Document:

Separation Agreement, Release and Covenant Not to Sue

 Exhibit 10.33 
  
 SEPARATION AGREEMENT, RELEASE AND COVENANT NOT TO SUE 
  
 This Separation Agreement and General Release (hereinafter “Agreement”) is made and entered into on September 26, 2005, by and between Armstrong World
Industries, Inc., and all parents, subsidiaries and affiliates, (hereinafter the “Company”) and Matthew J. Angello (hereinafter “Employee”). 
  

WITNESSETH: 
  
 WHEREAS, Employee’s employment with the Company will end effective December 31, 2005, under circumstances which qualify him for severance pay
under the terms of the Severance Pay Plan for Salaried Employees of Armstrong World Industries, Inc. (the “Plan”) and the special severance benefit program approved by the Bankruptcy Court in Armstrong World Industries’ Chapter 11
proceeding. 
  
 WHEREAS, Employee and the Company wish to
effectuate a final resolution of all matters relating to Employee’s employment and the termination thereof. 
  
 NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, Employee and the Company agree as follows: 
  
 1. Employment. Employee’s employment with the Company will
end December 31, 2005. Employee agrees that his participation in any and all other positions, committees, and managing or governing Boards with the Company or its affiliates will end on September 15, 2005. 
  
 2. Severance and Other Payments. In consideration of the
execution of this Agreement, the Company shall maintain the Employee on the salaried payroll at his current base salary through December 31, 2005. Further, Company shall pay Employee a lump-sum severance payment (less applicable payroll
withholding taxes) on or about December 29, 2005. This lump-sum severance payment will be in the amount calculated pursuant to the terms of the special severance benefit program approved in 2001 by the Bankruptcy Court in Armstrong World
Industries’ Chapter 11 proceeding, and be based upon Employee’s grade level, base salary and target bonus opportunity. 
  
 Employee shall remain eligible for a payment under the Management Achievement Plan (“MAP”) based upon Company performance, and subject to all
terms and conditions of the MAP, with any such payment expected to be made on or before March 1, 2006. Employee’s actual payment will be based solely on the Company’s achievement of financial goals as set forth in the MAP. 

 
 Employee shall also remain eligible for a payment under the Long-Term
Incentive Plan (“LTIP”) under the second-half of the grant under the LTIP for 2004/2005, subject to all terms and conditions of the LTIP, with any such payment expected to be made on or before March 1, 2006. Employee’s actual
payment will be based solely on the Company’s achievement of financial goals as set forth in this LTIP grant. 
  
 Subject to approval by the Management Development and Compensation Committee, effective December 31, 2005 you will receive 2,160 shares of restricted
stock held in your name. All restrictions will be waived at that time. You will not be permitted to use share tax withholding with this share distribution. 

 Employee shall not be eligible for, and shall not receive, a retention payment under the Extended Cash
Retention Program/2005 Cash Retention Payment approved as part of Company’s Chapter 11 Bankruptcy proceeding. Such payment would otherwise have been made in December 2005. 
  
 3. Employee Benefits. The Company will notify Employee of his right to continue his health and life insurance
coverage for 24 months at active employee contribution rates. This 24-month health care coverage will satisfy the 18-month COBRA continuation requirement. This 24-month period shall begin effective January 1, 2006. All other benefits which
serve as the consideration for this Agreement are shown on Attachment A. 
  
 4. Return of the Company’s Property. All notes, reports, sketches, plans, books, keys, credit cards, computers, unpublished memoranda or other documents or property which were created, developed,
generated or held or controlled by Employee during her employment and which concern or are related to the Company’s business, are the property of the Company and will be promptly returned to the Company prior to execution of this Agreement.

  
 5. Confidential Information. Employee recognizes
Employee has a duty and obligation to the Company to continue to protect its confidential and proprietary information and any trade secrets belonging to the Company (“Confidential Information”) which includes but is not limited to
information pertaining to pricing, customer lists, research or development, distribution, technology, product design, potential acquisitions, claims against the Company, litigation and litigation strategy, production processes and know-how, and
marketing, and therefore agrees that: 
  
 a. Any
and all Company Confidential Information produced or received by Employee during her employment and hereafter is the property of the Company. 
  
 b. Employee shall not use, disclose, divulge or convey to any third person, anywhere in the world, any Confidential Information belonging
to the Company or its affiliates until such time as such information or secrets become publicly known by legitimate means, such as public disclosure by the Company or otherwise through no wrongful act by Employee. 
  
 6. Nondisclosure. Employee shall not disclose or cause to be
disclosed the terms of this Agreement or the negotiations leading to it to any person (other than Employee’s direct family and tax and legal advisors). 
  
 7. No Adverse Comments. Neither party shall make, issue, release or authorize any written or oral statements, derogatory or defamatory in
nature, about the other party in, or through any medium, including the Internet. This limitation includes, but is not limited to, statements about the directors, officers or employees of the Company. 
  
 8. Release, Discharge, Waiver and Covenant Not to Sue. For and
in consideration of the mutual covenants provided in this Agreement, Employee on behalf of himself and his direct family, heirs, executors, administrators, children and assigns: 
  
 a. does hereby fully release and discharge the Company and its officers, directors, employees, attorneys,
agents, subsidiaries, affiliates, related organizations, successors and assigns from, and 
  

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 b. does hereby fully waive any obligations of the Company, such persons or entities for
any or all sums or money, accounts, actions, causes of action, claims and demands based upon or arising by reason of any damage, loss, injury or entitlement regardless of source or nature, whether known or unknown or contingent or absolute, which
heretofore has been or which hereafter may be suffered or sustained, directly or indirectly, by Employee or his direct family, heirs, executors, administrators, children, or assigns in consequence of, arising out of, or in any way related to
Employee’s employment, or termination of employment, with the Company or any of its affiliates, including his separation as an employee of the Company on December 31, 2005 . The foregoing release and discharge, waiver and covenant not to
sue includes, but is not limited to, all claims and any obligations or causes of action arising from such claims, under common law including wrongful or retaliatory discharge, breach of contract and any action arising in tort including libel,
slander, defamation or intentional infliction of emotional distress, and claims under any federal, state or local statute including Title VII of the Civil Rights Act of 1964, the Civil Rights Acts of 1866 and 1871 (42 U.S.C. § 1981), the
National Labor Relations Act, the Age Discrimination in Employment Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Americans with Disabilities Act of 1990, the Rehabilitation Act of 1973, the Sarbanes Oxley Act of
2002, the Pennsylvania Human Relations Act, or the discrimination or employment laws of any state, county or municipality, and/or claims under any express or implied contract which Employee, her successors or assigns or representatives may claim
existed with the Company. This release, discharge and waiver expressly includes all claims, and any obligations or causes of action arising from such claims, that could have been raised in state or federal court or with a state, federal or municipal
agency or entity. This is intended to be a full release of all possible claims against the Company. 
  
 However, you do maintain the right to receive any payments or benefits under your Individual Change in Control Agreement dated
November 1, 2000, and amended and modified July 15, 2002, should your Individual Change in Control Agreement be triggered pursuant to its terms. Except that if you become eligible for and receive benefits and/or payments pursuant to your
Individual Change in Control Agreement, any such payments or benefits will be offset by any severance payments and benefits you receive pursuant to the Severance Pay Plan for Salaried Employees of Armstrong World Industries, Inc. (including any
modification to the payments schedule pursuant to Order of the Bankruptcy Court where Armstrong World Industries, Inc.’ Chapter 11 bankruptcy is pending) and other payments or benefits relating to, and paid pursuant to this Agreement.

  
 Excluded from this release are any claims
which cannot be waived by law, including but not limited to the right to file a charge with or participate in an investigation conducted by certain government agencies. Employee does, however, waive Employee’s right to any monetary recovery
should any agency (such as the Equal Employment Opportunity Commission) pursue any claims on Employee’s behalf. Employee represents and warrants that Employee has not filed any complaint, charge, or lawsuit against the Company with any
government agency or any court. 
  
 In addition,
Employee agrees never to sue the Company in any forum for any claim covered by the above waiver and release language. If Employee violates this Agreement by suing the Company, Employee shall be liable to the Company for its reasonable
attorneys’ fees and other litigation costs incurred in defending against such a suit. Alternatively, in the event 

  

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Employee sues the Company, Employee may, at the Company’s option, be required to return all monies and other benefits paid to Employee pursuant to this
Agreement. 
  
 c. The Employee shall, after the
date of termination, retain all rights to defense and indemnification under (a) applicable law; (b) any applicable agreements or insurance policies; or (c) any of the Company’s own / subsidiaries’ Articles or Certificates of
Incorporation; or (d) any of the Company’s own / subsidiaries’ By-Laws, as they may be amended or restated from time to time. 
  
 9. Exclusive Payments. The payments and other benefits outlined in this Agreement and Attachment A to be made to Employee will be considered
as fulfilling all compensation obligations to Employee by the Company, including but not limited to salary, vacation, benefits, bonuses, stock options and any other payments or benefits from the Company. 
  
 10. Severability. The terms and provisions of this Agreement
shall be deemed separable, so that if any term or provision is deemed to be invalid or unenforceable, such term or provision shall be deemed deleted or modified so as to be valid and enforceable to the full extent permitted by applicable law. No
terms or words used in this agreement are intended to be gender specific. All feminine terms are intended to include the masculine, and vice versa. 
  
 11. Entire Agreement. The terms of this Agreement constitute the entire agreement between Employee and the Company, and supersede any prior
agreement executed between Employee and the Company to the extent the prior agreement is inconsistent with this Agreement. 
  
 12. Governing Law. This Agreement shall be construed and enforced under the laws of the Commonwealth of Pennsylvania. 
  
 13. Successors and Assigns. This Agreement shall inure to the
benefit of and may be enforced by the parties to this Agreement and shall be binding upon Employee, Employee’s executors, administrators, legatees, or any other successor interest and upon the Company, its successors and any assignee or
transferee of or successor to all or substantially all of the business or assets of the Company, and may not be amended, in whole or in part, except in writing signed by a duly authorized officer of the Company and Employee. 
  
 14. Knowing and Voluntary. Employee acknowledges and recites
that: 
  

	 	a.	Employee entered into this Agreement knowingly and voluntarily; 

  

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	 	b.	Employee has read and understands this Agreement in its entirety; 

  

	 	c.	Employee has been advised and directed orally and in writing (and this Paragraph c constitutes such written direction) to seek legal counsel and any other advice he wishes with
respect to the terms of this Agreement before executing it; 

  

	 	d.	Employee’s execution of this Agreement has not been forced by any employee or agent of the Company, and Employee has had an opportunity to negotiate about the Agreement’s
terms; 

  

	 	e.	That the payments and benefits listed in Paragraphs 2 and 3 constitute additional consideration to which Employee is entitled by virtue of this Agreement only.

  

	 	f.	You have been given a period of at least twenty-one (21) days within which to consider this Agreement and review any documents. 

  

	 	g.	This Agreement may be revoked by Employee if he provides written notice of his revocation within seven (7) days of his execution of this Agreement. Any such written revocation
must be provided to Mr. R. Scott Webster, Human Resources, Armstrong World Industries, Inc., 2500 Columbia Avenue, Lancaster, PA 17603. 

  
 IN WITNESS WHEREOF, the parties have executed this Agreement on the date indicated above. 
  

									
	 ARMSTRONG WORLD INDUSTRIES, INC.
	 	 	 	 Matthew J. Angello

					
	 By:
	 	/s/    WALTER T. GANGL        	 	 	 	 	 	/s/    MATTHEW J.
ANGELLO        
			
	 Dated: 9/22/05
	 	 	 	 Dated: 9/26/05

  

									
	 Witnessed
	 	 	 	 
					
	 By:
	 	/s/    R. S. WEBSTER        	 	 	 	 	 	/s/    DEBRA ANGELLO        

  

 5Form of 2006 Target Incentive Bonus Award Letter

 Exhibit 10(a) 
  
 

 
  

	TO:	[Name] 

  
 October     , 2005 
  
 FISCAL YEAR 2006 
 TARGET INCENTIVE
BONUS AWARD 
 UNDER PERFORMANCE BONUS PLAN 
  

Dear [First Name]: 
  
 On August 29, 2005, the Management Development and Compensation Committee of the Board of Directors (the “Committee”) authorized a target incentive bonus
award (the “Award”) to you under the Corporation’s Performance Bonus Plan (“Bonus Plan”). This award is made subject to the Corporation’s Performance Bonus Plan, which was approved by the shareholders of the Corporation
on October 26, 2005, so that payments made hereunder will be qualified as “performance-based compensation” for purposes of Section 162(m) of the Internal Revenue Code of 1986 and Section 1.162-27 of the Treasury Regulations
promulgated thereunder. Your Award is in the target amount of $                     (the “Target Amount”). The Award is subject to
the following terms and conditions: 
  
 1. The payout under the
Award (the “Payout”) will be based upon the Corporation’s actual operating cash flow less capital expenditures (free cash flow) expressed as a percent of the Corporation’s sales (“FCF Margin”) for fiscal year 2006 (the
“Performance Period”). Discretionary pension contributions by the Corporation shall not be included in the calculation of FCF Margin. You will receive a Payout of 100% of your Target Amount if a 6.0% FCF Margin for the Performance Period
is achieved. FCF Margin above or below 6.0% for the Performance Period will result in a lesser or greater Payout than the Target Amount on a pro rata basis (see Table 1 below). The minimum threshold for any Payout under the Award is 3.0% FCF
Margin during the Performance Period. 
  

																			
	 FY06 FCF Margin:

	  	<3.0%

	  	3.0%

	  	4.0%

	  	5.0%

	  	6.0%

	  	6.9%

	  	8.0%

	  	9.0%

	  	39.0%

	 Payout %:
	  	0%	  	25%	  	50%	  	75%	  	100%	  	123%	  	163%	  	200%	  	200%

  
 2. The Payout earned
under the Award will be paid at the end of the Performance Period. Your Payout will be reduced on a pro rata basis to reflect the actual amount of time you serve in an eligible position during the Performance Period. 
  
 3. If you retire (at or after age 60, or earlier with the consent of the
Committee), die or become disabled during the Performance Period, you will be entitled to receive a pro rata share of the Payout ultimately earned during the Performance Period based upon the number of full months worked during the
Performance Period. Termination of employment for any other reason during the Performance Period will result in forfeiture of your Award. 

 4. You will receive the Payout in either cash or a credit to your Executive Deferral Plan account (based
on your election prior to September 30, 2005) following certification of the calculation of the FCF Margin by the Committee at the end of the Performance Period. The Committee retains the ability to reduce the Payout at its sole discretion. The
amount of the Payout is also subject to the payout limitations set forth in Section 5(c) of the Bonus Plan. 
  
 5. The Award is subject to all terms, conditions and provisions of the Bonus Plan to the extent not specifically addressed herein. In the event of any
conflict between the terms of the Bonus Plan and the Award, the Bonus Plan shall prevail. 
  
 Please acknowledge receipt of the Award and indicate your agreement with the terms hereof by signing and returning a copy to me as soon as possible. 
  

	
	

	
	 Thomas A. Piraino, Jr.

	 Vice President, General Counsel

	     And Secretary

  
 Receipt Acknowledged and Agreed: 
  

					
	  

	  	Date:	  	  

	             [Name]

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