diligent, trustworthy, businesslike and efficient
manner.
	 
	4.	 	Compensation and Benefits.






	 	(a)	 	Salary. The Company agrees to pay the Executive a salary (“Base
Salary”) during the Employment Period in installments based on the Company’s
practices as may be in effect from time to time. The Executive’s initial Base Salary
shall be at the rate of $                     per year. The Executive’s Base Salary shall be
reviewed annually and may be increased from time to time.




 


 









 











	 	(b)	 	Incentive Plans. The Executive shall be eligible to participate in the
Company’s annual and long-term incentive plans, on a basis comparable to other
similarly situated executives of the Company.






	 	(c)	 	Expense Reimbursement. The Company shall reimburse the Executive for
all reasonable expenses incurred by the Executive during the Employment Period in the
course of performing the Executive’s duties under this Agreement that are consistent
with the Company’s policies in effect from time to time with respect to travel,
entertainment and other business expenses, subject to the Company’s requirements
applicable generally with respect to reporting and documentation of such expenses. To
the extent that the right to receive such reimbursement would constitute a “deferral of
compensation” under Section 409A of the Code, any such reimbursement shall be made not
later than the last day of the Executive’s tax year following the year in which the
Executive incurs the expense. In no event will the amount of expenses so reimbursed by
the Company in one year affect the amount of expenses eligible for reimbursement to be
provided in any other taxable year.






	 	(d)	 	Standard Executive Benefits. The Executive shall be entitled during
the Employment Period to participate (on the same basis as other similarly situated
executives of the Company) in the Company’s benefit plans (including health and life
insurance, retirement and investment plans (including supplements thereto), vacation,
perquisites and other benefits, but excluding, except as hereinafter provided in
Section 6, any severance pay program or policy of the Company) for which substantially
all other similarly situated executives of the Company are from time to time generally
eligible, as determined from time to time by the Board or a committee of the Board.






	 	(e)	 	Indemnification. The Executive shall be eligible to enter into the
Company’s standard Indemnification Agreement that is entered into with other similarly
situated senior executives of the Company.






	5.	 	Employment Period.






	 	(a)	 	Except as hereinafter provided, the Employment Period shall begin on the
Effective Date and shall extend until January 1, 2011, with automatic one-year renewals
thereafter unless either party notifies the other at least 120 days before the
scheduled expiration date that the Employment Period is not to renew.






	 	(b)	 	Notwithstanding (a) above, the Employment Period shall end early upon the first
to occur of any of the following events:






	 	(i)	 	the Executive’s death;






	 	(ii)	 	the Company’s termination of the Executive’s employment on
account of Disability;






	 	(iii)	 	a Termination for Cause;






	 	(iv)	 	a Termination without Cause; or






	 	(v)	 	a Voluntary Termination.




 


2









 











	6.	 	Post-Employment Period Payments.






	 	(a)	 	At the end of the Employment Period for any reason, the Executive shall cease
to have any rights to salary, bonus, expense reimbursements or other benefits, except
that the Executive shall be entitled to receive: (i) on the sixty-first
(61st) day after the Termination Date, any Base Salary which has accrued but
is unpaid, any reimbursable expenses which have been incurred but are unpaid, and
payment for any unexpired vacation days which have accrued under the Company’s or a
Subsidiary’s vacation policy but are unused, as of the end of the Employment Period,
(ii) any plan benefits which by their terms extend beyond termination of the
Executive’s employment (but only to the extent provided in any such benefit plan in
which the Executive has participated as an employee of the Company or a Subsidiary and
excluding, except as hereinafter provided in Section 6, any severance pay program or
policy of the Company or a Subsidiary), (iii) payments or benefits payable pursuant to
the terms of any annual and/or long-term incentive plan of the Company or a Subsidiary
in accordance with the terms thereof, and (iv) any benefits to which the Executive is
entitled under Part 6 of Subtitle B of Title I of the Employee Retirement Income
Security Act of 1974, as amended (“COBRA”). In addition, the Executive shall
be entitled to the additional benefits and amounts described in the succeeding
subsections of this Section 6, in the circumstances described in such subsections.






	 	(b)	 	If the Employment Period ends pursuant to Section 5 hereof on account of death,
a Voluntary Termination, a Termination for Cause or a termination on account of the
Executive’s Disability, the Company shall make no further payments to the Executive
except as contemplated in Section 6(a) above.






	 	(c)	 	If the Employment Period ends early pursuant to Section 5 on account of a
Termination without Cause, the Executive shall be entitled to the payments contemplated
in Section 6(a) above and as set forth below:






	 	(i)	 	On the sixty-first (61st) day after the Termination
Date, the Executive shall be entitled to a lump sum payment in an amount equal
to two (2) times the sum of (A) Base Salary (at the highest rate in effect for
any period within two years prior to the Termination Date), plus (B) annual
bonus (in an amount equal to target annual bonus for the year in which the
Termination Date occurs).




 


3









 






	 	(ii)	 	On the sixty-first (61st) day after the Termination
Date, the Executive shall be entitled to a lump sum payment equal to the total
cost (including both the Executive’s and the Company’s portion of such costs as
paid while the Executive was employed) of continuing the medical, dental,
vision, long-term disability and life insurance benefits (excluding benefits
under the executive death benefit plan) substantially similar to those that the
Executive was receiving or entitled to receive immediately prior to the
Termination Date for a period of eighteen (18) months; provided,
however, if any benefit described in this Section 6(c)(ii) is
subject to tax, the Company will pay to the Executive, at the same time the
lump sum cash payment is made, an additional amount such that after payment
by the Executive or the Executive’s dependents or beneficiaries, as the case
may be, of all taxes so imposed, the recipient retains an amount equal to
such taxes.






	 	(iii)	 	In addition to the retirement and other benefits to which the
Executive is entitled under the Company’s defined benefit retirement plans
(including any supplemental plans) with respect to the Executive’s employment
through the Termination Date, the Executive shall be entitled to a lump sum
payment, payable on the sixty-first (61st) day after the Termination
Date, in an amount equal to the present value (calculated in accordance with
the terms of the Company’s defined benefit plans or supplemental plans, based
on the age of the Executive at the date entitlement to benefits under this
Section 6(c)(iii) arises) of the excess of (A) the retirement income and other
benefits that would be payable to the Executive under the defined benefit plans
(including any supplemental plans) of the Company if the Executive was credited
with an additional two years of age and two years of benefit and credited
service in addition to the age and total number of years of benefit and
credited service the Executive has accrued under such plans over (B) the
retirement income and other benefits the Executive is entitled to receive
(either immediately or on a deferred basis) under the defined benefit plans
(including any supplemental plans) of the Company. In the event that the
Executive, after credit for the additional two years, has a total of less than
five years of credited service, the Executive nonetheless shall be treated as
fully vested under the defined benefit retirement plans and any supplemental
retirement plans, but with benefits computed solely on the basis of total
benefit service.






	 	(iv)	 	The Executive shall be entitled to outplacement services for a
time period (not less than six (6) months) established by the Company, by a
firm selected by the Company in its sole discretion, and at the expense of the
Company; provided, however, that all such outplacement services
must be completed by December 31 of the second calendar year following the
calendar year in which the Termination Date occurs and the Company will be
required to make all payments to the Executive for such outplacement services
by December 31 of the third calendar year following the calendar year in which
the Termination Date occurs.




 


4









 






	 	(v)	 	Notwithstanding anything to the contrary contained in this
Agreement, if any payment or reimbursement, or the provision of any benefit
under this Agreement that is paid or provided upon the Executive’s “separation from
service” with the Company and its Subsidiaries within the meaning of Section
409A(a)(2)(A)(i) of the Code would constitute a “deferral of compensation”
under Section 409A of the Code and the Executive is a “specified employee”
(as determined pursuant to procedures adopted by the Company in compliance
with Section 409A of the Code) on the date of the Executive’s “separation
from service” with the Company and its Subsidiaries within the meaning of
Section 409A(a)(2)(A)(i) of the Code, the Executive (or the Executive’s
beneficiary) will receive payment or reimbursement of such amounts or the
provision of such benefits upon the earlier of (i) the first day of the
seventh month following the date of the Executive’s “separation from
service” with the Company and its Subsidiaries within the meaning of Section
409A(a)(2)(A)(i) of the Code or (ii) the Executive’s death. In addition, if
payment to the Executive of any amount pursuant to Section 6(a) or this
Section 6(c) would constitute a “deferral of compensation” under Section
409A of the Code and if the Executive’s termination does not constitute a
“separation from service” with the Company and its Subsidiaries within the
meaning of Section 409A(a)(2)(A)(i) of the Code, then payment of such amount
shall be made, to the extent necessary to comply with Section 409A of the
Code and subject to the preceding sentence, to the Executive on the later of
(i) the payment date identified in the applicable paragraph of this Section
6 or (ii) on the earlier of (A) the Executive’s “separation from service”
with the Company and its Subsidiaries within the meaning of Section
409A(a)(2)(A)(i) of the Code, (B) the Executive’s disability (within the
meaning of Section 409A of the Code), (C) a change in control of the Company
within the meaning of Section 409A of the Code or (D) the Executive’s death.






	 	(d)	 	It is expressly understood that the Company’s payment obligations under Section
6(c) shall cease in the event the Executive breaches any of his or her agreements in
Section 7 hereof and, in the event of any such breach, the Executive shall repay in
cash immediately to the Company any amounts previously paid to the Executive under
Section 6(c) of this Agreement.






	 	(e)	 	The Executive shall not be required to mitigate the amount of any payment or
benefit provided for in this Agreement by seeking other employment or otherwise.






	7.	 	Competitive Activity; Confidentiality; Nonsolicitation.






	 	(a)	 	Acknowledgements and Agreements. The Executive hereby acknowledges and
agrees that in the performance of the Executive’s duties for the Company during the
Employment Period, the Executive will be brought into frequent contact, either in
person, by telephone or through the mails, with existing and potential customers of the
Company throughout the United States. The Executive also agrees that trade secrets and
confidential information of the Company, more fully described in Section 7(i) of this
Agreement, gained by the Executive during the Executive’s association with the Company,
have been developed by the Company
through substantial expenditures of time, effort and money and constitute valuable
and unique property of the Company. The Executive further understands and agrees
that the foregoing makes it necessary for the protection of the business of the
Company that the Executive not compete with the Company during the Employment Period
and not compete with the Company for a reasonable period thereafter, as further
provided in the following subsections.




 


5









 






	 	(b)	 	Covenants During the Employment Period. During the Employment Period,
the Executive will not compete with the Company anywhere that the Company conducts its
business. In accordance with this restriction, but without limiting its terms, during
the Employment Period, the Executive will not:






	 	(i)	 	enter into or engage in any business which competes with the
business of the Company;






	 	(ii)	 	solicit customers, business, patronage or orders for, or sell,
any products and services in competition with, or for any business that
competes with, the business of the Company;






	 	(iii)	 	divert, entice or otherwise take away any customers, business,
patronage or orders of the Company or attempt to do so; or






	 	(iv)	 	promote or assist, financially or otherwise, any person, firm,
association, partnership, corporation or other entity engaged in any business
which competes with the business of the Company.






	 	(c)	 	Covenants Following Termination. For a period of two (2) years
following the termination of the Executive’s employment for any reason, unless the
Executive is entitled to severance benefits under a severance agreement between the
Executive and the Company providing for payment of benefits upon a termination of
employment following a change in control of the Company and containing covenants made
by the Executive with respect to the subject matter of this Section 7(c) (a “Severance
Agreement”), in which case those covenants contained in such Severance Agreement shall
apply to the Executive in lieu of the application of this Section 7, the Executive will
not:






	 	(i)	 	enter into or engage in any business which competes with the
Company’s business within the United States;






	 	(ii)	 	solicit customers, business, patronage or orders for, or sell,
any products and services in competition with, or for any business, wherever
located, that competes with, the Company’s business within the United States;






	 	(iii)	 	divert, entice or otherwise take away any customers, business,
patronage or orders of the Company within the United States, or attempt to do
so; or






	 	(iv)	 	promote or assist, financially or otherwise, any person, firm,
association, partnership, corporation or other entity engaged in any business
which competes with the Company’s business within the United States.




 


6









 






	 	(d)	 	Indirect Competition. For the purposes of Sections 7(b) and 7(c), but
without limitation thereof, the Executive will be in violation thereof if the Executive
engages in any or all of the activities set forth therein directly as an individual on
the Executive’s own account, or indirectly as a general partner, joint venturer,
employee, agent, salesperson, consultant, officer and/or director of any firm,
association, partnership, corporation or other entity, or as a limited partner, member
or stockholder of any limited partnership, limited liability company, or corporation in
which the Executive or the Executive’s spouse, child or parent owns, directly or
indirectly, individually or in the aggregate, more than five percent (5%) of the
limited partnership interests, limited liability company interests or outstanding
stock, as the case may be.






	 	(e)	 	The Company. For purposes of this Section 7, the Company shall include
any and all Subsidiaries of the Company.






	 	(f)	 	The Company’s Business. For the purposes of Sections 7(b), 7(c), 7(j)
and 7(k), the Company’s business is defined to be the manufacture and distribution of
gypsum wallboard, joint compound and related gypsum products, cement board, gypsum
fiber panels, ceiling panels and grid, the distribution of building products and any
future businesses the Company may enter, as further described in any and all
manufacturing, marketing and sales manuals and materials of the Company as the same may
be altered, amended, supplemented or otherwise changed from time to time, or of any
other products or services substantially similar to or readily substitutable for any
such described products and services.






	 	(g)	 	Extension. If it shall be judicially determined that the Executive has
violated any of the Executive’s obligations under Section 7(c), then the period
applicable to each obligation that the Executive shall have been determined to have
violated shall automatically be extended by a period of time equal in length to the
period during which such violation(s) occurred.






	 	(h)	 	Non-Solicitation. Until the expiration of three (3) years following
the Termination Date, the Executive will not directly or indirectly at any time solicit
or induce or attempt to solicit or induce any employee(s), sales representative(s),
agent(s) or consultant(s) of the Company and/or of its Subsidiaries to terminate their
employment, representation or other association with the Company and/or its
Subsidiaries.




 


7









 






	 	(i)	 	Further Covenants.






	 	(i)	 	The Executive will keep in strict confidence, and will not,
without the prior written consent of the Company or as may otherwise be
required by law or legal process, directly or indirectly, at any time during or
after the Executive’s employment with the Company, disclose, furnish, disseminate,
make available or, except in the course of performing the Executive’s duties
of employment, use any trade secrets or non-public confidential business and
technical information of the Company or its customers or vendors, including
without limitation as to when or how the Executive may have acquired such
information before or during employment. Such confidential information
shall include, without limitation, the Company’s unique non-public
confidential selling, manufacturing and servicing methods and business
techniques, training, service and business manuals, promotional materials,
training courses and other training and instructional materials, vendor and
product information, customer and prospective customer lists, other customer
and prospective customer information and other business information. The
Executive specifically acknowledges that all such non-public confidential
information, whether reduced to writing, maintained on any form of
electronic media, or maintained in the Executive’s mind or memory and
whether compiled by the Company and/or the Executive, derives independent
economic value from not being readily known to or ascertainable by proper
means by others who can obtain economic value from its disclosure or use,
that reasonable efforts have been made by the Company to maintain the
secrecy of such information, that such information is the sole property of
the Company and that any retention and use of such information by the
Executive during the Executive’s employment with the Company (except in the
course of performing the Executive’s duties and obligations to the Company)
or after the termination of the Executive’s employment shall constitute a
misappropriation of the Company’s trade secrets.






	 	(ii)	 	The Executive agrees that upon termination of the Executive’s
employment with the Company, for any reason, the Executive shall return to the
Company, in good condition, all property of the Company, including without
limitation, the originals and all copies of any materials which contain,
reflect, summarize, describe, analyze or refer or relate to any items of
information listed in Section 7(i)(i) of this Agreement. In the event that
such items are not so returned, the Company will have the right to charge the
Executive for all reasonable damages, costs, attorneys’ fees and other expenses
incurred in searching for, taking, removing and/or recovering such property.




 


8









 






	 	(j)	 	Discoveries and Inventions; Work Made for Hire.






	 	(i)	 	The Executive hereby assigns and agrees to assign to the
Company, its successors, assigns or nominees, all of the Executive’s rights to
any discoveries, inventions and improvements, whether patentable or not, made,
conceived or suggested, either solely or jointly with others, by the Executive
while in the Company’s employ with the use of the Company’s time, material or
facilities or in any way within or related to the existing or
contemplated scope of the Company’s business. Any discovery, invention or
improvement relating to any subject matter with which the Company was
concerned during the Executive’s employment and made, conceived or suggested
by the Executive, either solely or jointly with others, within one (1) year
following termination of the Executive’s employment under this Agreement or
any successor agreements shall be irrebuttably presumed to have been so
made, conceived or suggested in the course of such employment with the use
of the Company’s time, materials or facilities. Upon request by the Company
with respect to any such discoveries, inventions or improvements, the
Executive will execute and deliver to the Company, at any time during or
after the Executive’s employment, all appropriate documents for use in
applying for, obtaining and maintaining such domestic and foreign patents as
the Company may desire, and all proper assignments therefor, when so
requested, at the expense of the Company, but without further or additional
consideration.






	 	(ii)	 	The Executive acknowledges that, to the extent permitted by
law, all work papers, reports, documentation, drawings, photographs, negatives,
tapes and masters therefor, prototypes and other materials (hereinafter,
“items”), including without limitation, any and all such items generated and
maintained on any form of electronic media, generated by the Executive during
the Executive’s employment with the Company shall be considered a “work made
for hire” and that ownership of any and all copyrights in any and all such
items shall belong to the Company. The item will recognize the Company as the
copyright owner, will contain all proper copyright notices, e.g., “(creation
date) [Company Name], All Rights Reserved,” and will be in condition to be
registered or otherwise placed in compliance with registration or other
statutory requirements throughout the world.






	 	(k)	 	Communication of Contents of Agreement. During the Executive’s
employment and for two (2) years thereafter, the Executive will communicate the
contents of this Agreement to any person, firm, association, partnership, corporation
or other entity which the Executive intends to be employed by, associated with, or
represent and which is engaged in a business that is competitive to the business of the
Company.






	 	(l)	 	Non-Disparagement. The Executive and his immediate family agree to
refrain from criticizing or making disparaging or derogatory comments about the Company
or any Subsidiary and any of their respective officers, directors, employees and agents
or any products or services of the Company or any Subsidiary.




 


9









 






	 	(m)	 	Relief. The Executive acknowledges and agrees that the remedy at law
available to the Company for breach of any of the Executive’s obligations under this
Agreement would be inadequate. The Executive therefore agrees that, in addition to any
other rights or remedies that the Company may have at law or in equity,
temporary and permanent injunctive relief may be granted in any proceeding which may
be brought to enforce any provision contained in Sections 7(b), 7(c), 7(h), 7(i),
7(j) 7(k) and 7(l) of this Agreement, without the necessity of proof of actual
damage.






	 	(n)	 	Reasonableness. The Executive acknowledges that the Executive’s
obligations under this Section 7 are reasonable in the context of the nature of the
Company’s business and the competitive injuries likely to be sustained by the Company
if the Executive was to violate such obligations. The Executive further acknowledges
that this Agreement is made in consideration of, and is adequately supported by, the
agreement of the Company to perform its obligations under this Agreement and by other
consideration, which the Executive acknowledges constitutes good, valuable and
sufficient consideration.






	8.	 	Golden Parachute Excise Tax. The amounts payable to the Executive under Section 6
shall be adjusted as set forth in this Section 8 if the sum (the “combined amount”) of the
amounts payable under Section 6 and all other payments or benefits which the Executive has
received or has the right to receive from the Company which are defined in Section
280G(b)(2)(A)(i) of the Code, would constitute a “parachute payment” (as defined in Section
280G(b)(2) of the Code). In such event, the combined amount shall, unless the following
sentence applies, be decreased by the smallest amount that will eliminate any parachute
payment. If the decrease referred to in the preceding sentence is 10% or more of the combined
amount, the combined amount shall not be decreased, but rather shall be increased by an amount
(the “Gross Up Payment”) sufficient to provide the Executive, after tax, a net amount equal to
the Code Section 4999 excise tax imposed on such combined amount, as increased pursuant to
this section. For this purpose, “after tax” means the amount retained by the Executive after
satisfaction (whether through withholding, direct payment or otherwise) of all applicable
federal, state, provincial and local income taxes at the highest marginal tax rate, and the
employee share of any applicable FICA taxes. To the extent the decrease referred to in the
second sentence of this Section 8 applies, such decrease shall be made to the combined amount
by reduction of the lump sum payment described in Section 6(c)(i) of this Agreement and, to
the extent further reductions are required, in such payments due to the Executive as the
Company may determine. If at a time subsequent to any payment under Section 6, an additional
amount of Code Section 4999 excise tax is definitively determined to be due by either the
Internal Revenue Service or a court of competent jurisdiction, the Company shall pay to the
Executive an additional amount which, net of Federal, state, provincial and local income, FICA
and Code Section 4999 excise taxes, will satisfy such additional Code Section 4999 excise tax,
including applicable interest and penalties. The parties acknowledge that, if the decrease
referred to in the second sentence of this Section 8 is 10% or more of the combined amount,
the intention of the preceding sentences in this Section 8 is to place the Executive in the
position in which the Executive would be if the Code Section 4999 excise tax did not exist.
Notwithstanding any other provision of this Section 8 to the contrary, all taxes and expenses
described in this Section 8 shall be paid or reimbursed within fifteen (15) days after the
Executive submits evidence of the incurrence of such taxes and/or expenses, provided that in
all events such payment or reimbursement shall be made on or before the last day of the year
following (a) the year in which the applicable taxes are remitted or expenses are incurred or (b), in the case of
reimbursement of expenses incurred due to a tax audit or litigation in which there is no
remittance of taxes, the year in which the audit is completed or there is a final or
nonappealable settlement or other resolution of the litigation, in accordance with Treas.
Reg. § 1.409A-3(i)(1)(v). The Executive shall be required to submit all requests for
payment or reimbursement no later than thirty (30) days prior to the last day for payment or
reimbursement described in the preceding sentence. Any expense paid or reimbursed by the
Company in one taxable year in no event will affect the amount of expenses required to be
paid or reimbursed by the Company in any other taxable year.




 


10









 






	9.	 	Definitions.






	 	(a)	 	“Board” means the Board of Directors of the Company.






	 	(b)	 	“Cause” means that, prior to the termination of the Employment Period,
the Executive shall have:






	 	(i)	 	committed a felony or a fraud;






	 	(ii)	 	engaged in conduct that brings the Company or any of its
Subsidiaries into substantial public disgrace or disrepute;






	 	(iii)	 	committed gross negligence or gross misconduct with respect to
the Company or any of its Subsidiaries;






	 	(iv)	 	repudiated this Agreement or abandoned employment with the
Company;






	 	(v)	 	failed to follow the directives of the Board or the Chief
Executive Officer and such failure is not cured within five (5) business days
after written notice thereof to the Executive from the Company;






	 	(vi)	 	breached any of the agreements in Section 7 hereof;






	 	(vii)	 	breached a material employment policy of the Company which is
not cured within five (5) business days after written notice thereof to the
Executive from the Company; or






	 	(viii)	 	committed any other breach of this Agreement which is material and which is
not cured within thirty (30) days after written notice thereof to the Executive
from the Company.






	 	(c)	 	“Code” means the Internal Revenue Code of 1986, as amended.






	 	(d)	 	“Disability” means the Executive’s having become unable (as determined
in good faith by the Chief Executive Officer), with reasonable accommodations, to
regularly perform the Executive’s duties hereunder by reason of illness or incapacity.




 


11









 











	 	(e)	 	“Release Agreement” means an agreement, in substantially the form
customarily used by the Company for similarly situated executives of the Company in
similar instances, pursuant to which the Executive releases, to the extent permitted by
law, all current or future claims, known or unknown, arising on or before the date of
the release against the Company, its subsidiaries and its officers.






	 	(f)	 	“Subsidiary” means a corporation, company or other entity (i) at least
50 percent of whose outstanding shares or securities (representing the right to vote
for the election of directors or other managing authority) are, or (ii) which does not
have outstanding shares or securities (as may be the case in a partnership, joint
venture or unincorporated association), but at least 50 percent of whose ownership
interest representing the right generally to make decisions for such other entity is,
now or hereafter, owned or controlled, directly or indirectly, by the Company.






	 	(g)	 	“Termination Date” means the date on which the Executive’s employment
is terminated by the Company or any Subsidiary.






	 	(h)	 	“Termination for Cause” means the Company’s termination of the
Executive’s employment for Cause.






	 	(i)	 	“Termination without Cause” means the Company’s termination of the
Executive’s employment other than a Termination for Cause.






	 	(j)	 	“Voluntary Termination” means Executive’s termination of the
Executive’s employment for any reason, including retirement.






	10.	 	Representations.






	 	(a)	 	Executive Representations. The Executive represents and warrants to
the Company that (i) the execution, delivery and performance of this Agreement by the
Executive does not and will not conflict with, breach, violate or cause a default under
any contract, agreement, instrument, order, judgment or decree to which the Executive
is a party or by which the Executive is bound, (ii) the Executive is not a party to or
bound by any employment agreement, noncompete agreement or confidentiality agreement
with any other person or entity and (iii) upon the execution and delivery of this
Agreement by the Company, this Agreement shall be the valid and binding obligation of
the Executive, enforceable in accordance with its terms.






	 	(b)	 	Company Representation. The Company represents and warrants to the
Executive that upon the execution and delivery of this Agreement by the Executive, this
Agreement shall be the valid and binding obligation of the Company, enforceable in
accordance with its terms.




 


12









 






	11.	 	Release Agreement. No payments shall be made under Section 6(c) hereof unless the
Executive, on or before the sixtieth (60th) day following the Executive’s
Termination Date, (i) signs and returns the Release Agreement within the number of days that
the Company determines is required under applicable law, but in no event more than forty-five (45) days after the Company delivers the Release Agreement to the Executive and (ii)
does not revoke the Release Agreement within the time period provided therein, such time
period not to exceed seven (7) days. If the Executive becomes entitled to payments under
Section 6(c) hereof, the Company shall deliver to the Executive a copy of the Company’s
standard form of Release Agreement within seven (7) days of the Executive’s Termination
Date.






	12.	 	Survival. Subject to any limits on applicability contained therein, Section 7 hereof
shall survive and continue in full force in accordance with its terms notwithstanding any
termination of the Employment Period.






	13.	 	Withholding of Taxes. The Company may withhold from any amounts payable under this
Agreement all federal, state, city or other taxes as the Company is required to withhold
pursuant to any applicable law, regulation or ruling.






	14.	 	Notices. For all purposes of this Agreement, all communications, including without
limitation notices, consents, requests or approvals, required or permitted to be given
hereunder will be in writing and will be deemed to have been duly given when hand delivered or
dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or
five business days after having been mailed by United States registered or certified mail,
return receipt requested, postage prepaid, or three business days after having been sent by a
nationally recognized overnight courier service such as FedEx or UPS, addressed to the Company
(to the attention of the Secretary of the Company) at its principal executive office and to
the Executive at the Executive’s principal residence, or to such other address as any party
may have furnished to the other in writing and in accordance herewith, except that notices of
changes of address will be effective only upon receipt.






	15.	 	Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity or unenforceability shall not
affect any other provision of this Agreement, but this Agreement shall be reformed, construed
and enforced in such jurisdiction as if such invalid or unenforceable provision had never been
contained herein.






	16.	 	Complete Agreement. This Agreement embodies the complete agreement and understanding
between the parties with respect to the employment of the Executive and the subject matter
hereof and effective as of its date supersedes and preempts any prior understandings,
agreements or representations by or between the parties, written or oral, which may have
related to the subject matter hereof in any way, including any prior Employment Agreements
between the Company and the Executive. The severance benefits provided in Section 6(c) hereof
shall be in lieu of any severance benefits under any plans, programs, policies or practices of
the Company; provided, however, that if the Executive is entitled to benefits
under this Agreement and a Severance Agreement, the Executive will be entitled to severance
benefits under either this Agreement or such
Severance Agreement, whichever agreement provides for greater benefits, but will not be
entitled to benefits under both agreements.




 


13









 






	17.	 	Counterparts. This Agreement may be executed in separate counterparts, each of which
shall be deemed to be an original and both of which taken together shall constitute one and
the same agreement.






	18.	 	Successors and Assigns. This Agreement shall bind and inure to the benefit of and be
enforceable by the Executive, the Company and their respective heirs, executors, personal
representatives, successors and assigns, except that neither party may assign any rights or
delegate any obligations hereunder without the prior written consent of the other party. The
Executive hereby consents to the assignment by the Company of all of its rights and
obligations hereunder to any successor to the Company by merger or consolidation or purchase
of all or substantially all of the Company’s assets, provided such transferee or successor
assumes the liabilities of the Company hereunder.






	19.	 	Governing Law. The validity, interpretation, construction and performance of this
Agreement will be governed by and construed in accordance with the substantive laws of the
State of Delaware and federal law, without giving effect to the principles of conflict of laws
of such State, except as expressly provided herein.






	20.	 	Amendment and Waiver. The provisions of this Agreement may be amended or waived only
with the prior written consent of the Company and the Executive, and no course of conduct or
failure or delay in enforcing the provisions of this Agreement shall affect the validity,
binding effect or enforceability of this Agreement.






	21.	 	Section 409A of the Code. Each payment or reimbursement and the provision of each
benefit under this Agreement shall be considered to be a separate payment and not one of a
series of payments for purposes of Section 409A of the Code. To the extent applicable, it is
intended that this Agreement 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
Executive. This Agreement 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.




 


14









 










IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
written above.



	 	 	 	 	 
	 	USG CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 	
 	 
	 	Executive 
	 	 	 	 




 


15