UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K
(Mark One)
x

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2014
OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from

to
Commission File Number 1-8864

USG CORPORATION
(Exact name of Registrant as Specified in its Charter)
Delaware

36-3329400

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer
Identification No.)

550 W. Adams Street, Chicago, Illinois

60661-3676

(Address of Principal Executive Offices)

(Zip Code)

Registrants Telephone Number, Including Area Code: (312) 436-4000

Securities Registered Pursuant to Section 12(b) of the Act:
Title of Each Class

Name of Exchange on Which Registered

New York Stock Exchange

Common Stock, $0.10 par value

Chicago Stock Exchange

Preferred Stock Purchase Rights (subject to Rights

New York Stock Exchange

Agreement dated December 21, 2006, as amended)

Securities Registered Pursuant to Section 12(g) of the Act: None

Chicago Stock Exchange

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes x

No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.

Yes o

No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and
posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and
post such files). Yes x No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants
knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of
large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).

Yes o

o
No x

The aggregate market value of the registrants common stock held by non-affiliates computed by reference to the New York Stock Exchange closing price on June 30, 2014
(the last business day of the registrants most recently completed second fiscal quarter) was approximately $2,583,001,211. Solely for this purpose, directors, executive officers and
greater than 10% record shareholders are considered the affiliates of the registrant.
The number of shares of the registrants common stock outstanding as of January 31, 2015 was 144,846,861.

Documents Incorporated By Reference: Certain sections of USG Corporations definitive Proxy Statement for use in connection with its 2015 annual meeting of stockholders, to be
filed subsequently, are incorporated by reference into Part III of this Form 10-K Report where indicated.

Table of Contents

TABLE OF CONTENTS
Page

PART I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.

Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures

1
8
16
17
18
18

PART II
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.

Market for the Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Selected Financial Data
Managements Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information

19
21
22
45
46
94
94
96

PART III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.

Directors, Executive Officers and Corporate Governance

Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accounting Fees and Services

97
98
98
98
98

PART IV
Item 15.

Exhibits and Financial Statement Schedules

99

Signatures

100

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PART I
Item 1.

BUSINESS

In this annual report on Form 10-K, USG, we, our and us refer to USG Corporation, a Delaware corporation, and its subsidiaries included in the
consolidated financial statements, except as otherwise indicated or as the context otherwise requires.
General
USG, through its subsidiaries, is a leading manufacturer and distributor of building materials. We produce a wide range of products for use in new residential,
new nonresidential, and residential and nonresidential repair and remodel construction as well as products used in certain industrial processes. Our businesses
are cyclical in nature and sensitive to changes in general economic conditions, including, in particular, conditions in the North American housing and
construction-based markets, which are our most significant markets.
For the new residential construction market, housing starts are a very good indicator of demand for our gypsum products. Installation of our gypsum
products typically follows a housing start by 90 to 120 days. Based on preliminary data reported by the U.S. Census Bureau, housing starts in the United
States increased 8.7% in 2014 to 1,005,800 compared with 924,900 in 2013. This followed an 18.7% increase in 2013 compared with 2012. For December
2014, the seasonally-adjusted annualized rate of housing starts was reported by the U.S. Census Bureau to be 1,089,000 units. While housing starts increased
for the fifth consecutive year in 2014, they are still low by historical standards. Industry analysts believe that the recovery in new residential construction will
continue, although the recovery over the next few years may be uneven and modest, and that over the longer term housing starts will begin to reach historical
averages. Industry analysts forecasts for 2015 housing starts in the United States included in the most recent Blue Chip Economic Indicators are 1,080,000 to
1,260,000 units, based upon the average of the bottom ten and top ten forecasts included in the report, respectively. We currently estimate that 2015 housing
starts in the United States will be at the middle of the range of 1,000,000 to 1,200,000.
Demand for our products from new nonresidential construction is determined by floor space for which contracts are signed. Installation of gypsum and
ceilings products typically follows signing of construction contracts by about 12 to 18 months. According to the most recent construction market forecast
from Dodge Data & Analytics (formerly known as McGraw Hill Construction), total floor space for which new nonresidential construction contracts were
signed in the United States increased 5% in 2014 compared with 2013. This followed a 12% increase in 2013 compared with 2012 and a 11% increase in
2012 compared with 2011. Dodge Data & Analytics forecasts that total floor space for which new nonresidential construction contracts in the United States
are signed will increase approximately 11% in 2015 from the 2014 level. Dodge Data & Analytics's forecast includes several building types which do not
generate significant demand for our products; therefore, we anticipate new nonresidential construction growth in our business sectors in 2015 compared to
2014 will be in the mid-single digits.
The repair and remodel market includes renovation of both residential and nonresidential buildings. As a result of the low levels of new home
construction in recent years, this market currently accounts for the largest portion of our sales. Many buyers begin to remodel an existing home within two
years of purchase. According to the National Association of Realtors, sales of existing homes in the United States decreased to approximately 4.93 million
units in 2014 reflecting a 3% decrease from the 2013 level of 5.09 million units, which was an increase of 9% from 2012. Even with the slight decrease in the
current year, existing home sales and home resale values have contributed to an increase for our products from the residential repair and remodel market. We
currently estimate that overall repair and remodel spending in 2014 increased approximately 1% over the 2013 level and that overall repair and remodel
spending growth in 2015, compared to 2014, will be in the low- to mid-single digits.
The rate of recovery in the new residential construction market, new nonresidential construction market and the repair and remodel market still remains
uncertain and will depend on broader economic issues such as employment, foreclosures, house price trends, availability of mortgage financing, interest rates,
income tax policy, consumer confidence, lease turnover rates, discretionary business investment, job growth and governmental building-related
expenditures.
We expect improvement over the next twelve months in the construction industries in our largest international markets, Canada and Mexico.
Emerging markets, including those that are within the territory of our 50/50 joint ventures, USG Boral Building Products, or UBBP, provide opportunities for
our operations to serve the increasing demand for products in these regions. Although the rate of growth in certain emerging markets has slowed, we expect
the growth in these markets to exceed the improvement in North America. We anticipate that the results from UBBP will enable us to dampen some of the
future cyclicality in our business.
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Since January 2007, we have temporarily idled or permanently closed approximately 3.8 billion square feet of our highest-cost gypsum wallboard,
paper and other production facilities. We eliminated approximately 4,830 salaried and hourly positions between 2007 and 2012. As part of our efforts to
reduce the cost structure of our distribution business, which is comprised of L&W Supply Corporation and its subsidiaries, or L&W Supply, we closed a total
of 125 distribution branches during that same time frame. L&W Supply did not close any branches during 2014 and 2013, and, as of December 31, 2014,
served its customers from 145 distribution branches in the United States, including two new distribution branches opened during 2014. We continue to
monitor economic conditions in our markets and will adjust our operations as needed.
The effects of recent market conditions on our operations are discussed in this Item 1 and in Part II, Item 7, Managements Discussion and Analysis of
Financial Condition and Results of Operations.
Recent Developments
On February 27, 2014, we and certain of our subsidiaries formed 50/50 joint ventures, USG Boral Building Products Pte. Limited, a company organized under
the laws of Singapore, and USG Boral Building Products Pty Limited, a company organized under the laws of Australia, with Boral Limited (Boral). These
joint ventures are herein referred to as USG Boral Building Products, or UBBP. UBBP distributes and sells certain building products, mines raw gypsum and
sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East (the "Territory"). The products that USG and Boral manufacture and
distribute through UBBP include products for wall, ceiling, floor lining and exterior systems that utilize gypsum, plasterboard (wallboard), mineral fiber
ceiling tiles, steel grid and studs, joint compound and other products. As part of the consideration for our 50% ownership in UBBP, we contributed to UBBP
our subsidiaries and joint venture investments in Asia-Pacific, India and Oman. As discussed below, UBBP now comprises one of our segments.
Our investments in UBBP are accounted for as equity method investments and were initially measured at cost. Our existing wholly owned subsidiaries
and consolidated variable interest entities that were contributed into the joint venture were deconsolidated. See Note 3 to the consolidated financial
statements in Part II, Item 8 of this report for additional information related to our equity method investments.
Segments
Effective April 1, 2014, we changed the composition of our reportable segments to reflect the change in management over our businesses in Mexico and
Latin America. Additionally, with the contribution of our businesses in the Asia-Pacific region, India and Oman into the 50/50 joint ventures, UBBP, we have
determined UBBP to be our fourth segment. See further discussion below under Ceilings and UBBP. As a result of these changes, our Mexico and Latin
America businesses have been combined, and their Gypsum results have been included within our Gypsum segment, previously referred to as North American
Gypsum, and their Ceiling results have been included within our Ceilings segment, previously referred to as Worldwide Ceilings. Our prior period results
have been recast to reflect these changes and present comparative year-over-year results.
As a result of these changes, our operations are now organized into four reportable segments: Gypsum, Ceilings, Distribution, and UBBP. The net sales
of Gypsum, Ceilings, and Distribution accounted for approximately 56%, 12% and 32%, respectively, of our 2014 consolidated net sales. UBBP is accounted
for as equity method investments, and thus, net sales of UBBP are not included in consolidated net sales.
Gypsum
BUSINESS

Previously referred to as North American Gypsum, our Gypsum segment manufactures and markets gypsum and related products in the United States, Canada,
Mexico and Latin America. It includes United States Gypsum Company, or U.S. Gypsum, in the United States, the gypsum business of CGC Inc., or CGC, in
Canada, the gypsum businesses of USG Mexico, S.A. de C.V., or USG Mexico, along with our gypsum businesses in Latin America. U.S. Gypsum is the largest
manufacturer of gypsum wallboard in the United States and accounted for approximately 26% of total industry shipments of gypsum board (which includes
gypsum wallboard, other gypsum-related paneling products and imports) in the United States in 2014. CGC is the largest manufacturer of gypsum wallboard
in eastern Canada. USG Mexico is the largest manufacturer of gypsum wallboard in Mexico with more than 59% market share in 2014.
PRODUCTS

Gypsums products are used in a variety of building applications to construct the walls, ceilings, roofs and floors of residential, commercial and institutional
buildings, as well as in certain industrial applications. These products provide aesthetic as well as sound-dampening, fire-retarding, abuse-resistance and
moisture-control value. The majority of these products are sold under the Sheetrock brand name, including a broad portfolio of gypsum panels and a line of
joint compounds, corner beads, and tape
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used for finishing wallboard joints. The DUROCK line of cement board and accessories provides water-resistant and fire-resistant assemblies for both
interior and exterior applications. The FIBEROCK line of gypsum-fiber panels includes abuse-resistant interior wall panels, tile backer boards, and flooring
underlayments. The SECUROCK line of products includes glass faced gypsum panels used for exterior sheathing and roof cover boards, as well as gypsum
fiber panels used as roof cover boards. The LEVELROCK line of poured gypsum underlayments provides surface leveling and enhanced sound-dampening
performance for residential and commercial flooring applications. Our construction plaster products, sold under the brand names RED TOP, IMPERIAL,
DIAMOND and SUPREMO, are used to provide a custom finish for residential and commercial interiors. These products provide aesthetic, sounddampening, fire-retarding and abuse-resistance value. We also produce gypsum-based products for agricultural and industrial customers to use in a wide
variety of applications, including soil conditioning, road repair, fireproofing and ceramics.
As the leader in lightweight innovation, we offer the industry's broadest portfolio of lightweight gypsum panels. In 2010, we introduced USG
Sheetrock Brand UltraLight Panels, the industry's first lightweight gypsum wallboard panel for use in interior wall and ceiling applications. We have since
extended our lightweight portfolio with the introductions of USG Sheetrock Brand UltraLight Panels Firecode 30 and USG Sheetrock Brand UltraLight
Panels Firecode X for fire rated assemblies, USG Sheetrock Brand UltraLight Panels Mold Tough , the industry's first lighweight moisture- and moldresistant wallboard, USG Sheetrock Brand MH UltraLight Gypsum Panels for manufactured housing, and USG Sheetrock Brand UltraLight Gypsum Base
Imperial for veneer plaster systems.
USG Sheetrock Brand UltraLight Panels accounted for 63% of all of our wallboard shipments in the United States in 2014 and 55% in 2013.
MANUFACTURING

Gypsum manufactures products at 40 plants located throughout the United States, Canada, Mexico, and Latin America.
Gypsum rock is mined or quarried at 13 company-owned locations in North America. Our mines and quarries provided approximately 59% of the
gypsum used by our plants in North America in 2014.
Some of our manufacturing plants purchase or acquire synthetic gypsum and natural gypsum rock from outside sources. In 2014, outside purchases of
synthetic gypsum and natural gypsum rock accounted for approximately 36% and 5%, respectively, of the gypsum used in our plants.
Synthetic gypsum is a byproduct of flue gas desulphurization carried out by electric generation or industrial plants that burn coal as a fuel. The
suppliers of this kind of gypsum are primarily power companies, which are required to operate scrubbing equipment for their coal-fired generating plants
under federal environmental regulations. We have entered into a number of long-term supply agreements to acquire synthetic gypsum. We generally take
possession of the gypsum at the producers facility and transport it to our wallboard plants by ship, river barge, railcar or truck. Six of our 19 gypsum
wallboard plants in operation use synthetic gypsum for all of their needs, while another six use it for a portion of their needs. The U.S. Environmental
Protection Agency, or U.S. EPA, currently classifies synthetic gypsum as a non-hazardous waste. Certain power companies have recently switched to using
natural gas instead of coal for their electric generation needs. In the event more power companies switch to using natural gas instead of coal, the availability
of synthetic gypsum may decrease. See Item 1A, Risk Factors.
We produce wallboard paper at four company-owned production facilities located in the United States. Vertical integration in paper helps to ensure a
continuous supply of high-quality paper that is tailored to the specific needs of our production processes. We augment our paper needs through purchases
from outside suppliers when necessary. We did not purchase any wallboard paper from outside suppliers during 2014.
MARKETING AND DISTRIBUTION

Our gypsum products are distributed through L&W Supply, other specialty wallboard distributors, building materials dealers, home improvement centers and
other retailers, and contractors. Sales of gypsum products are seasonal in the sense that sales are generally greater from spring through the middle of autumn
than during the remaining part of the year.
Based on our estimates using publicly available data, internal surveys and industry shipment data for gypsum board, as reported by the Gypsum
Association, we estimate that during 2014 volume demand for gypsum board was generated by:

residential and nonresidential repair and remodel activity of about 52%,

new residential construction of about 36%,

new nonresidential construction of about 7%, and

other activities, such as exports and temporary construction of about 5%.

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COMPETITION

Industry shipments of gypsum board in the United States (including gypsum wallboard, other gypsum-related paneling products and imports), as reported by
the Gypsum Association, were an estimated 21.8 billion square feet in 2014, up approximately 4% from 20.9 billion square feet in 2013. U.S. Gypsums share
of the gypsum board market in the United States, which includes for comparability its shipments of USG Sheetrock brand gypsum wallboard, FIBEROCK
brand gypsum fiber panels and SECUROCK brand glass mat sheathing, was approximately 26% in 2014, unchanged from 2013.
Our competitors in the United States include: National Gypsum Company, CertainTeed Corporation (a subsidiary of Compagnie de Saint-Gobain SA),
Georgia-Pacific (a subsidiary of Koch Industries, Inc.), American Gypsum Company LLC (a unit of Eagle Materials Inc.), Continental Building Products LLC
and PABCO Gypsum (a division of PABCO Building Products). Our competitors in Canada include CertainTeed Corporation, Georgia-Pacific and Cabot
Gypsum Company. Our major competitors in Mexico include Panel Rey, S.A. (a Grupo Promax Company) and Plaka (a unit of Comex). The principal
methods of competition are quality of products, service, pricing, compatibility of systems and product design features.
Ceilings
BUSINESS

Previously referred to as Worldwide Ceilings, our Ceilings segment manufactures and markets interior systems products in the United States, Canada,
Mexico, and Latin America. Ceilings includes USG Interiors, LLC, or USG Interiors, the ceilings business of CGC, and our ceilings businesses in Mexico and
Latin America. Ceilings is a leading supplier of interior ceilings products used primarily in commercial applications. We estimate that we are the secondlargest manufacturer of ceiling grid and acoustical ceiling tile worldwide.
Through February 27, 2014, our Ceilings reportable segment also included our businesses in the Asia-Pacific region (see Recent Developments above
regarding UBBP), which were included in USG International.
On August 7, 2012, USG and its indirect wholly owned subsidiaries, USG Foreign Investments, Ltd. and USG (U.K.) Ltd., together the Sellers, entered
into a Share and Asset Purchase Agreement with Knauf International GmbH and Knauf AMF Ceilings Ltd., together Knauf, pursuant to which we agreed to
sell to Knauf all of our wholly owned European business operations. These businesses include the manufacture and distribution of DONN brand ceiling grid
and SHEETROCK brand finishing compounds principally throughout Europe, Russia and Turkey. The results of our European business operations have
been presented as discontinued operations in the consolidated financial statements and accompanying footnotes presented in Item 8 of this report and were
previously included in our Ceilings segment. On December 27, 2012, the sale transaction was consummated and we received net proceeds of $73 million and
recognized a gain of $55 million. See Note 4 to the consolidated financial statements in Part II, Item 8 of this report for additional information related to
discontinued operations.
PRODUCTS

Ceilings manufactures ceiling tile in the United States and ceiling grid in the United States, Canada and, through February 27, 2014, the Asia-Pacific region.
It markets ceiling tile and ceiling grid in the United States, Canada, Mexico, Latin America, and through February 27, 2014, the Asia-Pacific region. Our
integrated line of ceilings products provides qualities such as sound absorption, fire retardation and convenient access to the space above the ceiling for
electrical and mechanical systems, air distribution and maintenance. USG Interiors significant brand names include the RADAR TM, ECLIPSETM, MARSTM,
and HALCYONTM brands of ceiling tile and the DONN, DX, FINELINE, CENTRICITEETM, DXI IDENTITEETM, CURVATURATM and COMPASSOTM
brands of ceiling grid.
MANUFACTURING

Ceilings manufactures products at 10 plants located in North America. Principal raw materials used to produce Ceilings products include mineral fiber, steel,
perlite and starch. We produce some of these raw materials and obtain others from outside suppliers.
MARKETING AND DISTRIBUTION

Ceilings sells products primarily in markets related to the construction and renovation of nonresidential buildings. During 2014, approximately 69% of
Ceilings net sales were from repair and remodel activity, primarily nonresidential, 28% of its net sales were from new nonresidential construction and 3% of
its net sales were from new residential construction. Products are marketed and distributed through a network of distributors, installation contractors, L&W
Supply locations and home improvement centers. Sales of Ceilings products are seasonal in nature. Sales are generally weaker in the fourth quarter of the
calendar year as compared to the preceding three quarters.
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COMPETITION

Our principal competitors in acoustical ceiling tile include Armstrong World Industries, Inc., Compagnie de Saint-Gobain SA, Knauf AMF GmbH & Co. KG,
Odenwald Faserplattenwerk GmbH (OWA), and Rockwool International. Our principal competitors in ceiling grid include WAVE (a joint venture between
Armstrong World Industries, Inc. and Worthington Industries), Compagnie de Saint-Gobain SA and Rockwool International. Principal methods of
competition are quality of products, service, pricing, compatibility of systems and product design features.
Distribution
BUSINESS

Previously referred to as Building Products Distribution, our Distribution segment consists of L&W Supply, a leading distributor of gypsum wallboard and
other building materials in the United States. In 2014, L&W Supply distributed approximately 7% of all gypsum board in the United States, including
approximately 29% of U.S. Gypsums gypsum board production. During 2014, approximately 35% of L&W Supplys net sales were from residential and
nonresidential repair and remodel activity, 40% of its net sales were from new nonresidential construction and 25% of its net sales were from new residential
construction.
MARKETING AND DISTRIBUTION

L&W Supply is a service-oriented business that stocks a wide range of construction materials. It delivers less-than-truckload quantities of construction
materials to job sites and places them in areas where work is being done, thereby reducing the need for handling by contractors. L&W Supply specializes in
the distribution of gypsum wallboard (which accounted for 36% of its 2014 net sales) and joint compound manufactured by U.S. Gypsum as well as other
manufacturers. Further, L&W Supply distributes products manufactured by USG Interiors, LLC, such as acoustical ceiling tile and grid, as well as products of
other manufacturers, including drywall metal, insulation, roofing, fasteners and exterior insulation finishing systems. Sales of L&Ws products are seasonal in
nature and are generally greater from spring through autumn when access to job sites is easier and construction activity is at its peak. L&W Supply leases
approximately 90% of its facilities from third parties. Typical leases have terms of five years and include renewal options.
During the economic downturn, L&W Supply focused on reducing its cost structure and optimizing utilization of its personnel and assets. As a result,
L&W Supply closed 125 distribution branches between January 2007 and September 2012. The closures were widely dispersed throughout the markets that
L&W Supply serves. L&W Supply did not close any branches during 2013 and 2014, and, as of December 31, 2014, served its customers from 145
distribution branches in the United States, including two new distribution branches opened during 2014.
COMPETITION

L&W Supply competes with a number of specialty wallboard distributors, lumber dealers, hardware stores, home improvement centers and acoustical ceiling
tile distributors. Its principal competitors include ProBuild Holdings Inc., a national supplier of building materials, Gypsum Management Supply with
locations in the southern, central and western United States, KCG, Inc. in the southwestern and central United States, and Allied Building Products
Corporation in the northeastern, central and western United States. Principal methods of competition are location, service, range of products and pricing.
USG Boral Building Products
BUSINESS

USG Boral Building Products, or UBBP, are 50/50 joint ventures formed on February 27, 2014 with Boral. UBBP manufactures, distributes and sells certain
building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East (the "Territory"). UBBP is a
leader in most of the markets it serves.
PRODUCTS

UBBP manufactures and distributes products for wall, ceiling, floor lining and exterior systems that utilize gypsum wallboard, referred to as plasterboard in
the region in which UBBP operates, mineral fiber ceiling tiles, steel grid and studs and joint compound. UBBP's significant brand names include USG Boral
Sheetrock premium plasterboard, USG Boral NextGen , Elephant, Jayaboard, Durock and Donn DX, the worlds most widely specified and installed
ceiling suspension system. UBBP launched USG Boral Sheetrock products, which leverages the technology in USG Sheetrock , in Australia, South Korea
and Thailand. UBBP is able to sell USG Boral Sheetrock at a premium price and, in some markets, conversion rates have surpassed 10%.
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MANUFACTURING

UBBP has 24 plasterboard lines and 37 other non-board production facilities for metal stud, metal ceiling grid, ceiling tile, joint compound, and cornice
throughout the Territory including Australia, New Zealand, Indonesia, Malaysia, Philippines, Thailand, China, South Korea, Vietnam, and India.
Executive Officers of the Registrant
See Part III, Item 10, Directors, Executive Officers and Corporate Governance - Executive Officers of the Registrant (as of February 12, 2015).
Other Information
RESEARCH AND DEVELOPMENT

To contribute to our high standards and our leadership in the building materials industry, we perform extensive research and development at the USG
Corporate Innovation Center in Libertyville, Illinois, using open innovation models and outside partnerships. Research team members collaborate with
suppliers, universities and national research laboratories to provide product support and to develop new products and technologies for our operating units.
With fire, acoustical, structural and environmental testing capabilities, the research center allows us to conduct our own on-site evaluation of products and
systems. Chemical analysis and materials characterization support product development and safety/quality assessment programs. Development activities can
be taken to an on-site pilot plant before being transferred to a full-size plant. Research and development activities have been focused on customer preferred
system solutions. We charge research and development expenditures to earnings as incurred. These expenditures amounted to $23 million in 2014, $21
million in 2013 and $18 million in 2012.
SUSTAINABILITY

The adoption of green building codes and standards such as the Leadership in Energy and Environmental Design, or LEED, rating system established by the
U.S. Green Building Council to encourage the design and construction of buildings that are environmentally friendly, combined with an increase in customer
preference for products that can assist in obtaining LEED credit or are otherwise environmentally preferable, has increased demand for products, systems and
services that contribute to building sustainable spaces. Many of our products meet the requirements for the awarding of LEED credits, and we are continuing
to develop new products, systems and services to address market demand for products that enable construction of buildings that require fewer natural
resources to build, operate and maintain. Our competitors also have developed and introduced to the market more environmentally responsible products.
We expect that there will be increased demand over time for products, systems and services that meet regulatory and customer sustainability standards
and preferences and decreased demand for products that produce significant greenhouse gas emissions. We also believe that our ability to continue to
provide these products, systems and services to our customers will be necessary to maintain our competitive position in the marketplace.
ENERGY

Our primary supplies of energy have been adequate, and we have not been required to curtail operations as a result of insufficient supplies. Supplies are likely
to remain sufficient for our projected requirements. Currently, we are using swap contracts to hedge a significant portion of our anticipated purchases of
natural gas to be used in our manufacturing operations over the next 12 months and beyond. We typically do not hedge beyond three years. We review our
positions regularly and make adjustments as market conditions warrant.
SIGNIFICANT CUSTOMER

On a worldwide basis, The Home Depot, Inc. accounted for approximately 16% of our consolidated net sales in 2014 and approximately 15% in both 2013
and 2012. Our Gypsum, Ceilings and Distribution segments had net sales to The Home Depot, Inc. in each of those years.
OTHER

Because we fill orders upon receipt, no segment has any significant order backlog.
None of our segments has any special working capital requirements.
We consider patents, copyrights, trademarks, trade secrets, proprietary technology and similar intellectual property as critical to our success. We hold
numerous patents and have registered numerous trademarks of varying duration in multiple legal jurisdictions. Further, we have filed patent applications and
applications for the registration of trademarks in the United States and internationally. Although we consider our patents, licenses and trade secrets to
constitute valuable assets, we do not regard any of our businesses as being materially dependent upon individual patents, trade secrets, or licenses.
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No material part of our business is subject to renegotiation of profits or termination of contracts or subcontracts at the election of any government.
As of December 31, 2014, we had approximately 8,900 employees worldwide.
See Note 16 and Note 3 to the consolidated financial statements in Part II, Item 8 of this report for financial information pertaining to revenue and assets by
geographic region and our segments and for financial information pertaining to UBBP, respectively, and Item 1A, Risk Factors, for information regarding the
risks associated with conducting business in international locations, as well as the possible effects that compliance with environmental laws and regulations
may have on our businesses and operating results.
Available Information
We maintain a website at www.usg.com and make available at this website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K and all amendments to those reports as soon as reasonably practicable after they are electronically filed with or furnished to the Securities and
Exchange Commission, or SEC. The information on our website is not, and will not be deemed to be, a part of this Annual Report on Form 10-K, or
incorporated into any of our other filings with the SEC, except where we expressly incorporated such information. If you wish to receive a paper copy of any
exhibit to our reports filed with or furnished to the SEC, the exhibit may be obtained, upon payment of reasonable expenses, by writing to: Corporate
Secretary, USG Corporation, 550 West Adams Street, Chicago, Illinois 60661-3676.
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Item 1A.

RISK FACTORS

Our business, financial condition and operating results are subject to various risks and uncertainties. We have described below significant factors that may
adversely affect our industry and our business, financial condition, operating results and cash flows. You should carefully consider these factors, together
with all of the other information in this annual report on Form 10-K and in other documents that we file with the SEC, before making any investment decision
about our securities. Adverse developments or changes related to any of the factors listed below could affect our business, financial condition, operating
results and cash flows.
Our business is cyclical in nature, and is particularly dependent on the housing and construction-based markets. Continued weakness, or future downturns
or delays in the recovery of these markets, may have a material adverse effect on our business, financial condition, operating results and cash flows.
Our businesses are cyclical in nature and sensitive to changes in general economic conditions, including, in particular, conditions in the North American
housing and construction-based markets. Housing starts and new nonresidential construction in the United States still remain low by historical standards.
Further, the residential and non-residential repair and remodel market, which accounts for the largest portion of our sales, decreased over the prior year,
following modest year over year increases, after years of substantial decline. Since January 2007, we permanently closed or temporarily idled certain of our
highest cost gypsum wallboard, paper and other production facilities. We have recorded long-lived asset impairment charges aggregating approximately
$175 million since January 2007 related to these closures and idled facilities. If our markets do not return to historic levels, or if they experience future
downturns, additional material write-downs or impairment charges may be required in the future.
We cannot predict the duration of the current market conditions, or the timing or strength of any recovery of the housing and construction-based
markets, which may depend on broader economic issues such as employment, the availability of credit, lending practices, interest rates, foreclosures, house
price trends, availability of mortgage financing, income tax policy, and consumer confidence and preference. We also cannot provide any assurances that the
housing and construction-based markets will continue to recover, or that further operational adjustments will not be required to address market conditions.
Continued weakness, delays in recovery, or future downturns in the housing and construction-based markets may have a material adverse effect on our
business, financial condition, operating results and cash flows.
Prices for our products are affected by overall supply and demand in the markets for our products and our competitors products. Market prices of
building products historically have been volatile and cyclical. Currently, there is significant excess wallboard production capacity industry wide in the
United States. Further, a majority of our businesses are seasonal, which has caused in the past, and will likely cause in the future, our quarterly results to vary
significantly from quarter to quarter. A prolonged continuation of weak demand or excess supply in any of our businesses may have a material adverse effect
on our business, financial condition, operating results and cash flows. We recently implemented a price increase for wallboard with the new price for January
1, 2015 through October 31, 2015. However, it is uncertain that we will be able to maintain the increase in our gypsum wallboard selling prices. If we are
unable to maintain our price increases, our net sales and operating profit may be materially and adversely impacted.
Our customers and suppliers are exposed to risks associated with economic and financial conditions that could adversely affect their payment of our
invoices or the continuation of their businesses at the same level.
The businesses of many of our customers and suppliers are exposed to risks related to the current economic environment. A number of our customers and
suppliers have been and may continue to be adversely affected by weak financial conditions in their markets, disruptions to the capital and credit markets
and decreased demand for their products and services. In the event that any of our large customers or suppliers, or a significant number of smaller customers or
suppliers, are adversely affected by these risks, we may face disruptions in supply, further reductions in demand for our products and services, failure of
customers to pay invoices when due and other adverse effects that may have a material adverse effect on our business, financial condition, operating results
and cash flows.
Our substantial indebtedness may adversely affect our business, financial condition and operating results.
We have a substantial amount of indebtedness. As of December 31, 2014, we had $2.209 billion of total debt, consisting of senior notes, industrial revenue
bonds and outstanding borrowings under our ship mortgage facility. Our substantial indebtedness may have material adverse effects on our business,
financial condition and operating results, including to:

make it more difficult for us to satisfy our debt service obligations or refinance our indebtedness;
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require us to dedicate a substantial portion of our cash flows from operations to payments on our indebtedness, thereby reducing the availability
of our cash flows to fund working capital, capital expenditures and other general operating requirements;

limit our ability to obtain additional financing to fund our working capital requirements, capital expenditures, acquisitions, investments, debt
service obligations and other general corporate requirements;

restrict us from making strategic acquisitions, taking advantage of favorable business opportunities or executing our strategic priorities;

place us at a relative competitive disadvantage compared to our competitors that have proportionately less debt;

limit our flexibility to plan for, or react to, changes in our businesses and the industries in which we operate, which may adversely affect our
operating results and ability to meet our debt service obligations;

increase our vulnerability to the current and potentially more severe adverse general economic and industry conditions; and

limit our ability, or increase the cost, to refinance our indebtedness.

Under the terms of our debt instruments, we are permitted to incur substantial additional indebtedness. If we incur additional indebtedness, the risks related to
our substantial indebtedness may intensify.
We require a significant amount of liquidity to service our indebtedness and fund operations, capital expenditures, research and development efforts,
acquisitions and other corporate expenditures.
Our ability to fund operations, capital expenditures, research and development efforts, acquisitions and other corporate expenditures, including repayment of
our indebtedness, depends on our ability to generate cash through future operating performance, which is subject to economic, financial, competitive,
legislative, regulatory and other factors. Many of these factors are beyond our control. We cannot ensure that our businesses will generate sufficient cash flow
from operations or that future borrowings or other financing will be available to us in an amount sufficient to pay our indebtedness or to fund our other needs.
We are required to post letters of credit or cash as collateral primarily in connection with our hedging transactions, insurance programs and bonding
activities. The amounts of collateral we are required to post may vary based on our financial position and credit ratings. Use of letters of credit as collateral
reduces our borrowing availability under our domestic revolving credit agreement and, therefore, like the use of cash as collateral, reduces our overall
liquidity and our ability to fund other business activities.
If we are unable to generate sufficient cash flow to fund our needs, we may need to pursue one or more alternatives, such as to:

curtail our operations;

reduce or delay planned capital expenditures, research and development or acquisitions;

seek additional financing or restructure or refinance all or a portion of our indebtedness at or before maturity;

sell assets or businesses; or

sell additional equity.

Any curtailment of operations, reduction or delay in planned capital expenditures, research and development or acquisitions, or any sales of assets or
businesses, may materially and adversely affect our future revenue prospects. In addition, we cannot ensure that we will be able to raise additional equity
capital, restructure or refinance any of our indebtedness or obtain additional financing on commercially reasonable terms or at all.
We face competition in each of our businesses. If we cannot effectively compete in the marketplace, our business, financial condition, operating results and
cash flows may be materially and adversely affected.
We face competition in each of our businesses. Principal methods of competition include quality and range of products, service, location, pricing,
compatibility of systems and product design features. Actions of our competitors, or the entry of new competitors in our markets, could lead to lower pricing
by us in an effort to maintain market share and could also lead to lower sales volumes. To achieve and/or maintain leadership positions in key product
categories, we must continue to develop brand
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recognition and loyalty, enhance product quality and performance, introduce new products and develop our manufacturing and distribution capabilities.
We also compete through our use and improvement of information technology. In order to remain competitive, we need to provide customers with
timely, accurate, easy-to-access information about product availability, orders and delivery status using state-of-the-art systems. While we have provided
manual processes for short-term failures and disaster recovery capability, a prolonged disruption of systems or other failure to meet customers expectations
regarding the capabilities and reliability of our systems may materially and adversely affect our operating results, particularly during any prolonged period of
disruption.
We intend to continue making investments in research and development to develop new and improved products and more efficient production
methods in order to maintain our market leadership position. If we do not make these investments, or our investments are not successful, our revenues,
operating results and market share could be materially and adversely affected. In addition, there can be no assurance that revenue from new products or
enhancements will be sufficient to recover the research and development expenses associated with their development.
Certain of our customers have significant buying power, which may materially and adversely affect our revenues, financial condition and operating
results.
Certain of our important customers are large companies with significant buying power. In addition, potential further consolidation in our distribution
channels could enhance the ability of certain of our customers to seek more favorable terms, including pricing, for the products that they purchase from us.
Accordingly, our ability to maintain or raise prices in the future may be limited, including during periods of raw material and other cost increases. If we are
forced to reduce prices or to maintain prices during periods of increased costs, or if we lose customers because of pricing or other methods of competition, our
revenues, financial condition and operating results may be materially and adversely affected.
The loss of sales to one or more of our major customers may have a material adverse effect on our business, financial condition, operating results and cash
flows.
We face strong competition for our major customers. If one or more of our major customers reduces, delays or cancels substantial orders, our business,
financial condition, operating results and cash flows may be materially and adversely affected, particularly for the period in which the reduction, delay or
cancellation occurs and also possibly for subsequent periods.
Significant changes in discount rates used to measure our defined benefit plan obligations, actual investment returns on pension assets and other factors
could negatively impact our operating results and cash flows.
We maintain defined benefit pension plans as well as other postretirement benefit plans for eligible employees. Our profit margins are affected by costs
related to maintaining these plans for active employees and retirees. The recognition of costs and liabilities associated with these plans for financial reporting
purposes is affected by the level of interest rates and assumptions made by management and used by actuaries engaged by us to calculate the projected and
accumulated benefit obligations and the annual expense recognized for these plans. The assumptions used in developing the required estimates primarily
include discount rates, expected return on plan assets for the funded plans, compensation increase rates, retirement rates, mortality rates and, for
postretirement benefits, health care cost trend rates. Economic and market factors and conditions could affect any of these assumptions and may affect our
estimated and actual employee benefit plan costs and our business, financial condition and operating results.
Our pension plans were underfunded by approximately $346 million as of December 31, 2014 and $114 million as of December 31, 2013. In recent
years, the declining interest rates and changes to mortality assumptions have negatively impacted the funded status of our pension plans. The asset
performance has been volatile since 2008, with plan assets outperforming in some years and underperforming in other years versus the assumed rate of return
used to determine pension expense. If the discount rates and actual asset returns increase or decrease, the funded status of our plan as well as the future
pension expense and funding obligations will decrease and increase, respectively.
If costs of key raw materials or energy increase, or the availability of key raw materials or energy decreases, our cost of products sold will increase and our
operating results or cash flows may be materially and adversely affected.
The cost and availability of raw materials and energy are critical to our operations. For example, we use substantial quantities of gypsum, wastepaper, mineral
fiber, steel, perlite and starch. The cost of certain of these items has been volatile, and availability has sometimes been limited. We obtain some of these
materials from a limited number of suppliers, which increases the risk of unavailability. We may not be able to pass increased raw material prices on to our
customers in the future if the market or
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existing agreements with our customers do not allow us to raise the prices of our finished products. If price adjustments for our finished products significantly
trail the increase in raw material prices, or if we cannot effectively hedge against price increases, our operating results or cash flows may be materially and
adversely affected.
Approximately half of the gypsum used in our wallboard plants is synthetic gypsum, which is a coal-combustion byproduct, or CCB, resulting
primarily from flue gas desulphurization carried out by electric generation or industrial plants burning coal as a fuel. Six of our 19 gypsum wallboard plants
in operation use synthetic gypsum for all of their needs, while another six use it for some of their needs. The suppliers of synthetic gypsum are primarily
power companies, and certain power companies have recently switched to using natural gas instead of coal for their electric generation needs. In the event
more power companies switch to using natural gas instead of coal, the availability of synthetic gypsum may decrease. Further, although the U.S. EPA issued a
final rule in December 2014 providing that there are no additional regulatory requirements on the use of synthetic gypsum, legal challenges to this final rule,
or subsequent state legislation, could result in laws or regulations that adversely affect the classification, use, storage and disposal of synthetic gypsum,
which may result in a material adverse effect on our business, financial condition, operating results and cash flows.
Energy costs also are affected by various market factors, including the availability of supplies of particular forms of energy, energy prices and local
and national regulatory decisions. Prices for natural gas and electrical power, which are significant components of the costs associated with production of our
gypsum and interior systems products, have been volatile in recent years. There may be substantial increases in the price, or a decline in the availability, of
energy in the future, especially in light of instability or possible dislocations in some energy markets.
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC has promulgated rules regarding disclosure of the presence in a
companys products of certain metals, known as conflict minerals, which are metals mined from the Democratic Republic of the Congo and adjoining
countries, as well as procedures regarding a manufacturers efforts to identify the sourcing of those minerals from this region. Complying with these rules
requires investigative efforts, which has and will continue to cause us to incur associated costs, and could adversely affect the sourcing, supply, and pricing
of materials used in our products, or result in process or manufacturing modifications, all of which could adversely affect our business, financial condition,
operating results and cash flows.
Fluctuations in the market price of natural gas may have a material adverse effect on our business, financial condition and operating results.
We use natural gas extensively in the production of gypsum and interior systems products in the United States, Canada and Mexico. As a result, our
profitability and cash flows can be highly dependent on the price of natural gas, which historically has been very volatile and is affected by numerous factors
beyond our control. We are not always able to pass on increases in energy costs to our customers through increases in product prices.
In an attempt to reduce our price risk related to fluctuations in natural gas prices, we enter into hedging agreements using swaps. We benefit from the
hedge agreements when spot prices exceed contractually specified prices. We are disadvantaged by the hedge agreements when spot prices are less than
contractually specified prices.
In addition, the results of our hedging agreements could be negative in any period depending on price changes in the hedged exposures. Further,
changes to the price of natural gas, including as a result of environmental or other legislation, could result in changes to the value of our hedging contracts,
which could impact our results of operations for a particular period. Our hedging activities are not designed to mitigate long-term natural gas price
fluctuations and, therefore, will not protect us from long-term natural gas price increases.
Any substantial or extended decline in prices of, or demand for, natural gas that has been hedged could cause our production costs to be greater than
those of our competitors. A significant production cost differential could have a material adverse effect on our business, financial condition, operating results
and cash flows.
Our exposure to the risks of operating internationally could adversely affect our business, financial condition, operating results and cash flows.
International business operations, including through UBBP, and our operations in Canada, Mexico, and Latin America, are becoming increasingly important
to our future operations, growth and prospects. Further, it is a strategic priority of ours to continue to grow and diversify our earnings by expanding in select
emerging markets. Our foreign operations and our international expansion strategy are subject to a number of risks, including:

compliance with United States laws affecting operations outside of the United States, such as the Foreign Corrupt Practices Act or similar antibribery laws and regulations;
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compliance with a variety of local regulations and laws;

changes in tax laws and the interpretation of those laws;

fluctuations in currency values;

sudden changes in foreign currency exchange controls;

discriminatory or conflicting fiscal policies;

difficulties enforcing intellectual property and contractual rights in certain jurisdictions;

greater risk of uncollectible accounts and longer collection cycles;

effective and immediate implementation of control environment processes across our diverse operations and employee base;

nationalization of properties by foreign governments; and

imposition of more or new tariffs, quotas, trade barriers, and similar restrictions on our sales outside the United States.

Moreover, political and economic changes or volatility, geopolitical regional conflicts, terrorist activity, political unrest, civil strife, acts of war,
epidemics, including the Ebola epidemic, public corruption and other economic or political uncertainties could interrupt and negatively affect our business
operations. All of these factors could result in increased costs or decreased revenues, and could materially and adversely affect our business, financial
condition, operating results and cash flows.
USG Boral Building Products reduces our control over certain of our assets and could give rise to disputes with Boral that could adversely affect our
business, financial condition, operating results and cash flows.
UBBP involves risks not otherwise present when we operate our business through wholly-owned entities. For example:

Certain major decisions with respect to UBBP require the majority or unanimous approval of the joint ventures boards or shareholders.
Accordingly, we may not be able to obtain approval of certain matters that would be in our best interests.

A deadlock with respect to certain fundamental decisions may result in the triggering of a sale process of UBBP. In such a case, the terms of the
sale may be less attractive than if we had held onto our investments.

UBBP is operated in accordance with the terms of a shareholders agreement (the "Shareholders Agreement") that limits our ability to transfer our
interest in UBBP. As a result, we may be unable to sell our interest in UBBP when we would otherwise like.

UBBP may not pay dividends if such payments are, among other things, restricted pursuant to the terms of the credit facilities maintained by
UBBP, inconsistent with the then-applicable strategic plan, or illegal. Accordingly, we may not receive dividend payments from UBBP in the
amounts that we currently anticipate or at all, which may adversely impact our ability to receive any economic benefit from UBBP.

If we or Boral, or certain of our respective affiliates, are subject to a change of control, or if certain other events of default under the Shareholders
Agreement occur with respect to us or Boral, we or Boral, as applicable, may be required to sell our or Boral's, as applicable, entire interest in
UBBP at fair market value, as determined in accordance with the Shareholders Agreement. In the event we are forced to sell our interest in UBBP,
it may be under terms that are not advantageous to us. In the event Boral is forced to sell its interest in UBBP, and we are unable to acquire Boral's
interest due to lack of funding or otherwise, we would not have the right to select the third party to which Boral would sell its interest.

We have provided unconditional and irrevocable guarantees of the obligations of our subsidiaries under two share sale and subscription
agreements and the Shareholders Agreement (together, the Joint Venture Agreements) and have agreed to indemnify Boral and its subsidiaries
for all losses, actions, proceedings and judgments resulting from any default or delay in performance by our subsidiaries thereunder. Any such
payments may have a material adverse effect on our business, financial condition and operating results.

In certain circumstances, a capital call may be issued to the shareholders of UBBP in order to obtain additional funding for the joint ventures'
operations. If we do not provide capital and Boral does, Boral may receive additional shares in UBBP, thereby diluting our interest and impairing
our rights under the Shareholders Agreement.
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Boral may become insolvent, refuse to make additional capital contributions or fail to meet its obligations under the Joint Venture Agreements,
which may result in certain liabilities to us for guarantees and other commitments.

Boral may have economic or other business interests or goals that are or become inconsistent with our interests or goals, or we may become
engaged in a dispute with Boral that could require us to spend additional resources to resolve such dispute and have an adverse impact on the
operations and profitability of UBBP.

In the event we exit UBBP, we may be restricted from competing in certain markets, many of which we anticipate to be high-growth markets, until
the later of the third anniversary of our exit and ten years from the commencement of UBBP.

If any of these risks were to materialize, our business, financial condition, operating results and cash flows could be negatively impacted.
Our business, financial condition and operating results could be materially and adversely affected by infringement or misappropriation of our intellectual
property and other proprietary rights.
Our success depends, in part, upon our intellectual property rights. We rely on a combination of contractual rights, copyright, trademark and trade secret laws
to establish and protect our intellectual property. We also maintain patents for certain of our technologies. We customarily require our employees and
independent contractors to execute confidentiality agreements or otherwise to agree to keep our proprietary information confidential when their relationship
with us begins. In addition, we have entered into certain contractual intellectual property protections in connection with the licensure and use of our
intellectual property by UBBP.
Despite our efforts, the steps we have taken to protect our intellectual property may be inadequate. Existing trade secret, patent, trademark and
copyright laws offer only limited protection. Our patents could be invalidated or circumvented. In addition, others may develop substantially equivalent or
superseding proprietary technology, or competitors may offer similar competing products that do not infringe on our intellectual property rights, thereby
substantially reducing the value of our proprietary rights.
Moreover, the laws of some foreign countries in which our products are or may be manufactured or sold may not protect our products or intellectual
property rights to the same extent as do the laws of the United States. This risk may be heightened in connection with our investments in UBBP, because it
results in the use of our intellectual property in additional foreign jurisdictions, some of which lack robust or accessible intellectual property protection
enforcement mechanisms.
From time to time, litigation may be necessary to defend and enforce our proprietary rights. As a result, we could incur substantial costs and divert
management resources, which could harm our business, regardless of the final outcome. Despite our efforts to safeguard and maintain our intellectual property
rights, both in the United States and abroad, we may be unsuccessful in doing so, which could materially and adversely affect our business, financial
condition, operating results and cash flows.
A security breach of customer, employee, supplier or company information may have a material adverse effect on our business, financial condition and
operating results.
In the conduct of our business we collect, use, transmit and store data on information systems, which are vulnerable to an increasing threat of continually
evolving cybersecurity risks. Any security breach or compromise of our information systems could significantly damage our reputation, cause the disclosure
of confidential customer, employee, supplier or company information, including our intellectual property, and result in significant losses, litigation, fines and
costs. While we have implemented processes to protect against unauthorized access to our information systems and data, there is no guarantee that these
procedures are adequate or will be able to prevent breaches. The regulatory environment related to information security, data collection and privacy is
evolving, with new and constantly changing requirements applicable to our business, and compliance with those requirements could result in additional
costs.
Covenant restrictions under the agreements governing our indebtedness may limit our ability to pursue business activities or otherwise operate our
business.
The agreements governing our indebtedness contain covenants that may limit our ability to finance future operations or capital needs or to engage in other
business activities, including, among other things, our ability to:

incur additional indebtedness;

pay dividends

make guarantees;
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sell assets or make other fundamental changes;

engage in mergers and acquisitions;

make investments;

enter into transactions with affiliates;

change our business purposes; and

enter into sale and lease-back transactions.

In addition, we are subject to agreements that may require us to meet and maintain certain financial ratios and tests, which may require that we take
action to reduce our debt or to act in a manner contrary to our current or future business plans. General business and economic conditions may affect our
ability to comply with these covenants or meet those financial ratios and tests.
A breach of any of our credit agreement or indenture covenants or failure to maintain a required ratio or meet a required test may result in an event of
default under those agreements. This may allow the counterparties to those agreements to declare all amounts outstanding thereunder, together with accrued
interest, to be immediately due and payable. If this occurs, we may not be able to refinance the accelerated indebtedness on favorable terms, or at all, or repay
the accelerated indebtedness.
We are subject to environmental and safety laws and regulations that may change. These laws and regulations could cause us to make modifications to
how we manufacture and price our products. They could also require that we make significant capital investments or otherwise increase our costs.
We are subject to federal, state, local and foreign laws and regulations governing the protection of the environment and occupational health and safety,
including laws regulating air emissions, wastewater discharges, the management and disposal of hazardous materials and wastes, and the health and safety of
our employees. We are also required to obtain permits from governmental authorities for certain operations. If we were to fail to comply with these laws,
regulations or permits, we could incur fines, penalties or other sanctions. In addition, we could be held responsible for costs and damages arising from any
contamination at our past or present facilities or at third-party waste disposal sites. We cannot completely eliminate the risk of contamination or injury
resulting from hazardous materials. Environmental laws and regulations tend to become more stringent over time, and we could incur material expenses
relating to compliance with future environmental laws. Further, new environmental and safety legislation may have a material and adverse impact on our
operations and results. For example, although the U.S. EPA issued a final rule in December 2014 providing that there are no additional regulatory
requirements on the use of synthetic gypsum, one of our primary raw materials, legal challenges to this final rule, or subsequent state legislation, could result
in laws or regulations that adversely affect the classification, use, storage and disposal of synthetic gypsum, which may result in a material adverse effect on
our business, financial condition, operating results, and cash flows. In addition, the Occupational Safety and Health Administration has proposed a
comprehensive occupational health standard for crystalline silica which would, among other things, lower the permissible occupational exposure limits. We
could incur substantial costs in connection with complying with this rule as proposed.
The price and availability of certain of the raw materials that we use may vary in the future as a result of environmental laws and regulations affecting
our suppliers. An increase in the price of our raw materials, a decline in their availability or future costs relating to our compliance with environmental laws
and regulations may materially and adversely affect our operating margins or result in reduced demand for our products.
The U.S. Congress, several states and the international community are considering measures to reduce emission of greenhouse gases (GHGs), including
carbon dioxide and methane. Some states and provinces have already adopted greenhouse gas regulation or legislation. Following a finding by the U.S. EPA
that certain GHGs represent an endangerment to human health, the U.S. EPA adopted two sets of rules regulating GHG emissions under the Clean Air Act, one
that requires a reduction in emissions of GHGs from motor vehicles and another that regulates emissions of GHGs from certain large stationary sources. These
rules, if they withstand legal challenge, could affect all of our U.S. wallboard and ceiling tile plants and paper mills and would require that we incur
significant costs to satisfy permitting requirements. In addition, enactment of new climate control legislation, regulatory initiatives or treaties impacting the
locations where we conduct business could have a materially adverse effect on our operations and demand for our services or products. For example, any new
legislation, such as a carbon tax on energy use or establishing a cap and trade, could materially and adversely increase the cost of energy used in our
manufacturing processes. If energy becomes more expensive, we may not be able to pass these increased costs on to purchasers of our products. Further,
stricter regulation of emissions might require us to install emissions controls or other equipment at some or all of our manufacturing facilities, requiring
significant additional capital investments.
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We may pursue acquisitions, joint ventures and other transactions that complement or expand our businesses. We may not be able to complete proposed
transactions, and even if completed, the transactions may involve a number of risks that may result in a material adverse effect on our business, financial
condition, operating results and cash flows.
As business conditions warrant and our financial resources permit, we may pursue opportunities to acquire businesses or technologies and to form joint
ventures that we believe could complement, enhance or expand our current businesses or product lines or that might otherwise offer us growth opportunities.
We may have difficulty identifying appropriate opportunities, or if we do identify opportunities, we may not be successful in completing transactions for a
number of reasons. Any transactions that we are able to identify and complete, including UBBP, may involve one or more of a number of risks, including:

the diversion of managements attention from our existing businesses to integrate the operations and personnel of the acquired business or joint
venture;

possible adverse effects on our operating results during the integration process;

failure of the acquired business or joint venture to achieve expected operational, profitability and investment return objectives;

the incurrence of significant charges, such as asset devaluation or restructuring charges;

the incurrence of unanticipated liabilities and costs for which indemnification is unavailable or inadequate; and

the inability to achieve other intended objectives of the transaction.

In addition, we may not be able to successfully or profitably integrate, operate, maintain and manage our newly acquired operations or their employees. We
may not be able to maintain uniform standards, controls, procedures and policies, which may lead to operational inefficiencies. In addition, future
acquisitions may result in dilutive issuances of equity securities or the incurrence of additional indebtedness.
Our financial results may be affected by various legal and regulatory proceedings, including those involving antitrust, tax, environmental, or other
matters.
We are subject to litigation and regulatory proceedings in the normal course of business and could become subject to additional claims in the future, some of
which could be material. The outcome of existing legal proceedings may differ from our expectations because the outcomes of litigation and similar disputes
are often difficult to predict reliably. Various factors and developments can lead to changes in current estimates of liabilities and related insurance
receivables, where applicable, or make additional estimates, including new or modified estimates that may be appropriate due to a judicial ruling or
judgment, a settlement, regulatory developments or changes in applicable law. A future adverse ruling, settlement or unfavorable development could result in
charges that could have a material adverse effect on our results of operations in any particular period. For a more detailed discussion of certain of the legal
proceedings in which we are involved, see Item 3, Legal Proceedings, below.
If we experience an ownership change within the meaning of the Internal Revenue Code, utilization of our net operating loss, or NOL, carryforwards
would be subject to an annual limitation.
The Internal Revenue Code imposes limitations on a corporations ability to utilize NOLs to reduce its federal income taxes if it experiences an ownership
change. In general terms, an ownership change may result from transactions increasing the ownership of certain stockholders in the stock of a corporation by
more than 50 percentage points over a three-year period. If we were to experience an ownership change, utilization of our NOLs would be subject to an
annual limitation determined by multiplying the market value of our outstanding shares of stock at the time of the ownership change by the applicable longterm tax-exempt rate (which was 2.80% for December 2014). Any unused annual limitation may be carried over to later years within the allowed NOL
carryforward period. The amount of the limitation may, under certain circumstances, be increased or decreased by built-in gains or losses held by us at the
time of the change that are recognized in the five-year period after the change. Many states have similar limitations. If an ownership change had occurred as
of December 31, 2014, our annual U.S. federal NOL utilization would have been limited to approximately $113 million per year.
We may use our NOL carryforwards to offset future earnings and reduce our federal income tax liability. As a result, we believe these NOL
carryforwards are a substantial asset for us. We have a stockholder rights plan, or the Rights Agreement, in place to protect our stockholders from coercive
takeover practices or takeover bids that are inconsistent with their best interests. On March 22, 2013 and February 11, 2015, our board of directors approved
amendments to the Rights Agreement in an effort to protect our NOLs. In addition, our Restated Certificate of Incorporation includes an amendment, the
Protective Amendment, that restricts certain transfers of our common stock. The Protective Amendment is intended to protect the tax benefits of our
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NOLs. See Note 20 to the consolidated financial statements in Part II, Item 8 of this report for a description of the amendment to the Rights Agreement and the
Protective Amendment. Although the amendment to the Rights Agreement and Protective Amendment are intended to reduce the likelihood of an
ownership change that could adversely affect us, we cannot provide assurance that the restrictions on transferability in the amendment to the Rights
Agreement and Protective Amendment will prevent all transfers that could result in such an ownership change. There also can be no assurance that the
transfer restrictions in the Protective Amendment will be enforceable against all of our shareholders absent a court determination confirming such
enforceability. The transfer restrictions may be subject to challenge on legal or equitable grounds.
A small number of our stockholders could significantly influence our business, affairs and stock price.
Based on filings made with the SEC and other information available to us, we believe that, as of January 31, 2015, two stockholders collectively controlled
over 40% of our common stock. Accordingly, a small number of our stockholders could affect matters requiring approval by stockholders, including the
election of directors and the approval of potential business combination transactions. In addition, if one or more of these stockholders sell a large number of
our shares, our share price may decline, and could then continue to trade at lower prices.
We have outsourced certain corporate and operational functions, which makes us more dependent on third parties.
We have outsourced certain elements of our corporate and operational functions, including certain elements of our finance, accounting and information
technology functions, to third party service providers, some of whom operate outside of the United States. We may outsource additional functions in the
future. As a result, we rely on third parties to ensure that these functions are sufficiently performed. This reliance subjects us to risks arising from the loss of
control over certain processes, changes in pricing that may affect our operating results, and the termination of provision of these services by our suppliers. A
failure of our service providers to satisfactorily perform these functions may have an adverse effect on our business and operating results.
Our continuing efforts to return to historic levels of profitability by reducing costs may not result in the anticipated savings in operating costs.
We have implemented various cost reduction programs to lower our breakeven and return to historic levels of profitability, including plant and distribution
branch closures, workforce reductions, outsourcing of corporate and operational function and Lean Six Sigma initiatives. We may implement additional
programs in the future. These cost reduction programs may not produce anticipated results. Our ability to achieve cost savings and other benefits within
expected time frames is subject to many estimates and assumptions. These estimates and assumptions are subject to significant economic, competitive and
other uncertainties, some of which are beyond our control. If these estimates and assumptions are incorrect, if we experience delays, if anticipated market
recovery does not occur, or if other unforeseen events occur, our business, financial condition, operating results and cash flows could be adversely impacted.
We do not expect to pay cash dividends on our common stock for the foreseeable future.
We have not paid a dividend on our common stock since the first quarter of 2001 and have no plans to do so in the foreseeable future. Further, our credit
agreement limits our ability to pay a dividend or repurchase our stock unless specified borrowing availability and fixed charge coverage ratio tests are met,
and it prohibits payment of a dividend if a default exists under the agreement. Because we do not expect to pay dividends on our common stock in the
foreseeable future, investors in our common stock will have to rely on the possibility of stock appreciation for a return on their investment.
Item 1B.

UNRESOLVED STAFF COMMENTS

None
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Item 2.

PROPERTIES

We operate plants, mines, quarries, transport ships and other facilities in North America, South America and other regions. U.S. Gypsums SHEETROCK
brand gypsum wallboard plants operated at approximately 56% of capacity during 2014. USG Interiors ceiling tile plants operated at approximately 77% of
capacity during 2014. The locations of our production properties in operation as of December 31, 2014, grouped by reportable segment, are as follows (plants
are owned unless otherwise indicated):
Gypsum
GYPSUM WALLBOARD AND OTHER GYPSUM PRODUCTS

Aliquippa, Pennsylvania*
Baltimore, Maryland**
Bridgeport, Alabama*
East Chicago, Indiana*
Galena Park, Texas*
Jacksonville, Florida**
Norfolk, Virginia*

Plaster City, California

Rainier, Oregon
Shoals, Indiana**
Sigurd, Utah
Sperry, Iowa**
Sweetwater, Texas
Washingtonville, Pennsylvania*

Hagersville, Ontario, Canada**

Montreal, Quebec, Canada **
Monterrey, Nuevo Leon, Mexico
Puebla, Puebla, Mexico
Tecoman, Colima, Mexico

JOINT COMPOUND (SURFACE PREPARATION AND JOINT TREATMENT PRODUCTS)

Auburn, Washington
Baltimore, Maryland
Bridgeport, Alabama
Chamblee, Georgia
Dallas, Texas
East Chicago, Indiana*
Fort Dodge, Iowa

Galena Park, Texas

Gypsum, Ohio
Jacksonville, Florida
Phoenix (Glendale), Arizona
Port Reading, New Jersey
Sigurd, Utah
Torrance, California

Calgary, Alberta, Canada***

Hagersville, Ontario, Canada
Montreal, Quebec, Canada
Surrey, British Columbia, Canada***
Monterrey, Nuevo Leon, Mexico
Puebla, Puebla, Mexico
Buenos Aires, Argentina***
Lima, Peru

New Orleans, Louisiana

Monterrey, Nuevo Leon, Mexico

Sigurd, Utah
Southard, Oklahoma
Sperry, Iowa
Sweetwater, Texas

Hagersville, Ontario, Canada

Little Narrows, Nova Scotia, Canada
Monterrey, Nuevo Leon, Mexico
San Luis Potosi, San Luis Potosi, Mexico
Tecoman, Colima, Mexico

CEMENT BOARD

Baltimore, Maryland
Detroit (River Rouge), Michigan
GYPSUM ROCK (MINES AND QUARRIES)

Alabaster (Tawas City), Michigan

Fort Dodge, Iowa
Plaster City, California
Shoals, Indiana
PAPER FOR GYPSUM WALLBOARD

Galena Park, Texas

North Kansas City, Missouri
*
**
***

Oakfield, New York

Otsego, Michigan

Plants supplied fully by synthetic gypsum

Plants supplied partially by synthetic gypsum
Leased
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OTHER PRODUCTS

We operate a mica-processing plant at Spruce Pine, North Carolina. We manufacture metal lath, plaster and drywall accessories and light gauge steel framing
products at Monterrey, Nuevo Leon, Mexico, and Puebla, Puebla, Mexico. We produce plaster products at Southard, Oklahoma; Puebla, Puebla, Mexico;
Saltillo, Coahuila, Mexico; and San Luis Potosi, San Luis Potosi, Mexico. We manufacture paper-faced metal corner bead at Auburn, Washington and
Weirton, West Virginia (leased). We also manufacture cement panels at a manufacturing facility in Delavan, Wisconsin (leased).
OCEAN VESSELS

Gypsum Transportation Limited, or GTL, our wholly owned subsidiary, owns two, and leases one, self-unloading ocean vessel. Prior to 2012, these vessels
were used primarily to transport gypsum rock from our Nova Scotia quarries to our East Coast plants. However, due to the increased use of synthetic gypsum
in the manufacture of wallboard at our East Coast plants, the utilization of these vessels dropped significantly. Accordingly, we sought an alternate use for
the vessels and currently transship iron ore for a third party on a temporary basis. See Note 14 to the consolidated financial statements in Part II, Item 8, of this
report.
Ceilings
CEILING GRID

Cartersville, Georgia
Westlake, Ohio

Stockton, California

Oakville, Ontario, Canada

A coil coater and slitter plant used in the production of ceiling grid is located in Westlake, Ohio. A slitter plant is located in Stockton, California
(leased).
CEILING TILE

Cloquet, Minnesota

Greenville, Mississippi

Walworth, Wisconsin

OTHER PRODUCTS

We manufacture mineral fiber products at Red Wing, Minnesota, and Walworth, Wisconsin, and metal specialty systems at Oakville, Ontario, Canada.
Item 3. LEGAL PROCEEDINGS
See Part II, Item 8, Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements, Note 22, Litigation, for information on legal
proceedings, which information is incorporated herein by reference.
Item 4. MINE SAFETY DISCLOSURES
The information concerning mine safety violations or regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer
Protection Act and Item 104 of Regulation S-K promulgated by the SEC is included in Exhibit 95 to this report.
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PART II
Item 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
Our common stock trades on the New York Stock Exchange, or NYSE, and the Chicago Stock Exchange under the symbol USG. The NYSE is the principal
market for our common stock. As of January 31, 2015, there were 2,482 record holders of our common stock. We currently do not pay dividends on our
common stock. Our credit agreement restricts our ability to pay cash dividends on, or repurchase, our common stock. See Item 8, Financial Statements and
Supplementary Data, Note 7, Debt, for more information regarding these restrictions.
We did not purchase any of our equity securities during the fourth quarter of 2014.
See Part III, Item 12, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters, for information regarding
common stock authorized for issuance under equity compensation plans.
Pursuant to our Deferred Compensation Program for Non-Employee Directors, four of our non-employee directors deferred the $120,000 annual grant
they were entitled to receive on December 31, 2014 under our Non-Employee Director Compensation Program, into a total of 17,091 deferred stock units.
These units will increase or decrease in value in direct proportion to the market value of our common stock and will be paid in cash or shares of common
stock, at each directors option, following termination of service as a director. The issuance of these deferred stock units was effected through a private
placement under Section 4(a)(2) of the Securities Act and was exempt from registration under Section 5 of the Securities Act.
COMMON STOCK PRICES

The high and low sales prices of our common stock in 2014 and 2013 were as follows:
2014
High
First quarter

2013
Low

35.85

High
28.41

Low
30.44

26.44

Second quarter

33.16

29.20

29.25

22.19

Third quarter

30.04

26.45

28.58

23.06

Fourth quarter

29.65

24.55

28.77

25.13

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PERFORMANCE GRAPH

The following graph and table compare the cumulative total stockholder return on our common stock with the Standard and Poors 500 Index, or S&P 500,
and the Dow Jones U.S. Construction and Materials Index, or DJUSCN, in each case assuming an initial investment of $100 and full dividend reinvestment,
for the five-year period ended December 31, 2014.

Value of Investment as of December 31

2009
USG

2010
100

2011
120

2012
72

2013
200

2014
202

199

S&P 500

100

115

117

136

180

205

DJUSCN

100

120

112

157

203

200

All amounts are rounded to the nearest dollar.

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Item 6.

SELECTED FINANCIAL DATA

(millions, except per-share and employee data)

Years Ended December 31,

2014

2013

2012

2011 (a)

2010 (a)

Statement of Operations Data:

Net sales

3,724

Cost of products sold

3,570

3,224

2,910

2,834

3,070

2,989

2,829

2,752

2,697

Gross profit

654

581

395

158

137

Selling and administrative expenses

339

320

304

289

295

Litigation settlement charge (b)

48

Long-lived asset impairment charges (c)

90

53

58

Contract termination charge and loss on receivable (d)

15

Restructuring charges

10

22

52

Operating profit (loss)

162

258

73

(206)

(268)

35

Income from equity method investments

Interest expense

(179)

Interest income

(203)

(206)

(211)

(183)

Loss on extinguishment of debt

(41)

Gain on deconsolidation of subsidiaries and consolidated joint ventures (e)

27

Other expense, net

Income (loss) from continuing operations before income taxes

46

59

Income tax (expense) benefit

(7)

(11)

(12)

14

37

Income (loss) from continuing operations

39

48

(182)

(396)

(410)

(170)

(1)

(410)

(447)

Income (loss) from discontinued operations, net of tax

(1)

(2)

Gain on sale of discontinued operations, net of tax

55

Net income (loss)

38

46

(125)

(1)

Less: Net income (loss) attributable to noncontrolling interest

Net income (loss) attributable to USG

37

47

(390)

1
$

(126)

(405)

(390)

(405)

Income (loss) from continuing operations per common share:

Basic

0.27

0.45

(1.72)

(3.81)

(4.08)

Diluted

0.26

0.44

(1.72)

(3.81)

(4.08)

Balance Sheet Data (as of the end of the year):

Working capital

589

Current ratio

2.05

Cash and cash equivalents

1,132

2.99

776

2.41

715

2.36

924
2.75

228

810

546

365

629

Property, plant and equipment, net

1,908

2,103

2,100

2,104

2,252

Total assets

3,994

4,121

3,723

3,719

4,087

Long-term debt (f)

2,205

2,292

2,305

2,297

2,301

408

662

19

156

619

Total stockholders equity

Other Information:
Capital expenditures

132

124

70

54

38

Closing stock price per common share as of December 31

27.99

28.38

28.07

10.16

16.83

Average number of employees (g)

8,928

8,732

8,758

8,880

9,450

(a) Amounts reflected above have been adjusted from the originally reported amounts to reflect our European businesses, which were sold on December 27, 2012, as discontinued
operations. See Note 4 to our consolidated financial statements in Item 8 of this report.
(b) Reflects a charge related to the settlement of the U.S. wallboard pricing class action lawsuit. See Note 22 to our consolidated financial statements in Item 8 of this report.
(c) Reflects long-lived asset impairment charges on certain manufacturing facilities, capitalized costs for the construction of future facilities and ocean vessels. See Note 13 and Note
14 to our consolidated financial statements in Item 8 of this report.
(d) Item relates to our GTL operations. See Note 14 to our consolidated financial statements in Item 8 of this report.
(e) Reflects the gain recorded on the deconsolidation and contribution to UBBP of our wholly-owned subsidiaries in Singapore, Malaysia, New Zealand, and Australia and our
consolidated joint ventures in Oman.
(f) Amounts reflected above exclude currently maturing portion of long-term debt.
(g) As of December 31, 2014, we had approximately 8,900 employees worldwide. For 2011 and 2010, the average number of employees includes employees from both our
discontinued operations and our entities contributed to UBBP. For 2012 and 2013, the average number of employees includes employees from our entities contributed to UBBP.

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Item 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
Through our subsidiaries, we are a leading manufacturer and distributor of building materials. We produce a wide range of products for use in new residential,
new nonresidential, and residential and nonresidential repair and remodel construction as well as products used in certain industrial processes. We estimate
that during 2014

residential and nonresidential repair and remodel activity accounted for approximately 53% of our net sales,

new residential construction accounted for approximately 18% of our net sales,

new nonresidential construction accounted for approximately 24% of our net sales, and

other activities accounted for approximately 5% of our net sales.

SEGMENTS

Effective April 1, 2014, we changed the composition of our reportable segments to reflect the change in management over our businesses in Mexico and
Latin America. Additionally, with the contribution of our businesses in the Asia-Pacific region, India and Oman into the 50/50 joint ventures, USG Boral
Building Products, or UBBP, we have determined UBBP to be our fourth reportable segment. See further discussion below under Ceilings and UBBP. As a
result of these changes, our Mexico and Latin America businesses have been combined, and their Gypsum results have been included within our Gypsum
segment, previously referred to as North American Gypsum, and their Ceiling results have been included within our Ceilings segment, previously referred to
as Worldwide Ceilings. Our prior period results have been recast to reflect these changes and present comparative year-over-year results.
Our operations are organized into four segments: Gypsum, Ceilings, Distribution, and UBBP.
Gypsum: Previously referred to as North American Gypsum, our Gypsum segment manufactures and markets gypsum and related products in the United
States, Canada, Mexico and Latin America. It includes United States Gypsum Company, or U.S. Gypsum, in the United States, the gypsum business of CGC
Inc., or CGC, in Canada, the gypsum businesses of USG Mexico, S.A. de C.V., or USG Mexico, along with our gypsum businesses in Latin America. Gypsums
products are used in a variety of building applications to finish the walls, ceilings and floors in residential, commercial and institutional construction and in
certain industrial applications. Its major product lines include USG Sheetrock brand gypsum wallboard, a line of joint compounds used for finishing
wallboard joints also sold under the SHEETROCK brand name, DUROCK brand cement board, FIBEROCK brand gypsum fiber panels and
SECUROCK brand glass mat sheathing used for building exteriors and gypsum fiber and glass mat panels used as roof cover board.
Ceilings: Previously referred to as Worldwide Ceilings, our Ceilings reportable segment manufactures and markets interior systems products in the United
States, Canada, Mexico and Latin America. Ceilings includes USG Interiors, LLC, or USG Interiors, the ceilings business of CGC, and our ceilings businesses
in Mexico and Latin America. In addition, through February 27, 2014, it also included our businesses in the Asia-Pacific region, which were included in USG
International. Ceilings is a leading supplier of interior ceilings products used primarily in commercial applications. Ceilings manufactures ceiling tile in the
United States and ceiling grid in the United States, Canada and, through February 27, 2014, in the Asia-Pacific region. It markets ceiling tile and ceiling grid
in the United States, Canada, Mexico, Latin America and, through February 27, 2014, in the Asia-Pacific region.
As discussed below under Discontinued Operations and in Note 4 to our consolidated financial statements in Part II, Item 8 of this report, our European
business operations were classified as discontinued operations during the third quarter of 2012; therefore, the segment results for Ceilings exclude the results
of these operations. On December 27, 2012, the sale transaction was consummated and we received net proceeds of $73 million resulting in a gain of $55
million.
As discussed below under Key Strategies, on February 27, 2014, we invested with Boral in UBBP and in connection therewith contributed to UBBP
our operations in the Asia-Pacific region. As such, Ceilings includes the results and activities of our subsidiaries in the Asia-Pacific region only through
February 27, 2014.
Distribution: Previously referred to as Building Products Distribution, our Distribution segment consists of L&W Supply Corporation and its subsidiaries, or
L&W Supply, a leading distributor of gypsum wallboard and other building materials in the United States. It is a service-oriented business that stocks a wide
range of construction materials. It delivers less-than-truckload quantities of construction materials to job sites and places them in areas where work is being
done, thereby reducing the need for handling by contractors.
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USG Boral Building Products (UBBP): On February 27, 2014, we and certain of our subsidiaries formed 50/50 joint ventures, USG Boral Building Products
Pte. Limited, a company organized under the laws of Singapore, and USG Boral Building Products Pty Limited, a company organized under the laws of
Australia, with Boral Limited (Boral). These joint ventures are herein referred to as USG Boral Building Products, or UBBP. UBBP manufactures, distributes
and sells certain building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East (the
"Territory"). The products that UBBP manufactures and distributes include products for wall, ceiling, floor lining and exterior systems that utilize gypsum
wallboard, referred to as plasterboard in the region, mineral fiber ceiling tiles, steel grid and studs and joint compound.
As consideration for our 50% ownership in UBBP, we (i) made a $515 million cash payment to Boral, which includes a $500 million base price and
$15 million of customary working capital and net debt adjustments, contributed to UBBP our subsidiaries and joint venture investments in China, Singapore,
India, Malaysia, New Zealand, Australia and the Middle East, including our joint ventures in Oman, and granted to UBBP a license to use certain of our
intellectual property rights in the Territory. In the event certain performance targets are satisfied by UBBP, we will be obligated to pay Boral scheduled
earnout payments in an aggregate amount up to $75 million, comprised of $25 million based on performance during the first three years after closing and up
to $50 million based on performance during the first five years after closing.
UBBP is targeting the distribution of 50% of combined after tax profits to USG and Boral in proportion to the respective ownership interests; provided,
however, that UBBP will not pay dividends if such payments are, among other things, restricted pursuant to the terms of the credit facilities maintained by
UBBP, inconsistent with the then-applicable strategic plan, or illegal. Through December 31, 2014, no dividends have been declared or paid by UBBP. We
expect UBBP will begin to distribute cash dividends in 2015.
From February 27, 2014 through December 31, 2014, UBBP was funded from its net cash flows from operations and third-party financing, and it is our
intent that as an ongoing operation, UBBP will continue to self-fund.
As a result of the contribution of our wholly-owned subsidiaries in Singapore, India, Malaysia, New Zealand and Australia and our consolidated joint
ventures in Oman on February 27, 2014, the net sales and operating profit attributable to these entities are no longer included in those corresponding line
items on our consolidated statement of operations on a going forward basis. Instead, our share of the equity income from UBBP is shown within income from
equity method investments.
Our investments in UBBP are accounted for as equity method investments and were initially measured at cost. Our existing wholly-owned subsidiaries
and consolidated variable interest entities that were contributed into the joint ventures were deconsolidated, which resulted in a gain of $27 million during
the first quarter of 2014. Our investments in UBBP consummated on February 27, 2014, and as a result, our share of ten months of equity income from UBBP
is included in our accompanying consolidated statement of operations for the twelve months ended December 31, 2014.
Geographic Information: In 2014, 83% of our consolidated net sales were attributable to the United States. Canada accounted for 10% of our net sales, and
other foreign countries accounted for the remaining 7%.
In 2014, UBBP's net sales were comprised of 34% to Australia, 21% to South Korea, 13% to China, 14% to Thailand, and other foreign countries
accounted for the remaining 18%.
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FINANCIAL INFORMATION

Consolidated net sales increased for the fifth consecutive year in 2014, up $154 million, or 4%, compared to 2013. We had an operating profit of $162
million in 2014 compared to $258 million in 2013. Operating profit in 2014 included, among other items, $48 million in a litigation settlement charge, $90
million in asset impairment charges and $15 million in a contract termination charge and loss on receivable offset by a $12 million gain on sale of a surplus
property. Our income from continuing operations was $39 million, or $0.26 per diluted share, in 2014 compared to an operating income from continuing
operations of $48 million, or $0.44 per diluted share, in 2013. As of December 31, 2014, we had $382 million of cash and cash equivalents and marketable
securities compared with $952 million as of December 31, 2013. Our total liquidity was $673 million as of December 31, 2014 (including $291 million of
borrowing availability under our revolving credit facility) compared to $1.266 billion as of December 31, 2013 (including $314 million of borrowing
availability under our revolving credit facilities). Liquidity as of December 31, 2013 included the net proceeds of our $350 million notes offering completed
in October 2013, which we used, together with cash on hand, to fund our investments in UBBP on February 27, 2014.
KEY STRATEGIES

We continue to focus on the following strategic priorities:

strengthen our core businesses;

diversify our earnings by expanding in select emerging markets and growing our adjacent product lines; and

differentiate USG from our competitors through innovation.

In line with our strategy to diversify our earnings, on February 27, 2014, we and certain of our subsidiaries formed the 50/50 joint ventures, UBBP,
with Boral. UBBP manufactures, distributes and sells certain building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia,
Australasia and the Middle East (the "Territory"). The products that USG and Boral manufacture and distribute through UBBP include products for wall,
ceiling, floor lining and exterior systems that utilize gypsum plasterboard, mineral fiber ceiling tiles, steel grid and studs, joint compound and other products.
See Note 3 to the consolidated financial statements in Part II, Item 8 of this report for further information.
MARKET CONDITIONS AND OUTLOOK

Our businesses are cyclical in nature and sensitive to changes in general economic conditions, including, in particular, conditions in the North American
housing and construction-based markets, which are our most significant markets. The markets we serve can be broadly categorized as new residential
construction, new nonresidential construction and repair and remodel activity, which includes both residential and nonresidential construction.
For the new residential construction market, housing starts are a very good indicator of demand for our gypsum products. Installation of our gypsum
products typically follows a housing start by 90 to 120 days. Based on preliminary data reported by the U.S. Census Bureau, housing starts in the United
States increased 8.7% in 2014 to 1,005,800 compared with 924,900 in 2013. This followed an 18.7% increase in 2013 compared with 2012. For December
2014, the seasonally-adjusted annualized rate of housing starts was reported by the U.S. Census Bureau to be 1,089,000 units. While housing starts increased
for the fifth consecutive year in 2014, they are still low by historical standards. Industry analysts believe that the recovery in new residential construction will
continue, although the recovery over the next few years may be uneven and modest, and that over the longer term housing starts will begin to reach historical
averages. Industry analysts forecasts for 2015 housing starts in the United States included in the most recent Blue Chip Economic Indicators are 1,080,000 to
1,260,000 units, based upon the average of the bottom ten and top ten forecasts included in the report, respectively. We currently estimate that 2015 housing
starts in the United States will be at the middle of the range of 1,000,000 to 1,200,000.
Demand for our products from new nonresidential construction is determined by floor space for which contracts are signed. Installation of gypsum and
ceilings products typically follows signing of construction contracts by about 12 to 18 months. According to the most recent construction market forecast
from Dodge Data & Analytics (formerly known as McGraw Hill Construction), total floor space for which new nonresidential construction contracts were
signed in the United States increased 5% in 2014 compared with 2013. This followed a 12% increase in 2013 compared with 2012 and a 11% increase in
2012 compared with 2011. Dodge Data & Analytics forecasts that total floor space for which new nonresidential construction contracts in the United States
are signed will increase approximately 11% in 2015 from the 2014 level. Dodge Data & Analytics's forecast includes several building types which do not
generate significant demand for our products; therefore, we anticipate new nonresidential construction growth in our business sectors in 2015 compared to
2014 will be in the mid-single digits.
The repair and remodel market includes renovation of both residential and nonresidential buildings. As a result of the low levels of new home
construction in recent years, this market currently accounts for the largest portion of our sales. Many
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buyers begin to remodel an existing home within two years of purchase. According to the National Association of Realtors, sales of existing homes in the
United States decreased to approximately 4.93 million units in 2014, reflecting a 3% decrease from the 2013 level of 5.09 million units, which was a 9%
increase from 2012. Even with the slight decrease in the current year, existing home sales and home resale values have contributed to an increase for our
products from the residential repair and remodel market. We currently estimate that overall repair and remodel spending in 2014 increased approximately 1%
over the 2013 level and that overall repair and remodel spending growth in 2015, compared to 2014, will be in the low- to mid-single digits.
The rate of recovery in the new residential construction market, new nonresidential construction market and the repair and remodel market still remains
uncertain and will depend on broader economic issues such as employment, foreclosures, house price trends, availability of mortgage financing, interest rates,
income tax policy, consumer confidence, lease turnover rates, discretionary business investment, job growth and governmental building-related
expenditures.
We expect improvement over the next twelve months in the construction industries in our largest international markets, Canada and Mexico.
Emerging markets, including those that are within the territory of our 50/50 joint ventures, UBBP, provide opportunities for our operations to serve the
increasing demand for products in these regions. Although the rate of growth in certain emerging markets has slowed, we expect the growth in these markets
to exceed the improvements in North America. We anticipate that the results from UBBP will enable us to dampen some of the future cyclicality in our
business.
The housing and construction-based markets we serve are affected by broader economic issues such as employment, the availability of credit, lending
practices, interest rates, availability of mortgage financing, income tax policy and consumer confidence and preference. An increase in interest rates, high
levels of unemployment, restrictive lending practices, a decrease in consumer confidence or other adverse economic conditions could have a material adverse
effect on our business, financial condition, operating results and cash flows. Our businesses are also affected by a variety of other factors beyond our control,
including the inventory of unsold homes, the level of foreclosures, home resale rates, housing affordability, office and retail vacancy rates and foreign
currency exchange rates. Since we operate in a variety of geographic markets, our businesses are subject to the economic conditions in each of these
geographic markets. General economic downturns or localized downturns or financial concerns in the regions where we have operations may have a material
adverse effect on our business, financial condition, results of operations and cash flows.
During the last several years, our results of operations have been adversely affected by the economic downturn and uncertainty in the financial
markets. Although our Gypsum segment has improved with the modest recovery in residential housing over the last three years, it continues to be adversely
affected by the low level of residential and other construction activity compared to historical averages. Our Distribution segment, which serves the residential
and commercial markets, and our Ceilings segment, which primarily serves the commercial markets, have both showed some improvements, however, they
continued to be adversely affected by the low levels of new commercial construction activity.
Industry shipments of gypsum board in the United States (including gypsum wallboard, other gypsum-related paneling products and imports), as
reported by the Gypsum Association, were an estimated 21.8 billion square feet in 2014, up approximately 4% from 20.9 billion square feet in 2013.
U.S. Gypsum shipped 5.33 billion square feet of Sheetrock brand gypsum wallboard in 2014, a 4% increase from 5.14 billion square feet in 2013.
USG Sheetrock Brand UltraLight Panels accounted for approximately 63% and 55% of that volume in 2014 and 2013, respectively. U.S. Gypsums share of
the gypsum board market in the United States, which includes, for comparability, its shipments of Sheetrock brand gypsum wallboard, FIBEROCK brand
gypsum fiber panels and SECUROCK brand glass mat sheathing, was approximately 26% in 2014, unchanged from 2013.
There is excess wallboard production capacity industry-wide in the United States. Industry capacity in the United States was approximately 32.8
billion square feet as of January 1, 2015. We estimate that the industry capacity utilization rate was approximately 74% and 73% during the fourth quarters of
2014 and 2013, respectively and approximately 66% and 64% during the full years 2014 and 2013, respectively. Based on current industry trends and
forecasts, demand for gypsum wallboard is expected to increase in 2015, but the magnitude of any increase will depend on the levels of housing starts and
repair and remodel activity. We project that the industry capacity utilization rate will experience a modest increase in 2015 compared to 2014. Despite our
realization of improvement in our average wallboard selling price, we could experience pressure on gypsum wallboard selling prices and our gross margins at
such low levels of capacity utilization. U.S. Gypsum recently implemented a price increase for wallboard with the new price being set for January 1, 2015
through October 31, 2015. However, it is uncertain that we will be able to maintain the increase in our gypsum wallboard selling prices. If we are unable to
maintain our price increases, our net sales and operating profit may be materially and adversely impacted.
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Table of Contents

RESTRUCTURING, IMPAIRMENTS AND OTHER INITIATIVES

Since January 2007, we have temporarily idled or permanently closed approximately 3.8 billion square feet of our highest-cost wallboard, paper and other
production facilities. We have eliminated approximately 4,830 salaried and hourly positions from 2007 to 2012. As part of our efforts to reduce the cost
structure of our distribution business, we closed a total of 125 distribution branches during that same timeframe. During 2014, we recorded long-lived asset
impairment charges of $30 million on certain manufacturing facilities and capitalized costs. Additionally, in 2014, we recorded long lived asset impairment
charges of $60 million on two ocean vessels as a result of a terminated contract of affreightment with our trading partner who ceased operations in the fourth
quarter. See Notes 13 and 14 to our consolidated financial statements in Item 8 of this report.
Historically, the housing and other construction markets that we serve have been deeply cyclical. Downturns in demand are typically steep and last
several years, but they have typically been followed by periods of strong recovery. If the current recovery results in increases in demand similar to those
realized in recoveries from past cycles, we believe we will generate significant cash flows when our markets fully recover. However, this recovery could be
slower than recoveries in the past, as the most recent downturn was especially steep. We regularly monitor forecasts prepared by external economic forecasters
and review our facilities and other assets to determine which of them, if any, are impaired under applicable accounting rules. If the recovery in our markets is
delayed, or we experience a future downturn in the housing and construction-based markets, material write-downs or impairment charges may be required in
the future. The magnitude, likelihood and timing of those possible charges would be dependent on the severity and duration of the downturn, should the
downturn materialize, and cannot be determined at this time. Any material restructuring or impairment charges, including write-downs of property, plant and
equipment, would have a material adverse effect on our results of operations and financial condition. We will continue to monitor economic forecasts and
their effect on our facilities to determine whether any of our assets are impaired.
Our focus on costs and efficiencies, including capacity closures and overhead reductions, helped to mitigate the effects of the most recent downturn in
all of our markets. As economic and market conditions warrant, we will evaluate alternatives to further reduce costs, improve operational efficiency and
maintain adequate liquidity. Actions to reduce costs and improve efficiencies could require us to record additional restructuring charges. See Liquidity and
Capital Resources below for information regarding our cash position and credit facilities.
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Table of Contents

Consolidated Results of Operations

Favorable (Unfavorable)
2014 vs. 2013
(millions, except per-share data)
Net sales

2014
$

Cost of products sold

2013

3,724

2012

3,570

3,224

2013 vs. 2012

$
$

154

4%

346

(81)

(3)%

(160)

11 %
(6)%

3,070

2,989

2,829

Gross profit

654

581

395

73

13 %

186

47 %

Selling and administrative expenses

(6)%

(16)

(5)%

339

320

304

(19)

Litigation settlement charge

48

(48)

Long-lived asset impairment charges

90

(90)

100 %

Contract termination charge and loss on receivable

15

(15)

Restructuring charges

10

100 %

162

258

73

(96)

(37)%

185

35

34

Operating profit
Income from equity method investments
Interest expense

(179)

Interest income

(203)

(206)

24

12 %

(2)

(67)%

(1)

*
70 %

1%

Gain on deconsolidation of subsidiaries and consolidated joint

ventures

27

27

100 %

Loss on extinguishment of debt

(41)

41

100 %

Income (loss) from continuing operations before income taxes

46

59

(170)

(13)

(22)%

229

Income tax expense

(7)

(11)

(12)

36 %

Income (loss) from continuing operations

39

48

(182)

(9)

(19)%

230

Income (loss) from discontinued operations, net of tax

(1)

(2)

50 %

Gain on sale of discontinued operations, net of tax

55

Net income (loss)

38

46

(125)

(1)

Less: Net income (loss) attributable to noncontrolling interest

(25)%

8%
*

(4)

(55)

(8)

(17)%

171

(2)

(21)%

173

2.16

Net income (loss) attributable to USG

37

47

(126)

(10)

Diluted earnings (loss) per share - continuing operations

0.26

0.44

(1.72)

(0.18)

* not meaningful
NET SALES

Consolidated net sales in 2014 increased $154 million, or 4%, compared with 2013. This was our fifth consecutive year-on-year increase. Net sales increased
6% for our Gypsum segment and 8% for our Distribution segment offset by a decrease of 10% for our Ceilings segment. The higher levels of net sales for
Gypsum and Distribution primarily reflected increased selling prices and higher volume for USG Sheetrock brand gypsum wallboard. The decrease in net
sales for Ceilings primarily reflected the absence of net sales from our subsidiaries in Asia-Pacific, India, and Oman that were contributed to UBBP on
February 27, 2014. Net sales for our Ceiling segment also decreased 2% due to lower volumes on ceiling tile and grid.
Consolidated net sales in 2013 increased $346 million, or 11%, compared with 2012. Net sales increased 14% for our Gypsum segment, 2% for our
Ceilings segment and 9% for our Distribution segment. The higher levels of net sales for Gypsum and Distribution primarily reflected increased selling prices
and higher volume for USG Sheetrock brand gypsum wallboard. The higher level of net sales for Ceilings primarily reflected an increase in net sales for USG
International and USG Interiors, primarily driven by higher selling prices for ceiling tile and grid and higher volume for ceiling grid.
GROSS PROFIT

Gross profit was $654 million in 2014, $581 million in 2013 and $395 million in 2012. The increase for both 2014 compared with 2013 and 2013 compared
to 2012 was primarily due to higher selling prices for USG Sheetrock .
As a percentage of net sales, gross profit was 17.6% in 2014, 16.3% in 2013 and 12.3% 2012. The increase for 2014 compared with 2013 and 2013 compared
to 2012 was primarily driven by higher selling prices for USG Sheetrock , as discussed above.
SELLING AND ADMINISTRATIVE EXPENSES

Selling and administrative expenses totaled $339 million in 2014, $320 million in 2013 and $304 million in 2012. As a percentage of net sales, selling and
administrative expenses remained consistent at 9.1% in 2014, 9.0% in 2013 and 9.4% in 2012.
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LITIGATION SETTLEMENT CHARGE

In the third quarter of 2014, we recorded a litigation settlement charge of $48 million related to the settlement of the U.S. wallboard pricing class action
lawsuit. See Note 22 to the consolidated financial statements in Part II, Item 8 of this report for additional detail.
LONG-LIVED ASSET IMPAIRMENT CHARGES

Long-lived asset impairment charges were $90 million in 2014 and $8 million in 2012. There were no impairment charges on long-lived assets in 2013. The
charges in 2014 reflect the impairment of $30 million on certain manufacturing facilities and capitalized costs for the construction of future facilities, which
we do not anticipate will be built within our planning horizon, and of $60 million on two vessels owned by Gypsum Transportation Limited (GTL). The
charges in 2012 are primarily related to a change in estimate related to reclamation activities at our Windsor, Nova Scotia, Canada facility, which resulted in
an increase in the related asset retirement obligation and the corresponding long-lived assets and a subsequent impairment of the long-lived assets. See Notes
13 and 14 to our consolidated financial statements in Part II, Item 8 of this report for additional information related to long-lived asset impairment.
CONTRACT TERMINATION CHARGE AND LOSS ON RECEIVABLE

In the fourth quarter of 2014, we recorded a charge of $15 million for contract costs related to a lease of an ocean vessel that will continue to be incurred over
the remaining term without economic benefit to us and a loss on an uncollectible receivable owed to GTL by its trading partner. See Note 14 to the
consolidated financial statements in Part II, Item 8 of this report for additional information.
RESTRUCTURING CHARGES

In prior years, we implemented restructuring activities and as a result, recorded restructuring charges of $3 million in 2013 and $10 million in 2012. There
were no restructuring charges recorded in 2014. These charges in prior years primarily related to salaried workforce reductions. See Note 15 to the
consolidated financial statements in Part II, Item 8 of this report for additional information related to restructuring charges and reserves.
INCOME FROM EQUITY METHOD INVESTMENTS

Income from equity method investments was $35 million in 2014 and $1 million in 2013. There was none in 2012. The increase from 2013 to 2014 primarily
reflects income of $33 million attributable to our share of the income of UBBP.
INTEREST EXPENSE

Interest expense was $179 million in 2014, $203 million in 2013 and $206 million in 2012. Lower interest expense primarily reflects a decrease of $28
million due to the conversion of $325 million and $75 million of our 10% convertible senior notes into common stock in December 2013 and April 2014,
respectively, and the repayment of $59 million of our 2014 Notes in August 2014. This decrease is partially offset by $15 million of additional interest
expense related to our $350 million of 5.875% senior notes that were issued in October 2013.
Lower interest expense in 2013 primarily reflects (a) the conversion of $325 million of our 10% convertible senior notes into common stock in
December 2013 resulting in a decrease of $3 million of interest expense, (b) a $3 million increase in the amount of interest capitalized (lower interest
expense) in 2013 compared to 2012 due to higher capital expenditures, and (c) lower interest expense of $2 million due to the second quarter 2012
refinancing of our 9.75% senior notes and the related the issuance of the 7.875% senior notes. These decreases were offset by $3 million of interest expense
from our October 2013 issuance of $350 million of 5.875% senior notes and a $2 million bridge loan commitment fee.
GAIN ON DECONSOLIDATION OF SUBSIDIARIES

In the first quarter of 2014, we recognized a gain of $27 million on the deconsolidation of subsidiaries as a result of our contribution of our wholly-owned
subsidiaries in Singapore, India, Malaysia, New Zealand and Australia and our consolidated joint ventures in Oman into UBBP.

LOSS ON EXTINGUISHMENT OF DEBT

In the second quarter of 2012, we recorded a $41 million loss on the extinguishment of debt, including premiums, the write-off of unamortized debt discount
and deferred financing fees, in connection with the tender offer and repurchase of our 9.75% senior notes.
INCOME TAX EXPENSE

Income tax expense was $7 million in 2014 compared with $11 million in 2013. Our effective tax rate in 2014 was 15.3%. Income tax expense in 2014
primarily reflects income taxes for certain foreign, state and local jurisdictions of $9 million, which includes $2 million of withholding taxes between foreign
jurisdictions, offset by an income tax benefit of $2 million
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from accumulated other comprehensive income (loss) related to the settlement of a pension plan for which we recorded a $13 million charge in 2014.
Our income tax expense for 2013 was $11 million compared with $12 million in 2012. Our effective tax rate in 2013 was 18.6%. Income tax expense
in 2013 primarily reflects income taxes for certain foreign, state and local jurisdictions of $14 million, including $6 million of withholding taxes on
dividends between foreign jurisdictions, partially offset by an income tax benefit of $3 million recorded in the first quarter of 2013, which primarily related
to the release of the valuation allowance against a portion of our alternative minimum tax, or AMT, credits. This change in the realizability of those credits
was due to the enactment of the American Taxpayer Relief Act of 2012.
The effective tax rate based on our income (loss) from continuing operations was (7.1)% for 2012. Since recording a full valuation allowance against
our federal and state deferred tax assets in 2009, the effective tax rate is generally lower than statutory rates as we do not record a tax benefit from our losses
in any domestic jurisdiction.
GAIN ON SALE OF DISCONTINUED OPERATIONS, NET OF TAX

On December 27, 2012, we completed the sale of our European operations and received net proceeds of $73 million, resulting in a gain on the sale of $55
million net of tax. See further discussion in Note 4 to our consolidated financial statements included in Part II, Item 8 of this report.

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Segment Results of Operations

GYPSUM

Net sales and operating profit (loss) for the businesses comprising our Gypsum segment were as follows:

(millions)

2014(a)

2013(b)

2012(c)

2014 vs. 2013

2013 vs. 2012

Favorable (Unfavorable)

Favorable (Unfavorable)

Net Sales:
United States

245

16 %

Canada

344

348

336

(4)

(1)%

12

4%

Mexico / Latin America

195

197

183

(2)

(1)%

14

8%

86

89

63

(3)

(3)%

26

41 %

(5)

(4)%

Other **
Eliminations
Total

1,920

(142)

1,765

1,520

(137)

(114)

155

9%

(23)

(20)%

6%

274

14 %

(22)

(10)%

130

(4)

(24)%

2,403

2,262

1,988

141

192

214

84

Operating Profit (Loss):

United States
Canada
Mexico / Latin America
Other **
Eliminations
Total

13

17

12

42 %
11 %

19

21

19

(2)

(10)%

(55)

10

(5)

(65)

15

(1)

(1)

(92)

(35)%

152

169

261

109

Not meaningful

**

Includes our mining operation in Little Narrows, Nova Scotia, Canada and our shipping company

(a)

Operating profit in 2014 included a litigation charge of $48 million, which relates to the United States, long-lived asset impairment charges of $90 million, of which $30 million
relates to United States and $60 million relates to Other, and contract termination charge and loss on receivable of $15 million, which relates to Other.

(b) Operating profit in 2013 included restructuring charges of $3 million, which all related to United States, and pension settlement charges of $9 million, which primarily related to
United States.
(c)

Operating profit in 2012 included restructuring charges of $8 million and long-lived asset impairment charges of $7 million. These charges included $9 million related to our
gypsum quarry and ship loading facility in Windsor, Nova Scotia, Canada, $5 million related to U.S. Gypsum and $1 million related to CGC (Gypsum).

UNITED STATES - 2014 COMPARED WITH 2013

Net sales in 2014 increased $155 million, or 9%, compared with 2013. Net sales of USG Sheetrock brand gypsum wallboard increased $91 million, or 11%,
reflecting an 8% increase in average gypsum wallboard selling prices, which increased sales by $62 million, and a 4% increase in gypsum wallboard
shipments, which contributed $29 million to net sales. Net sales of SHEETROCK brand joint compound were up $16 million due to a 4% increase in
volume and a 1% increase in selling prices. Net sales of DUROCK brand cement board increased $6 million due to a 7% increase in volume offset by a 1%
decrease in price. Net sales of other products, including freight, increased an aggregate of $45 million compared with 2013. Offsetting these increases are
lower sales of FIBEROCK brand gypsum fiber panels of $2 million primarily due to a 4% decrease in volume and a 2% decrease in price and an increase in
sales discounts of $1 million due primarily to higher sales.
Operating profit was $192 million in 2014 and $214 million in 2013. The decrease of $22 million includes a litigation settlement charge of $48
million due to the settlement of the U.S. wallboard pricing class action lawsuit and impairment charges of $30 million related to certain manufacturing
facilities and capitalized costs for the construction of future facilities, which we do not anticipate will be built within our planning horizon. The decrease also
includes a $9 million charge from the mark-to-market of our natural gas hedges due to the decrease in natural gas price and additional cost and overhead
expenses, including $16 million of employee related costs, $3 million of professional fees, $2 million in marketing costs, $3 million of depreciation and
accretion, $4 million of freight charges, $3 million of other plant costs and $4 million of other miscellaneous costs. Offsetting these costs is an increase in
gross profit of $78 million due to the following: (a) a gross profit increase of $68 million for USG Sheetrock brand gypsum wallboard primarily due to
higher volume and selling prices of 4% and 8%, respectively, partially offset by higher per unit costs of 1%, (b) a gross profit increase of $3 million for
SHEETROCK brand joint compound primarily due to higher volume of 4% and selling prices of 1%, partially offset by higher per unit costs of 1%, (c) a
gross profit increase of $1 million for DUROCK brand cement board primarily due to increased volume of 7% offset by decreased price of 1% and
unchanged per unit costs, and (d) a gross profit increase of $7 million for our other gypsum
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products, offset by a decrease of $1 million in FIBEROCK brand gypsum fiber panels due to the decreased volume of 4% and price of 2% offset by lower
per unit costs of 1%. Also contributing to the offset of the increased costs were lower information technology costs of $1 million, the absence of a pension
settlement charge of $9 million that was recorded in 2013 and a gain of $12 million on sale of surplus property.
New housing construction increased in 2014, resulting in increased demand for gypsum wallboard, as discussed above. U.S. Gypsum shipped 5.33
billion square feet of USG Sheetrock brand gypsum wallboard in 2014, a 4% increase from 5.14 billion square feet in 2013. During 2014, USG Sheetrock
Brand UltraLight Panels accounted for 63% of all of our wallboard shipments in the United States. We estimate that industry capacity utilization rates
averaged approximately 66% during 2014, while U.S. Gypsums capacity utilization rate averaged 56%.
Manufacturing costs per unit increased 1% for USG Sheetrock brand gypsum wallboard in 2014 compared with 2013, due primarily to an increase of
6% for conversion costs primarily due to labor costs partially offset by lower man hour usage and 5% for energy due primarily to increased cost of energy in
the first quarter due to colder than normal weather offset by per unit cost decreases of 6% for fixed costs reflecting favorable impact from higher volumes.
UNITED STATES - 2013 COMPARED WITH 2012

Net sales in 2013 increased $245 million, or 16%, compared with 2012. Net sales of USG Sheetrock brand gypsum wallboard increased $170 million, or
27%, reflecting an 17% increase in average gypsum wallboard selling prices, which increased sales by $115 million and a 9% increase in gypsum wallboard
shipments which raised sales by $55 million. Net sales of products other than USG Sheetrock brand gypsum wallboard were $966 million in 2013, a 9%
increase compared with 2012. Net sales of SHEETROCK brand joint compound were up $22 million due to a 6% increase in volumes and a 1% increase in
selling prices. Net sales of DUROCK brand cement board increased $10 million due to a 10% increase in volume. The improvement in sales also included
an increase in net sales for FIBEROCK brand gypsum fiber panels of $4 million primarily due to a 17% increase in volume. Net sales of other products,
including freight, increased an aggregate of $40 million compared with 2012.
Operating profit in 2013 increased $130 million compared with 2012 reflecting (a) a gross profit increase of $128 million for USG Sheetrock brand
gypsum wallboard primarily due to higher selling prices, (b) a gross profit increase of $4 million for SHEETROCK brand joint compound primarily due to
higher volume and selling prices, partially offset by higher per unit costs, (c) a gross profit increase of $3 million for DUROCK brand cement board
primarily due to the increased volume, (d) a gross profit increase of $2 million for FIBEROCK brand gypsum fiber panels due to the increased volume and,
to a lesser extent, a 2% decrease in per unit costs, and (e) a $1 million aggregate increase in gross profit for other product lines. Operating profit was also
favorably impacted by a $3 million decrease in restructuring charges and a $5 million decrease in miscellaneous costs. These favorable variations were
partially offset by $9 million of pension settlement charges, a $2 million increase in selling and administrative expenses and an $8 million gain in the prior
year from the sale of surplus assets.
New housing construction increased in 2013, resulting in increased demand for gypsum wallboard, as discussed above. U.S. Gypsum shipped 5.14
billion square feet of USG Sheetrock brand gypsum wallboard in 2013, a 9% increase from 4.72 billion square feet in 2012. During 2013, USG Sheetrock
Brand UltraLight Panels accounted for 55% of all of our wallboard shipments in the United States. We estimate that industry capacity utilization rates
averaged approximately 64% during 2013, while U.S. Gypsums capacity utilization rate averaged 55%.
Manufacturing costs per unit increased 1% for USG Sheetrock brand gypsum wallboard in 2013 compared with 2012, due primarily to per unit cost
increases of 4% for conversion costs and 2% for raw materials, primarily due to gypsum and starch. These per unit cost increases were mostly offset by a per
unit cost decrease of 3% for fixed costs, reflecting the favorable impact from higher volumes, and a per unit cost decrease of 1% for energy.
CANADA (GYPSUM)

Net sales in 2014 were $344 million compared to net sales in 2013 of $348 million. This decrease of $4 million includes an unfavorable impact of currency
translation of $23 million due to the weakening of the Canadian Dollar to the US Dollar and an unfavorable change in cash discounts recorded of $1 million.
Offsetting this decrease are $17 million of higher net sales for SHEETROCK brand gypsum wallboard due to a 6% increase in volume offset by a 4%
decrease in price, higher net sales of other non-wallboard products of $1 million and increased outbound freight of $2 million.
Operating profit was $13 million in 2014 compared with $17 million in 2013. This $4 million decrease reflects $2 million of lower gross profit for
joint treatment products, $1 million of lower gross profit for other non-wallboard products and an unfavorable impact due to currency translation of $1
million.
Net sales in 2013 were $348 million, up $12 million compared to 2012, primarily driven by $19 million of higher net sales for SHEETROCK brand
gypsum wallboard due to a 12% increase in average realized selling prices partially offset by a
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2% decrease in volume. Net sales of joint treatment increased by $2 million and net sales of other non-wallboard products increased by $2 million. These
increases in net sales were partially offset by the unfavorable impact of currency translation of $10 million and a decrease of $1 million in outbound freight.
Operating profit was $17 million in 2013 compared with $12 million in 2012. This $5 million increase in operating profit was primarily driven by $11
million of higher gross profit for gypsum wallboard, primarily due to the increase in average realized selling prices, partially offset by an increase in per unit
manufacturing costs, and a $3 million increase in gross profit for joint treatment products. These improvements were partially offset by a decrease of $2
million in gross profit for non-wallboard products, an increase of $6 million in miscellaneous costs and an increase of $1 million in cash discounts.
MEXICO / LATIN AMERICA (GYPSUM)

Net sales for business in Mexico and Latin America were $195 million in 2014 compared with $197 million in 2013. The decrease of $2 million in sales
includes an unfavorable impact due to currency translation of $7 million primarily due to the weakening of the Mexican Peso to the US Dollar and a decrease
in gypsum wallboard of $6 million due to lower volumes in Mexico and a decrease in price in Latin America. Offsetting these decreases is a $2 million
increase in DUROCK due to increased volume and price, a $2 million increase in joint treatment due to increased volume and price, and a $7 million
increase in other non-wallboard products due primarily to higher volume of industrial gypsum and FIBEROCK.
Operating profit was $19 million in 2014 compared with $21 million in 2013. The decrease of $2 million includes unfavorable currency translation of
$1 million. Also contributing to the decline in operating profit was a $4 million decrease in gypsum wallboard and a $1 million decrease in drywall steel.
These declines were offset by a $1 million increase in joint treatment, a $2 million increase in DUROCK, and a $1 million increase in other products. Selling
and administrative expenses were unchanged year over year.
Comparing 2013 with 2012, net sales increased $14 million which included $2 million for joint treatment products, $6 million for framing products,
and $3 million of other products offset by decreased sales of $2 million for gypsum wallboard, reflecting lower volume, partially offset by an increase in
selling prices. Also increasing sales is a $4 million favorable impact of currency translation.
Operating profit for Mexico and Latin America was $21 million in 2013 compared with $19 million in 2012 reflecting a $2 million increase in
operating profit for drywall steel, a $2 million increase in operating profit for other nonwallboard products and the favorable impact from currency translation
of $1 million. These increases were partially offset by a decrease in operating profit of $1 million for cement board, an increase of $1 million in miscellaneous
costs and an increase of $1 million in selling and administrative expenses.
OTHER

Other includes our shipping company (GTL) and our mining operation in Little Narrows, Nova Scotia, Canada. Net sales for these operations were $86
million in 2014 as compared to $89 million in 2013. The decrease of $3 million reflects a cancellation of a contract of affreightment by our shipping
company in the fourth quarter due to its key trading partner ceasing operations. Operating profit decreased $65 million from operating income of $10 million
in 2013 to an operating loss of $55 million in 2014. The decrease reflects a long-lived asset impairment charge of $60 million on two shipping vessels owned
by GTL and a $15 million charge for contract costs related to a lease of an ocean vessel that will continue to be incurred over the remaining term without
economic benefit to us and a loss on an uncollectible receivable owed to GTL by its trading partner This is offset by higher gross profit and lower selling and
administrative expenses.
Net sales increased to $89 million in 2013 from $63 million in 2012. The increase is primarily attributable to an increase in volumes shipped by our
shipping company. Operating profit of $10 million was recognized in 2013 compared with an operating loss of $5 million for 2012. The increase in operating
profit in 2013 compared to 2012 was driven by the favorable impact of $7 million of higher operating profit from our shipping company, due to increased
shipments, and $8 million of higher operating profit primarily due to long-lived asset impairment charges in 2012 related to our closed gypsum quarry and
ship loading facility in Windsor, Nova Scotia, Canada.
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CEILINGS

Net sales and operating profit for the businesses comprising our Ceilings segment were as follows:

(millions)

2014

2013(b)

2012(c)(d)

2014 vs. 2013

2013 vs. 2012

Favorable (Unfavorable)

Favorable (Unfavorable)

Net Sales:
United States

USG International (a)

464

471

460

51

43

Canada

57

61

64

Mexico / Latin America

39

39

37

(54)

(54)

(46)

Eliminations
Total

(7)

(1)%

11

2%

(44)

(86)%

19 %

(4)

(7)%

(3)

(5)%

(8)

(10)%

10

2%

(9)%

12

17 %

513

568

558

(55)

74

81

69

(7)

5%
(17)%

Operating Profit:
United States
USG International (a)
Canada
Mexico / Latin America
Total

(3)

100 %

(4)

11

11

(5)

(45)%

(2)

(22)%

29 %

(11)

(11)%

10

11 %

7
$

87

9
$

98

7
$

88

* not meaningful
(a)

USG Internationals net sales and operating profit for the year ended December 31, 2014 include the results of our wholly-owned subsidiaries and consolidated joint ventures that
were contributed to UBBP through February 27, 2014. The comparative periods include the results of those entities for the full year presented.
(b) Operating profit for 2013 included a pension settlement charge of $2 million.
(c) Operating profit for 2012 included long-lived asset impairment charges of $1 million related to United States.
(d) As discussed in Note 4 to our consolidated financial statements in Item 8 of this report, our European business operations have been classified as discontinued operations;
therefore, the table above and discussion below exclude the results of the European operations previously included in USG International.
UNITED STATES - 2014 COMPARED WITH 2013

Net sales for our domestic ceilings business decreased to $464 million in 2014, a $7 million, or 1%, decrease from $471 million in 2013. This decrease
reflected lower sales of $7 million for ceiling grid and $2 million for other product lines offset by increased sales of $2 million for ceiling tile. The decrease in
sales of ceiling grid was primarily attributable to an decrease in volume of 8%, or $12 million, offset by an improvement in average realized selling prices of
4%, which favorably affected sales by $5 million. The decrease in sales volume for ceiling grid reflects the impact of extreme weather conditions in the
United States during the early part of 2014 and the unfavorable impact of higher sales related to demand pull-forward in the fourth quarter of 2013. The
increase in sales of ceiling tile reflected higher average realized selling prices of 4%, which favorably affected sales by $9 million, partially offset by a 3%
decrease in ceiling tile volume, which adversely affected sales by $7 million.
Operating profit of $74 million in 2014 was down $7 million, or 9%, The decrease in operating profit was attributable to a $3 million and $4 million
decrease in gross profit for ceiling grid and ceiling tile, respectively, $2 million in plant costs and $6 million for miscellaneous and overhead costs. The
decrease in gross profit for ceiling grid reflects a 8% decrease in volume and a 2% increase in per unit cost offset by a 4% increase in price. The decrease in
gross profit for ceiling tile reflects a decrease in volume of 3% and an increase in per unit cost of 6% offset by an increase in price of 4%. The increase in per
unit cost for both ceiling tile and grid reflect higher conversion and energy costs due to lower volume and seasonal gas usage and non-routine maintenance.
Offsetting the decrease was the absence of $6 million of environmental charges and $2 million of pension settlement charges recorded in 2013.
UNITED STATES - 2013 COMPARED WITH 2012

Net sales for our domestic ceilings business increased to $471 million in 2013, an $11 million, or 2%, increase from $460 million in 2012. This increase was
primarily due to higher average realized selling prices for ceiling tile and ceiling grid in addition to higher volume for ceiling grid, partially offset by lower
volume for ceiling tile. Operating profit of $81 million was up $12 million, or 17%, compared with 2012, primarily due to a higher gross margin for ceiling
grid and tile partially offset by the net impact of environmental charges accrued in 2013.
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Net sales in 2013 increased $5 million for ceiling grid, $6 million for ceiling tile and an aggregate of $1 million for other product lines compared
with 2012. The increase in ceiling grid sales was primarily attributable to an increase in average realized selling prices of 2%, which favorably affected sales
by $3 million and a 1% increase in ceiling grid volume, which favorably affected sales by $2 million. An increase in average realized selling prices of 5% for
ceiling tile, which favorably affected sales by $12 million, was partially offset by a 2% decrease in ceiling tile volume, which adversely affected sales by
$6 million.
The increase in operating profit was attributable to an $8 million increase in gross profit for ceiling grid and an $11 million increase in gross profit for
ceiling tile, and, to a lesser extent, a decrease of $1 million in restructuring costs. These favorable variances were partially offset by $6 million of
environmental charges accrued in 2013, a pension settlement charge of $2 million, a $1 million increase in miscellaneous costs and a $1 million increase in
overhead. Gross profit for ceiling grid was favorably affected by $7 million due to an increase in gross margin reflecting higher selling prices and a decrease
in per unit manufacturing costs. An increase in volume further impacted ceiling grid gross profit by $1 million. Gross profit for ceiling tile increased by $13
million as a result of an increase in gross margin primarily reflecting higher selling prices. The improvement in ceiling tile gross profit was partially offset by
a $2 million decline due to the decrease in ceiling tile volume.
USG INTERNATIONAL

Net sales in 2014 for USG International were $7 million, a decrease of $44 million, or 86%, compared to 2013. As a result of our change in segments, as
discussed above, prior to February 27, 2014 USG International consists only of the results of our wholly-owned subsidiaries in the Asia-Pacific region and
India and our consolidated joint ventures in Oman that were contributed in February 2014 as part of our investments in UBBP. Therefore, results for USG
International represent the net sales and operating profit (loss) for those entities for two months in 2014 and a full year for 2013. Results for our Latin America
businesses, previously included within USG International, are now included in "Mexico / Latin America" within Gypsum or Ceilings, as applicable.
Operating profit for USG International was $0 million in 2014 compared to a $3 million operating loss in 2013 which is also reflective of the contribution of
our subsidiaries and consolidated joint ventures as part of our investments in UBBP.
Net sales in 2013 for USG International were $51 million, an increase of $8 million, or 19%, compared to 2012. The increase was primarily attributable
to sales of SHEETROCK brand gypsum wallboard in India as we entered this market in 2013 and increased sales of ceiling tile in the Asia-Pacific region.
Operating profit for USG International decreased to an operating loss of $3 million in 2013 from an operating profit of $1 million in 2012 primarily reflecting
higher selling and administrative expenses for miscellaneous costs associated with our previously wholly-owned joint ventures in Oman.
CANADA (CEILINGS)

Net sales in 2014 were $57 million, a decrease of $4 million, or 7%, compared with 2013. The decrease includes an unfavorable currency translation of $4
million due to the weakening of the Canadian Dollar as compared to the US Dollar. Net sales also included a decrease in ceiling grid sales of approximately
$1 million offset by an increase of $1 million in outbound freight. Operating profit was $6 million in 2014 and $11 million in 2013, a decrease of $5 million,
which primarily reflected increased costs and lower gross margins of $2 million for ceiling grid and $2 million for ceiling tile. The decrease also includes an
unfavorable currency translation of $1 million. Selling and administrative expenses were unchanged from 2014 as compared to 2013.
Comparing 2013 with 2012, net sales decreased $3 million, or 5%, to $61 million. Lower sales were primarily driven by lower volumes, partially offset
by higher average realized selling prices, and a $2 million unfavorable impact of currency translation. Operating profit was $11 million in 2013, unchanged
from 2012 which primarily reflected higher average realized selling prices for ceiling tile and grid, an increase in gross profit for specialty ceilings and a
decrease in miscellaneous costs, offset by lower volumes for ceiling tile and grid.
MEXICO / LATIN AMERICA (CEILINGS)

Net sales in 2014 were unchanged from 2013 at $39 million which reflects an increase of $1 million in ceiling grid due to increases in both volume and price
offset by unfavorable currency translation of $1 million. Operating profit in 2014 decreased $2 million from $9 million in 2013. This decrease reflects
increase cost for ceiling grid of approximately $2 million. Selling and administrative expenses remained unchanged from 2013 to 2014.
Net sales increased $2 million from 2012 to 2013 due primarily to increased sales for both ceiling tile and grid of $1 million and a favorable impact
of currency translation of $1 million. Operating profit in 2013 increased $2 million from $7 million in 2012. The increase reflects higher gross margin on
ceiling tile and grid of $1 million and a favorable impact of currency translation of $1 million.
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DISTRIBUTION

Net sales and operating profit (loss) for our Distribution segment, which consists of L&W Supply, were as follows:

(millions)
Net sales
Operating profit (loss)

2014
$

2013(a)

1,345
16

2012

1,245

2013 vs. 2012

Favorable (Unfavorable)

1,145

2014 vs. 2013

Favorable (Unfavorable)

(33)

%
100
10

$
8%

%
100
39

9%
*

* not meaningful
(a) The operating profit for 2013 includes a $1 million reduction to previously accrued restructuring charges and $3 million of pension settlement charges.
L&W SUPPLY - 2014 COMPARED WITH 2013

Net sales in 2014 increased $100 million compared with 2013. Net sales of gypsum wallboard increased $60 million, or 14%, reflecting a 8% increase in
average gypsum wallboard selling prices and a 6% increase in gypsum wallboard shipments. The improvement also included an increase of $11 million, or
5%, for ceilings products, $6 million, or 2%, for metal products, $5 million, or 8%, for joint treatment products, and $18 million, or 7%, for other products.
Same-location net sales for 2014 were up 7% compared with 2013.
Operating profit was $16 million in 2014 compared with $6 million in 2013. The improvement of $10 million was primarily attributed to an increase
in gross profit of $10 million, or 5%, for gypsum wallboard due to an increase in volume and selling price partially offset by an increase in cost. Also
increasing operating profit is a reimbursement of $2 million with Knauf Plasterboard for Chinese wallboard claims and the absence of $3 million of pension
settlement charges offset by other overhead costs of $5 million. As a percentage of sales, selling and administrative expenses remained at 1%.
L&W SUPPLY - 2013 COMPARED WITH 2012

Net sales in 2013 increased $100 million compared with 2012. Net sales of gypsum wallboard increased $75 million, or 21%, reflecting a 17% increase in
average gypsum wallboard selling prices, which favorably affected sales by $62 million, and a 4% increase in gypsum wallboard shipments, which favorably
affected sales by $13 million. The improvement also included an increase of $6 million, or 12%, for joint treatment products. Net sales decreased $3 million,
or 1%, for construction metal products and $7 million, or 3%, for ceilings products. Net sales of all other products increased $30 million, or 12%. Samelocation net sales for 2014 were up 12% compared with 2012.
Operating profit was $6 million in 2013 compared with an operating loss of $33 million in 2012. The improvement of $39 million was driven by
increased gross profit of $24 million for gypsum wallboard, an aggregate gross profit increase of $10 million for other non-wallboard products, a decrease in
the provision for bad debt of $7 million and the reduction to previously accrued restructuring expenses of $1 million in 2013 due to a change in estimate,
partially offset by $3 million of pension settlement charges. The gross profit improvement for gypsum wallboard reflected a 20% increase in gross margin,
and, to a lesser extent, the favorable impact of rebates.
L&W SUPPLY - DISTRIBUTION BRANCHES

As of December 31, 2014, L&W Supply served its customers from 145 distribution branches in the United States. It operated 143 branches as of December 31,
2013 and 142 branches as of December 31, 2012. During the economic downturn, L&W Supply focused on reducing its cost structure and optimizing
utilization of its personnel and assets. As part of L&W Supply's efforts to reduce its cost structure, it closed a total of 125 distribution branches from January
1, 2007 through December 31, 2012. The closures were widely dispersed throughout the markets that L&W Supply serves. In 2014 and 2013, no distribution
branches were closed. Two new branches were opened in 2014, and one new branch was opened in 2013.
USG BORAL BUILDING PRODUCTS

UBBP is the 50/50 joint ventures with Boral and is accounted for as equity method investments. Our investments commenced on February 27, 2014, and as a
result, our share of ten months of equity income from UBBP is included in our accompanying consolidated statement of operations for the year ended
December 31, 2014. See Note 3 to our consolidated financial statements included in Part II, Item 8 of this report. Income from equity method investments in
our consolidated statement of operations for the year ended December 31, 2014 included $33 million representing our share of the net income of UBBP. Our
income from equity method investments for the year ended December 31, 2014 included approximately $2 million, net of tax, of costs representing our share
of UBBP's restructuring charges.
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For the ten month period from February 27, 2014 to December 31, 2014, net sales for UBBP were $927 million, plasterboard shipments were 3.83
billion square feet, operating profit was $95 million and net income attributable to UBBP was $67 million. UBBP's results included sales from the launch of
USG Boral Sheetrock , which leverages the technology in USG Sheetrock , in Australia, South Korea and Thailand. UBBP is able to sell USG Boral
Sheetrock at a premium price and, in some markets, conversion rates have surpassed 10%. Net sales in Asia and Australasia made up approximately 65% and
35%, respectively, of total net sales for UBBP. Net sales in China, Indonesia, South Korea and Thailand represented approximately 83% of Asia's net sales
and plasterboard revenue accounted for approximately 70% of Asia's net sales. Net sales in Australia represented almost all of Australasia's net sales. Results
for UBBP included $7 million ($5 million, net of tax) of restructuring costs incurred in the second quarter of 2014.
CORPORATE

Operating expenses for Corporate were $109 million in 2014, $93 million in 2013 and $82 million in 2012. The increase in expenses in 2014 compared to
2013 primarily reflected a pension settlement charge of $13 million recorded in 2014 for our previously frozen pension plan at our subsidiary in the U.K.
compared to a $1 million settlement charge recorded in 2013 for the U.S. plan. Also impacting operating expenses for Corporate are increases in stock
compensation expense related to higher fair value of awards on grant date and in expenses related to upgrades to our information technology which are offset
by a decrease in incentive compensation.
The increase in operating expenses from $82 million in 2012 to $93 million in 2013 of reflects an increase in marketing expenses resulting from our
new brand roll-out and a higher level of expenses related to upgrades to our information technology.
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Liquidity and Capital Resources

LIQUIDITY

As of December 31, 2014, we had $382 million of cash and cash equivalents and marketable securities compared with $952 million as of December 31, 2013.
Our total liquidity was $673 million as of December 31, 2014 (including $291 million of borrowing availability under our credit facility in the United States
and Canada) compared to $1.266 billion as of December 31, 2013 (including $314 million of borrowing availability under our credit facilities in the United
States, Canada and Oman). The decrease in total liquidity was primarily attributable to our $560 million cash outflow for our investments in UBBP.
We invest in cash equivalents and marketable securities pursuant to an investment policy that has preservation of principal as its primary
objective. The policy includes provisions regarding diversification, credit quality and maturity profile that are designed to minimize the overall risk profile
of our investment portfolio. The securities in the portfolio are subject to normal market fluctuations. See Note 5 to the consolidated financial statements in
Part II, Item 8 of this report for additional information regarding our investments in marketable securities.
Total debt, as of December 31, 2014, consisted of senior notes, industrial revenue bonds, and outstanding borrowings under our ship mortgage facility,
and, as of December 31, 2013, our convertible senior notes and our Oman joint ventures' credit facilities. Total debt amounted to $2.209 billion ($2.210
billion in aggregate principal amount less $1 million of unamortized original issue discount) as of December 31, 2014 and $2.355 billion ($2.359 billion in
aggregate principal amount less $4 million of unamortized original issue discount) as of December 31, 2013. As of December 31, 2014 and during the year
then ended, there were no borrowings under our revolving credit facility. See Note 7 to the consolidated financial statements in Part II, Item 8 of this report for
additional information about our debt.
On October 22, 2014, we amended and restated our credit facility in order to, among other things, join CGC as a party and to increase the maximum
borrowing limit under the credit agreement from $400 million to $450 million (including a $50 million borrowing sublimit for CGC). As amended and
restated, the credit agreement allows for the borrowing of revolving loans and issuance of letters of credit (up to a maximum of $200 million at any time
outstanding, in aggregate) to USG and its subsidiaries. The credit agreement contains two borrowing bases, one determined by reference to the trade
receivables and inventory of USG and the U.S. guarantors (the U.S. Borrowing Base) and one determined by reference to the trade receivables and
inventory of CGC and certain Canadian subsidiaries (the Canadian Borrowing Base). Pursuant to the credit agreement, the maximum principal amount of
revolving loans and letters of credit that may be borrowed by and/or be issued in favor of USG at any time (the total amount outstanding at any time, the
U.S. Revolving Exposure) may not exceed the lesser of (1) $450 million, as such mount may be increased in accordance with the credit facility, the
"Revolving Commitment" (less the sum of the outstanding principal balance of the revolving loans and letters of credit made and/or issued to or for the
account of CGC at such time, such sum being the Canadian Revolving Exposure) and (2) the excess of (a) the U.S. Borrowing Base minus (b) the amount, if
any, by which of the Canadian Revolving Exposure exceeds the Canadian Borrowing Base at such time. The maximum principal amount of revolving loans
and letters of credit that may be borrowed by and/or be issued in favor of CGC at any time may not exceed the lesser of (1) $50 million and (2) the sum of the
Canadian Borrowing Base, plus the U.S. Borrowing Base, minus the U.S. Revolving Exposure at such time. At no time may the sum of the U.S. Revolving
Exposure and the Canadian Revolving Exposure exceed the U.S. Revolving Exposure.
USG's obligations under the credit facility are guaranteed by USG and its significant domestic subsidiaries and secured by their and USGs trade
receivables and inventory. CGC's obligations under the credit facility are secured by trade receivables and inventory of certain subsidiaries. The credit
facility matures on October 22, 2019 unless terminated earlier in accordance with its terms. The credit facility is available to fund working capital needs and
for other general corporate purposes.
The credit agreement contains a financial covenant that would require us to maintain a minimum fixed charge coverage ratio of not less than 1.0 to 1.0
if the excess of the availability (as defined in the credit agreement) is less than an amount equal to 10% of the lesser of (a) the aggregate revolving
commitment at such time and (b) the aggregate borrowing base at such time. We would be required to continue to comply with such financial covenant until
the availability under the credit agreement exceeds such minimum threshold for 30 consecutive calendar days thereafter. As of December 31, 2014, our fixed
charge coverage ratio was 1.18-to-1.0. Because we currently satisfy the required fixed charge coverage ratio, we are not required to maintain a minimum
borrowing availability under the credit facility. Taking into account the most recent borrowing base calculation, borrowings available under the credit
facility were approximately $291 million.
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CASH FLOWS

The following table presents a summary of our cash flows:

(millions)

2014

2013

2012

Net cash provided by (used for):

Operating activities - Continuing operations

173

80

68

Investing activities - Continuing operations

(683)

(157)

138

Financing activities - Continuing operations

(66)

350

(38)

Discontinued operations

(1)

(2)

Effect of exchange rate changes on cash

(5)

(7)

Net increase (decrease) in cash and cash equivalents

(582)

264

9
4
$

181

Operating Activities: Higher cash flows from operating activities in 2014 compared to 2013 primarily reflected improved gross profit in 2014 offset by higher
cash outflows for working capital of receivables, inventory, payables and accrued expenses. As of December 31, 2014, working capital (current assets less
current liabilities) amounted to $589 million, and the ratio of current assets to current liabilities was 2.05-to-1. As of December 31, 2013, working capital,
which included the working capital of our wholly-owned subsidiaries and consolidated joint ventures that were contributed to UBBP, amounted to $1.132
billion, and the ratio of current assets to current liabilities was 2.99-to-1. Higher working capital at December 31, 2013 includes the net proceeds of $344
million received for the October 2013 issuance of 5.875% senior notes as described in Financing Activities below.
Higher cash flows from operating activities in 2013 compared to 2012 primarily reflected stronger operating results in 2013, partially offset by higher
cash outflows for working capital. As of December 31, 2013, working capital (current assets less current liabilities) amounted to $1.132 billion, and the ratio
of current assets to current liabilities was 2.99-to-1. As of December 31, 2012, working capital amounted to $776 million, and the ratio of current assets to
current liabilities was 2.41-to-1.
Investing Activities: Net cash used for investing activities in 2014 was $683 million compared to $157 million during 2013. The primary drivers of the
$526 million variation included (a) a $560 million outflow for our investments in UBBP, consisting of $500 of million of base price, $15 million of
customary estimated working capital and net debt adjustments, $22 million of transaction costs, and $23 million of cash held by the wholly-owned
subsidiaries that we contributed to UBBP; (b) an increase in the cash inflow due to the net proceeds of asset dispositions of $16 million primarily due to the
sale of a surplus property; and (c) an increase in the outflow of capital expenditures of $8 million, to $132 million in 2014 compared with $124 million in
2013.
Net cash used for investing activities in 2013 was $157 million compared to net cash provided by investing activities of $138 million during 2012.
The primary drivers of the $295 million variation included (a) a $165 million difference between a net cash outflow in 2013 of $11 million for purchases of
marketable securities, net of sale or maturities, compared with a net cash inflow in 2012 of $154 million from the sales or maturities of marketable securities,
net of purchases; (b) net proceeds of $73 million from the sale of our European businesses in the fourth quarter of 2012; and (c) an increase in capital
expenditures of $54 million, to $124 million in 2013 compared with $70 million in 2012.
Financing Activities: The net cash used for financing activities in 2014 primarily reflected the repayment of $59 million of principal balance of our 9.75%
senior notes and the expenses paid for the amendment of our credit facility as discussed above. The net cash provided by financing activities in 2013
reflected the net proceeds of $344 million from the October 2013 issuance of $350 million of 5.875% senior notes and $11 million of borrowings under the
credit facilities of our Oman consolidated joint ventures.
The net cash provided by financing activities in 2013 primarily reflected the net proceeds of $344 million from the October 2013 issuance of $350
million of 5.875% senior notes and $11 million of borrowings under the credit facilities of our Oman consolidated joint ventures. The net cash used for
financing activities in 2012 reflected the $277 million paid in April 2012 to repurchase our $241 million principal amount of the 2014 Senior Notes,
partially offset by the net proceeds of $243 million we received from the April 2012 issuance of the $250 million senior notes due 2020.
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LIQUIDITY OUTLOOK

In 2015, we plan to spend approximately $100 million on capital expenditures in the normal course of our business. We expect to fund these capital
expenditures with cash from operations or cash on hand, and, if determined to be appropriate and available, borrowings under our revolving credit facilities.
Estimated future spending on approved capital expenditures for the replacement, modernization and expansion of operations totaled $96 million as of
December 31, 2014 compared with $307 million as of December 31, 2013.
Interest payments are expected to decrease to approximately $167 million in 2015 compared with $175 million in 2014 primarily due to the
conversion of $75 million of our 10% convertible senior notes in April 2014, the repayment of our 9.75% senior notes in August 2014, and lower fees from
our amended credit facility. In 2015, we will pay approximately $4 million in debt payments under our ship mortgage facility that is classified as current
portion of long term debt on our balance sheet. We have no term debt maturities until 2016.
Our undistributed foreign earnings as of December 31, 2014 are considered permanently reinvested. The amount of cash and cash equivalents held by
our foreign subsidiaries was $107 million as of December 31, 2014. Any repatriation of these funds to the U.S. would have an immaterial impact on our
current tax rate due to our substantial net operating loss, or NOL, carryforwards and related valuation allowance.
We believe that cash, cash equivalents, and marketable securities on hand, cash available from future operations and our credit facility will provide
sufficient liquidity to fund our operations for at least the next 12 months. Cash requirements include, among other things, capital expenditures, working
capital needs, employee retirement plans funding, debt amortization and other contractual obligations.
From February 27, 2014 through December 31, 2014, UBBP was funded from its net cash flows from operations and third-party financing, and it is our
intent that as an ongoing operation, UBBP will continue to self-fund. UBBP is targeting the distribution of 50% of combined after tax profits to USG and
Boral; provided, however, that UBBP will not pay dividends if such payments are, among other things, restricted pursuant to the terms of the credit facilities
maintained by UBBP, inconsistent with the then-applicable strategic plan, or illegal. We expect UBBP will begin to distribute cash dividends in 2015.
Realization of Deferred Tax Asset
As of December 31, 2014, we had federal NOL carryforwards of approximately $1.898 billion that are available to offset future federal taxable income and
will expire in the years 2026 through 2032. In addition, as of that date, we had federal alternative minimum tax credit carryforwards of approximately $46
million that are available to reduce future regular federal income taxes over an indefinite period. In addition, we have federal foreign tax credit carryforwards
of $8 million that will expire in 2015.
As of December 31, 2014, we had a gross deferred tax asset related to our state NOLs and tax credit carryforwards of $244 million, of which $1 million
will expire in 2015. The remainder will expire if unused in years 2016 through 2033. We also had NOL and tax credit carryforwards in various foreign
jurisdictions in the amount of $1 million as of December 31, 2014 against a portion of which we have historically maintained a valuation allowance.
During the year ended December 31, 2014, we increased our valuation allowance by $28 million which resulted in a deferred tax asset valuation
allowance of $1.023 billion as of December 31, 2014. The increase in the valuation allowance primarily related to the increase in deferred tax assets for
pension and other post retirement accounts. The valuation allowance has no impact on our ability to utilize our U.S. federal and state NOL and tax credit
carryforwards to offset future U.S. profits. We continue to believe that we ultimately will have sufficient U.S. profitability during the remaining NOL and tax
credit carryforward periods to realize substantially all of the economic value of the federal NOLs and some of the state NOLs before they expire. In future
periods, the valuation allowance can be reversed based on sufficient evidence indicating that it is more likely than not that a portion of our deferred tax assets
will be realized.
See Note 17 to the consolidated financial statements in Part II, Item 8 for additional information regarding income tax matters.
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Contractual Obligations and Other Commitments

As of December 31, 2014, our contractual obligations and commitments were as follows:
Payments Due by Period
(millions)
Debt obligations (a)

Total
$

2015

2,210

2016 - 2017
6

2018 - 2019

515

850

Thereafter
$

839

Other long-term liabilities (b)

631

11

13

17

590

Interest payments (c)

847

165

299

164

219

Purchase obligations (d)

505

132

205

54

114

Capital expenditures (e)

94

89

292

69

111

70

42

18

Operating leases
Unrecognized tax benefits (f)

22

Litigation settlement (g)

48

48

Earnout payment (h)

Total

75
$

4,724

524

25
$

1,173

50
$

1,205

1,822

(a) Excludes debt discount of $1 million.

(b) Other long-term liabilities primarily consist of asset retirement obligations that principally extend over a 50-year period. The majority of associated payments are due toward the
latter part of that period.
(c) Reflects estimated interest payments on debt obligations as of December 31, 2014.
(d) Purchase obligations primarily consist of contracts to purchase energy, certain raw materials and finished goods.
(e) Reflects estimates of future spending on active capital projects that were approved prior to December 31, 2014 but were not completed by that date.
(f) Reflects estimated payments (if required) of gross unrecognized tax benefits.
(g) Reflects settlement of the U.S. wallboard pricing class action lawsuit
(h) Reflects contractual earnout payments for our investments in UBBP of $25 million based on performance during the first three years after closing and up to $50 million based on
performance during the first five years after closing. See discussion of accounting for these earnouts in Note 3 to the consolidated financial statements in Part II, Item 8 of this
report.

The table above excludes liabilities related to both our defined benefit pension plans and postretirement benefits (retiree health care and life
insurance). For 2014, our defined benefit pension plans had no minimum funding requirements under the Employee Retirement Income Security Act of 1974.
We are evaluating our level of funding for pension plans and currently estimate that we will contribute approximately $67 million to our pension plans in
2015. We voluntarily provide postretirement benefits for eligible employees and retirees. The portion of benefit claim payments we made in 2014 was $12
million. See Note 10 to the consolidated financial statements in Part II, Item 8 for additional information on future expected cash payments for pension and
other postretirement benefits.
OFF-BALANCE-SHEET ARRANGEMENTS

With the exception of letters of credit, it is not our business practice to use off-balance-sheet arrangements, such as third-party special-purpose entities.
GUARANTEES

We are party to a variety of agreements under which we may be obligated to indemnify a third party with respect to certain matters. We do not consider the
maximum potential amount of future payments that we could be required to make under these agreements to be material.
Legal Contingencies
We are named as defendants in litigation arising from our operations, including lawsuits arising from the operation of our vehicles and lawsuits arising from
product performance or warranties, personal injury, and commercial disputes. USG Corporation, United States Gypsum Company, and CGC Inc. have also
been named as defendants in class action lawsuits alleging that North American wallboard manufacturers conspired to fix the price of wallboard sold in the
United States and Canada. In October 2014, we entered into a settlement agreement in principle with the attorneys representing the direct and indirect
purchaser plaintiff classes in the U.S. wallboard pricing lawsuits, which name USG Corporation and United States Gypsum Company as defendants. In the
first quarter of 2015, we executed final settlement agreements. We will file the final settlement agreements with the Court for its approval. Assuming the
settlements are approved by the Court, USG will pay a maximum of $48 million to resolve the U.S. direct and indirect purchaser cases. We recorded a $48
million charge in the third quarter of 2014 related to this settlement. If we are unable to settle the U.S. litigation under the terms set forth in the settlement
agreements, or at all, there can be no assurance that the outcome of these lawsuits will not have a material effect on our business, financial condition,
operating results or cash flows. The settlement does not include the Canadian lawsuits to which
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CGC is a party. At this stage of the Canadian lawsuits, we are not able to estimate the amount, if any, of any reasonably possible loss or range of reasonably
possible losses. We believe, however, that these Canadian lawsuits will not have a material effect on our results of operations, financial position, or cash
flows.
We have also been notified by state and federal environmental protection agencies of possible involvement as one of numerous potentially
responsible parties in a number of Superfund sites in the United States. We believe that we have appropriately accrued for our potential liability in
connection with these matters, taking into account the probability of liability, whether our exposure can be reasonably estimated and, if so, our estimate of
our liability or the range of our liability. However, we continue to review these accruals as additional information becomes available and revise them as
appropriate. We do not currently expect these matters to have a material effect upon our results of operations, financial position or cash flows. See Note 22 to
the consolidated financial statements in Part II, Item 8 of this report for additional information regarding litigation matters. See, also, Part I, Item 1A, Risk
Factors, for information regarding the possible effects of environmental laws and regulations on our businesses.
Critical Accounting Policies
In preparing our consolidated financial statements in conformity with accounting principles generally accepted in the United States, we make decisions that
impact the reported amounts of assets, liabilities, revenues and expenses, and related disclosures. Such decisions include the selection of the appropriate
accounting principles to be applied and the assumptions on which to base accounting estimates. In reaching such decisions, we apply judgments based on
our understanding and analysis of the relevant circumstances, current developments and historical experience. Actual amounts could differ materially from
those estimated at the time the consolidated financial statements are prepared.
Our significant accounting policies are described in Note 1 to the consolidated financial statements in Item 8 of this annual report. Some of these
significant accounting policies require us to make difficult, subjective or complex judgments or estimates. An accounting estimate is considered to be critical
if it meets both of the following criteria: (1) the estimate requires assumptions about matters that are highly uncertain at the time the accounting estimate is
made and (2) different estimates reasonably could have been used, or changes in the estimate are reasonably likely to occur from period to period, that would
have a material impact on the presentation of our financial condition, changes in financial condition or results of operations. Our critical accounting
estimates include the following:
PROPERTY, PLANT AND EQUIPMENT

We assess our property, plant and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying values of the
assets may not be recoverable or a revision of remaining useful lives is necessary. Such indicators may include economic and competitive conditions,
changes in our business plans or managements intentions regarding future utilization of the assets or changes in our commodity prices. An asset impairment
would be indicated if the sum of the expected future net pretax cash flows from the use of an asset (undiscounted and without interest charges) is less than the
carrying amount of the asset. An impairment loss would be measured based on the difference between the fair value of the asset and its carrying value. The
determination of fair value is based on a discounted cash flow technique, in which multiple cash flow scenarios that reflect a range of possible outcomes and
a risk-free rate of interest are used to estimate fair value, or on a market appraisal.
Determination as to whether and how much an asset is impaired involves significant management judgment involving highly uncertain matters,
including estimating the future success of product lines, future sales volumes, future selling prices and costs, alternative uses for the assets, and estimated
proceeds from disposal of the assets. However, the impairment reviews and calculations are based on estimates and assumptions that take into account our
business plans and long-term investment decisions.
We regularly evaluate the recoverability of assets idled or at risk of being idled. In most cases, the idled assets are relatively older and higher-cost
production plants or lines, which we refer to as facilities, and have relatively low carrying values. We consider idled facilities to be unimpaired if we plan to
reopen them to meet future demand and the estimated future undiscounted cash flows exceed the carrying values of those facilities. We record impairment
charges for facilities that we permanently close if their fair value is less than their carrying value and for temporarily idled facilities with estimated future
undiscounted cash flows that do not exceed the carrying values of those facilities.
See Notes 13 and 14 to our consolidated financial statements in Part II, Item 8 of this report for discussion of asset impairments during the years ended
2014, 2013 and 2012. On a segment basis, all of the permanently closed and temporarily idled wallboard, quarry, ship loading and paper facilities, ocean
vessels and related long-lived asset impairment charges during
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the years ended 2014, 2013 and 2012 related primarily to our Gypsum segment. As of December 31, 2014, the total carrying value of net property, plant and
equipment for the Gypsum segment was $1.681 billion.
EMPLOYEE RETIREMENT PLANS

We maintain defined benefit pension plans for most of our employees. Most of these plans require employee contributions in order to accrue benefits. We
also maintain plans that provide postretirement benefits (retiree health care and life insurance) for eligible existing retirees and for eligible active employees
who may qualify for coverage in the future. For accounting purposes, these plans depend on assumptions made by management, which are used by actuaries
we engage to calculate the projected and accumulated benefit obligations and the annual expense recognized for these plans. The assumptions used in
developing the required estimates primarily include discount rates, expected return on plan assets for the funded plans, compensation increase rates,
retirement rates, mortality rates and, for postretirement benefits, health care cost trend rates.
We determined the assumed discount rate based on a hypothetical AA yield curve represented by a series of annualized individual discount rates. Each
underlying bond issue is required to have a credit rating of Aa or better by Moodys Investors Service or a credit rating of AA or better by Standard & Poors
Financial Services LLC. We consider the underlying types of bonds and our projected cash flows of the plans in evaluating the yield curve selected. The use
of a different discount rate would impact net pension and postretirement benefit costs and benefit obligations. In determining the expected return on plan
assets, we use a building block approach, which incorporates historical experience, our pension plan investment guidelines and expectations for long-term
rates of return. The use of a different rate of return would impact net pension costs. A one-half percentage point change in the assumed discount rate and
return on plan asset rate would have the following effects (dollars in millions):
Increase (Decrease) in

Percentage
Change

Assumptions

2014
Projected
Benefit
Obligation

2015
Net Annual
Benefit Cost

Pension Benefits:
Discount rate

0.5% increase

Discount rate

0.5% decrease

10

(9)

(101)
114

Expected return on plan assets

0.5% increase

(6)

N/A

Expected return on plan assets

0.5% decrease

N/A

Postretirement Benefits:
Discount rate

0.5% increase

Discount rate

0.5% decrease

(10)

11

Compensation increase rates are based on historical experience and anticipated future management actions. Retirement rates are based primarily on
actual plan experience, while standard actuarial tables are used to estimate mortality rates.
We developed health care cost trend rate assumptions based on historical cost data and an assessment of likely long-term trends. Effective January 1,
2011, we made modifications to our U.S. postretirement health care plan to limit the increase in the annual amount we pay for retiree health care coverage for
certain current and future retirees to 3%. Any additional increase will be the responsibility of plan participants. In 2011 and in April 2014, we amended our
U.S. postretirement benefit plan to require retiree medical plan participants to begin purchasing individual coverage in the Affordable Insurance Exchanges
or individual Medicare marketplace beginning January 1, 2016 using a company-funded subsidy based upon years of service at retirement. After January 1,
2016, due to the 2011 and 2014 amendments to the U.S. postretirement health care plan, we do not expect to have a material exposure to health care cost
inflation for the U.S. plan.
Results that differ from these assumptions are accumulated and amortized over future periods and, therefore, generally affect the net benefit cost of
future periods. The sensitivity of assumptions reflects the impact of changing one assumption at a time and is specific to conditions at the end of 2014.
Economic factors and conditions could affect multiple assumptions simultaneously, and the effects of changes in assumptions are not necessarily linear.
See Note 10 to our consolidated financial statements in Part II, Item 8 of this report for additional information regarding costs, plan obligations, plan
assets and discount rate and other assumptions, including the health care cost trend rate.
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INCOME TAXES

We record income taxes (benefit) under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized based on the
future tax consequences to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax
bases and attributable to operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply
in the years in which the temporary differences are expected to be recovered or paid. The effect on deferred tax assets and liabilities of a change in tax rates is
recognized in earnings in the period when the change is enacted.
A reduction of the carrying amounts of deferred tax assets by a valuation allowance is required if, based on the available evidence, it is more likely
than not that such assets will not be realized. The need to establish valuation allowances for deferred tax assets is assessed periodically. In assessing the
requirement for, and amount of, a valuation allowance in accordance with the more-likely-than-not standard, we give appropriate consideration to all positive
and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature, frequency and severity
of current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, our experience with operating loss and tax
credit carryforwards not expiring unused and tax planning alternatives. A history of cumulative losses for a certain threshold period is a significant form of
negative evidence used in the assessment, and we are required to have a policy regarding the duration of the threshold period. If a cumulative loss threshold
is met, forecasts of future profitability may not be used as positive evidence related to the realization of the deferred tax assets in the assessment. Consistent
with practices in the home building and related industries, we have a policy of four years as our threshold period for cumulative losses.
We recognize the tax benefits of an uncertain tax position only if those benefits are more likely than not to be sustained upon examination by the
relevant taxing authorities. Unrecognized tax benefits are subsequently recognized at the time the more-likely-than-not recognition threshold is met, the tax
matter is effectively settled or the statute of limitations for the relevant taxing authority to examine and challenge the tax position has expired, whichever is
earlier.
See Note 17 to our consolidated financial statements in Part II, Item 8 of this report for additional information on deferred income taxes and valuation
allowances.
Recently Issued Accounting Pronouncements
See Note 2, Recent Accounting Pronouncements, to the consolidated financial statements in Part II, Item 8 of this report for information related to new
accounting standards.

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Forward-Looking Statements
This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to managements
expectations about future conditions. Actual business, market or other conditions may differ materially from managements expectations and, accordingly,
may affect our sales and profitability or other results and liquidity. Actual results may differ materially due to various other factors, including:

economic conditions, such as the levels of new home and other construction activity, employment levels, the availability of mortgage, construction and
other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates
and consumer confidence;

capital markets conditions and the availability of borrowings under our credit agreement or other financings;

our substantial indebtedness and our ability to incur substantial additional indebtedness;

competitive conditions, such as price, service and product competition;

shortages in raw materials;

changes in raw material and energy costs;

volatility in the assumptions used to determine the funded status of our pension plans;

the loss of one or more major customers and our customers ability to meet their financial obligations to us;

capacity utilization rates for us and the industry;

our ability to expand into new geographic markets and the stability of such markets;

our ability to successfully operate USG Boral Building Products, including risks that our joint ventures partner, Boral, may not fulfill its obligations as
an investor or may take actions that are inconsistent with our objectives;

our ability to protect our intellectual property and other proprietary rights;

changes in laws or regulations, including environmental and safety regulations;

the satisfactory performance of certain business functions by third party service providers;

our ability to achieve anticipated savings from cost reduction programs;

the outcome in contested litigation matters;

the effects of acts of terrorism or war upon domestic and international economies and financial markets; and

acts of God.

We assume no obligation to update any forward-looking information contained in this report.

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Item 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We use derivative instruments to manage selected commodity price and foreign currency exposures. We do not use derivative instruments for speculative
trading purposes, and we typically do not hedge beyond three years.
COMMODITY PRICE RISK

We use natural gas swap and option contracts to manage our exposure to fluctuations in commodity prices associated with anticipated purchases of natural
gas. Currently, a significant portion of our anticipated purchases of natural gas is hedged for 2015. The aggregate notional amount of these hedge contracts in
place as of December 31, 2014 was 26 million mmBTUs. We review our positions regularly and make adjustments as market and business conditions warrant.
The fair value of these contracts was a $25 million unrealized loss as of December 31, 2014.
A sensitivity analysis was prepared to estimate the potential change in the fair value of our natural gas hedge contracts assuming a hypothetical 10%
change in market prices. Based on the results of this analysis, which may differ from actual results, the potential change in the fair value of our natural gas
hedge contracts as of December 31, 2014 was $9 million. This analysis does not consider the underlying exposure.
FOREIGN CURRENCY EXCHANGE RISK

We have foreign exchange forward contracts to hedge forecasted purchases of products and services denominated in foreign currencies. The notional amount
of these contracts was $72 million as of December 31, 2014, and they mature by June 30, 2016. The fair value of these contracts was an $3 million unrealized
gain as of December 31, 2014.
A sensitivity analysis was prepared to estimate the potential change in the fair value of our foreign exchange forward contracts assuming a
hypothetical 10% change in foreign exchange rates. Based on the results of this analysis, which may differ from actual results, the potential change in the fair
value of our foreign exchange forward contracts as of December 31, 2014 was $8 million. This analysis does not consider the underlying exposure.
INTEREST RATE RISK

As of December 31, 2014, most of our outstanding debt was fixed-rate debt. A sensitivity analysis was prepared to estimate the potential change in interest
expense assuming a hypothetical 100-basis-point increase in interest rates. Based on the results of this analysis, which may differ from actual results, the
potential change in interest expense would be immaterial.
A sensitivity analysis was also prepared to estimate the potential change in fair value of our marketable securities portfolio assuming a hypothetical
100-basis-point increase in interest rates. Based on the results of this analysis, which may differ from actual results, the potential change in fair value of our
marketable securities as of December 31, 2014 would be approximately $1 million.
See Notes 1 and 8 to the consolidated financial statements in Part II, Item 8 for additional information regarding our financial exposures.
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Item 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Page

CONSOLIDATED FINANCIAL STATEMENTS:

Statements of Operations
Statements of Comprehensive Income (Loss)
Balance Sheets
Statements of Cash Flows
Statements of Stockholders Equity

47
48
49
50
52

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:

1.
Significant Accounting Policies
2.
Recent Accounting Pronouncements
3.
Equity Method Investments
4.
Discontinued Operations
5.
Marketable Securities
6.
Intangible Assets
7.
Debt
8.
Derivative Instruments
9.
Fair Value Measurements
10.
Employee Retirement Plans
11.
Share-Based Compensation
12.
Supplemental Balance Sheet Information
13.
Long-Lived Asset Impairment Charges
14.
Gypsum Transportation Limited
15.
Restructuring Charges
16.
Segments
17.
Income Taxes
18.
Earnings (Loss) Per Share
19.
Oman Investment
20.
Stockholder Rights Plan
21.
Lease Commitments
22.
Litigation
23.
Quarterly Financial Data (unaudited)

53
56
57
58
59
59
60
63
65
66
73
76
78
79
80
81
84
87
88
88
89
90
91

Report of Independent Registered Public Accounting Firm

Schedule II - Valuation and Qualifying Accounts

92
93

All other schedules have been omitted because they are not required or applicable or the information is included in the consolidated financial statements or
notes thereto.
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USG CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(millions, except share and per-share data)

Years Ended December 31,

2014

Net sales

2013

3,724

2012

3,570

3,224

3,070

2,989

2,829

Gross profit

654

581

395

Selling and administrative expenses

Cost of products sold

339

320

304

Litigation settlement charge

48

Long-lived asset impairment charges

90

Contract termination charge and loss on receivable

15

10

162

258

73

Restructuring charges
Operating profit

Income from equity method investments

35

Interest expense

(179)

Interest income
Gain on deconsolidation of subsidiaries and consolidated joint ventures

(203)

(206)

27

Loss on extinguishment of debt

(41)

Income (loss) from continuing operations before income taxes

46

59

(170)

Income tax expense

(7)

(11)

(12)

Income (loss) from continuing operations

39

48

(182)

Income (loss) from discontinued operations, net of tax

(1)

(2)

Gain on sale of discontinued operations, net of tax

55

Net income (loss)

38

46

(125)

(1)

Less: Net income (loss) attributable to noncontrolling interest

Net income (loss) attributable to USG

37

0.27

47

(126)

0.45

(1.72)

0.43

(1.19)

0.44

(1.72)

(1.19)

Earnings per common share - basic:

Income (loss) from continuing operations

Income (loss) from discontinued operations

(0.01)
$

Net income (loss)

(0.02)

0.26

0.26

0.53

Earnings per common share - diluted:

Income (loss) from continuing operations

Income (loss) from discontinued operations

(0.01)
$

Net income (loss)

0.25

(0.02)
$

0.42

0.53

Average common shares

141,722,616

108,891,703

106,382,934

Average diluted common shares

144,296,316

111,434,543

106,382,934

See accompanying Notes to Consolidated Financial Statements

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USG CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(millions)

Years Ended December 31,

2014

Net income (loss)

2013
38

2012
46

(125)

Other comprehensive income (loss), net of tax:

Derivatives qualifying as cash flow hedges:
Gain (loss) on derivatives qualifying as cash flow hedges, net of tax of $0
Less: Reclassification adjustment for gain (loss) on derivatives included in net income, net of tax of $0
Derivatives qualifying as cash flow hedges, net of tax (benefit) of $0

(15)

(5)

(9)

(19)

(272)

247

Pension and postretirement benefits:

Changes in pension and postretirement benefits, net of tax (benefit) of ($2), $10 and ($7), respectively
Less: Amortization of prior service benefit (cost) included in net periodic pension cost, net of tax (benefit) of ($1), ($2) and
($1), respectively

(2)

Pension and postretirement benefits, net of tax (benefit) of ($1), $12 and $(6), respectively

(81)

(24)

(270)

271

(82)

(68)

(17)

22

(73)

(17)

19

(362)

257

(59)

Foreign currency translation:

Changes in foreign currency translation, net of tax of $0
Less: Translation gains realized upon sale of foreign entities, net of tax of $0
Foreign currency translation, net of tax of $0

Other comprehensive income (loss), net of tax

Comprehensive income (loss)

See accompanying Notes to Consolidated Financial Statements

48

(324)

303

(184)

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USG CORPORATION
CONSOLIDATED BALANCE SHEETS
(millions, except share and per share data)

As of December 31,
2014

2013

Assets
Current Assets:
Cash and cash equivalents

Short-term marketable securities

228

96

Restricted cash

810
82

Receivables (net of reserves: 2014 - $22; 2013 - $12)

404

369

Inventories

329

332

Income taxes receivable

Deferred income taxes

43

52

Other current assets

Total current assets
Long-term marketable securities
Property, plant and equipment, net
Deferred income taxes

48

47

1,152

1,700

58

60

1,908

2,103

19

17

Equity method investments

735

73

Other assets

122

168

Total assets

3,994

4,121

290

284

Liabilities and Stockholders Equity

Current Liabilities:
Accounts payable
Accrued expenses

220

216

Current portion of long-term debt

63

Income taxes payable

Litigation settlement accrual

48

Total current liabilities

563

568

Long-term debt

2,205

2,238

Long-term debt - related party

54

Deferred income taxes

61

66

491

277

Pension and other postretirement benefits

Other liabilities
Total liabilities

266

256

3,586

3,459

Stockholders Equity:
Preferred stock

$1 par value, authorized 36,000,000 shares; outstanding - none

Common stock

$0.10 par value; authorized 200,000,000 shares; issued: 2014 - 144,768,000 shares; 2013 - 137,314,000 shares

14

14

3,014

2,920

Additional paid-in capital

Accumulated other comprehensive income (loss)

(338)

Retained earnings (accumulated deficit)

24

(2,283)

Stockholders' equity of parent

(2,320)

407

Noncontrolling interest
Total stockholders equity including noncontrolling interest
Total liabilities and stockholders equity

See accompanying Notes to Consolidated Financial Statements

49

638

24

408

662

3,994

4,121

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USG CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended December 31,
(millions)

2014

2013

2012

Operating Activities
Net income (loss)

38

46

(125)

Less: Income (loss) from discontinued operations, net of tax

(1)

(2)

Less: Gain on sale of discontinued operations, net of tax

55

Income (loss) from continuing operations

39

48

(182)

154

155

156

Loss on extinguishment of debt

41

Litigation settlement charge

48

Long-lived asset impairment charges

90

Contract termination charge and loss on receivable

15

Share-based compensation expense

Adjustments to reconcile income (loss) from continuing operations to net cash:

Depreciation, depletion, and amortization

21

19

17

Deferred income taxes

Provision for bad debt

Gain on asset dispositions

(12)

(1)

(8)

Income from equity method investments

(35)

(1)

13

16

(27)

(49)

(44)

(1)

(9)

(28)

(12)

Pension settlement
Gain on deconsolidation of subsidiaries and consolidated joint ventures
(Increase) decrease in working capital:
Receivables
Income taxes receivable
Inventories
Other current assets

(4)

10

(4)

27

(12)

(23)

14

(6)

Decrease in pension and other postretirement benefits

(55)

(63)

(16)

Decrease in other liabilities

(13)

(6)

(5)

Other, net

(18)

21

(1)

173

80

68

(204)

(205)

(137)

190

194

291

(132)

(124)

(70)

Payables
Accrued expenses
(Increase) decrease in other assets

Net cash provided by operating activities - continuing operations

Investing Activities
Purchases of marketable securities
Sales or maturities of marketable securities
Capital expenditures
Acquisition of mining rights

(17)

(16)

Net proceeds from asset dispositions

16

14

Net proceeds from sale of business

73

(5)

(14)

Investments in joint ventures, including $23 million of cash of contributed subsidiaries in 2014
Loans to joint ventures
Insurance proceeds
Return (deposit) of restricted cash
Net cash (used for) provided by investing activities - continuing operations

(560)

(4)

4
(683)

(4)

(157)

138

Financing Activities
Issuance of debt
Repayment of debt

361

248

(63)

(4)

(283)

Payment of debt issuance fees

(3)

(6)

(5)

Loan from venture partner

Issuances of common stock

Repurchases of common stock to satisfy employee tax withholding obligations

(7)

(9)

(6)

Net cash (used for) provided by financing activities - continuing operations

(66)

350

(38)

(continued on the next page)

50

Table of Contents

USG CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
Years Ended December 31,
(millions)

2014

2013

2012

Net cash (used for) provided by operating activities - discontinued operations

(1)

(2)

10

Net cash used for investing activities - discontinued operations

(1)

Effect of exchange rate changes on cash

(5)

(7)

Net increase (decrease) in cash and cash equivalents

(582)

Cash and cash equivalents at beginning of period

810

Cash and cash equivalents at end of period

264

181

546

365

228

810

546

172

192

200

Supplemental Cash Flow Disclosures:

Interest paid, net of interest capitalized
Income taxes paid, net of refunds received

10

15

13

10

Noncash Investing and Financing Activities:

Amount in accounts payable for capital expenditures
Contribution of wholly-owned subsidiaries and joint venture investments as consideration for investments in USG Boral Building
Products

121

Conversion of $75 million and $325 million, respectively, of 10% convertible senior notes due 2018, net of discount

(73)

(314)

Issuance of common stock upon conversion of debt

75

313

Acceleration of deferred financing fee amortization to additional paid-in capital

Accrued interest on debt conversion

(2)

See accompanying Notes to Consolidated Financial Statements

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USG CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY

(millions, except
share data)
Balance as of
January 1, 2012

Common
Shares
Issued
(000)

Treasury
Shares
(000)

105,329

Common
Stock
$

10

Treasury
Stock
$

Additional
Paid-in
Capital

Retained
Earnings
(Deficit)

2,561

$ (2,241)

Net loss

Accumulated
Other
Comprehensive
Income (Loss)
$

(126)
(59)

Share-based
compensation
2,522

Repurchase of
common stock

(1)

(1)

11

17

17

17

24

24

(6)

(6)

2,595

$ (2,367)

(233)

47
257

Stock issuances

954

Stock issuances
upon debt
conversion

28,509

Repurchase of
common stock

314

(1)

14

46

19

19

(4)

313

313

(9)

(9)

2,920

Net income

$ (2,320)

24

37

(9)

638

12
$

37

Other
comprehensive loss

(362)

Share-based
compensation

19

19

257

Changes in
noncontrolling
interest
137,314

13

12

257

310

(313)

12

47

Other
comprehensive loss
Share-based
compensation

156
(125)

17

(6)

107,851

(59)

Net (loss) income

Balance as of
December 31, 2013

Total

(59)

Changes in
noncontrolling
interest
Balance as of
December 31, 2012

156
(126)

Other
comprehensive loss

Stock issuances

(174)

Noncontrolling
Interest

Stockholders'
Equity

24

12
$

662
38

(362)

(362)

21

21

21

Stock issuances

947

166

Stock issuances
upon debt
conversion

6,507

72

72

75

75

(7)

(7)

Repurchases of
common stock

(238)

(7)

Changes in
noncontrolling
interest
Balance as of
December 31, 2014

144,768

14

3,014

See accompanying Notes to Consolidated Financial Statements

52

$ (2,283)

(338)

407

(24)
$

(24)
$

408

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In the following Notes to Consolidated Financial Statements, USG, we, our and us refer to USG Corporation, a Delaware corporation, and its
subsidiaries included in the consolidated financial statements, except as otherwise indicated or as the context otherwise requires.
1.

Significant Accounting Policies

Nature of Operations
USG, through its subsidiaries, is a leading manufacturer and distributor of building materials. We produce a wide range of products for use in new residential,
new nonresidential, and residential and nonresidential repair and remodel construction as well as products used in certain industrial processes. Our products
also are distributed through building materials dealers, home improvement centers and other retailers, specialty wallboard distributors, and contractors.
Segments
Effective April 1, 2014, we changed the composition of our reportable segments to reflect the change in management over our businesses in Mexico and
Latin America. Additionally, with the contribution of our businesses in the Asia-Pacific region, India and Oman into our investments with Boral Limited,
Boral, in the 50/50 joint ventures, USG Boral Building Products or UBBP, we have determined UBBP to be our fourth reportable segment. Accordingly, our
segments are now structured around our key products and business units: (1) Gypsum, (2) Ceilings, (3) Distribution and (4) UBBP. As a result of these
changes, our Mexico and Latin America businesses have been combined, and their Gypsum results have been included within our Gypsum segment,
previously referred to as North American Gypsum, and their Ceiling results have been included within our Ceilings segment, previously referred to as
Worldwide Ceilings. Our prior period results have been recast to reflect these changes and present comparative year over year results. See Note 3, Equity
Method Investments, and Note 16, Segments.
Our Gypsum reportable segment is an aggregation of the operating segments of the gypsum businesses in the United States, Canada, Mexico, and Latin
America, mining operation in Little Narrows, Nova Scotia, Canada, and our shipping company. Our Ceilings reportable segment is an aggregation of the
operating segments of the ceilings businesses in the United States, Canada, Mexico, Latin America and through February 27, 2014, the businesses in the
Asia-Pacific region. Gypsum manufactures USG Sheetrock brand gypsum wallboard and related products. Ceilings manufactures ceiling tile in the United
States and ceiling grid in the United States, Canada and the Asia-Pacific region. Distribution distributes gypsum wallboard, drywall metal, ceilings products,
joint compound and other building products throughout the United States. UBBP manufactures, distributes and sells certain building products, mines raw
gypsum and sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East.
Consolidation and Presentation
Our consolidated financial statements include the accounts of USG Corporation, its majority-owned subsidiaries and variable interest entities. Entities in
which we have more than a 20% but not more than 50% ownership interest are accounted for using the equity method of accounting. All intercompany
balances and transactions are eliminated in consolidation. On our consolidated statements of operations for the years ended December 31, 2013 and 2012,
income from equity method investments, which was previously included in "Other income, net," is reflected as "Income from equity method investments" and
long-lived asset impairment charges, which was previously included in "Restructuring and long-lived asset impairment charges," are reflected as "Long-lived
asset impairment charges" to conform to the current year presentation. On our consolidated balance sheets as of December 31, 2013, equity method
investments, which was previously included in "Other assets" is reflected as "Equity method investments" to conform to the current year presentation. On our
consolidated statements of cash flows for the years ended December 31, 2013 and 2012, income from equity method investments previously included in
"Other, net" has been reclassified to "Income from equity method investments."
Our investments with Boral in the 50/50 joint ventures, UBBP, commenced on February 27, 2014, and as a result, ten months of results of UBBP were
recorded in our accompanying consolidated statement of operations for the year ended December 31, 2014. See Note 3 for further description of our
investments in UBBP.
Use of Estimates
The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and
expenses. Actual results could differ from these estimates.
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Revenue Recognition
We recognize revenue when substantially all the risks and rewards of ownership transfer to the customer. We record provisions for discounts to customers
based on the terms of sale in the same period in which the related sales are recorded. We record estimated reductions to revenue for customer programs and
incentive offerings, including promotions and other volume-based incentives, in the period in which the sale occurs.
Shipping and Handling Costs
Shipping and handling costs are included in cost of products sold.
Advertising
Advertising expenses consist of media advertising and related production costs and sponsorships. We charge advertising expenses to earnings as incurred.
These expenses amounted to $23 million, $22 million, and $15 million for the years ended December 31, 2014, 2013, and 2012, respectively.
Research and Development
We charge research and development expenditures to earnings as incurred. These expenditures amounted to $23 million, $21 million and $18 million for the
years ended December 31, 2014, 2013 and 2012, respectively.
Litigation Costs
We expense litigation costs as incurred.
Income Taxes
We record income tax expense (benefit) under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized based on
the future tax consequences to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases and attributable to net operating loss, or NOL, and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply in the years in which the temporary differences are expected to be recovered or paid. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in earnings in the period when the change is enacted. Valuation allowances are recorded to reduce deferred tax assets when
it is more likely than not that a tax benefit will not be realized.
Inventory Valuation
All of our inventories are stated at the lower of cost or market. Virtually all of our inventories are valued under the average cost method with the remainder
valued under the first-in, first-out cost method. Inventories include materials, labor and applicable factory overhead costs. Depreciation associated with
manufacturing assets is excluded from inventory cost, but is included in cost of products sold.
Earnings (Loss) per Share
Basic earnings (loss) per share is based on the weighted average number of common shares outstanding. Diluted earnings per share is based on the weighted
average number of common shares outstanding plus the dilutive effect, if any, of market share units, or MSUs, restricted stock units, or RSUs, and
performance shares, and the potential exercise of outstanding stock options. Prior to the conversion of our 10% convertible senior notes (see Note 7), the
dilutive effect of the potential conversion of the 10% convertible senior notes was included for the appropriate time periods when these instruments were
outstanding.
Cash and Cash Equivalents
Cash and cash equivalents include highly liquid investments, primarily money market funds, with maturities of three months or less at the time of purchase.
Marketable Securities
Marketable securities are classified as available-for-sale securities and reported at fair value, with unrealized gains and losses excluded from earnings and
reported in accumulated other comprehensive income (loss), or AOCI. If it is deemed that marketable securities have unrealized losses that are other than
temporary, these losses will be recorded in earnings immediately. Situations in which losses may be considered other than temporary include when we have
decided to sell a security or when it is more likely than not that we will be required to sell the security before we recover its amortized cost basis. Cost basis
for securities sold are determined on a first-in-first-out basis.
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Receivables
We include trade receivables in receivables on our consolidated balance sheets. Trade receivables are recorded at net realizable value, which includes
allowances for cash discounts and doubtful accounts, and are reflected net of customer incentives. We review the collectability of trade receivables on an
ongoing basis. We reserve for trade receivables determined to be uncollectible. This determination is based on the delinquency of the account, the financial
condition of the customer and our collection experience.
We include short-term financing receivables in receivables and long-term financing receivables in other assets on our consolidated balance sheets.
Financing receivables are recorded at net realizable value which includes an allowance for credit losses. We review the collectability of financing receivables
on an ongoing basis. We reserve for financing receivables determined to be uncollectible. This determination is based on the delinquency of the account and
the financial condition of the other party. As of December 31, 2014, the allowance for credit losses was immaterial.
Property, Plant and Equipment
Property, plant and equipment is recorded at cost. We record depreciation of property, plant and equipment on a straight-line basis over the expected useful
lives of the assets. We have determined estimated useful lives to be 50 years for buildings and improvements, a range of 10 to 25 years for machinery and
equipment, and a range of 5 to 7 years for computer software and systems development costs. Leasehold improvements are capitalized and amortized over the
shorter of the remaining lease term or remaining economic useful life. We capitalize interest during the active construction period of major capital projects.
Capitalized interest is added to the cost of the underlying assets and is depreciated over the useful lives of those assets. We recorded $3 million of capitalized
interest in both 2014 and in 2013 and none in 2012. Facility start-up costs that cannot be capitalized are expensed as incurred and recorded in cost of
products sold. We compute depletion on a basis calculated to spread the cost of gypsum and other applicable resources over the estimated quantities of
material recoverable. We review property, plant and equipment for impairment when indicators of a potential impairment are present by comparing the
carrying values of the assets with their estimated future undiscounted cash flows. If we determine an impairment exists, the asset is written down to estimated
fair value. As of December 31, 2013, we had $1 million of assets classified as held for sale on our consolidated balance sheet. We recognized a gain on sale of
these assets of approximately $12 million in 2014. Both these assets and the gain on sale were included in our Gypsum segment. As of December 31, 2014,
we had no assets classified as held for sale.
Intangible Assets
We perform impairment tests for intangible assets with indefinite useful lives as of October 31 of each year, or more frequently if events occur or
circumstances change that would more likely than not reduce the fair value of an intangible asset below its carrying value. The impairment test consists of a
comparison of the fair value of the asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is
recognized in an amount equal to that excess. Intangible assets determined to have indefinite useful lives, primarily comprised of trade names, are not
amortized. An income approach is used for valuing trade names. Assumptions used in the income approach include projected revenues and assumed royalty,
long-term growth and discount rates. We perform impairment tests on definite lived intangible assets, such as customer relationships, upon identification of
events or circumstances that may indicate the carrying amount of the assets might be unrecoverable by comparing their undiscounted cash flows with their
carrying value. If we determine impairment exists, the assets are written down to estimated fair value. As of December 31, 2014, we had $5 million of
intangible assets in other current assets on the consolidated balance sheet classified as assets held for sale.
Share-Based Compensation
We award share-based compensation to employees in the form of stock options, restricted stock units, market share units, and performance shares and to
directors in the form of shares of our common stock. All grants under share-based payment programs are accounted for at fair value at the date of grant. We
recognize expense on all share-based awards to employees expected to vest over the service period, which is the shorter of the period until the employees
retirement eligibility dates or the service period of the award.
Derivative Instruments
We use derivative instruments to manage selected commodity price and foreign currency exposures. We do not use derivative instruments for speculative
trading purposes, and we typically do not hedge beyond three years. All derivative instruments must be recorded on the balance sheet at fair value. For
derivatives designated as fair value hedges, the changes in the fair values of both the derivative instrument and the hedged item are recognized in earnings in
the current period. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is recorded to AOCI, and
is reclassified to earnings when the underlying forecasted transaction affects earnings. The ineffective portion of changes in the fair value of
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the derivative is reported in cost of products sold in the current period. We periodically reassess the probability of the underlying forecasted transaction
occurring. For derivatives designated as net investment hedges, we record changes in fair value to AOCI. For derivatives not designated as hedging
instruments, all changes in fair value are recorded to earnings in the current period.
Currently, we are using swaps to hedge a significant portion of our anticipated purchases of natural gas to be used in our manufacturing operations.
Generally, we hedge the cost of a majority of our anticipated purchases of natural gas over the next 12 months. However, we review our positions regularly
and make adjustments as market conditions warrant. The majority of contracts currently in place are designated as cash flow hedges, and the remainder are
not designated as hedging instruments.
We have operations in a number of countries and use forward contracts from time-to-time to hedge the risk of changes in cash flows resulting from
selected forecasted intercompany and third-party sales or purchases, as well as intercompany loans, denominated in non-U.S. currencies, or to hedge the risk
of selected changes in our net investment in foreign subsidiaries. These contracts are designated as either cash flow hedges or net investment hedges or are
not designated as hedging instruments.
Foreign Currency Translation
We translate foreign-currency-denominated assets and liabilities into U.S. dollars at the exchange rates existing as of the respective balance sheet dates. We
translate income and expense items at the average exchange rates during the respective periods. We record translation adjustments resulting from fluctuations
in exchange rates to AOCI on our consolidated balance sheets. We also record our share of the translation adjustments recorded by our equity method
investments to AOCI. We record transaction gains and losses to earnings. The total transaction loss was $6 million in 2014, $4 million in 2013 and none in
2012.
Fair Value Measurements
Certain assets and liabilities are required to be recorded at fair value. The estimated fair values of those assets and liabilities have been determined using
market information and valuation methodologies. Changes in assumptions or estimation methods could affect the fair value estimates. However, we do not
believe any such changes would have a material impact on our financial condition, results of operations or cash flows. There are three levels of inputs that
may be used to measure fair value:

Level 1 Quoted prices for identical assets and liabilities in active markets;

Level 2 Quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are
not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

Level 3 Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Certain assets and liabilities are measured at fair value on a nonrecurring basis rather than on an ongoing basis, but are subject to fair value
adjustments in certain circumstances, such as when there is evidence of impairment or when a new liability is being established that requires fair value
measurement.
2.

Recent Accounting Pronouncements

In April 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-08, "Reporting Discontinued
Operations and Disclosures of Disposals of Components of an Entity," which includes amendments that change the requirements for reporting discontinued
operations and require additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in
operations - that is, a major effect on the organization's operations and financial results - should be presented as discontinued operations. Examples include a
disposal of a major geographic area, a major line of business, or a major equity method investment. Additionally, ASU 2014-08 requires expanded disclosures
about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of
discontinued operations. This update is effective for us in the first quarter of 2015. We do not expect that the adoption of ASU 2014-08 will have a
significant impact to our consolidated financial statements or disclosures.
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. ASU 2014-09 supersedes the revenue recognition
requirements in Revenue Recognition (Topic 605), and requires entities to recognize revenue in a way that depicts the transfer of promised goods or
services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. There
are two transition methods available under the new standard, either cumulative effect or retrospective. The standard will be effective for us in the first quarter
of 2017, with early adoption not permitted. We will adopt the new standard using the modified retrospective approach, which requires the
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standard be applied only to the most current period presented, with the cumulative effect of initially applying the standard recognized at the date of initial
application. We do not expect that the adoption of ASU 2014-09 will have a significant impact to our consolidated financial statements or disclosures.
In August 2014, the FASB issued ASU 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," which
requires management to assess, at each annual and interim reporting period, the entity's ability to continue as a going concern within one year of date of the
financial statements are issued and provide related disclosures. The new standard will be effective for us for the year ended December 31, 2016, with early
adoption permitted. We do not expect that the adoption of ASU 2014-15 will have a significant impact to our consolidated financial statements or
disclosures.
3. Equity Method Investments
Equity method investments were as follows:
December 31, 2014
(millions)

Carrying Value

USG Boral Building Products

Other equity method investments

$

Total equity method investments

689

50%

46

33% - 50%

735

December 31, 2013

Ownership
Percentage

Carrying Value
N/A

Ownership
Percentage
N/A

73

73

33% - 50%

Investments in USG Boral Building Products (UBBP)

On February 27, 2014, we formed the 50/50 joint ventures, USG Boral Building Products Pte. Limited, a company organized under the laws of Singapore, and
USG Boral Building Products Pty Limited, a company organized under the laws of Australia, with Boral. These joint ventures are herein referred to as UBBP.
UBBP manufactures, distributes and sells certain building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia, Australasia
and the Middle East (the "Territory"). The products that UBBP manufactures and distributes include products for wall, ceiling, floor lining and exterior
systems that utilize gypsum wallboard, referred to as plasterboard in the region, mineral fiber ceiling tiles, steel grid and studs and joint compound.
As consideration for our 50% ownership in UBBP, we (i) made a cash payment of $515 million to Boral, which includes a $500 million base price and
$15 million of customary estimated working capital and net debt adjustments, (ii) contributed to UBBP our subsidiaries and joint venture investments in
China, Singapore, India, Malaysia, New Zealand, Australia, the Middle East and Oman, see Note 19, and (iii) granted to UBBP licenses to use certain of our
intellectual property rights in the Territory. We funded our cash payment with the net proceeds from our October 2013 issuance of $350 million of 5.875%
senior notes and cash on hand. In the event certain performance targets are satisfied by UBBP, we will be obligated to pay Boral scheduled earnout payments
in an aggregate amount up to $75 million, comprised first of $25 million based on performance during the first three years after closing and then up to $50
million based on performance during the first five years after closing.
We account for our 50% investments in UBBP using the equity method of accounting, and we initially measured their carrying value at cost of
approximately $676 million as of February 27, 2014. Our existing wholly-owned subsidiaries and consolidated variable interest entities that were
contributed into the joint venture were deconsolidated resulting in a gain of $27 million, which is included in our consolidated statement of operations for
the year ended December 31, 2014. Approximately $11 million of the gain relates to the remeasurement of our retained investment in the contributed
subsidiaries to fair value, determined using a discounted cash flow model with several inputs, including a weighted-average discount rate of approximately
11% and a weighted-average long-term growth rate of approximately 2%. Additionally, we recorded a liability of $23 million representing the present value
of the first earnout payment, which is included in other liabilities on our accompanying consolidated balance sheet as of December 31, 2014. We are not
currently required under applicable accounting guidance to record a liability for the second earnout payment, as such, a liability has not been recorded on
our consolidated balance sheet as of December 31, 2014.
All of our investments accounted for under the equity method are initially recorded at cost and subsequently adjusted for our share of the net income
or loss and cash contributions and distributions to or from these entities. Because the underlying net assets in our investments are denominated in a foreign
currency, translation gains or losses will impact the recorded value of our investments and, for the year ended December 31, 2014, resulted in a net loss of
$34 million recorded in other comprehensive income (loss). For the year ended December 31, 2014, our accompanying consolidated statement of operations
includes $35 million of income from equity method investments, representing our share of ten months of results of UBBP of
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$33 million and our share of income from our other equity method investments of $2 million. The amount of consolidated retained earnings which represents
undistributed earnings from UBBP is $33 million.
Summarized Financial Information
Summarized financial information for our equity method investments is as follows:
Statement of Operations
For the year ended December 31,
(millions)

2014(a)

2013

2012

USG Boral Building Products:

Net sales

927

N/A

N/A

251

N/A

N/A

Operating profit

95

N/A

N/A

Net income from continuing operations

72

N/A

N/A

Net income

72

N/A

N/A

Net income attributable to USG Boral Building Products

67

N/A

N/A

USG share of income from USG Boral Building Products

33

N/A

N/A

35

Gross profit

Other equity method investments(b):

USG share of income from other investments accounted for using the equity method
Total income from equity method investments
(a)

Operating results are presented for UBBP for the ten months ended December 31, 2014.

(b) Amounts represent our share of income or loss from all equity method investments, other than UBBP. For the twelve months ended December 31, 2014, the amount reflected
includes two months of our share of income from equity method investments from the joint ventures which we owned prior to being contributed to UBBP on February 27, 2014.

Balance Sheet
(millions)

December 31, 2014

USG Boral Building Products:

Current assets

446

Non-current assets

989

Current liabilities(c)

245

Long-term debt

46

Other non-current liabilities

21

Shareholders' equity (d)

(c)

1,123

Includes the current portion of long-term debt of $35 million.

(d) Shareholders' equity includes $70 million related to non-controlling interests.

4. Discontinued Operations
On August 7, 2012, USG and its indirect wholly owned subsidiaries, USG Foreign Investments, Ltd. and USG (U.K.) Ltd., together the Sellers, entered into a
Share and Asset Purchase Agreement, or SAPA, with Knauf International GmbH and Knauf AMF Ceilings Ltd., together Knauf, pursuant to which the Sellers
agreed to sell to Knauf certain of their wholly owned European business operations. Those businesses include the manufacture and distribution of DONN
brand ceiling grid and SHEETROCK brand finishing compounds principally throughout Europe, Russia and Turkey.
On December 27, 2012, the sale of the European business operations was completed in accordance with the terms of the SAPA, and we received net
proceeds of $73 million resulting in a gain of $55 million, net of tax. Affiliates of Knauf are the beneficial owners of approximately 10% of USGs
outstanding shares of common stock.
The results of our European business operations sold to Knauf are classified as discontinued operations in the consolidated financial statements and
accompanying footnotes presented in this report.
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Sales from discontinued operations, operating profit from discontinued operations and income (loss) from discontinued operations before income taxes
were as follows:
For the year ended December 31,
(millions)

2014

Sales from discontinued operations

2013

2012

106

Operating profit from discontinued operations

Income (loss) from discontinued operations before income taxes

(1)

5.

Marketable Securities

Our investments in marketable securities as of December 31, 2014 and 2013 consisted of the following:
2014

2013

Amortized
Cost

millions
Corporate debt securities

Fair
Value
93

Amortized
Cost
93

Fair
Value
87

87

U.S. government and agency debt securities

22

22

12

12

Asset-backed debt securities

17

17

20

20

Certificates of deposit

18

18

17

17

Municipal debt securities

$

Total marketable securities

154

154

142

6
$

142

The realized and unrealized gains and losses as of and for the years ended December 31, 2014, 2013 and 2012 were immaterial.
Contractual maturities of marketable securities as of December 31, 2014 were as follows:
Amortized
Cost

(millions)
Due in 1 year or less

Fair
Value
96

Due in 1-5 years

96

154

58
$

Total marketable securities

154

58

Actual maturities may differ from the contractual maturities because issuers of the securities may have the right to prepay them.
6.

Intangible Assets

Intangible assets are included in other assets on the consolidated balance sheets. Intangible assets with definite lives are amortized. These assets are
summarized as follows:
As of December 31, 2014
Gross
Carrying
Amount

(millions)

As of December 31, 2013

Accumulated
Amortization

Gross
Carrying
Amount

Net

Accumulated
Amortization

Net

Intangible Assets with Definite Lives:

Customer relationships

Total

70

(54)

Other
$

79

16

(7)
$

(61)

70

2
$

18

(48)

9
$

79

22

25

(6)
$

(54)

The weighted average amortization periods are 10 years for customer relationships and 11 years for other intangible assets with definite lives. Total
amortization expense was $7 million in 2014, $7 million in 2013 and $8 million in 2012. Estimated annual amortization expense is as follows:
(millions)

2015

Estimated annual amortization expense

59

2016
7

2017
7

2019 and
thereafter

2018
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Intangible assets with indefinite lives are not amortized. These assets are summarized as follows:
As of December 31, 2014
Gross
Carrying
Amount

(millions)

As of December 31, 2013

Impairment
Charges

Gross
Carrying
Amount

Net

Impairment
Charges

Net

Intangible Assets with Indefinite Lives:

Trade names

22

Other
$

Total

31

1
$

22

8
$

30

22

8
$

22

29

30

In 2014, 2013 and 2012, there was no impairment for any of our customer relationship or trade name intangible assets.
Intangible assets are included in other assets on our consolidated balance sheets, except for approximately $5 million of other indefinite-lived
intangible assets which met the criteria to be classified as held for sale during the second quarter of 2014 and therefore are included in other current assets on
our consolidated balance sheet as of December 31, 2014.
7.

Debt

Total debt as of December 31 consisted of the following:

(millions)

2014

5.875% senior notes due 2021

2013
350

350

6.3% senior notes due 2016

500

500

7.75% senior notes due 2018

500

500

7.875% senior notes due 2020 (net of discount: 2014 - $1; 2013 - $1)

249

249

8.375% senior notes due 2018

350

350

9.75% senior notes due 2014

59

10% convertible senior notes due 2018 (net of discount: 2013 - $3)

72

Ship mortgage facility (includes current portion of long-term debt: 2014 - $4; 2013 - $4)

21

25

Credit facilities of Oman joint ventures

11

239

239

Industrial revenue bonds (due 2028 through 2034)

$

Total

2,209

2,355

Debt Repayment
On August 1, 2014, we repaid the remaining of $59 million of principal balance of our 9.75% senior notes due 2014.
Senior Notes
All of the senior notes are senior unsecured obligations and rank equally with all of our other existing and future unsecured senior indebtedness. The
indentures governing the notes contain events of default, covenants and restrictions that are customary for similar transactions, including a limitation on our
ability and the ability of certain of our subsidiaries to create or incur secured indebtedness.
Our obligations under the 5.875%, 7.875%, and 8.375% senior notes are guaranteed on a senior unsecured basis by certain of our domestic
subsidiaries. All of these senior notes contain a provision requiring us to offer to purchase those notes at a premium of 101% of their principal amount (plus
accrued and unpaid interest) in the event of a change in control. The 7.75% and 6.3% senior notes contain a provision requiring us to offer to purchase those
notes at a premium of 101% of their principal amount (plus accrued and unpaid interest) in the event of a change in control and a related downgrade of the
rating on the notes to below investment grade by both Moodys Investors Service and Standard & Poors Financial Services LLC.
The interest rate payable on the 7.75% senior notes is subject to adjustment from time to time by up to 2% in the aggregate if the debt ratings assigned
to the notes are upgraded or thereafter downgraded. There have been no adjustments to the amount of interest rate payable during the years ending December
31, 2014, 2013 or 2012.
The 6.3% and 7.75% senior notes contain a provision that allows us to redeem the notes in whole at any time, or in part from time to time, at our
option, at a redemption price equal to the greater of (1) 100% of the principal amount of the notes being redeemed and (2) the sum of the present value of the
remaining scheduled payments of principal and interest on the notes being redeemed discounted to the redemption date on a semi-annual basis at the
applicable U.S. Treasury rate plus a spread (as
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outlined in the respective indentures), plus, in each case, any accrued and unpaid interest on the principal amount being redeemed to the redemption date.
The 8.375% senior notes contain a similar provision that allows us to redeem those notes, in whole or in part from time to time, at our option, on or
after October 15, 2014 at stated redemption prices, plus any accrued and unpaid interest to the redemption date.
The 7.875% senior notes contain a similar provision that allows us to redeem those notes, in whole or in part from time to time, at our option, on or
after March 30, 2016 at stated redemption prices, plus any accrued and unpaid interest to the redemption date. In addition, we may redeem the notes in whole
or in part from time to time, at our option, prior to March 30, 2016 at a redemption price equal to 100% of the principal amount of the notes being redeemed
plus a premium (as specified in the supplemental indenture with respect to those notes), plus any accrued and unpaid interest.
The 5.875% senior notes contain a similar provision that allows us to redeem those notes, in whole or in part from time to time, at our option, on or
after November 1, 2016 at stated redemption prices, plus any accrued and unpaid interest to the redemption date. In addition, we may redeem the notes in
whole or in part from time to time, at our option, prior to November 1, 2016 at a redemption price equal to 100% of the principal amount of the notes
redeemed plus a premium (as specified in the supplemental indenture with respect to those notes), plus any accrued and unpaid interest.
Conversion of Convertible Senior Notes
In November 2013, we issued a notice of redemption to redeem $325 million in aggregate principal amount of our 10% convertible senior notes due 2018 at
the stated redemption price of 105%. The notes could either be (1) redeemed at a stated redemption price or (2) converted into shares of our common stock. In
December 2013, the holders of all $325 million in notes called for redemption elected to convert their notes into shares of our common stock. Accordingly,
we issued an additional 28,508,768 shares of our common stock in connection with the conversion of the notes. As of December 31, 2013, we had
$75 million aggregate principal amount of 10% convertible senior notes due 2018 that were recorded on the consolidated balance sheet at $72 million, net of
debt discount of $3 million.
In March 2014, we issued a notice of redemption to redeem the remaining $75 million in aggregate principal amount of outstanding notes. The holders
of all $75 million in notes called for redemption elected to convert their notes into shares of USGs common stock. Accordingly, in April 2014, we issued an
additional 6,578,946 shares of our common stock in connection with the conversion of the notes.
Affiliates of Berkshire Hathaway, Inc., who own approximately 30% of our outstanding shares of common stock as of December 31, 2014, held
$300 million of these notes, prior to the December 2013 and April 2014 conversion. As of December 31, 2013, affiliates of Berkshire Hathaway, Inc. held
$56 million of these notes, which are reflected on our consolidated balance sheet, net of unamortized debt discount, at $54 million. Our consolidated
statements of operations include the related interest expense of $2 million for the year ended December 31, 2014, $29 million for the year end ended
December 31, 2013, and $31 million for the year ended December 31, 2012, including the related accretion of the original debt discount. Our consolidated
balance sheet as of December 31, 2013 includes the related accrued interest, in accrued expenses, of $0.5 million.
2012 Repurchase of 9.75% Senior Notes and Issuance of 7.875% Senior Notes
On April 12, 2012, we completed a cash tender offer pursuant to which we repurchased approximately $118 million of our 9.75% senior notes due in 2014 for
aggregate consideration, including tender offer premium and accrued and unpaid interest, of approximately $136 million. Subsequent to the completion of
the cash tender offer, we repurchased an additional $123 million of these notes in privately negotiated transactions, for aggregate consideration, including
premiums and accrued and unpaid interest, of $145 million. As a result of the repurchases, in the second quarter of 2012, we recorded a loss on early
extinguishment of debt of $41 million, including premiums, the write-off of unamortized debt discount and deferred financing fees. There were no amounts
outstanding related to these notes at December 31, 2014. Also on April 12, 2012, we issued $250 million of 7.875% senior notes due March 30, 2020. The
net proceeds from the issuance of these notes and cash on hand were used to fund the repurchases of the 9.75% senior notes and all related costs and
expenses. We deferred $5 million of financing costs which we are amortizing to interest expense over the term of the notes. As of December 31, 2014 and
2013, these notes are recorded on the consolidated balance sheet at $249 million, net of unamortized debt discount of $1 million.
Credit Facility
On October 22, 2014, we amended and restated our credit facility in order to, among other things, join CGC, Inc., or CGC, as a party and to increase the
maximum borrowing limit under the credit agreement from $400 million to $450 million (including a $50 million borrowing sublimit for CGC). As amended
and restated, the credit agreement allows for the borrowing of revolving loans and issuance of letters of credit (up to a maximum of $200 million at any time
outstanding, in aggregate) to USG and its
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subsidiaries. Pursuant to the credit agreement, the maximum principal amount of revolving loans and letters of credit that may be borrowed by and/or be
issued in favor USG and CGC at any time may fluctuate based upon two separate borrowing base calculations. The maximum allowable borrowings may be
increased at our request with the agreement of the lenders providing increased or new lending commitments, provided that the maximum allowable
borrowings after giving effect to the increase may not exceed $650 million.
USG's obligations under the credit facility are guaranteed by USG and its significant domestic subsidiaries and secured by their and USGs trade
receivables and inventory. CGC's obligation's under the credit facility are secured by trade receivables and inventory of certain subsidiaries. The credit
facility matures on October 22, 2019 unless terminated earlier in accordance with its terms. The credit facility is available to fund working capital needs and
for other general corporate purposes.
The credit agreement contains a financial covenant that would require us to maintain a minimum fixed charge coverage ratio of not less than 1.0 to 1.0
if the excess of availability (as defined in the credit agreement) is less than an amount equal to 10% of the lesser of (a) the aggregate revolving commitment at
such time and (b) the aggregate borrowing base at such time. We would be required to continue to comply with such financial covenant until availability
under the credit agreement exceeds such minimum threshold for 30 consecutive calendar days thereafter. As of December 31, 2014, our fixed charge coverage
ratio was 1.18-to-1. Because we currently satisfy the required fixed charge coverage ratio, we are not required to maintain a minimum borrowing availability
under the credit facility. The credit agreement contains other covenants and events of default that are customary for similar agreements and may limit our
ability to take various actions. The credit agreement limits our ability to pay a dividend or repurchase our stock.
Taking into account the most recent borrowing base calculation delivered under the credit facility, which reflects trade receivables and inventory as of
December 31, 2014, and outstanding letters of credit, borrowings available under the credit facility were approximately $291 million, including $50 million
for CGC. As of December 31, 2014 and during the year then-ended, there were no borrowings under the facility. Had there been any borrowings as of that
date, the applicable interest rate would have been 2.01% for loans in the US and 3.05% for loans in Canada. Outstanding letters of credit totaled $54 million,
including $0.8 million for CGC, as of December 31, 2014.
Oman Credit Facilities
In June 2013, our joint ventures in Oman, which at the time and prior to their contribution to UBBP were fully consolidated, each entered into separate
secured credit agreements, which are guaranteed by us and our joint venture partner. The credit agreement for Zawawi Gypsum LLC, or ZGL, which matures
in 2020, provides for term loans not to exceed $10 million and overdraft and letter of credit facilities of approximately $3 million in the aggregate. The credit
agreement for USG-Zawawi Drywall LLC, or ZDL, which matures in 2022, provides for term loans not to exceed $26 million and overdraft and letter of credit
facilities of $5 million in the aggregate. Each credit agreement is secured by a general security interest in the applicable joint venture's assets. Loans under
the credit agreements may be made in Omani Rial or U.S. dollars. Loans made in Omani Rial bear interest at 4% and loans made in U.S. dollars bear interest at
a floating rate based on LIBOR plus 3.5%. Loans may be repaid at any time, subject to a prepayment penalty if repaid within the first two years, for ZGL, or
three years, for ZDL. See Note 19 for discussion of our contribution of ZGL and ZDL, and the corresponding Oman credit facilities, into UBBP on
February 27, 2014. See further description of our investments in UBBP in Note 3.
Ship Mortgage Facility
Our subsidiary, Gypsum Transportation Limited, or GTL, has a secured loan facility agreement with DVB Bank SE, as lender, agent and security trustee. Both
advances provided for under the secured loan facility have been drawn, and the total outstanding loan balances under the facility were $21 million as of
December 31, 2014 and $25 million as of December 31, 2013. Of the total amounts outstanding on our consolidated balance sheets as of December 31, 2014
and December 31, 2013, $4 million was classified as current portion of long-term debt as of both financial statement dates.
The loan balance under the secured loan facility bears interest at a floating rate based on LIBOR plus a margin of 1.65%. The interest rate was 1.97% as
of December 31, 2014. Each advance is repayable in quarterly installments in amounts determined in accordance with the secured loan facility agreement,
with the balance of each advance repayable eight years after the date it was advanced, or October 31, 2016 and May 22, 2017. The secured loan facility
agreement contains affirmative and negative covenants affecting GTL and certain customary events of default. GTL has granted DVB Bank SE a security
interest in the Gypsum Centennial and Gypsum Integrity ships and related insurance, contract, account and other rights as security for borrowings under the
secured loan facility. USG Corporation has guaranteed the obligations of GTL under the secured loan facility and has agreed to maintain liquidity of at least
$175 million. See Note 14 for discussion of GTL and related subsequent event.
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Industrial Revenue Bonds

Our $239 million of industrial revenue bonds have fixed interest rates ranging from 5.5% to 6.4%. The weighted average rate of interest on our industrial
revenue bonds is 5.875%. These bonds mature during the years 2028 through 2034.
OTHER INFORMATION

The fair value of our debt was $2.338 billion as of December 31, 2014 and $2.659 billion as of December 31, 2013 and was determined using the fair value
hierarchy of inputs described in Note 1. The fair values were based on quoted prices for identical or similar liabilities in markets that are not active or
valuation models in which all significant inputs and value drivers are observable and, as a result, are classified as Level 2.
Interest accrued on our debt as of December 31, 2014 and December 31, 2013 was $45 million and $48 million, respectively.
As of December 31, 2014, we were in compliance with the financial covenants contained in our credit facilities.
As of December 31, 2014, the amounts of total debt outstanding maturing in each of the next five years and beyond were as follows:
(millions)
Debt maturities

8.

2015
$

2016
6

507

2017
$

2018
8

850

2019
$

After 2019

839

Derivative Instruments

COMMODITY DERIVATIVE INSTRUMENTS

As of December 31, 2014, we had 26 million mmBTUs (millions of British Thermal Units) in aggregate notional amount of outstanding natural gas swap
contracts to hedge forecasted purchases. All of these contracts mature by December 31, 2017. For contracts designated as cash flow hedges, the unrealized
loss that remained in AOCI as of December 31, 2014 was $20 million. No ineffectiveness was recorded on contracts designated as cash flow hedges in 2014.
Gains and losses on contracts designated as cash flow hedges are reclassified into earnings when the underlying forecasted transactions affect earnings. For
contracts designated as cash flow hedges, we reassess the probability of the underlying forecasted transactions occurring on a regular basis. Changes in fair
value on contracts not designated as cash flow hedges are recorded to earnings. The fair value of those contracts not designated as cash flow hedges was a $5
million unrealized loss as of December 31, 2014.
FOREIGN EXCHANGE DERIVATIVE INSTRUMENTS

We have foreign exchange forward contracts to hedge purchases of products and services denominated in foreign currencies. The notional amount of these
contracts was $72 million as of December 31, 2014, and they mature by June 30, 2016. These forward contracts are designated as cash flow hedges and no
ineffectiveness was recorded in 2014. Gains and losses on the contracts are reclassified into earnings when the underlying transactions affect earnings. The
fair value of these contracts that remained in AOCI was a $3 million unrealized gain as of December 31, 2014.
During the third quarter of 2012, we entered into foreign exchange forward contracts to hedge a portion of our net investment in one of our European
subsidiaries. The notional amount of these contracts was $25 million and they matured on October 29, 2012. These forward contracts were designated as net
investment hedges and no ineffectiveness was recorded. Gains and losses on derivatives designated as net investment hedges, to the extent they are effective
as hedges, remain in AOCI until such point when the investment is either sold or liquidated. On December 27, 2012, we sold the subsidiary and, as a result,
we reclassified the $1 million loss from AOCI to earnings as a reduction to the gain on the sale of the businesses. See Note 4 for further discussion on the sale.
COUNTERPARTY RISK

We are exposed to credit losses in the event of nonperformance by the counterparties to our derivative instruments. As of December 31, 2014, our derivatives
were in a $22 million net liability position. All of our counterparties have investment grade credit ratings; accordingly, we anticipate that they will be able to
fully satisfy their obligations under the contracts.
All of our derivative contracts are governed by master netting agreements negotiated between us and the counterparties that reduce our counterparty
credit exposure. The agreements outline the conditions (such as credit ratings and net derivative fair values) upon which we, or the counterparties, are
required to post collateral. As required by certain of our agreements, we had $19 million of collateral posted with our counterparties related to our derivatives
as of December 31, 2014. Amounts paid as cash collateral are included in receivables on our consolidated balance sheets.
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We have not adopted an accounting policy to offset fair value amounts related to derivative contracts under our master netting arrangements;
therefore, individual derivative contracts are reflected on a gross basis, as either assets or liabilities, on our consolidated balance sheets, based on their fair
value as of the balance sheet date.
FINANCIAL STATEMENT INFORMATION

The following are the pretax effects of derivative instruments on the consolidated statements of operations and the consolidated statements of comprehensive
income (loss) for the years ended December 31, 2014, 2013 and 2012:
Amount of Gain or (Loss)
Recognized in
Other Comprehensive Income (Loss) on
Derivatives (Effective Portion)
(millions)

2014

2013

Location of Gain or (Loss)

Reclassified from
AOCI into Income
(Effective Portion)

Amount of Gain or (Loss) Reclassified from

AOCI into Income
(Effective Portion)

2012

2014

2013

2012

Derivatives in Cash Flow Hedging Relationships

Commodity contracts

Foreign exchange contracts

(19)

(4)

Cost of products sold

1
3

(1)

Cost of products sold

(2)

(10)

Derivatives in Net Investment Hedging

Relationships
Foreign exchange contracts
$

Total

(15)

Gain on sale of discontinued

operations

(5)

Location of Gain or (Loss)

Recognized in Income
on Derivatives

(1)

(9)

Amount of Gain or (Loss) Recognized in

Income
on Derivatives

(millions)

2014

2013

2012

Derivatives Not Designated as Hedging Instruments

Commodity contracts

Cost of products sold

Foreign exchange contracts

Other (income) expense, net

$

Total

(4)

(4)

As of December 31, 2014, we had no derivatives designated as net investment or fair value hedges.
The following are the fair values of derivative instruments on the consolidated balance sheets as of December 31, 2014 and 2013:
Balance Sheet
Location

Balance Sheet
Location

Fair Value

(millions)

12/31/14

Fair Value

12/31/13

12/31/14

12/31/13

Derivatives in Cash Flow Hedging Relationships

Commodity contracts

Other current assets

Commodity contracts

Other assets

Foreign exchange contracts

Other current assets

Total derivatives in hedging relationships

Balance Sheet
Location

12/31/14

14

Other liabilities

Accrued expenses

Balance Sheet
Location

Fair Value

(millions)

Accrued expenses

21

Fair Value

12/31/13

12/31/14

12/31/13

Derivatives Not Designated as Hedging Instruments

Commodity contracts

Other current assets

Commodity contracts

Other assets

Total derivatives not designated as hedging instruments

Total derivatives

Total assets

64

Accrued expenses

Total liabilities

Other liabilities

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9.

Fair Value Measurements

Certain assets and liabilities are required to be recorded at fair value. The fair values of our cash equivalents, equity mutual funds, marketable securities and
derivatives were determined using the fair value hierarchy of inputs described in Note 1. The cash equivalents shown in the table below primarily consist of
money market funds that are valued based on quoted prices in active markets and, as a result, are classified as Level 1. Equity mutual funds are valued based
on quoted markets in active markets and, as a result, are classified as Level 1. We use quoted prices, other readily observable market data and internally
developed valuation models when valuing our derivatives and marketable securities and have classified them as Level 2. Derivatives are valued using the
income approach including discounted-cash-flow models or a Black-Scholes option pricing model and readily observable market data. The inputs for the
valuation models are obtained from data providers and include end-of-period spot and forward natural gas prices and foreign currency exchange rates, natural
gas price volatility and LIBOR and swap rates for discounting the cash flows implied from the derivative contracts. Marketable securities are valued using
income and market value approaches and values are based on quoted prices or other observable market inputs received from data providers. The valuation
process may include pricing matrices, or prices based upon yields, credit spreads or prices of securities of comparable quality, coupon, maturity and type.
Our assets and liabilities measured at fair value on a recurring basis were as follows:
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
(millions)
Cash equivalents
Equity mutual funds

12/31/14
$

93

Significant
Other
Observable
Inputs
(Level 2)

12/31/13
$

549

12/31/14
$

32

Significant
Unobservable
Inputs
(Level 3)

12/31/13
$

24

12/31/14
$

Total

12/31/13
$

12/31/14
$

125

12/31/13
$

573

Corporate debt securities

93

87

93

87

U.S. government and agency debt securities

22

12

22

12

Asset-backed debt securities

17

20

17

20

Certificates of deposit

18

17

18

17

Municipal debt securities

Derivative assets

Derivative liabilities

(26)

(26)

Marketable securities:

Certain assets and liabilities are measured at fair value on a nonrecurring basis rather than on an ongoing basis, but are subject to fair value
adjustments in certain circumstances, such as when there is evidence of impairment or when a new liability is being established that requires fair value
measurement. As disclosed in Note 13, during 2014 and 2012, we recorded asset impairment charges of $90 million and $8 million, respectively.
During the fourth quarter of 2014, we reviewed the carrying value of the ocean vessels owned by GTL, our wholly owned subsidiary, for potential
impairment by comparing the carrying value of those assets with their fair values. To determine the estimated fair value for the ocean vessels, we engaged a
third-party ship broker. Management developed our estimate of fair value by considering comparable sales for similar asset types and incorporating an
adjustment for the specialized nature of these assets. This fair value measurement is classified as Level 3, and, as disclosed in Notes 13 and 14, we recorded a
long-lived asset impairment charge of $60 million during the fourth quarter of 2014.
During the third quarter of 2014, we reviewed our property, plant and equipment for potential impairment by comparing the carrying values of those
assets with their fair values as estimated using the future undiscounted cash flows for their remaining useful lives. We measured the fair value of the
machinery, equipment and buildings as of September 30, 2014 using measurements classified as Level 3, and, as disclosed in Note 13, we recorded long-lived
asset impairment charges of $30 million.
During 2012, we reviewed our property, plant and equipment for potential impairment by comparing the carrying values of those assets with their
estimated future undiscounted cash flows for their remaining useful lives and determined that impairment existed for machinery and equipment for a
previously idled production line. We measured the fair value of that machinery and equipment as of June 30, 2012 using measurements classified as Level 3
and recorded a long-lived asset impairment charge of $1 million.
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Also during 2012, as a result of a change in estimate related to reclamation activities at our permanently closed gypsum quarry and ship loading
facility in Windsor, Nova Scotia, Canada, we increased the related asset retirement obligation by $7 million with a corresponding increase to the long-lived
Windsor assets. Consequently, we recorded a long-lived asset impairment charge of $7 million to impair the assets down to a fair value of $6 million which
was determined using measurements classified as Level 3. Both of the 2012 impairment charges are included in long-lived asset impairment charges in the
consolidated statements of operations as disclosed in Note 13.
10. Employee Retirement Plans
We maintain defined benefit pension plans for most of our employees. Most of these plans require employee contributions in order to accrue benefits.
Benefits payable under the plans are based on employees years of service and compensation during specified years of employment. Effective December 31,
2010, we amended the USG Corporation defined benefit pension plan to replace the final average pay formula with a cash balance formula for employees
hired after that date.
We also maintain plans that provide postretirement benefits (retiree health care and life insurance) for eligible employees. Employees hired before
January 1, 2002 generally become eligible for the postretirement benefit plans when they meet minimum retirement age and service requirements. The cost of
providing most postretirement benefits is shared with retirees.
We had maintained a pension plan for our subsidiary USG (U.K.) Ltd which had been previously frozen to permanently eliminate future benefit
accruals. On December 12, 2014, we irrevocably purchased annuities for the remaining deferred members of the plan relieving us of the responsibility of the
pension benefit obligation, or PBO. Consequently, we recorded a settlement charge in selling and administrative expenses in the amount of $13 million and
removed the net pension asset from our consolidated balance sheet.
In 2013, we communicated to certain terminated vested participants in our USG Corporation Retirement Plan an option to receive a lump sum payment
for their accrued benefits. The option commenced on October 1, 2013 and expired on November 15, 2013. For participants who elected this option, payments
were made in December 2013, and we incurred a settlement charge of approximately $15 million, with a corresponding reduction in accumulated other
comprehensive income (loss). As a result, the measurement of the PBO, as of December 31, 2013 included a reduction of approximately $80 million.
In 2011, and as further discussed in the following paragraph, we amended our U.S. postretirement benefit plan to require retiree medical plan
participants to begin purchasing individual coverage in the Affordable Insurance Exchanges or individual Medicare marketplace beginning January 1, 2015
using a company-funded subsidy. The subsidy will be determined based upon years of service at retirement and Medicare eligibility. The subsidy provided to
retirees eligible for Medicare will end December 31, 2019. As a result of the amendment, the measurement of the accumulated postretirement benefit
obligation, or APBO, as of December 31, 2011 includes a reduction of approximately $100 million. This amendment was accounted for as a credit to
unrecognized prior service cost which will be amortized into the statement of operations over the average remaining service of active plan participants to
retirement eligibility.
In April 2014, we amended our U.S. postretirement benefit plan for those retiree medical plan participants who are pre-65 retirees, to defer the effective
date that requires participants to begin purchasing individual coverage in the Affordable Insurance Exchanges or individual Medicare marketplace using a
company-funded subsidy from January 1, 2015 to January 1, 2016. The financial statement impact of the plan amendment was immaterial.
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The components of net pension and postretirement benefit costs are summarized in the following table:
(millions)

2014

2013

2012

Pension Benefits:
Service cost of benefits earned

Interest cost on projected benefit obligation

37

38

32

65

63

64

(79)

(76)

(70)

Settlement (a)

13

16

Net amortization

24

43

34

Expected return on plan assets

Net pension cost

60

84

60

Postretirement Benefits:
Service cost of benefits earned
Interest cost on projected benefit obligation
Net amortization
$

Net postretirement benefit

(35)

(34)

(35)

(25)

(24)

(24)

(a) In 2014, the settlement charge related to the elimination of the PBO of the UK pension plan due to the purchase of annuities. In 2013, the settlement charge primarily related to
lump sum payments made to certain terminated vested participants in our U.S. Plan.

We use a December 31 measurement date for our plans. The accumulated benefit obligation, or ABO, for the defined benefit pension plans was $1.429
billion as of December 31, 2014 and $1.186 billion as of December 31, 2013.
As of December 31,
(millions)

2014

2013

Selected information for pension plans with accumulated benefit obligations in excess of plan assets:
Accumulated benefit obligation

(1,230)

1,113

Fair value of plan assets

(32)
3

Selected information for pension plans with benefit obligations in excess of plan assets:
$

Benefit obligation

(1,686)
1,340

Fair value of plan assets

67

(1,146)
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The following table summarizes projected benefit obligations, plan assets and funded status as of December 31:
Pension
(millions)

2014

Postretirement
2013

2014

2013

Change in Benefit Obligation:

Benefit obligation as of January 1

1,376

1,536

166

186

Service cost

37

38

Interest cost

65

63

(24)

(103)

Curtailment/settlements
Participant contributions
Benefits paid
Plan amendment

10

10

(81)

(38)

(20)

(21)

(13)

Actuarial (gain) loss

327

Foreign currency translation

(115)

(24)

Benefit obligation as of December 31

(16)

(5)

(4)

1,686

1,376

167

166

1,262

1,133

Change in Plan Assets:

Fair value as of January 1
Actual return on plan assets
Employer contributions
Participant contributions

132

203

64

71

12

13

10

10

Benefits paid

(81)

(38)

(20)

(21)

Curtailment/settlements

(24)

(103)

Foreign currency translation

(23)

(14)

Fair value as of December 31

Funded status

1,340
(346)

1,262

(114)

11

(167)

$
$

(166)

Components on the Consolidated Balance Sheets:

Noncurrent assets

Current liabilities

(9)

Noncurrent liabilities

(1)

(337)

Net liability as of December 31

(13)

(124)

(154)

(346)

(114)

490

259

(13)
(153)

(167)

24

(166)

Pretax Components in AOCI:

Net actuarial loss
Prior service credit

(1)
$

Total as of December 31

489

259

(140)
$

(116)

21
(179)

(158)

For our defined benefit pension plans, the 2014 actuarial loss of $327 million was primarily due to a decrease in the discount rates and the adoption of
the new mortality tables published by the Society of Actuaries used to determine the benefit obligation. The weighted-average discount rate decreased from
4.90% at December 31, 2013 to 4.10% at December 31, 2014 and increased from 4.20% at December 31, 2012 to 4.90% at December 31, 2013.
For the defined benefit pension plans, we estimate that during 2015 we will amortize from AOCI into net pension cost a net actuarial loss of $37
million and no prior service cost. For the postretirement benefit plans, we estimate that during 2015 we will amortize from AOCI into net postretirement cost a
net actuarial loss of $1 million and a prior service credit of $33 million.
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ASSUMPTIONS

The following tables reflect the assumptions used in the accounting for our plans:
Pension
2014

Postretirement
2013

2014

2013

Weighted average assumptions used to determine benefit obligations as of December 31:

Discount rate

4.10%

4.90%

Compensation increase rate

3.60%

3.50%

3.70%

4.60%

Discount rate

4.90%

4.20%

Expected return on plan assets

7.00%

7.00%

N/A

N/A

Compensation increase rate

3.50%

3.40%

N/A

N/A

N/A

N/A

Weighted average assumptions used to determine net cost for years ended December 31:
4.60%

3.95%

For the measurement of the accumulated postretirement plan obligation, or APBO, at December 31, 2014 for our U.S. postretirement health care plan,
the assumed health care cost trend rates start with an 7.30% increase in 2015, followed by a gradual decline in increases to 4.50% for 2022 and beyond. For
the measurement of the APBO at December 31, 2013, the assumed health care cost trend rates started with a 8% increase in 2014, followed by a gradual
decline in increases to 5% for 2020 and beyond.
Assumed health care cost trend rates can have a significant effect on the amounts reported for retiree health care costs. Effective January 1, 2011, and
considering the amendment in April 2014, we modified our U.S. postretirement health care plan to limit the increase in the annual amount we pay for retiree
health care coverage for certain current and future retirees to 3% per year, which mitigates the impact of the increasing health care cost trend rates, as any
additional increase will be the responsibility of plan participants. However, after January 1, 2016, due to the changes to the U.S. postretirement health care
plan announced in 2011, as previously described, we will no longer have a material exposure to health care cost inflation for that plan.
For the measurement of the APBO at December 31, 2014 for our Canadian postretirement health care plan, the assumed health care cost trend rates start
with a 8.25% increase in 2015, followed by a gradual decline in increases to 4% for 2032. For the measurement of the APBO at December 31, 2013, the
assumed health care cost trend rates started with a 8.5% increase in 2014, followed by a gradual decline in increases to 4% for 2032 and beyond.
A one percentage point change in the assumed health care cost trend rates would have the following effects on our U.S. and Canadian plans:
One-PercentagePoint Increase

(millions)
Effect on total service and interest cost

Effect on postretirement benefit obligation

One-PercentagePoint Decrease
1
13

(1)
(10)

RETIREMENT PLAN ASSETS

Investment Policies and Strategies: We have established investment policies and strategies for the defined benefit pension plans assets with a long-term
objective of maintaining the plans assets at a level equal to or greater than that of their liabilities (as measured by a funded ratio of 100% or more of the
ABO) and maximizing returns on the plans assets consistent with our moderate tolerance for risk. Contributions are made to the plans periodically as needed
to meet funding targets or requirements. Factors influencing our determination to accept a moderate degree of risk include the timing of plan participants
retirements and the resulting disbursement of retirement benefits, the liquidity requirements of the plans and our financial condition.
Our overall long-term objective is to achieve a 7.0% rate of return on plan assets with a moderate level of risk as indicated by the volatility of
investment returns. This rate of return target was established using a building block approach. In this approach, ranges of long-term expected returns for the
various asset classes in which the plans invest are estimated. The estimated ranges are primarily based on observations of historical asset returns and their
historical volatility. In determining the expected returns, we also consider consensus forecasts of certain market and economic factors that influence returns,
such as inflation, gross domestic product trends and dividend yields. We then calculate an overall range of likely expected rates of return by applying the
expected asset returns to the plans target asset allocation. The most likely rate of return is then determined and is adjusted to account for investment
management fees.
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Our investment strategy is to invest in a diversified mix of asset classes in accordance with an asset allocation that we believe is likely to achieve our
long-term target return while prudently considering risk. This strategy recognizes that many investment professionals believe that certain asset classes, such
as equities, may be expected to produce the greatest return in excess of inflation over time, but may also generate the greatest level of volatility. Conversely,
many investment professionals believe that an asset class such as fixed income securities may be likely to be less volatile, but may also produce lower returns
over time. In order to manage risk, the plans pension and investment committees periodically rebalance their asset allocations and monitor the investment
performance of the individual investment managers compared to their benchmark returns and investment guidelines on an ongoing basis, in part through the
use of quarterly investment portfolio reviews and compliance reporting by investment managers. The pension and investment committees also evaluate risk
by periodically conducting asset/liability studies to assess the correlation of the plans assets and liabilities and the degree of risk in the target asset
allocations. The plans limit the use of leverage to select investment strategies where leverage is typically employed, such as private equity and real estate.
Certain investment managers utilize derivatives, such as swaps, bond futures, and options, as part of their investment strategies. This is done primarily to gain
a desired market exposure or manage factors such as interest rate risk or duration of a bond portfolio. The following table shows the aggregate target asset
allocation on a weighted average basis for all the plans and the acceptable ranges around the targets as of December 31, 2014.
Investment Policy
Target

Range

Asset Categories:
Equity

39%

35% - 43%

Fixed income

49%

38% - 61%

Limited partnerships

6%

2% - 8%

Other real assets

6%

3% - 10%

0% - 5%

Cash equivalents and short-term investments

100%

Total

Equity investments are in institutional commingled/pooled equity funds, equity mutual funds and direct holdings of the common stock of U.S. and
non-U.S. companies. Both the equity funds and direct holdings are invested in companies with a range of market capitalizations. Fixed income securities
include U.S. Treasury securities, non-U.S. government debt securities such as Canadian federal bonds, corporate bonds of companies from diversified
industries and mortgage-backed securities. Limited partnerships include investments in funds that follow any of several different strategies, including
investing in distressed debt, energy development, infrastructure, and hedge funds. These investments use strategies with returns normally expected to have a
reduced correlation to the return of equities as compared to other asset classes and often provide a current income component that is a meaningful portion of
the investments total return. Other real assets primarily investments in large core, private real estate funds that directly own a diverse portfolio of properties
located in the United States. It also includes an allocation to funds investing in equities of real estate and infrastructure companies.
During 2012, we made contributions to our pension plans that included 1,249,219 shares of our common stock, or the Contributed Shares. The
Contributed Shares were contributed to the USG Corporation Retirement Plan Trust, or Trust, and were recorded on the consolidated balance sheet at the
June 25, 2012 closing price of $16.48 per share, or approximately $20.6 million in the aggregate. The Contributed Shares are not reflected on the
consolidated statement of cash flows because they were treated as a noncash financing activity. The Contributed Shares were valued for purposes of crediting
the contribution to the Trust at a discounted value of $16.01 per share ($16.48 less a 2.8% discount), or approximately $20 million in the aggregate, by an
independent appraiser retained by Evercore Trust Company, N.A., or Evercore, an independent fiduciary that has been appointed as investment manager with
respect to the Contributed Shares. The Contributed Shares are registered for resale, and Evercore has authority to sell some or all of them, as well as other of
our shares in the Trust, in its discretion as fiduciary. The remainder of our 2012 pension plan contributions, and all of our 2013 and 2014 contributions, were
made in cash. The Trust held no shares of our common stock as of December 31, 2014.
Fair Values of Plan Assets: Pension assets are classified based on the valuation methodologies and inputs used to determine the fair value as described in
Note 1.
Level 1 investments include mutual funds, or direct investments in common stocks of U.S. and non-U.S. companies that trade on liquid exchanges.
These investments are valued based on the closing price on these exchanges.
Level 2 investments include primarily fixed income securities such as corporate, or government debentures, mortgage- and asset-backed securities.
They are valued using income and market approaches and values are based on quoted prices or
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other observable market inputs received from data providers. The valuation process may include pricing matrices, or prices based upon yields, credit spreads
or prices of securities of comparable quality, coupon, maturity and type. Commingled funds not traded on an exchange, even though their underlying
investments are common stocks traded on liquid exchanges, are also included in the Level 2 category. The net asset value of commingled funds investing in
either stocks or fixed income securities is calculated by subtracting the value of any liabilities from the market value of all securities owned by a fund.
Level 3 investments include real estate, infrastructure, or direct energy investments as well as distressed securities or hedge funds. These are valued
using income approach methodologies such as discounted cash flows, or market approach methodologies such as relative value (specific to equity securities),
direct capitalization and comparable sales (specific to real estate investments). Some of the key inputs used to value these securities include discount rate,
EBITDA multiple, yield-to-worst, yield-to-maturity, and cap rate (specific to real estate investments).
The fair values by hierarchy of inputs as of December 31 were as follows:
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
(millions)

2014

Significant
Other
Observable
Inputs
(Level 2)

2013

2014

Significant
Unobservable
Inputs
(Level 3)

2013

2014

Total

2013

2014

2013

Asset Categories:
Equity: (a)
Common and preferred stock

Commingled/pooled/mutual funds

74

293

74

293

53

131

470

396

523

527

127

424

470

396

597

820

U.S. government and agency debt securities

195

23

195

23

Non-U.S. government and agency debt securities

30

15

30

15

Investment-grade debt securities

184

25

184

25

High-yield debt securities

39

39

Commingled/pooled funds

114

279

114

279

Other

Total fixed income

570

343

571

344

Limited partnerships (c)

103

39

103

39

Other real estate assets (d)

20

35

35

55

35

Cash equivalents and short-term investments (e)

17

22

17

Total equity
Fixed income: (b)

Total

127

424

1,077

761

139

75

Cash on hand
Receivables
Accounts payable

1,343

22
$

(4)
$

Total

1,260

1,340

(1)
$

1,262

(a) The majority of these funds are invested with investment managers that invest in common stocks of large capitalization U.S. companies. Certain investments in
commingled/pooled equity funds have been classified as Level 2 in 2014 and 2013 because observable quoted prices for these institutional funds are not available.
(b) Includes investments in individual fixed income securities and in institutional funds that invest in fixed income securities. For 2014 and 2013, these fixed income assets were
classified as Level 2.
(c) Limited partnerships include investments in funds that follow several different strategies, including investing in distressed debt, energy development, infrastructure, and hedge
funds. These investments use strategies with returns normally expected to have a low correlation to the return of equities and often provide a current income component that is
a meaningful portion of the investments total return.
(d) Includes investments in private real estate funds that invest primarily in a variety of property types in geographically diverse markets across the U.S. It also includes
commingled funds investing in equities of real-estate and infrastructure companies.
(e) Cash equivalents and short-term investments are primarily held in short-term investment funds or registered money market funds with daily liquidity.

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A reconciliation of the change in the fair value measurement of the defined benefit plans consolidated assets using significant unobservable inputs
(Level 3) between December 31, 2012 and December 31, 2014 is as follows:
Fixed
Income

(millions)
Balance as of January 1, 2013

Other Real Estate

Assets
1

Limited
Partnerships

36

Total

45

82

Realized gains (losses)

Unrealized gains (losses)

(1)

Purchases

Sales

(4)

(10)

(14)

Settlements

Purchases, sales and settlements:

Net transfers into (out of) Level 3

Balance as of December 31, 2013

35

39

75

Realized gains (losses)

Unrealized gains (losses)

(2)

(1)

Purchases

67

67

Sales

(2)

(1)

(3)

Settlements

Purchases, sales and settlements:

Net transfers into (out of) Level 3

Balance as of December 31, 2014

35

103

139

CASH FLOWS

For 2015, our defined benefit pension plans have no minimum funding requirements under the Employee Retirement Income Security Act of 1974. We are
evaluating our level of funding for pension plans and currently estimate that we will contribute approximately $67 million to our pension plans in 2015. Our
cash payments for postretirement plans are estimated to be $13 million in 2015.
Total benefit payments we expect to make to participants, which include payments funded from USGs assets as well as payments from our pension
plans' assets, are as follows (in millions):
Pension
Benefits

Years ended December 31

2015

Postretirement
Benefits
86

13

2016

84

10

2017

88

10

2018

101

10

2019

107

11

2020 - 2024

622

45

Total charges for our defined contribution plans amounted to approximately $6 million for the year ended December 31, 2014 and approximately $3
million for each of the years ended December 31, 2013 and 2012. These charges primarily consisted of contributions to our U.S. plan, commonly known as a
401(k) plan. The U.S. plan provides participating employees the opportunity to invest 1% to 75% of their compensation on a pretax and/or Roth after-tax
basis in any of 22 investment options offered, subject to limitations on the amount that may be contributed by highly compensated employees. Participants
earned a guaranteed company match of 10% on their contributions of up to 6% of their eligible compensation during 2013 and 2012. Effective as of January
1, 2014, the company match was increased to 25% of employee contributions up to 6% of their pay. Employees are fully vested in company matching
contributions after three years of participation in the plan. USGs contributions are charged to cost of products sold and selling and administrative expenses.
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11. Share-Based Compensation

We grant share-based compensation to eligible participants under our Long-Term Incentive Plan, or LTIP. The LTIP was approved by our Board of Directors
and stockholders. As of December 31, 2014, a total of 12.7 million shares of common stock were authorized for grants under the LTIP, of which 3.1 million
shares were reserved for future grants. The LTIP authorizes the Board, or the Boards Compensation and Organization Committee, to provide equity-based
compensation in the form of stock options, stock appreciation rights, or SARs, restricted stock, restricted stock units, or RSUs, market share units, or MSUs,
performance shares and units, and other cash and share-based awards for the purpose of providing our directors, officers and other employees incentives and
rewards for performance. We may issue common shares upon option exercises and upon the vesting or grant of other awards under the LTIP from our
authorized but unissued shares or from treasury shares.
Our expense for share-based arrangements was $21 million in 2014, $19 million in 2013 and $17 million in 2012 and is included in selling and
administrative expense in our consolidated statements of operations. No income tax benefits were recognized for share-based arrangements in the
consolidated statements of operations in 2014, 2013 and 2012. We recognize expense on all share-based awards over the service period, which is the shorter
of the period until the employees retirement eligibility dates or the service period of the award for awards expected to vest. For awards with graded vesting
that only contain a service condition, we recognize expense on a straight-line basis over the service period. Expense is generally reduced for estimated
forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
STOCK OPTIONS

We granted stock options in 2012 with exercise prices set at the closing price of USG common stock on the date of grant and a weighted average grant date
fair value was $8.39. We did not grant stock options in 2014 or 2013. The stock options generally become exercisable in four equal annual installments
beginning one year from the date of grant, although they may become exercisable earlier in the event of death, disability, retirement or a change in control.
The stock options generally expire ten years from the date of grant, or earlier in the event of death, disability or retirement.
We estimated the fair value of each stock option granted on the date of grant using a Black-Scholes option valuation model that uses the assumptions
noted in the following table. We based expected volatility on a 50% weighting of our historical volatilities and 50% weighting of implied USG volatilities.
The risk-free rate was based on zero-coupon U.S. government issues at the time of grant. The expected term was developed using the simplified method, as
permitted by the Securities and Exchange Commission because there is not sufficient historical stock option exercise experience available.
Assumptions:

2012

Expected volatility

59.03%

Risk-free rate

1.24%

Expected term (in years)

6.26

Expected dividends

A summary of stock options outstanding as of December 31, 2014 and of stock option activity during the fiscal year then ended is presented below:
Weighted
Average
Exercise
Price

Number of
Options
(000)
Outstanding at January 1, 2014

4,489

25.54

Exercised

(420)

11.51

Canceled

(69)

39.70

Forfeited

(18)

Weighted
Average
Remaining
Contractual
Term (years)

Aggregate
Intrinsic
Value
(millions)

5.21

39

15.36

Outstanding at December 31, 2014

3,982

26.81

4.14

31

Exercisable at December 31, 2014

3,560

28.12

4.77

26

Vested or expected to vest at December 31, 2014

3,982

26.77

4.17

31

Intrinsic value for stock options is defined as the difference between the current market value of our common stock and the exercise price of the stock
options. The total intrinsic value of stock options exercised was $8 million in 2014, $7 million in 2013 and $7 million in 2012 and cash received from the
exercise of stock options was $4 million in 2014, $4 million in 2013 and $4 million in 2012. As a result of the NOL we reported for federal tax purposes for
2014, 2013 and 2012, none of the excess tax benefit with respect to these exercises has been reflected in additional paid-in capital as of December 31, 2014.
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Included in our federal tax NOL carryforwards is $58 million for which a tax benefit of $20 million will be recorded in additional paid-in capital if the loss
carryforward is utilized.
As of December 31, 2014, there was $1 million of total unrecognized compensation cost related to nonvested share-based compensation awards
represented by stock options granted under the LTIP. We expect that cost to be recognized over a weighted average period of 1.1 years. The total fair value of
stock options vested was $2 million during 2014, $10 million during 2013 and $5 million during 2012.
MARKET SHARE UNITS

We granted market share units, or MSUs, during 2014 and 2013. The weighted average grant date fair value was $40.20 for MSUs granted in 2014 and $34.55
for MSUs granted in 2013. MSUs generally vest after a three-year period based on our actual stock price performance during such period. The number of
MSUs earned will vary from zero to 150% of the number of MSUs awarded depending on the actual performance of our stock price. In the case of termination
of employment due to death, disability or retirement during the performance period, vesting will be pro-rated based on the number of full months employed
in 2014. Awards earned will be issued at the end of the three-year period. MSUs may vest earlier in the case of a change in control in most circumstances only
if there is also a related loss of employment or diminution of duties. Each MSU earned will be settled in common stock.
We estimated the fair value of each MSU granted on the date of grant using a Monte Carlo simulation that used the assumptions noted in the following
table. Volatility was based on stock price history immediately prior to grant for a period commensurate with the expected term. The risk-free rate was based
on zero-coupon U.S. government issues at the time of grant. The expected term represents the period from the valuation date to the end of the performance
period.
Assumptions:

2014

2013

54.93%

60.97%

Risk-free rate

0.63%

0.35%

Expected term (in years)

2.94

2.38

Expected volatility

Expected dividends

Nonvested MSUs outstanding as of December 31, 2014 and MSU activity during 2014 were as follows:
Weighted
Number
of Shares
(000)

Weighted
Average
Grant Date
Fair Value

Nonvested at January 1, 2014

359

Granted

364

34.55
40.20

Vested

(174)

34.29

Forfeited

(38)

37.68

Nonvested at December 31, 2014

511

38.43

Half of the MSUs granted in 2013 vested after a two-year performance period ended December 31, 2014. Of those MSUs granted with a two-year
performance period, 174,271 vested for approximately 159,109 common shares based on the actual performance of our stock price. The remaining MSUs with
a two-year performance period granted in 2013 were forfeited.
Total unrecognized compensation cost related to nonvested share-based compensation awards represented by MSUs granted under the LTIP was $3
million as of December 31, 2014. We expect that cost to be recognized over a weighted average period of 1.8 years.
RESTRICTED STOCK UNITS

We granted RSUs during 2014, 2013 and 2012. The weighted average grant date fair value was $32.50 in 2014, $29.44 in 2013 and $15.49 in 2012. RSUs
granted prior to 2013 generally vest in three equal annual installments beginning three years from the date of grant. RSUs granted as special retention awards,
including those granted in 2014, generally vest after a specified number of years from the date of grant or at a specified date and RSUs granted with
performance goals vest if those goals are attained. RSUs may vest earlier in the case of death, disability, retirement or a change in control. Each RSU is settled
in a share of our common stock after the vesting period. The fair value of each RSU granted is equal to the closing market price of our common stock on the
date of grant.
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In 2014, we granted RSUs as special retention awards with respect to 69,500 shares of common stock that generally vest in three years from the date of
grant.
RSUs outstanding as of December 31, 2014 and RSU activity during 2014 were as follows:
Weighted
Average
Grant Date
Fair Value

Number
of Shares
(000)
Nonvested at January 1, 2014

800

16.15

Granted

70

32.50

Vested

(403)

14.70

Forfeited

(44)

17.17

Nonvested at December 31, 2014

423

20.12

As of December 31, 2014, there was $3 million of total unrecognized compensation cost related to nonvested share-based compensation awards
represented by RSUs granted under the LTIP. We expect that cost to be recognized over a weighted average period of 2.3 years. The total fair value of RSUs
that vested was $6 million during 2014, $7 million during 2013 and $13 million during 2012.
PERFORMANCE SHARES

We granted performance shares during 2014, 2013 and 2012. The weighted average grant date fair value was $46.46 in 2014, $38.89 in 2013 and $22.96 in
2012. The performance shares generally vest after a period of three years based on our total stockholder return relative to the performance of the Dow Jones
U.S. Construction and Materials Index, with adjustments to that index in certain circumstances, for the three-year period. The number of performance shares
earned will vary from zero to 200% of the number of performance shares awarded depending on that relative performance. Vesting will be pro-rated based on
the number of full months employed during the performance period in the case of death, disability, retirement or a change in control, and pro-rated awards
earned will be settled in common stock at the end of the three-year period.
We estimated the fair value of each performance share granted on the date of grant using a Monte Carlo simulation that uses the assumptions noted in
the following table. Expected volatility is based on implied volatility of our traded options and the daily historical volatilities of our peer group. The riskfree rate was based on zero coupon U.S. government issues at the time of grant. The expected term represents the period from the grant date to the end of the
three-year performance period.
Assumptions:

2014

2013

2012

54.93%

59.98%

67.63%

Risk-free rate

0.63%

0.43%

0.36%

Expected term (in years)

2.94

2.88

2.89

Expected volatility

Expected dividends

Nonvested performance shares outstanding as of December 31, 2014 and performance share activity during 2014 were as follows:
Weighted
Number
of Shares
(000)

Weighted
Average
Grant Date
Fair Value

Nonvested at January 1, 2014

308

Granted

111

28.36
46.46

Vested

(204)

23.00

Forfeited

(12)

42.06

Nonvested at December 31, 2014

203

42.82

With respect to the 225,127 performance shares granted in 2012, for which the three-year performance period ended December 31, 2014, 203,648
performance shares vested for approximately 378,174 common shares. The remaining performance shares granted in 2012 were previously forfeited.
Total unrecognized compensation cost related to nonvested share-based compensation awards represented by performance shares granted under the
LTIP was $5 million as of December 31, 2014. We expect that cost to be recognized over a weighted average period of 1.7 years.
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NON-EMPLOYEE DIRECTOR DEFERRED STOCK UNITS

Our non-employee directors may elect to receive a portion of their compensation as deferred stock units that increase or decrease in value in direct relation to
the market price of our common stock. Deferred stock units earned through December 31, 2007 will be paid in cash upon termination of board service.
Deferred stock units earned thereafter will be paid in cash or shares of USG common stock, at the election of the director, upon termination of board service.
The number of deferred stock units held by non-employee directors was approximately 164,235 as of December 31, 2014, 182,632 as of December 31,
2013 and 172,124 as of December 31, 2012. We recorded expense related to these deferred stock units of $1 million in 2014, $1 million in 2013 and $3
million in 2012.
12. Supplemental Balance Sheet Information
INVENTORIES

Inventories as of December 31 consisted of the following:

(millions)

2014

Finished goods and work in progress

2013
267

Raw materials

270

329

332

135

62
$

Total

62

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of December 31 consisted of the following:

(millions)

2014

Land and mineral deposits

2013
181

Buildings and improvements

1,095

1,139

Machinery and equipment

2,563

2,623

Reserves for depreciation and depletion

3,793

3,943

(1,885)

(1,840)

Total

1,908

2,103

Annual depreciation and depletion expense

134

135

21

ACCRUED EXPENSES

Accrued expenses as of December 31 consisted of the following:

(millions)

2014

Self-insurance reserves

2013
22

Employee compensation

42

58

Interest

45

48

Restructuring

Derivatives

18

Pension and other postretirement benefits

22

14

Environmental

16

18

Other

55
$

Total

76

220

53
$

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in the balances of each component of accumulated other comprehensive income (loss), or AOCI, are summarized in the following table:

(millions)

Pension and Other

Postretirement
Benefit Plans

Derivatives

Balance as of January 1, 2012

28

(221)

Foreign
Currency
Translation
$

Total AOCI
19

(174)

Other comprehensive income (loss) before reclassifications

(5)

(81)

22

Less: Amounts reclassified from AOCI, net of tax

(9)

(5)

(82)

19

(59)

Other comprehensive income (loss), net of tax

Balance as of December 31, 2012

32

(303)

38

(64)

(233)

Other comprehensive income (loss) before reclassifications

247

(17)

Less: Amounts reclassified from AOCI, net of tax

(24)

(23)

Other comprehensive income (loss), net of tax

271

(17)

257

Balance as of December 31, 2013

Other comprehensive loss before reclassifications

Less: Amounts reclassified from AOCI, net of tax

16

21

(302)

24
(355)

(270)
$

(68)

(2)

(19)
$

(32)
(272)

Other comprehensive loss, net of tax

Balance as of December 31, 2014

35
(15)

234

(73)
$

(52)

(362)
$

(338)

Amounts reclassified from AOCI, net of tax, for the years ended December 31, 2014 and 2013, were as follows:
(millions)

2014

2013

Derivatives
Net reclassification from AOCI for cash flow hedges included in cost of products sold

Income tax expense on reclassification from AOCI included in income tax expense (benefit)
$

Net amount reclassified from AOCI

(19)

Defined Benefit Plans

Net reclassification from AOCI for amortization of prior service cost included in cost of products sold

Net reclassification from AOCI for amortization of prior service cost included in selling and administrative expenses

(10)

Income tax expense on reclassification from AOCI included in income tax expense (benefit)
$

Net amount reclassified from AOCI

(7)

(2)

(24)

Foreign Currency Translation

Net reclassification from AOCI for translation gains realized upon the deconsolidation of foreign subsidiaries included in gain on
deconsolidation

Income tax expense on reclassification from AOCI included in income tax expense (benefit)

Net amount reclassified from AOCI

We estimate that we will reclassify a net $10 million after-tax loss on derivatives from AOCI to earnings within the next 12 months.
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ASSET RETIREMENT OBLIGATIONS

Changes in our liability for asset retirement obligations during 2014 and 2013 consisted of the following:
(millions)

2014

Balance as of January 1

2013
132

139

Accretion expense

Liabilities incurred

(13)

(11)

Liabilities settled

(2)

(4)

Foreign currency translation

(3)

Changes in estimated cash flows (a)

Balance as of December 31
(a)

123

(3)
$

132

Changes in estimated cash flows for the year ended December 31, 2014 includes changes in estimates primarily for our gypsum quarry and ship loading facility in Windsor, Nova
Scotia, Canada, which we permanently closed during the third quarter of 2011, and our mining operation in Little Narrows, Nova Scotia, Canada as a result of receiving
regulatory approval of a revised reclamation plan in 2014.

Our asset retirement obligations include reclamation requirements as regulated by government authorities related principally to assets such as our
mines, quarries, landfills, ponds and wells. The accounting for asset retirement obligations requires estimates by management about the timing of asset
retirements, the cost of retirement obligations, discount and inflation rates used in determining fair values and the methods of remediation associated with our
asset retirement obligations. We generally use assumptions and estimates that reflect the most likely remediation method on a site-by-site basis. Our
estimated liability for asset retirement obligations is revised annually, and whenever events or changes in circumstances indicate that a revision to the
estimate is necessary.
In instances where a decrease in the asset retirement obligation is in excess of the related remaining net book value of the asset retirement costs, the
excess is recorded to the consolidated statement of operations as a reduction in cost of products sold. Asset retirement obligations are included in other
liabilities on the consolidated balance sheets.
13. Long-Lived Asset Impairment Charges
Since we began idling plants in 2007, we have continuously evaluated our manufacturing needs by considering the capacity of existing and idled plants and
production lines, as well as capital projects for manufacturing facilities, relative to the demand assumptions included in our long-range plan. Although
industry and economic factors have improved and we believe that the overall economic recovery is intact, they are improving at a slower pace than expected,
requiring us to reconsider the future utilization of idled plants and production lines, and capital projects for manufacturing facilities. As a result, we have
recorded the following impairment charges.
(millions)

2014

Ocean vessels

2013
60

2012

Wallboard lines or facilities

16

Previously incurred costs related to construction of future facilities

12

Permanently closed gypsum quarry and ship loading facility

Other
$

Total long-lived asset impairment charges

90

1
$

2014

In 2014, we recorded long-lived asset impairment charges totaling $90 million, which included the following:
(a) impairment charges of $16 million related to the carrying values of machinery, equipment and buildings at our temporarily idled gypsum quarry
and wallboard production facility in Empire, Nevada and at our previously idled and now permanently closed gypsum wallboard line in New Orleans,
Louisiana. In addition, in the third quarter of 2014 we permanently closed our wallboard line in Detroit, Michigan. No impairment charge was recorded with
respect to our wallboard line in Detroit, Michigan, as these assets were previously impaired at the time the plant was originally idled.
(b) impairment charges of $12 million related to previously incurred and capitalized costs for the construction of two future facilities which we do not
anticipate will be built within our planning horizon.
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(c) impairment charges of $2 million related to the carrying values of machinery, equipment and buildings at our previously idled and now
permanently closed paper production line in Gypsum, Ohio.
(d) impairment charges of $60 million related to our two self-unloading ocean vessels. See Note 14 for further discussion.
The carrying values of the machinery, equipment and buildings at our temporarily idled facility in Empire, Nevada exceeded the estimated future
undiscounted cash flows for the remaining useful lives of the assets due to slower than expected acceleration in the markets served by this facility and our
forecasts regarding the timing and future rate of recovery in those markets. Based on these conditions, we do not anticipate that the carrying values of the
assets at this facility would be recovered prior to end of the assets useful lives, and therefore fully impaired these assets. For the production line in Gypsum,
Ohio that we deemed to be permanently closed, we fully impaired the long-lived assets specific to that line.
The long-lived asset impairment charges relate solely to our Gypsum segment.
2012

In 2012, we recorded long-lived asset impairment charges of $8 million. These impairment charges were primarily due to a change in estimate related to
reclamation activities at our Windsor, Nova Scotia, Canada facility, which resulted in an increase in the related asset retirement obligation by $7 million with
a corresponding increase to the long-lived assets at this facility. Consequently, we recorded a long-lived asset impairment charge of $7 million to write the
assets down to their fair value of $6 million. We also recorded a $1 million impairment on machinery and equipment for a previously idled production line.
Of these long-lived asset impairment charges, $7 million relate to our Gypsum segment and $1 million relate to our Ceilings segment.
14. Gypsum Transportation Limited
Gypsum Transportation Limited, or GTL, our wholly owned subsidiary, owns two self-unloading ocean vessels. GTL was a party to a five-year contract of
affreightment to transship iron ore in and around Sierra Leone since 2011. During the fourth quarter, our trading partner ceased operations, and consequently,
we terminated the agreement. As a result of the contract termination, we assessed the recoverability of the carrying value of the vessels and recorded an
impairment charge of $60 million. See Note 9 for additional information related to the fair value measurement.
In addition to our two owned vessels, GTL leased a third vessel for the use in the same transhipment agreement. We recorded a contract termination
charge of $6 million, initially measured at fair value at the cease-use date, for costs that will continue to be incurred under this lease for the remaining term
without economic benefit to us. The actual amount of cash payments made for lease contract termination costs will be dependent upon our ongoing
negotiations with the lessor and will be paid in 2015.
The trade receivable owed from our trading partner was $9 million as of December 31, 2014. We have deemed this balance to be uncollectible and
recorded a $9 million provision for bad debt.
Each of these charges relating to our GTL operations was recorded within our Gypsum segment. The impairment charge for the two owned vessels is
recorded within long-lived asset impairment charges on our consolidated statement of operations. The contract termination charge and provision for bad debt
are recorded within contract termination charge and loss on receivable on our consolidated statement of operations.
In February 2015, as consideration for DVB Bank SEs consent to allow GTL to enter into certain future contracts of affreightment, GTL voluntarily
repaid $2 million of the outstanding loan balance under its secured loan facility. The repayment provisions of the secured loan facility have not otherwise
been modified from the terms as described in Note 7 to these consolidated financial statements. The voluntary repayment was not classified in the current
portion of long-term debt on our consolidated balance sheets as of December 31, 2014.

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15. Restructuring Charges

As part of our continuing efforts to adapt our operations to market conditions, we implemented restructuring activities in 2013 and 2012 that resulted in the
following restructuring charges:
(millions)

2014

2013

2012

Severance

Lease obligations

(1)

Other exit costs

Total

10

2013

Total restructuring charges of $3 million primarily consisted of severance related to various cost-reduction programs, including our December 2012
management workforce reduction and salaried workforce reductions across various functional areas resulting from our initiatives to centralize and
consolidate certain back-office operations as well as other exit costs.
2012

Total restructuring charges of $10 million primarily related to salaried workforce reductions. As a result of these actions, the number of salaried employees
terminated and open salaried positions eliminated was approximately 90 and the number of hourly employees terminated and open hourly positions
eliminated was approximately 40.
Restructuring Reserve
A restructuring reserve of $8 million was included in accrued expenses and other liabilities on the consolidated balance sheet as of December 31, 2014. We
expect future payments to be approximately $1 million in 2015, $1 million in 2016 and $6 million after 2016. On a segment basis, $1 million of all expected
future payments relate to Gypsum, $6 million to Distribution and $1 million to Corporate. All restructuring-related payments were funded with cash on hand.
We expect that the future payments will be funded with cash from operations or cash on hand.
The restructuring reserve for the years ended December 31, 2014, 2013 and 2012 is summarized as follows:
Annual Activity

Balance
as of
January 1

(millions)

Balance
as of
December 31

Cash
Payments

Charges

2014 Activity:
$

Severance

Lease obligations

10

(3)

Other exit costs

Total

11

(3)

(6)

2013 Activity:
$

Severance

15

Lease obligations

(1)

Other exit costs

$

Total

(4)

20

1
10

(2)

(12)

(5)

11

2012 Activity:
$

Severance

21

Lease obligations

Other exit costs

$

Total

80

34

(6)

4
$

10

(13)
$

(24)

5
15

20

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16. Segments
As discussed in Note 1, effective April 1, 2014 we changed the composition of our reportable segments. Prior-year results have been recast to conform with
the new presentation of reportable segments. Our operations are organized into four reportable segments: Gypsum (previously North American Gypsum),
Ceilings (previously Worldwide Ceilings), Distribution (previously Building Products Distribution) and USG Boral Building Products, or UBBP. Segment
results were as follows:
GYPSUM, CEILINGS AND DISTRIBUTION
For the year ended December 31,
(millions)

2014

2013

2012

Net Sales:
Gypsum

Ceilings
Distribution
Eliminations

2,403

1,988

568

558

1,345

1,245

1,145

(537)

Total

2,262

513

(505)

(467)

3,724

3,570

3,224

169

261

109

Operating Profit (Loss):

Gypsum
Ceilings

87

98

88

Distribution

16

(33)

(109)

(93)

(82)

(1)

(14)

Corporate
Eliminations
Total

(9)

162

258

73

116

115

114

Depreciation, Depletion and Amortization:

Gypsum
Ceilings

14

14

15

Distribution

12

12

12

Corporate

12

14

Total

15

154

155

156

96

66

50

Capital Expenditures:
Gypsum
Ceilings

30

54

14

Distribution

Corporate

Total

132

124

1
$

70

Assets:

December 31, 2014

December 31, 2013

Gypsum

2,106

2,227

Ceilings

285

Distribution

412

406

Corporate

547

1,118

Equity method investments

735

73

Eliminations

(91)

(92)

Total

81

3,994

389

4,121

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GEOGRAPHIC INFORMATION
For the year ended December 31,
(millions)

2014

2013

2012

Net Sales:
$

United States

3,220

3,029

2,702

Canada

406

417

Other Foreign

283

309

288

(185)

(185)

(174)

Geographic transfers
$

Total

3,724

3,570

408

3,224

Long-lived assets, consisting of property, plant and equipment, net, by geographic location were as follows:
December 31,
2014

(millions)

December 31,
2013

Long-Lived Assets:
$

United States

1,665

Canada

112

Other Foreign

131
$

Total

1,908

1,691
128
284

2,103

For the year ended

December 31,

UBBP
(millions)

2014 (a)

Net sales

927

Operating profit

95

Net income attributable to UBBP

67

Depreciation, depletion, and amortization

31

Capital expenditures

40
December 31, 2014

Assets

1,435

For the year ended

December 31,

UBBP GEOGRAPHIC INFORMATION

(millions)

2014 (a)

Net Sales:
$

Australia

312

South Korea

197

China

122

Thailand

133

Other

206
(43)

Geographic Transfers
$

Total
(a)

Operating results are presented for UBBP for the ten months ended December 31, 2014.

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Long-lived assets, consisting of property, plant and equipment, net, by geographic location for UBBP were as follows:
(millions)

December 31, 2014

Long-Lived Assets:
$

Australia

245

South Korea

113

China

127

Oman

96

Thailand

72
78

Other
$

Total

731

OTHER SEGMENT INFORMATION

Segment operating profit (loss) includes all costs and expenses directly related to the segment involved and an allocation of expenses that benefit more than
one segment.
Restructuring charges by segment were as follows:
(millions)

2014

Gypsum

2013

2012
3

Ceilings

Distribution

(1)

Corporate

Total

1
$

2
$

10

Our share of UBBP's restructuring charges recorded during 2014 amounted to $2 million and was included as a reduction to our share of income from
equity method investments recorded for the ten months ending December 31, 2014. The charges primarily relate to severance. See Note 13 and Notes 14 and
15 for additional information regarding long-lived asset impairment charges and restructuring charges, respectively.
Revenues are attributed to geographic areas based on the location of the assets producing the revenues. Transactions between reportable segments and
geographic areas are accounted for at transfer prices that are approximately equal to market value. Intercompany transfers between segments (shown above as
eliminations) largely reflect intercompany sales from U.S. Gypsum to L&W Supply. Geographic transfers largely reflect intercompany sales from U.S. Gypsum
and USG Interiors, LLC to CGC and USG Mexico, S.A. de C.V.
The Home Depot, Inc. accounted for approximately 16% of our consolidated net sales in 2014 and approximately 15% of our sales in both 2013 and
2012. Our Gypsum, Ceilings and Distribution segments had net sales to The Home Depot, Inc. in each of those years.
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17. Income Taxes

Income (loss) from continuing operations before income taxes consisted of the following:
(millions)

2014

U.S.

2013
27

Foreign

19
$

Total

2012
17

(198)

(170)

42

46

28

59

Income tax expense (benefit) on continuing operations consisted of the following:

(millions)

2014

2013

2012

Current:
Federal

Foreign

10

State

11

Federal

(2)

Foreign

Deferred:

State

4
$

Total

11

4
$

12

For our continuing operations, differences between actual provisions for income taxes and provisions for income taxes at the U.S. federal statutory rate
(35%) were as follows:
(millions)

2014

Taxes on income (loss) from continuing operations at U.S. federal statutory rate

Foreign earnings subject to different tax rates (a)

2013
16

2012
21

(60)

16

(6)

(6)

(9)

(8)

76

(12)

Other, net

(1)

(3)

Tax release from AOCI

(2)

Gain on deconsolidation

(7)

State income tax, net of federal benefit

Change in valuation allowance
Income from equity method investments
Withholding taxes

Tax benefit not realized on pension loss

$

Provision for income tax expense

15.3%

Effective income tax rate

(a) Foreign earnings subject to different tax rates includes amounts related to impairments and other charges associated with our GTL business.

84

11
18.6%

(5)

12
(7.1)%

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Significant components of deferred tax assets and liabilities as of December 31 were as follows:
(millions)

2014

2013

Deferred Tax Assets:

Net operating loss and tax credit carryforwards

944

1,043

Pension and postretirement benefits

196

110

Goodwill and other intangible assets

29

33

Reserves not deductible until paid

47

31

Self insurance

15

15

Capitalized interest

15

12

Inventories
Share-based compensation
Other
Deferred tax assets before valuation allowance
Valuation allowance

37

35

11

1,302

1,287

(1,023)

Total deferred tax assets

279

(995)
$

292

Deferred Tax Liabilities:

Property, plant and equipment

278

Other

290

Total deferred tax liabilities

(1)

278
$

Net deferred tax assets

289
$

We have established a valuation allowance in the amount of $1.023 billion consisting of $773 million for federal deferred tax assets, $249 million for
state deferred tax assets and $1 million for foreign deferred tax assets.
We reduce the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely than not that such
assets will not be realized. The need to establish valuation allowances for deferred tax assets is assessed periodically. In assessing the requirement for, and
amount of, a valuation allowance in accordance with the more-likely-than-not standard, we give appropriate consideration to all positive and negative
evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature, frequency and severity of current and
cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, our experience with operating loss and tax credit
carryforwards not expiring unused and tax planning alternatives. A history of cumulative losses for a certain threshold period is a significant form of negative
evidence used in our assessment. Consistent with practices in the home building and related industries, we have a policy of four years as our threshold period
for cumulative losses. If a cumulative loss threshold is met, forecasts of future profitability are not used as positive evidence related to the realization of the
deferred tax assets in the assessment.
As of December 31, 2014, we had federal NOL carryforwards of approximately $1.898 billion that are available to offset future federal taxable income
and will expire in the years 2026 through 2032. In addition, as of that date, we had federal alternative minimum tax credit carryforwards of approximately
$46 million that are available to reduce future regular federal income taxes over an indefinite period. In order to fully realize the U.S. federal net deferred tax
assets, taxable income of approximately $2.028 billion would need to be generated during the period before their expiration. In addition, we have federal
foreign tax credit carryforwards of $8 million that will expire in 2015.
As of December 31, 2014, we had a gross deferred tax asset of $244 million related to state NOLs and tax credit carryforwards, of which $1 million will
expire in 2015. The remainder will expire if unused in years 2016 through 2033. To the extent that we do not generate sufficient state taxable income within
the statutory carryforward periods to utilize the NOL and tax credit carryforwards in these states, they will expire unused.
We also had NOL and tax credit carryforwards in various foreign jurisdictions in the amount of $1 million as of December 31, 2014, against a portion
of which we have historically maintained a valuation allowance.
During periods prior to 2014, we established a valuation allowance against our deferred tax assets totaling $995 million. Based upon an evaluation of
all available evidence, we recorded an increase in the valuation allowance against our deferred tax assets of $28 million in 2014. The increase in the
valuation allowance of $112 million primarily related to the increase in deferred tax assets for pension and other post retirement benefits. This increase was
offset by a decrease of $47 million related to current taxable earnings and $37 million in other discrete items. As a result, our deferred tax assets valuation
allowance is $1.023 billion as of December 31, 2014. In future periods, the valuation allowance can be reversed based on sufficient evidence
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indicating that it is more likely than not that a portion of our deferred tax assets will be realized. Our net deferred tax assets were $1 million as of
December 31, 2014 and $3 million as of December 31, 2013.
The Internal Revenue Code imposes limitations on a corporations ability to utilize NOLs if it experiences an ownership change. In general terms, an
ownership change may result from transactions increasing the ownership of certain stockholders in the stock of a corporation by more than 50 percentage
points over a three-year period. If we were to experience an ownership change, utilization of our NOLs would be subject to an annual limitation determined
by multiplying the market value of our outstanding shares of stock at the time of the ownership change by the applicable long-term tax-exempt rate, which
was 2.80% for December 2014. Any unused annual limitation may be carried over to later years within the allowed NOL carryforward period. The amount of
the limitation may, under certain circumstances, be increased or decreased by built-in gains or losses held by us at the time of the change that are recognized
in the five-year period after the change. Many states have similar limitations. If an ownership change had occurred as of December 31, 2014, our annual U.S.
federal NOL utilization would have been limited to approximately $113 million per year.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
(millions)

2014

Balance as of January 1

2013
22

2012
16

12

Tax positions related to the current period:

Gross increase

Gross decrease

Tax positions related to prior periods:

Gross increase

Gross decrease

Settlements

(2)

(3)

Lapse of statutes of limitations

Balance as of December 31

22

22

16

We classify interest expense and penalties related to unrecognized tax benefits and interest income on tax overpayments as components of income
taxes (benefit). The total amounts of interest expense and penalties recognized on our consolidated balance sheets were $3 million and $2 million,
respectively, as of December 31, 2014 and 2013. The total amounts of interest and penalties recognized in our consolidated statements of operations was zero
in 2014, zero for 2013 and $1 million for 2012. The total amounts of unrecognized tax benefit that, if recognized, would affect our effective tax rate were
$5 million for 2014, $7 million for 2013 and $7 million for 2012.
Our federal income tax returns for 2008 and prior years have been examined by the Internal Revenue Service. The U.S. federal statute of limitations
remains open for the year 2006 and later years. We are under examination in various U.S. state and foreign jurisdictions. It is possible that these examinations
may be resolved within the next 12 months. Due to the potential for resolution of the examinations and the expiration of various statutes of limitations, it is
reasonably possible that our gross unrecognized tax benefit may change within the next 12 months by a range of $0 million to $6 million. Foreign and U.S.
state jurisdictions have statutes of limitations generally ranging from three to five years.
We do not provide for U.S. income taxes on the portion of undistributed earnings of foreign subsidiaries that is intended to be permanently reinvested.
The cumulative amount of such undistributed earnings totaled approximately $540 million as of December 31, 2014. These earnings would become taxable
in the United States upon the sale or liquidation of these foreign subsidiaries or upon the remittance of dividends. The estimate of the amount of the deferred
tax liability on such earnings is $12 million, consisting of foreign withholding taxes.

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18. Earnings (Loss) Per Share

The reconciliation of basic income (loss) per share to diluted income (loss) per share is shown in the following table:
(millions, except per-share data)

2014

Income (loss) from continuing operations

2013
39

Net income (loss) attributable to noncontrolling interest

Income (loss) from continuing operations attributable to USG

38

2012
48

(1)

49

(182)
1
(183)

Income (loss) from discontinued operations

(1)

(2)

Gain on sale of discontinued operations

55

Net income (loss) attributable to USG

37

47

(126)

Effect of dilutive securities - RSUs, MSUs, performance shares and stock options

Effect of dilutive securities - 10% convertible senior notes

Effect of dilutive securities - Deferred compensation program for non-employee directors

Income (loss) available to shareholders

37

Average common shares

Dilutive RSUs, MSUs, performance shares and stock options
Common shares issuable upon conversion of our 10% convertible senior notes
Deferred shares associated with a deferred compensation program for non-employee directors
Average diluted common shares

47

(126)

141.7

108.9

106.4

2.4

2.5

0.2

144.3

111.4

106.4

Basic earnings (loss) per average common share:

Income (loss) from continuing operations attributable to USG

0.27

Income (loss) from discontinued operations

0.45

(0.01)
$

Net income (loss) attributable to USG

(1.72)

0.43

(1.19)

0.44

(1.72)

(1.19)

(0.02)

0.26

0.26

0.53

Diluted earnings (loss) per average common share:

Income (loss) from continuing operations attributable to USG

Income (loss) from discontinued operations

(0.01)
$

Net income (loss) attributable to USG

0.25

(0.02)
$

0.42

0.53

The diluted loss per share in 2012 was computed using the weighted average number of common shares outstanding during the year.
Stock options, RSUs, MSUs, performance shares and common shares issuable upon conversion of our 10% convertible senior notes that were not
included in the computation of diluted earnings (loss) per share for those periods because their inclusion was anti-dilutive were as follows:
(millions, common shares)

2014

Stock options, RSUs, MSUs and performance shares

10% convertible senior notes due 2018 (a)

2013

2012

2.1

2.2

7.9

6.6

35.1

(a) In December 2013 and April 2014, we converted $325 million and $75 million, respectively, of our 10% convertible senior notes due 2018 into common shares. See further
discussion in Note 7.

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19. Oman Investment

In June of 2012, we entered into a strategic partnership with the Zawawi Group in Oman to establish a mining operation by acquiring 55% of Zawawi
Gypsum LLC, or ZGL, which holds the mining rights to a gypsum quarry in Salalah, Oman. Quarry mining operations commenced in October 2013. The
second phase of the partnership is a 50/50 manufacturing venture, USG-Zawawi Drywall LLC, or ZDL, to build and operate a low cost wallboard plant in
Oman. Wallboard production operations are expected to commence by the first half of 2015.
We accounted for the acquisition of the mining rights as an asset acquisition and measured our interest in the mining rights at our cost. The mining
rights will be depleted based upon tonnage mined relative to the total probable capacity in the quarry, and are presented within total property, plant and
equipment in our consolidated balance sheet as of December 31, 2013. We determined that both entities are variable interest entities (VIEs), and, as such, we
consolidated the VIEs through February 27, 2014 when our interests in ZGL and ZDL were contributed to UBBP. See Note 3.
As of December 31, 2013, other liabilities included approximately $8 million of loans payable and the related accrued interest due to the joint venture
partner. We contributed our Oman joint ventures, including these loans, to UBBP on February 27, 2014; therefore, the loans payable are no longer reflected
on our balance sheet as of December 31, 2014. Also as a result of our contribution of our Oman joint ventures to UBBP, non-controlling interest within
shareholders' equity decreased by approximately $24 million.
See Note 7 for a description of the credit facilities entered into by our joint ventures in Oman in June 2013.
20. Stockholder Rights Plan
We have a stockholder rights plan, or the Rights Plan, established under the terms of a rights agreement dated December 21, 2006, as amended, with
Computershare Trust Company N.A., as Rights Agent, or the Rights Agreement. Our board of directors adopted the Rights Plan to protect our stockholders
from coercive takeover practices or takeover bids that are inconsistent with their best interests.
On March 22, 2013, our board of directors approved an amendment to the Rights Agreement in an effort to protect our NOL carryforwards. Our
stockholders ratified, on an advisory basis, the March 22, 2013 amendment to our Rights Agreement at our 2013 annual meeting of stockholders. On
February 11, 2015, our board of directors approved another amendment to the Rights Agreement. The primary purpose of the foregoing amendments is to
protect the value of the Company's NOLs and related tax benefits. The Rights Agreement, as amended, provides that if any person becomes the beneficial
owner of 4.9% or more of our common stock, stockholders other than the 4.9% triggering stockholder will have the right to purchase additional shares of our
common stock at half the market price, thereby diluting the triggering stockholder; provided that stockholders whose beneficial ownership exceeded 4.9% of
our common stock outstanding on February 11, 2015 will not be deemed to have triggered the Rights Agreement, as amended, so long as they do not
thereafter acquire additional common stock other than in certain specified exempt transactions.
The Companys ability to use its NOLs could be substantially reduced if the Company experiences an ownership change, as defined under Section
382 of the Internal Revenue Code of 1986 (the Code). The amendment adopted on February 11, 2015 maintains previously adopted protections and
modifies, until March 22, 2016 (or such earlier time that the Board determines that no Tax Benefits (as defined in the Rights Agreement) may be carried
forward or that the Rights Agreement is no longer necessary for the protection of Tax Benefits) (the Special Period), the definition of when a Person (as
defined in the Rights Agreement) will be deemed the Beneficial Owner of, and to Beneficially Own, securities under the Rights Agreement to align with
the definition of ownership under Section 382 of the Code. Under the revised definition, during the Special Period, only acquisitions that would result in
ownership of more than 4.9% of the Companys then-outstanding shares of common stock, as determined pursuant to Section 382 of the Code, would cause a
stockholder to be deemed an Acquiring Person, subject to certain specified exempt transactions. Upon the expiration of the Special Period, the triggering
threshold level under the Rights Plan will revert to the 15% level in effect prior to the amendment on March 22, 2013, and the definition of Beneficial
Owner and Beneficially Own will revert to a definition that does not track Section 382 of the Code.
The Rights Agreement also provides that Berkshire Hathaway (and certain of its affiliates) will not trigger the rights unless Berkshire Hathaway and its
affiliates acquire beneficial ownership of more than 50% of our voting stock on a fully diluted basis.
The rights issued pursuant to the Rights Agreement will expire on January 2, 2017. However, our board of directors has the power to accelerate or
extend the expiration date of the rights. In addition, a board committee composed solely of independent directors reviews the Rights Agreement at least once
every three years to determine whether to modify the Rights
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Plan in light of all relevant factors. This review was most recently conducted in November 2012. The next review is required by the end of 2015.
On May 9, 2013, we filed an amendment to our Restated Certificate of Incorporation, or the Protective Amendment, that restricts certain transfers of our
common stock. The Protective Amendment is intended to protect the tax benefits of our NOL carryforwards. See Note 17 for a description of our NOL
carryforwards. Subject to certain limited exceptions, the Protective Amendment's transfer restrictions would restrict any person from transferring our common
stock (or any interest in our common stock) if the transfer would result in a stockholder (or several stockholders, in the aggregate, who hold their stock as a
group under Section 382 of the Code) owning 4.9% or more of our common stock. Any direct or indirect transfer attempted in violation of the Protective
Amendment would be void as of the date of the prohibited transfer as to the purported transferee, and the purported transferee would not be recognized as the
owner of the shares attempted to be owned in violation of the Protective Amendment for any purpose, including for purposes of voting and receiving
dividends or other distributions in respect of that common stock, or in the case of options, receiving our common stock in respect of their exercise. The
Protective Amendment is effective until the earlier of (i) May 9, 2016, (ii) the repeal of Section 382 of the Code if our board of directors determines that the
Protective Amendment is no longer necessary for the preservation of tax benefits, (iii) the first day of a taxable year as to which our board of directors
determines that no tax benefits may be carried forward, or (iv) such other date as determined by our board of directors pursuant to the Protective Amendment.
21. Lease Commitments
We lease some of our offices, buildings, machinery and equipment, and autos under noncancelable operating leases. These leases have various terms and
renewal options. Lease expense amounted to $75 million in 2014 and $73 million in 2013 and 2012, respectively. Future minimum lease payments required
under operating leases with initial or remaining noncancelable terms in excess of one year as of December 31, 2014 were as follows:
(millions)
Future minimum lease payments

2015
$

2016
69

89

2017
59

2018
52

2019
41

After 2019
29

42

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22. Litigation
WALLBOARD PRICING CLASS ACTION LAWSUITS

In late 2012, USG Corporation and United States Gypsum Company were named as defendants in putative class action lawsuits alleging that since at least
September 2011, U.S. wallboard manufacturers conspired to fix and raise the price of gypsum wallboard sold in the United States and to effectuate the alleged
conspiracy by ending the practice of providing job quotes on wallboard. These lawsuits are consolidated for pretrial proceedings in multi-district litigation in
the United States District Court for the Eastern District of Pennsylvania, under the title In re: Domestic Drywall Antitrust Litigation, MDL No. 2437. One
group of plaintiffs purports to bring their claims on behalf of a class of entities that purchased gypsum wallboard in the United States directly from any of the
defendants or their affiliates from January 1, 2012 to the present. The second group of plaintiffs purports to bring their claims on behalf of indirect purchasers
of gypsum wallboard who from January 1, 2012 through the present indirectly purchased wallboard in the United States from the defendants or their affiliates
for end use and not for resale.
In the fall of 2013, similar lawsuits were filed in Quebec and Ontario courts on behalf of purchasers of wallboard in Canada. These Canadian lawsuits
also name as defendants CGC, as well as other Canadian and U.S. wallboard manufacturers.
USG has denied the allegations made in these wallboard pricing lawsuits, believes these cases are without merit, and that USGs actions were at all times
lawful. U.S. antitrust litigation, however, is expensive and protracted, and carries the risk of triple damages and joint and several liability. To avoid the
expense, risk and further distraction of management, in October 2014, we entered into a settlement agreement in principle with the attorneys representing the
direct and indirect purchaser plaintiff classes in the U.S. wallboard pricing lawsuits. In the first quarter of 2015, we executed final settlement agreements with
the attorneys representing the direct and indirect purchaser plaintiff classes, and those settlement agreements will be filed with the Court for approval. If the
settlements are preliminarily approved by the Court, notice of the settlements will be provided to potential class members who will be given the opportunity
to participate in the settlements, or, alternatively, opt out of the settlements by a deadline specified in the Court notice. Persons who opt out of the
settlements are not bound by the settlements, and may separately purse their claims. After the opt out deadline has passed, the Court will then determine
whether to enter final approval of the settlements. Assuming the Court enters final approval of the settlement, USG will pay a maximum of $48 million to
resolve the currently pending U.S. direct and indirect purchaser class action cases. Accordingly, we recorded a $48 million charge in the third quarter of 2014
related to these settlements. If we are unable to settle the U.S. litigation under the terms set forth in the settlement agreements, or at all, there can be no
assurance that the outcome of these lawsuits will not have a material effect on our business, financial condition, operating results or cash flows.
The settlement described above does not include the Canadian lawsuits. At this stage of the Canadian lawsuits, we are not able to estimate the amount,
if any, of any reasonably possible loss or range of reasonably possible losses. We believe, however, that these Canadian lawsuits will not have a material
effect on our results of operations, financial position, or cash flows.
ENVIRONMENTAL LITIGATION

We have been notified by state and federal environmental protection agencies of possible involvement as one of numerous potentially responsible parties
in a number of Superfund sites in the United States. As a potentially responsible party, we may be responsible to pay for some part of the cleanup of
hazardous waste at those sites. In most of these sites, our involvement is expected to be minimal. In addition, we are involved in environmental cleanups of
other property that we own or owned. As of December 31, 2014 and December 31, 2013 we had an accrual of $16 million and $18 million, respectively, for
our probable and reasonably estimable liability in connection with these matters. Our accruals take into account all known or estimated undiscounted costs
associated with these sites, including site investigations and feasibility costs, site cleanup and remediation, certain legal costs, and fines and penalties, if any.
However, we continue to review these accruals as additional information becomes available and revise them as appropriate. Based on the information known
to us, we believe these environmental matters will not have a material effect on our results of operations, financial position or cash flows.
OTHER LITIGATION

We are named as defendants in other claims and lawsuits arising from our operations, including claims and lawsuits arising from the operation of our vehicles,
product performance or warranties, personal injury and commercial disputes. We believe that we have properly accrued for our probable liability in
connection with these claims and suits, taking into account the probability of liability, whether our exposure can be reasonably estimated and, if so, our
estimate of our liability or the range of our liability. We do not expect these or any other litigation matters involving USG to have a material effect on our
results of operations, financial position or cash flows.

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23. Quarterly Financial Data (unaudited)

Quarter
(millions, except share data)

First

Second

Third

Fourth

2014
Net sales

Gross profit

850

948

972

954

143

175

176

160

Operating profit (loss) (b)

66

98

22

(24)

Income (loss) from continuing operations (b)

45

58

(11)

(53)

Loss from discontinued operations, net of tax

(1)

Net income (loss) attributable to USG (b)

45

57

(12)

(53)

Basic (a)

0.33

0.40

(0.09)

(0.36)

Diluted (a)

0.32

0.39

(0.09)

(0.36)

Income (loss) from continuing operations per common share:

2013
Net sales

Gross profit

814

916

925

915

124

151

155

151

49

74

75

60

25

24

(3)

(1)

(1)

25

23

(3)

Basic (a)

0.02

0.23

0.23

(0.02)

Diluted (a)

0.02

0.22

0.22

(0.02)

Operating profit (c)

Loss from continuing operations (c)
Loss from discontinued operations, net of tax
Net income (loss) attributable to USG (c)
Income (loss) from continuing operations per common share:

(a) The sum of the four quarters is not necessarily the same as the total for the year.
(b) Operating profit (loss), income (loss) from continuing operations, and net income (loss) attributable to USG for the third quarter of 2014 included a litigation settlement charge
of $48 million and long-lived asset impairment charges of $30 million and for the fourth quarter of 2014 included a long-lived asset impairment charge of $60 million, contract
termination charge and loss of receivable of $15 million, and pension settlement charges of $13 million.
(c) Gross profit, operating profit, income (loss) from continuing operations, and net income (loss) attributable to USG for the fourth quarter of 2013 included pension settlement
charges of $16 million.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of USG Corporation:
We have audited the accompanying consolidated balance sheets of USG Corporation and subsidiaries (the Corporation) as of December 31, 2014
and 2013, and the related consolidated statements of operations, comprehensive income (loss), stockholders equity, and cash flows for each of the three years
in the period ended December 31, 2014. Our audits also included the financial statement Schedule II-Valuation and Qualifying Accounts. These consolidated
financial statements and financial statement schedule are the responsibility of the Corporations management. Our responsibility is to express an opinion on
the financial statements and financial statement schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of USG Corporation and
subsidiaries as of December 31, 2014 and 2013, and the results of their operations and their cash flows for each of the three years in the period ended
December 31, 2014, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial
statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the
information set forth therein.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Corporations internal
control over financial reporting as of December 31, 2014, based on the criteria established in Internal Control Integrated Framework (1992) issued by the
Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 12, 2015 expressed an unqualified opinion on the
Corporations internal control over financial reporting.
/s/ DELOITTE & TOUCHE LLP
Chicago, Illinois
February 12, 2015

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USG CORPORATION
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Additions
Balance at
beginning of
period

(millions)

Charged to costs and

expenses

Charged to other
accounts

Deductions (a)

Balance at end of
period

Year ended December 31, 2014:

Doubtful accounts
Cash discounts
Income tax valuation allowance

10

20

45

(45)

995

112

(85)

1,023
10

Year ended December 31, 2013:

Doubtful accounts
Cash discounts
Income tax valuation allowance

14

(5)

42

(42)

(2)

(128)

995

15

(8)

14

38

(38)

1,042

82

1,125

Year ended December 31, 2012:

Doubtful accounts
Cash discounts
Income tax valuation allowance
(a)

Reflects receivables written off as related to doubtful accounts, discounts allowed as related to cash discounts and reductions in the income tax valuation allowance.

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Item 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None
Item 9A.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Rule
13a-15(e) promulgated under the Securities Exchange Act of 1934, or the Act), have concluded that, as of the end of the fiscal year covered by this report, our
disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or
submit under the Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commissions rules
and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be
disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuers management, including its
principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.
(a)

MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control system was designed
to provide reasonable assurance to management and our Board of Directors regarding the preparation and fair presentation of published financial statements.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can
provide only reasonable assurance with respect to financial statement preparation and presentation.
Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2014. In making this assessment,
management used the criteria established in Internal Control Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the
Treadway Commission. Based on its assessment, management believes that, as of December 31, 2014, our internal control over financial reporting is effective
based on those criteria.
Our independent registered public accounting firm has issued an attestation report on our internal control over financial reporting. This report appears
below.
February 12, 2015

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of USG Corporation:
We have audited the internal control over financial reporting of USG Corporation and subsidiaries (the Corporation) as of December 31, 2014, based
on criteria established in Internal Control Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway
Commission. The Corporations management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control Over Financial Reporting.
Our responsibility is to express an opinion on the Corporations internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all
material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as
we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A corporations internal control over financial reporting is a process designed by, or under the supervision of, the corporations principal executive
and principal financial officers, or persons performing similar functions, and effected by the corporations board of directors, management, and other
personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A corporations internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
corporation; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the corporation are being made only in accordance with authorizations of
management and directors of the corporation; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
use, or disposition of the corporations assets that could have a material effect on the financial statements.
Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management
override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of
the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based
on the criteria established in Internal Control Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway
Commission.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated
financial statements and financial statement schedule as of and for the year ended December 31, 2014 of the Corporation and our report dated February 12,
2015 expressed an unqualified opinion on those financial statements and financial statement schedule.
/s/ DELOITTE & TOUCHE LLP
Chicago, Illinois
February 12, 2015

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(c)

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) promulgated under the Act) identified in connection
with the evaluation required by Rule 13a-15(d) promulgated under the Act that occurred during the fiscal quarter ended December 31, 2014 that have
materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B.

OTHER INFORMATION

On February 11, 2015, our Board of Directors (the "Board") approved our 2015 Annual Management Incentive Program (the "2015 Program"), upon the
recommendation of the Compensation and Organization Committee of the Board. Under the 2015 Program, 50% of the par incentive award for each of USGs
named executive officers is based on a formula related to adjusted consolidated net earnings and 50% is based on specified operating and financial targets.
The Board also approved the following operating and financial targets for USGs named executive officers under the 2015 Program: North American
operations adjusted operating profit, L&W Supply adjusted operating profit, USG Boral Building Products adjusted equity income, wallboard cost and
selling, general and administrative expenses. Each named executive officer has been assigned one to five of these targets, as applicable.

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PART III
Item 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Executive Officers of the Registrant (as of February 12, 2015):

Name

Age

James S. Metcalf

57

Chairman of the Board of Directors since December 2011.

President and Chief Executive Officer since January 2011.
President and Chief Operating Officer prior thereto.

Present Position and Business Experience During the Last Five Years

Stanley L. Ferguson

62

Executive Vice President, General Counsel and Secretary since January 2013. Executive Vice President and General
Counsel prior thereto.

Christopher R. Griffin

52

Executive Vice President and Chief Operating Officer since October 2013.
Executive Vice President Operations to October 2013.
Senior Vice President, President, USG International and President, CGC Inc., to September 2010. Vice President to
February 2010.

Matthew F. Hilzinger

51

Executive Vice President since April 2012 and Chief Financial Officer since May 2012.
Executive Vice President and Chief Integration Officer, Exelon Corporation, in March 2012.
Senior Vice President and Chief Financial Officer, Exelon Corporation, to March 2012.

Brian J. Cook

57

Senior Vice President, Human Resources and Communications since May 2013.
Senior Vice President, Human Resources prior thereto.

Dominic A. Dannessa

58

Senior Vice President and Chief Technology Officer since February 2010.
Vice President and Chief Technology Officer prior thereto.

Mary A. Martin

59

Vice President and Associate General Counsel since July 2009.

Associate General Counsel prior thereto.

Jennifer F. Scanlon

48

Senior Vice President since October 2013 and President, International since September 2010.
Vice President and Chief Information Officer to September 2010.

Kenneth R. Banas

40

Vice President and Treasurer since January 2015.

Treasurer, April 2013 to December 2014.
Senior Director, Investor Relations, December 2011 to March 2013.
Senior Director EPMO, May 2010 to November 2011 and Director EPMO prior thereto.

Jeanette A. Press

39

Vice President and Controller since January 2015.

Controller, September 2012 to December 2014.
Senior Director, Accounting and Reporting, March 2011 to August 2012.
Audit Senior Manager at KPMG LLP prior thereto.

Chris A. Rosenthal

51

Vice President, Compensation, Benefits and Corporate Services since January 2015.
Senior Director Compensation, Benefits and Corporate Services, March 2014 to December 2014.
Senior Director HR Operations, September 2012 to February 2014 and Vice President, HR, L&W Supply
Corporation prior thereto.

Srinivas
Veeramasuneni

50

Vice President, Corporate Innovation Center since January 2015.

Senior Director, Corporate Innovation Center, December 2013 to December 2014 and Senior Director, Research
prior thereto.

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Committee Charters and Code of Business Conduct

Our Corporate Code of Business Conduct (applicable to directors, officers and employees), our Corporate Governance Guidelines and the charters of the
committees of our Board of Directors, including the Audit Committee, Governance Committee and Compensation and Organization Committee, are available
through the Investor Relations and Corporate Governance links in the Company Information section of our Web site at www.usg.com.
Other information required by this Item 10 is included under the headings Director Nominees and Directors Continuing in Office, Committees of
the Board of Directors, Audit Committee and Section 16(a) Beneficial Ownership Reporting Compliance in the definitive Proxy Statement for our
annual meeting of stockholders scheduled to be held on May 13, 2015, which information is incorporated herein by reference.
Item 11.

EXECUTIVE COMPENSATION

Information required by this Item 11 is included under the heading Compensation of Executive Officers and Directors in the definitive Proxy Statement for
our annual meeting of stockholders scheduled to be held on May 13, 2015, which information is incorporated herein by reference.
Item 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS

The following table sets forth information as of December 31, 2014 about our common stock that may be issued upon exercise of options under our LongTerm Incentive Plan, which was approved by our stockholders. The features of this plan are discussed further in Part II, Item 8, Financial Statements and
Supplementary Data, Note 11, Share-Based Compensation.

Number of securities to be
issued upon exercise of
outstanding options and rights

Plan Category
Equity compensation plans approved by
stockholders

Total

Weighted average exercise price

of outstanding options and
rights

3,559,771

Equity compensation plans not approved by

stockholders

Number of securities remaining

available for future issuance
under equity compensation plans
(excluding securities reported in column
one)

28.12

28.12

3,007,128

3,559,771

3,007,128

Other information required by this Item 12 is included under the headings Principal Stockholders and Security Ownership of Directors and
Executive Officers in the definitive Proxy Statement for our annual meeting of stockholders scheduled to be held on May 13, 2015, which information is
incorporated herein by reference.
Item 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Information required by this Item 13 is included under the heading Certain Relationships and Related Transactions and Director Independence in the
definitive Proxy Statement for our annual meeting of stockholders scheduled to be held on May 13, 2015, which information is incorporated herein by
reference.
Item 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

Information required by this Item 14 is included under the heading Independent Registered Public Accounting Firm Fees and Services in the definitive
Proxy Statement for our annual meeting of stockholders scheduled to be held on May 13, 2015, which information is incorporated herein by reference.

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PART IV
Item 15.
(a)

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

1 and 2. See Part II, Item 8, Financial Statements and Supplementary Data, for an index of our consolidated financial statements and supplementary
data schedule.
3. The information in the Exhibit Index of this Annual Report on Form 10-K is incorporated into this Item 15(a)3 by reference.

(b)
(c)

The information in the Exhibit Index of this Annual Report on Form 10-K is incorporated into this Item 15(b) by reference.
Separate financial statements of subsidiaries not consolidated and fifty percent or less owned persons.
(i) The audited consolidated financial statements of USG Boral Building Products Pte. as of and for the period from January 14, 2014 to June 30,
2014, including the report of Deloitte & Touche, independent certified public accountants, filed pursuant to Rule 3-09 of Regulation S-X, are
incorporated by reference to Exhibit 99.1.
(ii) The audited consolidated financial statements of USG Boral Building Products Pty Limited as of and for the year ended June 30, 2014, including
the report of KPMG, independent auditors, filed pursuant to Rule 3-09 of Regulation S-X, are incorporated by reference to Exhibit 99.2.

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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

USG CORPORATION
February 12, 2015
By:

/s/ Matthew F. Hilzinger

Matthew F. Hilzinger
Executive Vice President and
Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant
and in the capacities and on the date indicated.

/s/ James S. Metcalf

February 12, 2015

JAMES S. METCALF
Director, Chairman, President and
Chief Executive Officer
(Principal Executive Officer)
/s/ Matthew F. Hilzinger

February 12, 2015

MATTHEW F. HILZINGER
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
/s/ Jeanette A. Press

February 12, 2015

JEANETTE A. PRESS
Vice President and Controller
(Principal Accounting Officer)

JOSE ARMARIO, THOMAS A. BURKE,

MATTHEW CARTER JR.,

By:

/s/ Matthew F. Hilzinger

Matthew F. Hilzinger
Attorney-in-fact
February 12, 2015

GRETCHEN R. HAGGERTY,
WILLIAM H. HERNANDEZ, BRIAN A. KENNEY,
RICHARD P. LAVIN, STEVEN F. LEER
Directors

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EXHIBIT INDEX
Exhibit
Number

Exhibit

2.1

Share Sale and Subscription Agreement, dated as of October 17, 2013, by and among USG Corporation, USG Netherlands Global Holdings B.V.,
Boral Limited, Boral International Pty Limited, and Boral Gypsum Asia Sdn Bhd (incorporated by reference to Exhibit 2.1 to USG Corporation's
Current Report on Form 8-K dated October 16, 2013)

2.2

Share Sale and Subscription Agreement, dated as of October 17, 2013, by and among USG Corporation, USG Foreign Investments, Ltd., USG
Netherlands Global Holdings B.V., Boral Limited, Boral Building Materials Pty Limited, and Boral Australian Gypsum Limited (incorporated
by reference to Exhibit 2.2 to USG Corporation's Current Report on Form 8-K dated October 16, 2013)

3.1

Restated Certificate of Incorporation of USG Corporation (incorporated by reference to Exhibit 3.01 to USG Corporations Current Report on
Form 8-K filed June 21, 2006)

3.2

Certificate of Correction of the Restated Certificate of Incorporation of USG Corporation (incorporated by reference to Exhibit 4.1 to USG
Corporations Quarterly Report on Form 10-Q dated August 3, 2011)

3.3

Amendment to Restated Certificate of Incorporation of USG (incorporated by reference to Exhibit 3.1 to USG Corporation's Current Report on
Form 8-K dated May 10, 2013)

3.4

Amended and Restated By-Laws of the Company, dated as of November 13, 2014 (incorporated by reference to Exhibit 3.1 to USG
Corporations Current Report on Form 8-K dated November 18, 2014)

4.1

Form of Common Stock certificate (incorporated by reference to Exhibit 4.1 to USG Corporations Annual Report on Form 10-K dated February
16, 2007)

4.2

Rights Agreement, dated as of December 21, 2006, between USG Corporation and Computershare Investor Services, LLC, as Rights Agent
(incorporated by reference to Exhibit 4.1 to USG Corporations Registration Statement on Form 8-A dated December 21, 2006)

4.3

Amendment No. 1 to Rights Agreement, dated as of December 5, 2008, to the Rights Agreement, dated as of December 21, 2006, by and
between USG Corporation and Computershare Investor Services, LLC, as Rights Agent (incorporated by reference to Exhibit 4.1 to USG
Corporations Amendment No. 1 to Form 8-A dated December 5, 2008)

4.4

Amendment No. 2 to Rights Agreement, dated as of March 22, 2013, between USG Corporation and Computershare Trust Company, N.A., as
rights agent (successor-in-interest to Computershare Investor Services LLC) (incorporated by reference to Exhibit 4.1 to USG Corporations
Amendment No. 2 to Form 8-A dated March 22, 2013)

4.5

Amendment No. 3 to Rights Agreement, dated as of February 11, 2015 between USG Corporation and Computershare Trust Company, N.A., as
rights agent (successor-in-interest to Computershare Investor Services LLC) (incorporated by reference to Exhibit 4.1 to USG Corporations
Amendment No. 3 to Form 8-A dated February 11, 2015)

4.6

Indenture, dated as of November 1, 2006, by and between USG Corporation and Wells Fargo Bank, National Association, as trustee
(incorporated by reference to Exhibit 4.01 to USG Corporations Current Report on Form 8-K dated November 20, 2006, or the November 2006
8-K)

4.7

Supplemental Indenture No. 1, dated as of November 17, 2006, by and between USG Corporation and Wells Fargo Bank, National Association,
as trustee (incorporated by reference to Exhibit 4.02 to the November 2006 8-K)

4.8

Form of 7.750% Senior Note due 2018 (incorporated by reference to USG Corporations Current Report on Form 8-K dated September 26, 2007)

4.9

Agreement of Resignation, Appointment and Acceptance, dated as of October 18, 2011, by and among USG Corporation, U.S. Bank National
Association and HSBC Bank USA, National Association (incorporated by reference to Exhibit 4.1 to USG Corporations Quarterly Report on
Form 10-Q dated October 31, 2011)

4.10

Supplemental Indenture No. 2, dated as of August 4, 2009, between USG Corporation, each of United States Gypsum Company, L&W Supply
Corporation, USG Foreign Investments, Ltd. and USG Interiors, Inc. and HSBC Bank USA, National Association, as trustee (incorporated by
reference to Exhibit 4.01 to USG Corporations Current Report on Form 8-K dated August 4, 2009)

4.11

Supplemental Indenture No. 3, dated as of November 9, 2010, by and among USG Corporation, each of United States Gypsum Company, L&W
Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, Inc. as guarantors, and HSBC Bank USA, National Association, as
Trustee, (incorporated by reference to Exhibit 4.1 to USG Corporations Current Report on Form 8-K dated November 9, 2010)

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4.12

Guaranty Agreement, dated as of December 12, 2011, among USG Interiors, LLC, USG Corporation, United States Gypsum Company, L&W
Supply Corporation, USG Foreign Investments, Ltd., USG Interiors, Inc. and U.S. Bank National Association, as successor trustee under
Supplemental Indenture No. 3 (incorporated by reference to Exhibit 4.13 to the 2011 10-K)

4.13

Supplemental Indenture No. 4, dated as of April 12, 2012, by and among USG Corporation, each of United States Gypsum Company, L&W
Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, LLC, as guarantors, and U.S. Bank National Association, as trustee
(incorporated by reference to Exhibit 4.1 to USG Corporation's Current Report on Form 8-K dated April 12, 2012)

4.14

Supplemental Indenture No. 5, dated as of October 31, 2013, by and among USG Corporation, each of United States Gypsum Company, L&W
Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, LLC, as guarantors, and U.S. Bank National Association, as trustee
(incorporated by reference to Exhibit 4.1 to USG Corporation's Current Report on Form 8-K dated October 31, 2013)

USG Corporation and certain of its consolidated subsidiaries are parties to other long-term debt instruments under which the total amount of securities
authorized does not exceed 10% of the total assets of USG Corporation and its subsidiaries on a consolidated basis. Pursuant to paragraph (b)(4)(iii)(A) of
Item 601 of Regulation S-K, USG Corporation agrees to furnish a copy of such instruments to the Securities and Exchange Commission upon request.
10.1

Amendment and Restatement of USG Corporation Supplemental Retirement Plan, effective as of January 1, 2007 and dated December 10, 2008
(incorporated by reference to Exhibit 10.1 to USG Corporations Annual Report on Form 10-K dated February 20, 2009, or the 2008 10-K) *

10.2

Form of Employment Agreement (incorporated by reference to Exhibit 10.1 to USG Corporations Current Report on Form 8-K dated October 2,
2008, or the First October 2008 8-K) *

10.3

Form of Employment Agreement (form used since January 1, 2015)* **

10.4

Form of Change in Control Severance Agreement (Tier 1 Benefits) (incorporated by reference to Exhibit 10.2 to the First October 2008 8-K) *

10.5

Form of Change in Control Severance Agreement (Tier 2 Benefits) (incorporated by reference to Exhibit 10.3 to the First October 2008 8-K) *

10.6

Form of Indemnification Agreement (incorporated by reference to Exhibit 10.14 to USG Corporations Annual Report on Form 10-K dated
February 15, 2008, or the 2007 10-K) *

10.7

Employment Agreement, effective as of April 16, 2012, between USG Corporation and Matthew Hilzinger (incorporated by reference to Exhibit
10.1 to USG Corporation's Current Report on Form 8-K dated March 26, 2012, or the March 2012 8-K) *

10.8

Change in Control Severance Agreement, dated as of April 16, 2012, between USG Corporation and Matthew Hilzinger (incorporated by
reference to Exhibit 10.2 to the March 2012 8-K) *

10.9

USG Corporation Stock Compensation Program for Non-Employee Directors (as Amended and Restated Effective as of January 1, 2005)
(incorporated by reference to Exhibit 10.2 to USG Corporations Current Report on Form 8-K dated November 14, 2005) *

10.10

Amendment No. 1 to the USG Corporation Stock Compensation Program for Non-Employee Directors (as Amended and Restated as of January
1, 2005) (incorporated by reference to Exhibit 10.1 to USG Corporations Quarterly Report on Form 10-Q dated August 3, 2006, or the second
quarter 2006 10-Q) *

10.11

Amendment No. 2 to the USG Corporation Stock Compensation Program for Non-Employee Directors (as Amended and Restated as of January
1, 2005) (incorporated by reference to Exhibit 10.8 to USG Corporations Quarterly Report on Form 10-Q dated April 30, 2007) *

10.12

USG Corporation Non-Employee Director Compensation Program (Amended and Restated February 13, 2008) (incorporated by reference to
Exhibit 10.18 to the 2007 10-K) *

10.13

Amendment No. 1 to USG Corporation Non-Employee Director Compensation Program (as Amended and Restated February 13, 2008)
(incorporated by reference to Exhibit 10.10 to USG Corporations Annual Report on Form 10-K dated February 11, 2011, or the 2010 10-K) *

10.14

Amendment No. 2 to USG Corporation Non-Employee Director Compensation Program (as Amended and Restated February 13, 2008 and
amended November 12, 2010) (incorporated by reference to Exhibit 10.11 to the 2011 10-K)*

Table of Contents

10.15

Amendment No. 3 to USG Corporation Non-Employee Director Compensation Program (as Amended and Restated February 13, 2008 and
amended November 12, 2010 and November 10, 2011)*

10.16

Amendment No. 4 to USG Corporation Non-Employee Director Compensation Program (as Amended and Restated February 13, 2008 and
amended November 12, 2010, November 10, 2011 and November 14, 2013)* **

10.17

USG Corporation Deferred Compensation Program for Non-Employee Directors (as Amended and Restated effective December 31, 2008)
(incorporated by reference to Exhibit 10.10 to the 2008 10-K) *

10.18

Fourth Amendment and Restatement Agreement, dated as of October 22, 2014, among USG Corporation and CGC Inc., as borrowers, and JP
Morgan Chase Bank, N.A. and JP Morgan Chase Bank, N.A., Toronto Branch, as administrative agents, and the lenders party thereto**

10.19

Fourth Amended and Restated Credit Agreement, dated as of October 22, 2014, among USG Corporation and CGC Inc., as borrowers, JPMorgan
Chase Bank, N.A. and JP Morgan Chase Bank, N.A., Toronto Branch, as administrative agents, the lenders party thereto and Bank of America,
N.A. and Wells Fargo Bank, N.A., as co-syndication agents**

10.20

Amended and Restated Guarantee Agreement dated as of October 22, 2014 among USG Corporation, CGC Inc., the subsidiary guarantors party
thereto and JP Morgan Chase Bank, N.A., as administrative agent**

10.21

U.S. Pledge and Security Agreement dated as of January 7, 2009 among USG Corporation, the other grantors party thereto and JPMorgan Chase
Bank, N.A., as administrative agent**

10.22

Canadian Pledge and Security Agreement dated as of October 22, 2014 among CGC Inc., the other grantors party thereto and JPMorgan Chase
Bank, N.A., as administrative agent**

10.23

2014 Annual Management Incentive Program of USG Corporation (Executive Officers Only) (incorporated by reference to Exhibit 10.1 to USG
Corporations Form 8-K filed as of February 13, 2014, or the February 2014 8-K)*

10.24

2015 Annual Management Incentive Program of USG Corporation (Executive Officers Only)* **

10.25

USG Corporation Deferred Compensation Plan (incorporated by reference to Exhibit 10.31 to USG Corporations Annual Report on Form 10-K
dated February 16, 2007) *

10.26

First Amendment of USG Corporation Deferred Compensation Plan, effective as of April 1, 2007 and dated December 10, 2008 (incorporated by
reference to Exhibit 10.25 to the 2008 10-K) *

10.27

Second Amendment of USG Corporation Deferred Compensation Plan, effective as of April 1, 2007 and dated September 5, 2012 (incorporated
by reference to Exhibit 10.1 to USG Corporation's Quarterly Report on Form 10-Q dated October 23, 2014)*

10.28

Third Amendment of USG Corporation Deferred Compensation Plan, effective as of April 1, 2007 and dated November 21, 2014* **

10.29

USG Corporation Long-Term Incentive Plan (as amended effective May 12, 2010) (incorporated by reference to Annex C to the Proxy Statement
for the Annual Meeting of Stockholders of USG Corporation held on May 12, 2010, or the 2010 Proxy Statement) *

10.30

Form of USG Corporation Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.9 to the second quarter 2006 10-Q) *

10.31

Form of USG Corporation Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 to USG Corporations Current
Report on Form 8-K dated March 28, 2007, or the March 2007 8-K) *

10.32

Form of USG Corporation Restricted Stock Units Agreement (Annual Grant) (incorporated by reference to Exhibit 10.2 to the March 2007 8-K)
*

10.33

Form of USG Corporation Restricted Stock Units Agreement (Retention Grant) (incorporated by reference to Exhibit 10.3 to the March 2007 8K) *

10.34

Form of USG Corporation Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.36 to the 2008 10-K) *

10.35

Form of USG Corporation Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.37 to the 2008 10-K) *

10.36

Form of USG Corporation Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.30 to USG Corporations Annual
Report on Form 10-K dated February 12, 2010, or the 2009 10-K) *

Table of Contents

10.37

Form of USG Corporation Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.31 to the 2009 10-K) *

10.38

Form of Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.7 to the 2010 10-Q) *

10.39

Form of Amended and Restated Performance Based Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.36 to the 2011
10-K) *

10.40

Form of USG Corporation Performance Based Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.2 to USG
Corporation's Quarterly Report on Form 10-Q dated October 26, 2012, or the third quarter 2012 10-Q) *

10.41

Form of USG Corporation Market Share Units Agreement (incorporated by reference to Exhibit 10.40 to the 2012 10-K)*

10.42

Form of USG Corporation Performance Shares Agreement (incorporated by reference to Exhibit 10.41 to the 2012 10-K)*

10.43

Form of USG Corporation Market Share Units Agreement (incorporated by reference to Exhibit 10.2 to the February 2014 8-K)*

10.44

Form of USG Corporation Performance Shares Agreement (incorporated by reference to Exhibit 10.3 to the February 2014 8-K)*

10.45

Form of Restricted Stock Units Agreement (incorporated by reference to Exhibit 10.1 to USG Corporation's Quarterly Report on Form 10-Q
dated July 24, 2014)*

10.46

Form of USG Corporation Market Share Units Agreement* **

10.47

Form of USG Corporation Performance Shares Agreement* **

10.48

Changes to Equity Awards for Compliance With Section 409A (incorporated by reference to Exhibit 10.39 to the 2008 10-K) *

10.49

USG Corporation Management Incentive Plan (incorporated by reference to Annex B to the 2010 Proxy Statement)*

10.50

Shareholders Agreement, entered into as of January 30, 2006, by and between USG Corporation and Berkshire Hathaway Inc. (incorporated by
reference to Exhibit 10.3 to the January 2006 8-K)

10.51

Amended and Restated Registration Rights Agreement, dated as of November 26, 2008, by and between USG Corporation and Berkshire
Hathaway Inc. (incorporated by reference to Exhibit 10.1 to the November 2008 8-K)

10.52

Secured Loan Facility Agreement, dated October 21, 2008, between Gypsum Transportation Limited and DVB Bank SE, as lender, agent and
security trustee (incorporated by reference to Exhibit 10.5 to the 2010 10-Q)

10.53

Guarantee and Indemnity Agreement, dated October 21, 2008, between USG Corporation and DVB Bank SE, as agent (incorporated by reference
to Exhibit 10.2 to USG Corporations Current Report on Form 8-K dated October 27, 2008, or the Second October 2008 8-K)

10.54

Form of Deed of Covenants between Gypsum Transportation Limited and DVB Bank SE, as mortgagee (incorporated by reference to Exhibit
10.3 to the Second October 2008 8-K)

10.55

Form of Deed of Assignment between Gypsum Transportation Limited and DVB Bank SE, as assignee (incorporated by reference to Exhibit 10.4
to the Second October 2008 8-K)

10.56

Second Supplemental Agreement, dated November 10, 2009, to Secured Loan Facility Agreement dated October 21, 2008 between Gypsum
Transportation Limited, USG Corporation and DVB Bank SE, as lender, agent and security trustee (incorporated by reference to Exhibit 10.43 to
the 2009 10-K)

10.57

Share and Asset Purchase Agreement, dated as of August 7, 2012, by and between USG Corporation and its indirect wholly owned subsidiaries,
USG Foreign Investments, Ltd. and USG (U.K.) Ltd., and Knauf International GmbH and Knauf AMF Ceilings Ltd. (incorporated by reference to
Exhibit 10.1 to the third quarter 2012 10-Q)

10.58

Shareholders Agreement, dated as of February 28, 2014, by and among USG Corporation, Boral International Pty Limited, Boral Building
Materials Pty Limited, USG Netherlands Global Holdings B.V., USG Boral Building Products Pte Limited, USG Boral Building Products Pty
Limited, and Boral Limited (incorporated by reference to Exhibit 10.1 to USG Corporation's Current Report on Form 8-K filed February 28,
2014) (Note: Portions of this
document have been omitted pursuant to a Request for Confidential Treatment filed with the Securities and Exchange Commission on February
28, 2014)

Table of Contents

99.1

Audited Financial Statements of USG Boral Building Products Pte. as of and for the year ended June 30, 2014**

99.2

Audited Financial Statements of USG Boral Building Products Pty Limited as of and for the year ended June 30, 2014 **

Other:
21

Subsidiaries **

23.1

Consent of Independent Registered Public Accounting Firm, Deloitte & Touche LLP **

23.2

Consent of Independent Registered Public Accounting Firm, Deloitte Singapore**

23.3

Consent of Independent Auditors, KPMG **

24

Power of Attorney **

31.1

Rule 13a - 14(a) Certifications of USG Corporations Chief Executive Officer **

31.2

Rule 13a - 14(a) Certifications of USG Corporations Chief Financial Officer **

32.1

Section 1350 Certifications of USG Corporations Chief Executive Officer **

32.2

Section 1350 Certifications of USG Corporations Chief Financial Officer **

95

Mine Safety Disclosures **

101

The following financial information from USG Corporations Annual Report on Form 10-K for the year ended December 31, 2014, formatted in
XBRL (Extensible Business Reporting Language): (1) the consolidated statements of operations for the years ended December 31, 2014, 2013
and 2012, (2) the consolidated statements of other comprehensive income (loss) for the years ended December 31, 2014, 2013 and 2012, (3) the
consolidated balance sheets as of December 31, 2014 and 2013, (4) the consolidated statements of cash flows for the years ended December 31,
2014, 2013 and 2012, (5) the consolidated statements of stockholders equity for the years ended December 31, 2014, 2013 and 2012 and (6)
notes to the consolidated financial statements. **

*
**

Management contract or compensatory plan or arrangement

Filed or furnished herewith
Schedules and other similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant hereby undertakes to
furnish supplementally copies of any of the omitted schedules and other similar attachments upon request by the Securities and Exchange
Commission, provided that the registrant may request confidential treatment for any schedule or other similar attachment so furnished.

EXHIBIT 10.3

USG CORPORATION
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this Agreement) is effective as of [DATE] (the Effective Date) between USG
Corporation, a Delaware corporation (the Company), and [NAME] (the Executive).
RECITALS:
WHEREAS, the Company desires to continue to employ the Executive and the Executive desires to accept such continued
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 effective
[DATE] 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 Executives duties and responsibilities to the best of the Executives abilities in a
diligent, trustworthy, businesslike and efficient manner.
Compensation and Benefits.

4.

(a)

Salary. The Company agrees to pay the Executive a salary (Base Salary) during the Employment Period in
installments based on the Companys practices as may be in effect from time to time. The Executives initial Base
Salary shall be at the rate of [$ ] per year. The Executives 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 Companys annual and long-term incentive plans,
on a basis comparable to other similarly situated executives of the Company.

5.

(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 Executives duties under this Agreement that
are consistent with the Companys policies in effect from time to time with respect to travel, entertainment and other
business expenses, subject to the Companys 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 Executives 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 Companys 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 Companys standard Indemnification Agreement that
is entered into with other similarly situated senior executives of the Company.

Employment Period.
(a)

Except as hereinafter provided, the Employment Period shall begin on the Effective Date and shall extend until
[DATE], 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 Executives death;

(ii)

the Companys termination of the Executives employment on account of Disability;

(iii)

a Termination for Cause;

(iv)

a Termination without Cause; or

(v)

a Voluntary Termination.

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
Companys or a Subsidiarys 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 Executives 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 Executives 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 one (1) 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).

(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 Executives and the Companys 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 Executives dependents or beneficiaries, as the case may be, of all taxes
so imposed, the recipient retains an amount equal to such taxes.

7.

(iii)

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.

(iv)

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 Executives 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 Executives
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 Executives 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
Executives 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
Executives 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 Executives 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 Executives death.

(d)

It is expressly understood that the Companys 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.

Competitive Activity; Confidentiality; Nonsolicitation.

(a)

Acknowledgements and Agreements. The Executive hereby acknowledges and agrees that in the performance of the
Executives 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 Executives 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.
(b)

(c)

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.

Covenants Following Termination. For a period of two (2) years following the termination of the Executives
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 Companys 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 Companys 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 Companys business within the United States.

(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
Executives 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
Executives 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 Companys Business. For the purposes of Sections 7(b), 7(c), 7(j) and 7(k), the Companys 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 Executives 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.

(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
Executives employment with the Company, disclose, furnish, disseminate, make available or, except in the
course of performing the Executives 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 Companys 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 Executives 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 Executives employment with the Company (except in the course of performing the
Executives duties and obligations to the Company) or after the termination of the Executives employment shall
constitute a misappropriation of the Companys trade secrets.
(ii)

(j)

The Executive agrees that upon termination of the Executives 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.

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 Executives 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 Companys employ
with the use of the Companys time, material or facilities or in any way within or related to the existing or
contemplated scope of the Companys business. Any discovery, invention or improvement relating to any
subject matter with which the Company was concerned during the Executives employment and made,
conceived or suggested by the Executive, either solely or jointly with others, within one (1) year following
termination of the Executives 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 Companys 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 Executives 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)

8.

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 Executives 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) USG Corporation, 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 Executives 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.

(m)

Relief. The Executive acknowledges and agrees that the remedy at law available to the Company for breach of any of
the Executives 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 Executives obligations under this Section 7 are reasonable in
the context of the nature of the Companys 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.

Section 280G. The amounts payable to the Executive under Section 6 may 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, but
for the application of this Section 8, constitute a parachute payment (as defined in Section 280G(b)(2) of the Code). In such
event, the combined amount shall be reduced to the minimum extent necessary (but in no event to less than zero) so that no
portion of any such payment or benefit, as

so reduced, constitutes a parachute payment; provided, however, that the foregoing reduction shall be made only if and to the
extent that such reduction would result in an increase in the aggregate payments and benefits to be provided to the Executive,
determined on an after-tax basis (taking into account the excise tax imposed pursuant to Section 4999 of the Code, or any
successor provision thereto, any tax imposed by any comparable provision of state law, and any applicable federal, state and
local income taxes). To the extent the reduction referred to in the second sentence of this Section 8 applies, such reduction shall
be made to the combined amount by reduction of the aggregate amount of the lump sum payments described in Sections 6(c)(i)
and 6(c)(ii) of this Agreement and, to the extent further reductions are required, in such payments due to the Executive as the
Company may determine. Any determinations required to be made under this Section 8 shall be made by the Companys
independent accountants, which shall provide detailed supporting calculations both to the Company and the Executive within
15 business days of the date of termination or such earlier time as is requested by the Company, and shall be made at the
expense of the Company. The fact that the Executives right to payments or benefits may be reduced by reason of the
limitations contained in this Section 8 shall not of itself limit or otherwise affect any other rights of the Executive under this
Agreement.
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:

(c)

(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.

Code means the Internal Revenue Code of 1986, as amended.

10.

(d)

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

(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 Executives employment is terminated by the Company or any
Subsidiary.

(h)

Termination for Cause means the Companys termination of the Executives employment for Cause.

(i)

Termination without Cause means the Companys termination of the Executives employment other than a
Termination for Cause.

(j)

Voluntary Termination means Executives termination of the Executives employment for any reason, including
retirement.

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.

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 Executives 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 Companys standard form of Release Agreement within
seven (7) days of the Executives 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
Executives 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.

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

By:
Name:
Title:

Executive

EXHIBIT 10.16
249197

Amendment No. 4 to
USG Corporation
Non-Employee Director
Compensation Program
(As Amended and Restated February 13, 2008
and amended November 12, 2010, November 10, 2011 and November 14, 2013) .
Section 2 of the USG Corporation Non-Employee Director Program (As Amended and Restated February 13, 2008 and
amended November 12, 2010, November 10, 2011 and November 14, 2013) is amended effective January 1, 2015 to read in its
entirety as follows:
1. An additional cash retainer of $20,000 per year for the chair of the Audit Committee of the Board, $15,000 per year for the
chair of the Compensation and Organization Committee of the Board, and $10,000 per year for the chairs of the other
Board committees, each payable in equal quarterly installments on the last business day of each calendar quarter, and an
additional cash retainer of $20,000 per year for the Boards Lead Director, payable in equal quarterly installments on the
last business day of each calendar quarter commencing with the first quarter of 2015.

November 13, 2014

EXHIBIT 10.18

FOURTH AMENDMENT AND RESTATEMENT AGREEMENT (this Agreement) dated as of

October 22, 2014, among USG CORPORATION, a Delaware corporation (the U.S. Borrower), CGC INC.,
a New Brunswick corporation (the Canadian Borrower), the other LOAN PARTIES party hereto, the
LENDERS and ISSUING BANKS party hereto, JPMORGAN CHASE BANK, N.A., as administrative agent
under the Third Amended and Restated Credit Agreement dated as of December 21, 2010, among the U.S.
Borrower, the Lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent (the Administrative
Agent), and Bank of America, N.A. and Wells Fargo Bank, National Association, as co-syndication agents (as
amended by Amendment No. 1 dated as of April 17, 2014, and as further amended, supplemented or otherwise
modified prior to the date hereof, the Existing Credit Agreement), and JPMORGAN CHASE BANK, N.A.,
TORONTO BRANCH, as Canadian administrative agent (the Canadian Agent).
WHEREAS the U.S. Borrower has requested, and the undersigned Lenders (such term and each other capitalized term
used but not defined in these recitals having the meaning assigned to such term in Section 1 hereof) and the Administrative Agent have
agreed, upon the terms and subject to the conditions set forth herein and in the Restated Credit Agreement (as defined below), that (a)
the Existing Credit Agreement will be amended and restated as provided herein, (b) the Guarantee Agreement dated as of January 7,
2009 (as amended by Amendment No. 1 dated as of April 17, 2014, and as further amended, supplemented or otherwise modified
prior to the date hereof, the Existing Guarantee Agreement), among the U.S. Borrower, the subsidiaries of the U.S. Borrower
identified therein and the Administrative Agent, will be amended and restated as provided herein, (c) the Pledge and Security
Agreement dated as of January 7, 2009 (as amended by Amendment No. 1 dated as of April 17, 2014, and as further amended,
supplemented or otherwise modified prior to the date hereof, the Existing U.S. Security Agreement; the Existing U.S. Security
Agreement, together with the Existing Guarantee Agreement, the Existing Loan Documents), among the U.S. Borrower, the
subsidiaries of the U.S. Borrower identified therein and the Administrative Agent, will be amended as provided herein and (d) the
Loan Parties will reaffirm their respective obligations (including, without limitation, the grant of a security interest in their respective
Collateral) under the Collateral Documents and the Existing Guarantee Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. Defined Terms. Capitalized terms used but not defined herein shall have the respective meanings
assigned to such terms in the Restated Credit Agreement referred to below (except as otherwise expressly set forth herein).
SECTION 2. Restatement Effective Date. (a) The transactions provided for in Section 3 hereof shall be consummated
at a closing to be held on the Restatement Effective Date at the offices of Cravath, Swaine & Moore LLP, or at such other time and
place as the parties hereto shall agree upon.
(b) The Restatement Effective Date shall be specified by the U.S. Borrower, and shall be a date not later than
October 22, 2014, as of which date all the conditions set forth or referred to in Section 6 hereof shall have been satisfied.

SECTION 3. Amendment and Restatement of the Existing Credit Agreement. (a) Effective as of the Restatement
Effective Date, the Existing Credit Agreement is hereby amended and restated to read in its entirety as set forth in Exhibit A hereto (the
Restated Credit Agreement).
(b) The aggregate amount of all Letters of Credit outstanding under the Existing Credit Agreement on the Restatement
Effective Date shall continue to be outstanding under the Restated Credit Agreement and from and after such date, the terms of the
Restated Credit Agreement will govern the rights of the Administrative Agent, the Lenders and the Issuing Banks with respect thereto.
(c) As of the Restatement Effective Date and after giving effect to the transactions set forth in the Master Assignment
Agreement dated as of the date hereof among the U.S. Borrower, the Lenders party thereto and the Administrative Agent, (i) the
Revolving Commitments (as such term is defined in the Existing Credit Agreement) shall be automatically increased from
$400,000,000 to $450,000,000 and (ii) immediately following the Revolving Commitment increase referenced in clause (i) of this
paragraph (c), each Lender party hereto shall be deemed to have assigned that portion of its interests, rights and obligations with
respect to the Revolving Commitments of such Lender outstanding under the Restated Credit Agreement on the Restatement Effective
Date (all such interests, rights and obligations to be referred to herein as the Assigned Interests), or shall be deemed to have assumed
a portion of the Assigned Interests so assigned pursuant to this clause (ii), in accordance with Section 9.04 of the Restated Credit
Agreement such that, upon given effect to such assignment and assumption, each such Lender holds Revolving Commitments (and a
pro rata share of the interests in respect of Letters of Credit) in an amount equal to that set forth on Schedule 2.01 of the Restated Credit
Agreement opposite such Lenders name, provided that the Administrative Agent and the Lenders hereby waive the minimum
assignment requirements, the recordation fee requirement and the requirement to execute a separate Assignment and Assumption, in
each case set forth in Section 9.04(b)(ii) of the Restated Credit Agreement in respect of such assignments and assumptions. Without
limiting the generality of the foregoing, each Lender party hereto hereby makes the representations and warranties required to be made
under paragraphs 1.1 and 1.2, respectively, of Annex I to Exhibit A to the Restated Credit Agreement by an Assignor and Assignee (in
each case, as defined in such Exhibit A) with respect to the Assigned Interests being assigned or assumed by such Lender hereunder,
as the case may be. The U.S. Borrower hereby consents to each such assignment and assumption.
SECTION 4. Amendment and Restatement of the Existing Guarantee Agreement. Effective as of the Restatement
Effective Date, the Existing Guarantee Agreement is hereby amended and restated to read in its entirety as set forth in Exhibit B hereto
(the Restated Guarantee Agreement). As of the Restatement Effective Date, the Canadian Borrower, by execution of this
Agreement, shall become a party to the Restated Guarantee Agreement.
SECTION 5. Amendment of the Existing U.S. Security Agreement. (a) Effective as of the Restatement Effective Date,
the Existing U.S. Security Agreement is hereby amended to read in its entirety as set forth in Exhibit C hereto (the Existing U.S.
Security Agreement, as so amended, the Amended U.S. Security Agreement).
(b) From and after the Restatement Effective Date, it is hereby acknowledged and agreed that the
Released Loan Parties (as defined below) which were parties to the Existing U.S. Security Agreement are hereby released from
all obligations and liabilities under the Existing U.S. Security Agreement and shall no longer be deemed Grantors or Loan
Parties under and pursuant to the Existing U.S. Security Agreement or any other Loan Document.

SECTION 6. Conditions. The consummation of the transactions set forth in Sections 3, 4 and 5 hereof shall be subject
to the satisfaction of the following conditions precedent:
(a) Loan Documents. The Administrative Agent (or its counsel) shall have received (i) from the U.S. Borrower, the
Canadian Borrower, each other Loan Party listed on the signature pages hereto, each Lender (as such term is defined in the Existing
Credit Agreement), each other Lender that will have a Revolving Commitment on the Restatement Effective Date, the Administrative
Agent, each Issuing Bank, the Swingline Lender and the Canadian Agent, a counterpart of this Agreement signed on behalf of such
party (or written evidence reasonably satisfactory to the Administrative Agent (which may include facsimile or other electronic
transmission of a signed signature page) that such party has signed a counterpart of this Agreement), (ii) from (A) each of the Canadian
Collateral Parties and the Administrative Agent, a counterpart to the Canadian Security Agreement signed on behalf of such party (or
written evidence reasonably satisfactory to the Administrative Agent (which may include facsimile or other electronic transmission of a
signed signature page) that such party has signed a counterpart of such agreement) and (B) the Canadian Borrower and the
Administrative Agent, a counterpart to a Canadian Hypothec with respect to the assets of the Canadian Borrower located in the
Province of Quebec signed on behalf of such party (or written evidence reasonably satisfactory to the Administrative Agent (which
may include facsimile or other electronic transmission of a signed signature page) that such party has signed a counterpart of such
agreement) (provided that such delivery shall not be a condition precedent to the Restatement Effective Date, but shall be required to
be accomplished not later than 30 days after the Restatement Effective Date (or such later date as agreed by the Administrative Agent,
in its sole discretion)), (iii) from each of the Collateral Parties party thereto and the Administrative Agent, solely to the extent not
previously delivered in connection with the Existing Credit Agreement, a counterpart to each Deposit Account Control Agreement
required by the terms of the Amended U.S. Security Agreement or the Canadian Security Agreement (provided that, if the Collateral
Parties have used commercially reasonable efforts to procure and deliver, but shall nevertheless be unable to deliver, any such Deposit
Account Control Agreement, then such delivery shall not be a condition precedent to the Restatement Effective Date, but shall be
required to be accomplished not later than 90 days after the Restatement Effective Date (or such later date as agreed by the
Administrative Agent, in its sole discretion)) and (iv) a favorable written opinion (addressed to the Administrative Agent, the Canadian
Agent, the Issuing Banks and the Lenders and dated the Restatement Effective Date) of each of (A) Jones Day, New York counsel for
the Borrowers and the other Loan Parties, (B) Fasken Martineau, Canadian counsel for the Borrowers and the other Loan Parties and
(C) local counsel in each jurisdiction where a Loan Party is organized (other than any such jurisdiction covered by the opinions given
pursuant to the immediately preceding clauses (A) and (B)), in each case in form and substance reasonably satisfactory to the
Administrative Agent and covering such matters relating to the Loan Parties, the Loan Documents or the Restatement Transactions as
the Administrative Agent shall reasonably request.
(b) Closing Certificates; Certified Certificate of Incorporation; Good Standing Certificates. The Administrative Agent
shall have received (i) a certificate of each Loan Party, dated the Restatement Effective Date and executed by its Secretary or Assistant
Secretary, which shall (A) certify the resolutions of its Board of Directors, members or other body authorizing the execution, delivery
and performance of the Loan Documents to which it is a party, (B) identify by name and title and bear the signatures of the Financial
Officers and any other officers of such Loan Party authorized to sign the Loan Documents to which it is a party and (C) contain
appropriate attachments, including the certificate or articles of incorporation or organization of each Loan Party certified by the relevant
authority of the jurisdiction of organization of such Loan Party and a true and correct copy of its by-laws or operating, management or
partnership agreement (or, in lieu thereof, a certification to the effect that such constating documents have

not been amended or otherwise modified since December 21, 2010), and (ii) to the extent that such concept is applicable in the relevant
jurisdiction, a good standing certificate for each Loan Party from its jurisdiction of organization (and, to the extent that such good
standing certificate is not dated as of the Restatement Effective Date, a bring-down good standing certificate dated as of the
Restatement Effective Date).
(c) No Default Certificate. The Administrative Agent shall have received a certificate, signed by the chief financial
officer or treasurer of the U.S. Borrower and dated the Restatement Effective Date, (i) stating that, as of the Restatement Effective Date
and after giving effect to the Restatement Transactions, no Default or Event of Default has occurred and is continuing and (ii) stating
that the representations and warranties contained in the Loan Documents that are qualified by materiality are true and correct and the
representations and warranties contained in the Loan Documents that are not so qualified are true and correct in all material respects, in
each case on and as of such date with the same effect as if made on and as of such date, except to the extent such representations and
warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct (or true and
correct in all material respects, as the case may be) as of such earlier date.
(d) Fees. The Administrative Agent (or, if required by the relevant Loan Document or other written agreement relating
to any document, the applicable Arranger, Lender or Affiliate thereof) shall have received all fees and other amounts due and payable
by any Loan Party on or prior to the Restatement Effective Date, including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses (including reasonable fees, charges and disbursements of counsel), in each case, required to be reimbursed or
paid by any Loan Party under any Loan Document or any other written agreement relating to any Loan Document entered into by the
Borrower and the Administrative Agent (or by the applicable Arranger, Lender or Affiliate thereof, as the case may be). In addition,
the U.S. Borrower shall have paid to the Administrative Agent, for the account of the Administrative Agent, the Issuing Bank and the
Lenders, all unpaid fees, interest and other amounts that have accrued under the Existing Credit Agreement prior to the Restatement
Effective Date.
(e) Existing Canadian Facility. Prior to or substantially concurrently with the initial funding of the Loans on the
Restatement Effective Date, (i) all commitments under the Existing Canadian Facility shall have been terminated, (ii) all loans, interest
and other amounts accrued or owing thereunder shall have been repaid in full (or, in the case of letters of credit outstanding thereunder,
fully cash collateralized) and (iii) all guarantees and Liens (other than with respect to such cash collateral) granted in respect thereof
shall have been released and the terms and conditions of any such release shall be satisfactory to the Administrative Agent. The
Administrative Agent shall have received a payoff and release letter with respect to the Existing Canadian Facility in form and
substance reasonably satisfactory to the Administrative Agent.
(f) Perfection Certificate; Lien Searches. The Administrative Agent shall have received (i) a completed Perfection
Certificate, dated the Restatement Effective Date, together with all attachments contemplated thereby and (ii) the results of a recent lien
search in the jurisdictions requested by the Administrative Agent based on the Perfection Certificate, and such search shall reveal no
Liens on any of the assets of the Loan Parties except for Liens permitted by Section 6.02 of the Restated Credit Agreement or
discharged on or prior to the Restatement Effective Date pursuant to a pay-off letter or other documentation reasonably satisfactory to
the Administrative Agent.

(g) Borrowing Base Certificate. The Administrative Agent shall have received a Borrowing Base Certificate dated as of
the Restatement Effective Date that calculates the Borrowing Base as of September 30, 2014.
(h) Filings, Registrations and Recordings. Each document (including any Uniform Commercial Code financing
statement and Personal Property Security Act (Canada) filing) required by the Collateral Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of the Administrative Agent, for the
benefit of the Secured Parties, a perfected Lien on the Collateral described therein, prior to and superior in right to any other Person
(other than with respect to Liens expressly permitted by clauses (b) through (d), (f) and (k) of Section 6.02 of the Restated Credit
Agreement), shall be in proper form for filing, registration or recordation.
(i) Know Your Customer Requirements. The Lenders shall have received all documentation and other information
requested by the Administrative Agent and required under applicable know your customer rules and regulations, including all
information required to be delivered pursuant to Section 9.13 of the Restated Credit Agreement.
(j) Compliance With Laws. The U.S. Borrower, the Canadian Borrower and their respective Material Subsidiaries shall
be in compliance with all applicable foreign and U.S. Federal, State and local laws and regulations, including all applicable
environmental laws and regulations, except where the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. All necessary material governmental and material third party approvals in connection
with this Agreement, the Restated Credit Agreement and the credit facility contemplated thereby shall have been obtained and shall be
in effect.
(k) No Litigation. Other than as disclosed to the Lenders prior to the Restatement Effective Date or as set forth in the
U.S. Borrowers public filings with the SEC, there shall be no litigation, administrative proceedings or governmental investigation that,
individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.
(l) Insurance. The Administrative Agent shall have received evidence that the insurance required by Section 5.06 of the
Restated Credit Agreement is in effect.
SECTION 7. Reaffirmation. (a) Each of the Loan Parties party hereto hereby consents to this Agreement and the
transactions contemplated thereby and, except with respect to any such party that was a party to the Existing Loan Documents but is
not a party to the restated and/or amended Loan Documents (and shall cease to be a Loan Party thereunder (the Released Loan
Parties)), hereby confirms its guarantees, pledges, grants of security interests and other agreements, as applicable, under each of the
Existing Guarantee Agreement (as amended and restated hereby) and the Collateral Documents (in each case, as amended hereby)
(collectively, the Reaffirmed Agreements and each, a Reaffirmed Agreement) to which it is party and agrees that, notwithstanding
the effectiveness of this Agreement and the consummation of the transactions contemplated hereby (including, without limitation, the
amendment and restatement of the Existing Credit Agreement), such guarantees, pledges, grants of security interests and other
agreements of such Loan Parties (other than the Released Loan Parties) shall continue to be in full force and effect and shall accrue to
the benefit of the Secured Parties under the Restated Credit Agreement. Each of the Loan Parties party hereto further agrees to take any
action that may be required under any applicable law or that is reasonably requested by the Administrative Agent to

ensure compliance by the Borrowers with Section 5.10 of the Restated Credit Agreement and hereby reaffirms its obligations under
each similar provision of each Reaffirmed Agreement to which it is a party.
(b) Each of the Loan Parties party hereto hereby confirms and agrees that the Revolving Loans, the Letters of Credit,
the Swingline Loans and the Overadvances (in each case, if any) have constituted and, other than with respect to the Released Loan
Parties, continue to constitute Obligations (or any word of like import) under the Reaffirmed Agreements.
(c) From and after the Restatement Effective Date, it is hereby acknowledged and agreed that the Released Loan Parties
are hereby released from all obligations and liabilities under the Existing Loan Documents and shall no longer be deemed Grantors,
Guarantors or Loan Parties under and pursuant to the Existing Loan Documents, the Reaffirmed Agreements or any other Loan
Document.
SECTION 8. Effectiveness; Counterparts; Amendments. This Agreement shall become effective when copies hereof
that, when taken together, bear the signatures of the U.S. Borrower, the Canadian Borrower, each other Loan Party listed on the
signature pages hereto (including each of the Released Loan Parties), each Lender (as such term is defined in the Existing Credit
Agreement), each other Lender that will have a Revolving Commitment on the Restatement Effective Date, the Administrative Agent,
each Issuing Bank, the Swingline Lender and the Canadian Agent shall have been received by the Administrative Agent. This
Agreement may not be amended nor may any provision hereof be waived except pursuant to a writing signed by each of the parties
hereto. This Agreement may be executed in two or more counterparts, each of which shall constitute an original but all of which when
taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by facsimile
or other electronic transmission shall be effective as delivery of an original executed counterpart of this Agreement.
SECTION 9. No Novation. Until this Agreement becomes effective in accordance with its terms and the Restatement
Effective Date shall have occurred, the Existing Credit Agreement and the Existing Guarantee Agreement shall remain in full force and
effect and shall not be affected hereby. On and after the Restatement Effective Date, (a) all obligations of the U.S. Borrower under the
Existing Credit Agreement shall become obligations of the U.S. Borrower under the Restated Credit Agreement and the provisions of
the Existing Credit Agreement shall be superseded by the provisions of the Restated Credit Agreement and (b) all obligations of the
Loan Parties (other than the Released Loan Parties) under the Existing Guarantee Agreement shall become obligations of the Loan
Parties under the Restated Guarantee Agreement and the provisions of the Existing Guarantee Agreement shall be superseded by the
provisions of the Restated Guarantee Agreement.
Without limiting the generality of the foregoing, this Agreement shall not extinguish the Loans outstanding under the Existing
Credit Agreement or any other obligations for the payment of money outstanding under the Existing Credit Agreement or, other than
with respect to the Released Loan Parties, release the Liens granted under or the priority of any Collateral Document or any security
therefor. Nothing herein contained shall be construed as a substitution or novation of the Loans outstanding under the Existing Credit
Agreement or any other obligations for the payment of money outstanding under the Existing Credit Agreement, in each case which
shall remain outstanding on and after the Restatement Effective Date as modified hereby. Nothing implied herein (other than the
provisions that apply to Released Loan Parties) shall be construed as a release or other discharge of the U.S. Borrower or any
Subsidiary thereof under any Loan Document from any of its obligations and liabilities as the Borrower, a Grantor or a
Guarantor under the Existing Credit Agreement or the Loan Documents. Notwithstanding any provision of this Agreement, the
provisions of Sections 2.15, 2.16, 2.17 and 9.03 of

the Existing Credit Agreement as in effect immediately prior to the Restatement Effective Date will continue to be effective as to all
matters arising out of or in any way related to facts or events existing or occurring prior to the Restatement Effective Date.
On and after the Restatement Effective Date, any reference in the Loan Documents to (a) the Existing Credit
Agreement shall mean the Restated Credit Agreement, (b) the Existing Guarantee Agreement shall mean the Restated Guarantee
Agreement and (c) the Existing U.S. Security Agreement shall mean the Amended U.S. Security Agreement.
SECTION 10. Notices. All notices hereunder shall be given in accordance with the provisions of Section 9.01 of the
Restated Credit Agreement.
SECTION 11. Applicable Law; Waiver of Jury Trial. (A) THIS AGREEMENT AND ANY CLAIM,
CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED
UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.
(B) EACH PARTY HERETO HEREBY AGREES AS SET FORTH IN SECTIONS 9.09 AND 9.10 OF THE
RESTATED CREDIT AGREEMENT AS IF SUCH SECTIONS WERE SET FORTH IN FULL HEREIN.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective
authorized officers as of the day and year first written above.

USG CORPORATION
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

CGC INC.
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Vice President, Finance

UNITED STATES GYPSUM COMPANY

By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

USG INTERIORS, LLC

By: UNITED STATES GYPSUM COMPANY, as its Sole
Member
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

L&W SUPPLY CORPORATION

By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

CALIFORNIA WHOLESALE MATERIAL SUPPLY,

LLC
By: L&W SUPPLY CORPORATION, as its Sole Member
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

LIVONIA BUILDING MATERIALS, LLC

By: L&W SUPPLY CORPORATION, as its Sole Member
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

USG FOREIGN INVESTMENTS, LTD. (as a Released

Loan Party)
By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

OTSEGO PAPER, INC.

By:__/s/ Kenneth R. Banas_______________
Name: Kenneth R. Banas
Title: Treasurer

JPMORGAN CHASE BANK, N.A.,

Individually and as Administrative Agent, Issuing Bank and
Swingline Lender
By:__/s/ Peter S. Predun_______________
Name: Peter S. Predun
Title: Executive Director

JPMORGAN CHASE BANK, N.A., TORONTO

BRANCH, as Canadian Administrative Agent
By:__/s/ Peter S. Predun________________
Name: Peter S. Predun
Title: Executive Director

BANK OF AMERICA, N.A.,

Individually and as Issuing Bank
By:__/s/ Michael Fine___________________
Name: Michael Fine
Title: Senior Vice President

BANK OF AMERICA, N.A. (acting through its Canada

Branch)
By:__/s/ Sylwia Durkiewicz_______________
Name: Sylwia Durkiewicz
Title: Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
Wells Fargo Bank, National Association
Name of Institution

By:__/s/ Megan E. Entow___________

Name: Megan E. Entow
Title: Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
Citibank, N.A., as a Lender
Name of Institution

By:__/s/ Thomas M. Halsch__________

Name: Thomas M. Halsch
Title: Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
Goldman Sachs Bank USA
Name of Institution

By:__/s/ Rebecca Kratz___________

Name: Rebecca Kratz
Title: Authorized Signatory

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
U.S. Bank, National Association
Name of Institution

By:__/s/ Deborah Saffie___________

Name: Deborah Saffie
Title: Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
Royal Bank of Canada
Name of Institution

By:__/s/ Raja Khanna______________

Name: Raja Khanna
Title: Authorized Signatory

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
The Northern Trust Company
Name of Institution

By:__/s/ Steve Ryan_________________

Name: Steve Ryan
Title: Senior Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
TD Bank N.A.
Name of Institution

By:__/s/ Cyntra A. Trani___________

Name: Cyntra A. Trani
Title: Senior Vice President

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
Sun Trust Bank
Name of Institution

By:__/s/ Amanda Watkins___________

Name: Amanda Watkins
Title: Director

SIGNATURE PAGE TO THE FOURTH AMENDMENT

AND RESTATEMENT AGREEMENT DATED AS OF
OCTOBER 22, 2014, AMONG USG CORPORATION,
CGC INC., THE LOAN PARTIES PARTY THERETO,
THE LENDERS PARTY THERETO, JPMORGAN
CHASE BANK, N.A., AS ADMINISTRATIVE AGENT,
ISSUING BANK AND SWINGLINE LENDER, AND
JPMORGAN CHASE BANK, N.A., TORONTO
BRANCH, AS CANADIAN ADMINISTRATIVE
AGENT
HSBC Bank USA, N.A.
Name of Institution

By:__/s/ Robert F. Mello___________

Name: Robert F. Mello
Title: SVP

EXHIBIT 10.19

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT

dated as of October 22, 2014,
among
USG CORPORATION,
as U.S. Borrower,
CGC INC.,
as Canadian Borrower,
The Lenders and Issuing Banks Party Hereto,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent,
JPMORGAN CHASE BANK, N.A., TORONTO BRANCH
as Canadian Administrative Agent,
and
BANK OF AMERICA, N.A. and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Co-Syndication Agents
__________________________
J.P. MORGAN SECURITIES LLC,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Joint Lead Arrangers and Joint Bookrunners

TABLE OF CONTENTS
Page
ARTICLE I
Definitions

SECTION 1.01.
SECTION 1.02.
SECTION 1.03.
SECTION 1.04.
SECTION 1.05.
SECTION 1.06.

Defined Terms
Classification of Loans and Borrowings
Terms Generally
Accounting Terms; GAAP
Pro Forma Calculations
Currency Translation

1
42
43
43
43
43

ARTICLE II
The Credits

SECTION 2.01.
SECTION 2.02.
SECTION 2.03.
SECTION 2.04.
SECTION 2.05.
SECTION 2.06.
SECTION 2.07.
SECTION 2.08.
SECTION 2.09.
SECTION 2.10.
SECTION 2.11.
SECTION 2.12.
SECTION 2.13.
SECTION 2.14.
SECTION 2.15.
SECTION 2.16.
SECTION 2.17.
SECTION 2.18.
SECTION 2.19.
SECTION 2.20.

Revolving Commitments
Loans and Borrowings
Requests for Borrowings
Swingline Loans and Overadvances
Letters of Credit
Funding of Borrowings
Interest Elections
Termination and Reduction of Revolving Commitments
Repayment of Loans; Evidence of Debt
Prepayment of Loans
Fees
Interest
Alternate Rate of Interest
Increased Costs
Break Funding Payments
Taxes
Payments Generally; Allocation of Proceeds; Sharing of Setoffs
Mitigation Obligations; Replacement of Lenders
Revolving Commitment Increases
Defaulting Lenders

44
45
46
47
49
53
54
55
56
57
58
59
60
61
62
62
65
68
69
71

SECTION 2.21.

Protective Advances

73

ARTICLE III
Representations and Warranties

SECTION 3.01.
SECTION 3.02.
SECTION 3.03.
SECTION 3.04.
SECTION 3.05.
SECTION 3.06.
SECTION 3.07.
SECTION 3.08.
SECTION 3.09.
SECTION 3.10.
SECTION 3.11.
SECTION 3.12.
SECTION 3.13.
SECTION 3.14.
SECTION 3.15.

Organization; Powers
Authorization; Enforceability
Governmental Approvals; No Conflicts
Financial Condition; No Material Adverse Change
Properties
Litigation and Environmental Matters
Compliance with Laws and Agreements
Investment Company Status
Taxes
ERISA
Disclosure
Insurance
Security Interest in Collateral
Labor Matters
Anti-Terrorism Laws; Anti-Corruption Laws

74
74
74
74
75
75
75
75
75
75
76
76
76
77
77

ARTICLE IV
Conditions

SECTION 4.01.
SECTION 4.02.

[Intentionally Omitted]
Each Credit Event

77
77
ARTICLE V
Affirmative Covenants

SECTION 5.01.
SECTION 5.02.
SECTION 5.03.
SECTION 5.04.
SECTION 5.05.
SECTION 5.06.
SECTION 5.07.
SECTION 5.08.
SECTION 5.09.
SECTION 5.10.

Financial Statements; Borrowing Base and Other Information

Notices of Material Events
Existence; Conduct of Business
Payment of Taxes
Maintenance of Properties
Insurance

78
81
81
81
82
82

Books and Records; Inspection Rights; Field Examinations; Inventory Appraisals

Compliance with Laws
Use of Proceeds and Letters of Credit
Further Assurances

82
83
83
83

ARTICLE VI
Negative Covenants

SECTION 6.01.
SECTION 6.02.
SECTION 6.03.
SECTION 6.04.
SECTION 6.05.
SECTION 6.06.
SECTION 6.07.
SECTION 6.08.
SECTION 6.09.
SECTION 6.10.
SECTION 6.11.
SECTION 6.12.

Indebtedness
Liens
Fundamental Changes
Investments
Sale and Leaseback Transactions
Swap Agreements
Restricted Payments
Transactions with Affiliates
Restrictive Agreements
Amendment of Material Documents
Changes in Fiscal Periods
Fixed Charge Coverage Ratio

84
86
87
88
89
89
89
90
90
90
91
91

ARTICLE VII
Events of Default
ARTICLE VIII
The Administrative Agent
ARTICLE IX
Miscellaneous

SECTION 9.01.
SECTION 9.02.
SECTION 9.03.
SECTION 9.04.
SECTION 9.05.
SECTION 9.06.
SECTION 9.07.
SECTION 9.08.
SECTION 9.09.
SECTION 9.10.
SECTION 9.11.

Notices
Waivers; Amendments
Expenses; Indemnity; Damage Waiver
Successors and Assigns
Survival
Counterparts; Integration; Effectiveness
Severability
Right of Setoff
Governing Law; Jurisdiction; Consent to Service of Process
WAIVER OF JURY TRIAL
Headings

96
99
100
102
106
106
106
107
107
108
108

SECTION 9.12.
SECTION 9.13.
SECTION 9.14.
SECTION 9.15.
SECTION 9.16.
SECTION 9.17.
SECTION 9.18.

Confidentiality
USA PATRIOT Act
Disclosure
Appointment for Perfection
Interest Rate Limitation
Existing Credit Agreement; Effectiveness of Amendment and Restatement
No Fiduciary Relationship

108
109
109
109
109
110
110

SECTION 9.19.
SECTION 9.20.
SECTION 9.21.

Bifurcation
Quebec Collateral Matters
Judgment Currency

110
110
111

SCHEDULES:
Schedule 1.01(a) - Investment Objective and Guidelines
Schedule 1.01(b) - Borrowing Base Supplemental Documentation
Schedule 2.01 - Commitments
Schedule 3.06 - Disclosed Matters
Schedule 3.10(c) - Canadian Pension Plans
Schedule 6.01 - Existing Indebtedness
Schedule 6.02 - Existing Liens
Schedule 6.04 - Existing Investments
Schedule 6.09 - Existing Restrictions

EXHIBITS:
Exhibit A - Form of Assignment and Assumption
Exhibit B - Form of Borrowing Base Certificate
Exhibit C - Form of Borrowing Request
Exhibit D - Form of Interest Election Request
Exhibit E - Form of Compliance Certificate
Exhibit F - Form of Administrative Questionnaire
Exhibit G - Form of Perfection Certificate
Exhibit H - Form of Revolving Note

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT dated as of October 22, 2014
(this Agreement), among USG CORPORATION, a Delaware corporation, CGC INC., a New
Brunswick corporation, the LENDERS and ISSUING BANKS party hereto, JPMORGAN CHASE BANK,
N.A., as Administrative Agent, JPMORGAN CHASE BANK, N.A., TORONTO BRANCH, as Canadian
Administrative Agent, and BANK OF AMERICA, N.A. and WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Co-Syndication Agents.
Subject to satisfaction of the conditions set forth in the Fourth Amendment and Restatement Agreement dated as of
October 22, 2014 (the Amendment and Restatement Agreement), among the Borrowers, the Lenders (as defined in the Existing
Credit Agreement referred to below) party thereto, the Administrative Agent and the other parties thereto, the Third Amended and
Restated Credit Agreement dated as of December 21, 2010, among the U.S. Borrower, the Lenders party thereto, the Administrative
Agent and Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents (as amended or otherwise
modified from time to time prior to the Restatement Effective Date, the Existing Credit Agreement), is amended and restated in its
entirety to read as provided herein.
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the meanings specified below:
ABR, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
Account has the meaning assigned to such term in the Security Agreements.
Account Debtor means any Person obligated on an Account.
Adjusted Eligible Accounts means, at any time, the Eligible Accounts of (a) the U.S. Collateral Parties at such time, in
the case of the U.S. Borrowing Base, or (b) the Canadian Collateral Parties at such time, in the case of the Canadian Borrowing Base, in
each case minus the Dilution Reserve at such time applicable to such Borrowing Base.
Adjusted LIBO Rate means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per
annum (except in the case of the determination of the Adjusted LIBO Rate for purposes of clause (c) of the definition of the term
Alternate Base Rate, rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
Administrative Agent means (a) JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the Lenders
hereunder (or, as applicable, such Affiliates thereof as it shall from time to time designate for the purpose of performing its obligations
hereunder in such capacity), and (b) with respect to (i) Loans or Borrowings made to the Canadian Borrower denominated in Canadian
dollars, (ii) Loans or Borrowings made to the Canadian Borrower denominated in U.S. dollars that are Eurodollar Loans or Eurodollar
Borrowings and (iii) Canadian Letters of Credit denominated in Canadian dollars issued for the account of the Canadian Borrower (or
any Canadian Subsidiary, as permitted hereunder), JPMCB Toronto (or, as applicable, such Affiliates thereof as it shall from time to
time designate for the purpose of performing its obligations hereunder in such capacity), and, in each case, its successors in such
capacity as provided in Article VIII.
Administrative Questionnaire means an administrative questionnaire, substantially in the form of Exhibit F or any
other form approved by the Administrative Agent.

Affiliate means, with respect to a specified Person, another Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common Control with the Person specified; provided, however, that for purposes
of (a) Section 9.04(b)(i), the term Affiliate shall also include any person that directly, or indirectly through one or more
intermediaries, owns 10% or more of any class of Equity Interests of the Person specified or that is an officer or director of the Person
specified and (b) the definition of the term Eligible Accounts, an Affiliate of the Collateral Parties shall not be deemed to include (i)
Berkshire (or any of its Affiliates, other than the U.S. Borrower or any of the Subsidiaries), (ii) Gebr. Knauf Verwaltungsgesellschaft
KG (or any of its Affiliates, other than the U.S. Borrower or any of the Subsidiaries) and (iii) with respect to Accounts in an amount less
than $100,000 per person at any time outstanding arising in the ordinary course of business of the Collateral Parties, any officer,
director or employee of any Loan Party. For purposes of the foregoing, the parties hereto acknowledge that, as of the Restatement
Effective Date, neither Berkshire nor Gebr. Knauf Verwaltungsgesellschaft KG is an Affiliate of the U.S. Borrower or any of the
Subsidiaries, except as provided in clause (a) of the immediately-preceding proviso as a result of such entitys ownership of Equity
Interests of the U.S. Borrower.
Affiliated Account Debtor means, with respect to any Account Debtor and solely to the extent that any Loan Party has
knowledge of such ownership, another Person (a) that directly, or indirectly through one or more intermediaries, owns 25% or more of
the voting Equity Interests of such Account Debtor or (b) of which 25% or more of the voting Equity Interests of such Person is
directly, or indirectly through one or more intermediaries, owned by such Account Debtor or by any Person described in clause (a) of
this definition.
Aggregate Borrowing Base means, at any time, the sum of (a) the U.S. Borrowing Base (as reported in the most
recently delivered Borrowing Base Certificate) and (b) the lesser of (i) the Canadian Borrowing Base (as reported in the most recently
delivered Borrowing Base Certificate) and (ii) the aggregate Canadian Revolving Sub-Commitment at such time.
Agreement has the meaning assigned to such term in the preamble to this Agreement.
Alternate Base Rate means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such
day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1.00% per annum and (c) the Adjusted LIBO Rate on such
day (or, if such day is not a Business Day, the immediately preceding Business Day) plus 1.00% per annum. If the Administrative
Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms of the definition thereof, then the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no longer exist. For purposes of clause (c) above, the Adjusted
LIBO Rate on any day shall be based on the LIBO Screen Rate for a deposit in dollars and an Interest Period of one month, as such rate
appears at approximately 11:00 a.m., London time, on such day. If no LIBO Screen Rate shall be available for an Interest Period of one
month, then the Adjusted LIBO Rate for purposes of clause (c) above shall be based on the Interpolated Screen Rate on the applicable
date of determination. Notwithstanding the foregoing, if the Adjusted LIBO Rate (determined as provided above) shall be less than
zero, then such rate shall be deemed to be zero. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal
Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.
Amendment and Restatement Agreement has the meaning assigned to such term in the preamble hereto.
Applicable Percentage means, at any time with respect to any Revolving Lender, the percentage of the aggregate
Revolving Commitments represented by such Lenders Revolving Commitment at such time, provided that, for purposes of Section
2.20, when a Defaulting Lender shall exist, Applicable Percentage shall mean, at any time with respect to (a) any Revolving Lender
other than a Defaulting Lender, the percentage of the aggregate Revolving Commitments (disregarding any Defaulting Lenders
Revolving Commitment) represented by such Revolving Lenders Revolving Commitment at such time, and (b) any Defaulting Lender,
0 % . If the Revolving Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the
Revolving Commitments

most recently in effect, giving effect to any assignments of Revolving Loans, LC Exposure and Swingline Exposure that occur after
such termination or expiration and to any Lenders status as a Defaulting Lender at the time of determination.
Applicable Rate means, for any day with respect to any Eurodollar Loan, ABR Loan, CDOR Loan or Canadian Prime
Loan, as the case may be, the applicable rate per annum set forth below under the caption Eurodollar or CDOR Spread or ABR or
Canadian Prime Spread, as the case may be, based upon the Total Net Leverage Ratio determined as of the date of the most recent
annual or quarterly financial statements of the U.S. Borrower delivered pursuant to 5.01(a) or (b); provided that until the delivery to the
Administrative Agent pursuant to Section 5.01(a) or 5.01(b) as of and for the first fiscal quarter of the U.S. Borrower beginning after the
Restatement Effective Date, the Applicable Rate shall be the applicable rate per annum set forth below in Level II.

Level

Total Net Leverage Ratio

Eurodollar or CDOR
Spread

ABR or Canadian Prime

Spread

Greater than 4.50 to 1.00

2.00%

1.00%

II

Greater than or equal to 3.25 to 1.00 but less than or

equal to 4.50 to 1.00

1.75%

0.75%

III

Greater than or equal to 2.50 to 1.00 but less than 3.25 to

1.00

1.50%

0.50%

IV

Greater than or equal to 1.50 to 1.00 but less than 2.50 to

1.00

1.25%

0.25%

Less than 1.50 to 1.00

1.00%

0.00%

For purposes of the foregoing, each change in the Applicable Rate resulting from a change in the Total Net Leverage
Ratio shall be effective during the period commencing on and including the date of delivery to the Administrative Agent pursuant to
Section 5.01(a) or 5.01(b) of the consolidated financial statements (and the certificate of a Financial Officer required pursuant to Section
5.01(c)) indicating such change and ending on the date immediately preceding the effective date of the next such change; provided that
the Total Net Leverage Ratio shall be deemed to be in Level I if the U.S. Borrower fails to deliver the consolidated financial statements
required to be delivered by it pursuant to Section 5.01(a) or 5.01(b) or the certificate of a Financial Officer required pursuant to Section
5.01(c) during the period from the expiration of the time for delivery thereof until such consolidated financial statements and such
certificate are delivered.
Approved Fund has the meaning assigned to such term in Section 9.04(b).
Arrangers means J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo
Bank, National Association.
Assignment and Assumption means an assignment and assumption entered into by a Lender and an assignee (with the
consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or
any other form approved by the Administrative Agent.
Augmenting Lender has the meaning assigned to such term in Section 2.19(a).
Available Finished Good Inventory means, at any time, the lesser of (a) 65% of an amount equal to (x) the Eligible
Finished Goods Inventory (valued at the lower of cost (determined on a first-in, first-out basis) or market value) at such time less (y)
Inventory Reserves applicable thereto (without duplication of Inventory Reserves applicable to any other type of Inventory) and (b)
85% of the product of (i) the Net Orderly Liquidation Value percentage identified in the most recent Inventory appraisal provided to the
Administrative Agent in accordance with the terms hereof multiplied by (ii) an amount equal to (x) the Eligible Finished Goods
Inventory (valued at the lower of cost (determined on a first-in, first-out basis) or market value) at such time less (y) any Inventory
Reserves applicable thereto (without duplication of Inventory Reserves applicable to any other type of Inventory).

Available Raw Materials Inventory means, at any time, the lesser of (a) 65% of an amount equal to (x) the Eligible
Raw Materials Inventory (valued at the lower of cost (determined on a first-in, first-out basis) or market value) at such time less (y)
Inventory Reserves applicable thereto (without duplication of Inventory Reserves applicable to any other type of Inventory) and (b)
85% of the product of (i) the Net Orderly Liquidation Value percentage identified in the most recent Inventory appraisal provided to the
Administrative Agent in accordance with the terms hereof multiplied by (ii) an amount equal to (x) the Eligible Raw Materials Inventory
(valued at the lower of cost (determined on a first-in, first-out basis) or market value) at such time less (y) any Inventory Reserves
applicable thereto (without duplication of Inventory Reserves applicable to any other type of Inventory).
Available WIP Inventory means, at any time, the lesser of (a) 65% of an amount equal to (x) the Eligible WIP
Inventory (valued at the lower of cost (determined on a first-in, first-out basis) or market value) at such time less (y) Inventory Reserves
applicable thereto (without duplication of Inventory Reserves applicable to any other type of Inventory) and (b) 85% of the product of
(i) the Net Orderly Liquidation Value percentage identified in the most recent Inventory appraisal provided to the Administrative Agent
in accordance with the terms hereof multiplied by (ii) an amount equal to (x) the Eligible WIP Inventory (valued at the lower of cost
(determined on a first-in, first-out basis) or market value) at such time less (y) any Inventory Reserves applicable thereto (without
duplication of Inventory Reserves applicable to any other type of Inventory).
Availability Period means the period from and including the Business Day immediately following the Restatement
Effective Date to but excluding the earlier of the Maturity Date and the date of termination of the Revolving Commitments.
Bank of America means Bank of America, N.A., a national banking association, in its individual capacity, and its
successors.
Banking Services means each and any of the following bank services provided to any Loan Party by any Lender or
any of its Affiliates: (a) commercial credit cards and cardless e-payables services, (b) stored value cards and (c) treasury management
services (including controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository
network services).
Banking Services Obligations means, collectively, the U.S. Banking Services Obligations and the Canadian Banking
Services Obligations.
Bankruptcy Event means, with respect to any Person, such Person becoming the subject of a bankruptcy or
insolvency proceeding, or having had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or
similar Person charged with the reorganization or liquidation of such Persons business appointed for it, or, in the good faith
determination of the Administrative Agent, having taken any action in furtherance of, or indicating its consent to, approval of or
acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any
ownership interest, or the acquisition of any ownership interest, in such Person by any Governmental Authority or instrumentality
thereof; provided further that such ownership interest does not result in or provide such Person with immunity from the jurisdiction of
courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Person (or such
Governmental Authority or instrumentality thereof) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such
Person.
Berkshire means Berkshire Hathaway Inc., a Delaware corporation.
Blocked Person means any Person that is publicly identified on the most current list of Specially Designated
Nationals and Blocked Persons published by the Office of Foreign Assets Control of the U.S. Department of the Treasury, or any
similarly designated Person under other applicable laws including the Special Economic Measures Act (Canada) and the regulations
thereunder, as amended from time to time.
Board means the Board of Governors of the Federal Reserve System of the U.S.

Boral Transactions means all transactions consummated in connection with the investment in USG Boral Building
Products Pte. Limited and USG Boral Building Products Pty Limited (collectively, the Boral JV), a joint venture with Boral Limited,
including any consideration, fees, costs, expenses and investments incurred with the creation of and investment in the Boral JV and its
Subsidiaries and the fees, costs and expenses paid by the U.S. Borrower or its Affiliates in connection with the related financing
transactions.
Borrowers means, collectively, the U.S. Borrower and the Canadian Borrower.
Borrowing means (a) Revolving Loans of the same Class, Type, and currency made, converted or continued on the
same date and, in the case of Eurodollar Loans or CDOR Loans, as to which a single Interest Period is in effect, (b) a Swingline Loan,
(c) an Overadvance and (d) a Protective Advance.
Borrowing Base means each of the U.S. Borrowing Base and the Canadian Borrowing Base.
Borrowing Base Acquisition Adjustment Principles means, in connection with the consummation of any acquisition
by a Collateral Party of a business or other assets that constitutes an Investment permitted by Section 6.04, or of the acquisition of any
Person that becomes a Collateral Party upon the consummation thereof (in each case, for purposes of this definition, a Permitted
Acquisition), the U.S. Borrower may submit a calculation of the applicable Borrowing Bases, with adjustments to reflect the
acquisition of Accounts and Inventory in connection with such Permitted Acquisition, and availability hereunder for Loans and Letters
of Credit shall be increased accordingly; provided, however, that no such adjustment with respect to any Permitted Acquisition shall
result in the Aggregate Borrowing Base being increased by more than $45,000,000 until such time as the Administrative Agent shall
have completed its review of the Accounts and Inventory acquired in such Permitted Acquisition, including (a) a field examination of
the books and records relating to such Accounts and such Inventory and (b) receipt of new (or, if agreed by the Administrative Agent,
recently completed) appraisals or updates of appraisals in respect of such Inventory from one or more appraisers reasonably acceptable
to the Administrative Agent, in each case as the Administrative Agent may require in its Permitted Discretion (it being understood and
agreed that (i) the Net Orderly Liquidation Value with respect to any Inventory acquired in connection with such Permitted Acquisition
shall be based on such new (or recently completed) appraisals or updates of appraisals, if so required by the Administrative Agent (and,
if not so required by the Administrative Agent, the appraisals or updates thereof then existing with respect to the applicable class of
Eligible Inventory) and (ii) such acquired Accounts and Inventory shall be subject to the same advance rates, eligibility criteria and
Reserves as are applicable to the existing assets included in the Borrowing Bases).
Borrowing Base Certificate means a certificate, signed and certified as accurate and complete by a Financial Officer,
in substantially the form of Exhibit B or another form which is reasonably acceptable to each of the Administrative Agent and the U.S.
Borrower.
Borrowing Base Supplemental Documentation means the documentation listed on Schedule 1.01(b).
Borrowing Request means a request by either Borrower for a Borrowing in accordance with Section 2.03.
Business Day means any day that is not a Saturday, Sunday or other day on which commercial banks in New York
City are authorized or required by law to remain closed, provided that (a) when used in connection with a Eurodollar Loan, the term
Business Day shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market
and (b) when used in connection with a Loan made to, or a Letter of Credit issued for the account of, the Canadian Borrower (or, in the
case of a Letter of Credit, a Canadian Subsidiary), the term Business Day shall also (i) exclude any day on which commercial banks
in Toronto are authorized or required by law to remain closed but (ii) include any day on which commercial banks in Toronto are open
for business, even if commercial banks in New York City are not open on such day.
Canadian Banking Services Obligations of the Canadian Loan Parties means any and all obligations (including
obligations existing as of the Restatement Effective Date) of the Canadian Loan Parties, whether absolute

or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), in connection with Banking Services.
Canadian Borrowing Base means, at any time and subject to the Borrowing Base Acquisition Adjustment Principles,
an amount (but not less than zero) equal to the sum of (a) 85% of the Adjusted Eligible Accounts at such time plus (b) the sum of (i) the
Available Finished Goods Inventory, (ii) the Available Raw Materials Inventory and (iii) the Available WIP Inventory (in each case of
the Canadian Borrower and the Canadian Collateral Parties at such time), less (c) without duplication of other Reserves included in the
foregoing components of the Canadian Borrowing Base, the amount of any other Reserves established by the Administrative Agent in
its Permitted Discretion at such time. The Administrative Agent may, in its Permitted Discretion and based on new information or a
change in circumstances, adjust Reserves, with any such change to be effective three Business Days after delivery of written notice
thereof to the Canadian Borrower and the Lenders. Subject to the immediately preceding sentence, the Canadian Borrowing Base at any
time shall be determined by reference to the Borrowing Base Certificate most recently delivered to the Administrative Agent pursuant to
Section 5.01(e) (or, in the case of the initial Borrowing Base Certificate delivered in connection with this Agreement, pursuant to
Section 6(g) of the Amendment and Restatement Agreement), subject to adjustments made by the Administrative Agent in its Permitted
Discretion to address any events or conditions relating to any of the Collateral occurring on or after the date with respect to which such
Borrowing Base Certificate relates.
Canadian Borrower means CGC Inc., a New Brunswick corporation and wholly-owned subsidiary of the U.S.
Borrower.
Canadian Collateral means Collateral of the Canadian Collateral Parties.
Canadian Collateral Parties means, collectively, the Canadian Loan Parties (in each case, other than any Subsidiary
that is not a wholly owned Subsidiary).
Canadian Collection Account means the Collection Account as defined in the Canadian Security Agreement.
Canadian dollars or C$ means the lawful money of Canada.
Canadian Hypothec means a deed of hypothec and issue of bonds granted or to be granted by any Loan Party in favor
of the Administrative Agent on all of its present and future moveable or immoveable property pursuant to the laws of the Province of
Quebec, together with all bonds, debentures and pledge of bond/debenture agreements or hypothecs thereof, as amended,
supplemented or otherwise modified from time to time.
Canadian LC Exposure means, at any time, the sum of (a) the U.S. Dollar Equivalent of the aggregate undrawn
amount of all outstanding Letters of Credit at such time issued for the account of the Canadian Borrower (or for which the Canadian
Borrower is a co-applicant) and (b) the U.S. Dollar Equivalent of the aggregate amount of all LC Disbursements on Letters of Credit
issued for the account of the Canadian Borrower (or for which the Canadian Borrower is a co-applicant) that have not yet been
reimbursed (including with the proceeds of Revolving Loans hereunder) by or on behalf of the Canadian Borrower at such time. The
Canadian LC Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the aggregate Canadian LC Exposure
at such time.
Canadian Loan Party means (a) the Canadian Borrower, (b) each other Canadian Material Subsidiary, other than any
Canadian Material Subsidiary that is not required to become a Loan Party in accordance with Section 5.10(a), and (c) each other
Canadian Subsidiary designated by the Canadian Borrower, on or after the Restatement Effective Date, in writing to the Administrative
Agent to be a Loan Party hereunder to the extent that the requirements of Section 5.10 have been satisfied with respect to such
Canadian Subsidiary as if such Canadian Subsidiary were a Canadian Material Subsidiary (it being understood that any such Subsidiary
so designated shall be deemed to be a Material Subsidiary for purposes of the Loan Documents).
Canadian Material Subsidiary means any Material Subsidiary that is organized under the laws of Canada or any
province or territory thereof.

Canadian Multi-Employer Plan means a multi-employer pension plan, as such term is defined in the Pension
Benefits Act (Ontario) or any similar plan registered under pension standards legislation of another jurisdiction in Canada to which the
U.S. Borrower or any Subsidiary, including the Canadian Borrower and its Subsidiaries, contributes for its employees or former
employees employed in Canada.
Canadian Obligations means (a) the due and punctual payment by the Canadian Borrower of (i) the principal of and
interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) on the Loans made to the Canadian Borrower, when and as due,
whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by
the Canadian Borrower under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of
reimbursement of disbursements, interest thereon and obligations to provide cash collateral, and (iii) all other monetary obligations of
the Canadian Borrower to any of the Secured Parties under any Loan Document, including obligations to pay fees, expense
reimbursement obligations and indemnification obligations, whether primary, secondary, direct, contingent, fixed or otherwise
(including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) and (b) the due and punctual payment of all the obligations of each
other Canadian Loan Party under or pursuant to any Loan Document.
Canadian Pension Event means (a) the termination or wind-up in whole or in part of a Canadian Pension Plan, (b) the
occurrence of any circumstance or event that would provide any basis for a Governmental Authority to take steps to cause the
termination or wind-up, in whole or in part, of any Canadian Pension Plan, the issuance of a notice (or a notice of intent to issue such a
notice) to terminate in whole or in part any Canadian Pension Plan or the receipt of a notice of intent from a Governmental Authority to
require the termination in whole or in part of any Canadian Pension Plan, revoking the registration of same or appointing a new
administrator of such a plan, (c) an event or condition which constitutes grounds under applicable pension standards or tax legislation
for the issuance of an order, direction or other communication from any Governmental Authority or a notice of an intent to issue such
an order, direction or other communication requiring the U.S. Borrower or any Subsidiary to take or refrain from taking any action in
respect of a Canadian Pension Plan, (d) the issuance of either any order or charges which may give rise to the imposition of any fines or
penalties to or in respect of any Canadian Pension Plan or the issuance of such fines or penalties, (e) the failure to remit by the U.S.
Borrower or any Subsidiary (including the Canadian Borrower or any of its Subsidiaries) any contribution to a Canadian Pension Plan
when due or the receipt of any notice from an administrator, a trustee or other funding agent or any other Person that the U.S. Borrower
or any Subsidiary (including the Canadian Borrower or any of its Subsidiaries) have failed to remit any contribution to a Canadian
Pension Plan or a similar notice from a Governmental Authority relating to a failure to pay any fees or other amounts, (f) the noncompliance by the U.S. Borrower or any Subsidiary (including the Canadian Borrower or any of its Subsidiaries) or with any law
applicable to the Canadian Pension Plans and (g) the existence of any unfunded liability or any solvency deficiency with respect to any
Canadian Pension Plan.
Canadian Pension Plan means a pension plan or plan that is a registered pension plan as defined in the Income Tax
Act (Canada) or is subject to the funding requirements of the Pension Benefits Act (Ontario), or any similar pension benefits standards
legislation in any Canadian jurisdiction, and which is maintained or contributed to by, or to which there is or may be an obligation to
contribute by the U.S. Borrower or any Subsidiary, including the Canadian Borrower and its Subsidiaries, in respect of its employees or
former employees employed in Canada, and for greater certainty does not include a Canadian Multi-Employer Plan.
Canadian Prime, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans
comprising such Borrowing, are bearing interest at a rate determined by reference to the Canadian Prime Rate.
Canadian Prime Rate means, for any period, the rate per annum determined by the Administrative Agent to be the
greater of (a) the rate of interest per annum most recently announced or established by JPMCB Toronto as its reference rate in effect on
such day for determining interest rates for Canadian dollar denominated commercial loans in Canada and commonly known as prime
rate (or its equivalent or analogous such rate), such rate not being

intended to be the lowest rate of interest charged by JPMCB Toronto and (b) the sum of (i) the yearly interest rate to which the onemonth CDOR Rate is equivalent plus (ii) 1.0%.
Canadian Resident means a Person that is (a) resident in Canada for purposes of the Canadian Tax Act or (b) deemed
to be resident in Canada for purposes of the Canadian Tax Act in respect of all amounts paid or credited hereunder by the Canadian
Borrower and the Canadian Loan Parties.
Canadian Revolving Exposure means, at any time, the sum of (without duplication) (a) the U.S. Dollar Equivalent of
the aggregate outstanding principal amount of Canadian Revolving Loans at such time, (b) the Canadian LC Exposure at such time, (c)
the U.S. Dollar Equivalent of the aggregate outstanding principal amount of Overadvances at such time made to the Canadian Borrower
and (d) the U.S. Dollar Equivalent of the aggregate outstanding principal amount of Protective Advances at such time made to the
Canadian Borrower. The Canadian Revolving Exposure of any Lender at any time shall be such Lenders Applicable Percentage of the
Canadian Revolving Exposure at such time.
Canadian Revolving Loan means a Loan made to the Canadian Borrower pursuant to Section 2.01.
Canadian Revolving Sub-Commitment means, with respect to each Lender, the commitment of such Lender to make
Canadian Revolving Loans and to acquire participations in Letters of Credit, Overadvances and Protective Advances made to or for the
account of the Canadian Borrower hereunder, expressed as an amount expressed in U.S. dollars representing the maximum possible
aggregate amount of such Lenders Canadian Revolving Exposure hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.08, Section 2.18(b) or Section 9.02(c) or (b) reduced or increased from time to time pursuant to assignments
by or to such Lender, respectively, pursuant to Section 9.04. The initial amount of each Lenders Canadian Revolving Sub-Commitment
is set forth on the Schedule 2.01, or in the Assignment and Assumption or the Commitment Increase Amendment pursuant to which
such Lender shall have assumed its Canadian Revolving Sub-Commitment, as applicable, and, in any such case, shall be equal to such
Lenders Applicable Percentage of the aggregate Canadian Revolving Sub-Commitments. The initial aggregate amount of the Lenders
Canadian Revolving Sub-Commitments on the Restatement Effective Date is $50,000,000.
Canadian Secured Obligations means all Canadian Obligations, together with (a) Canadian Banking Services
Obligations and (b) Swap Obligations owing by Canadian Loan Parties to one or more Lenders or their respective Affiliates, provided
that, except with respect to Swap Obligations owing to one or more of the Lenders or their respective Affiliates as of the Restatement
Effective Date, not later than the date that is ten calendar days after the date that any transaction relating to such Swap Obligation is
executed (or amended, supplemented or otherwise modified to designate such Swap Obligations as Canadian Secured Obligations), the
Lender (or the applicable Affiliate) party thereto (other than JPMCB) shall have delivered written notice to the Administrative Agent and
the U.S. Borrower that such a transaction has been entered into (or has been amended, supplemented or otherwise modified, as the case
may be) and that it constitutes a Canadian Secured Obligation entitled to the benefits of the Collateral Documents. Notwithstanding the
foregoing, for purposes of clauses (a) and (b) of this defined term, the amount of Swap Obligations or Canadian Banking Services
Obligations, as applicable, owing to one or more of the Lenders or their respective Affiliates at any time shall be deemed to be reduced
by the aggregate amount of cash collateral provided in respect of such Swap Obligations or Canadian Banking Services Obligations, as
applicable, at such time pursuant to cash collateralization terms agreed to by the applicable counterparties to such Swap Obligations or
the provisions of such Canadian Banking Services Obligations, as applicable. Notwithstanding the foregoing, in the case of any
Excluded Swap Guarantor, Canadian Secured Obligations shall not include Excluded Swap Obligations of such Excluded Swap
Guarantor.
Canadian Security Agreement means that certain Pledge and Security Agreement, dated as of October 22, 2014,
among the Canadian Collateral Parties and the Administrative Agent, for the benefit of the Secured Parties.
Canadian Statutory Priority Claims means claims for unpaid wages, vacation pay, workers compensation,
employment insurance premiums, pension plan contributions, employee or non-resident withholding

tax source deductions, realty taxes (including utility charges and business taxes which are collectable like realty taxes), unremitted
goods and services taxes, provincial sales or harmonized sales taxes, customs duties or similar statutory obligations secured by, or the
non-payment or non-remittance of which would give rise to, a Lien on the assets of a Canadian Loan Party or any Subsidiary of it; and
Canadian Statutory Priority Lien means a Lien arising by operation of law securing a Canadian Statutory Priority Claim.
Canadian Subsidiary means any Subsidiary that is organized under the laws of Canada or any province or territory
thereof.
Canadian Tax Act means the Income Tax Act (Canada) or any successor law purported to cover the same subject
matter, as amended from time to time.
Capital Expenditures means, for any period, without duplication, any expenditure for any purchase or other
acquisition of any asset that would be classified as a capital expenditure in the financial statements of the U.S. Borrower and the
Subsidiaries for such period, prepared in accordance with GAAP.
Capital Lease Obligations of any Person means the obligations of such Person to pay rent or other amounts under any
lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are
required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance with GAAP.
Cash Dominion Period means any period in which full cash dominion is in effect pursuant to Section 7.03 of the
Security Agreements (which, for purposes of clarity, shall be during any of (a) each period beginning on the date on which Excess
Availability shall have been less than the Threshold Amount for five consecutive Business Days and ending on the first date thereafter
on which Excess Availability shall have been equal to or greater than the Threshold Amount for 30 consecutive calendar days and (b)
the continuation of any Event of Default).
CDOR, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the CDOR Rate.
CDOR Rate means, for any day, the annual rate of interest determined by reference to the arithmetic average of the
discount rate quotations of all institutions listed in respect of the relevant Interest Period for Canadian dollar-denominated bankers
acceptances displayed and identified as such on the Reuters Screen CDOR Page as defined in the International Swap Dealer
Association, Inc. definitions, as modified and amended from time to time, as of 11:00 a.m., Local Time, on such day or, if such day is
not a Business Day, then on the immediately preceding Business Day (as adjusted by the Administrative Agent after 11:00 a.m., Local
Time, to reflect any error in the posted rate of interest or in the posted average annual rate of interest); provided if no CDOR Rate shall
be available for a particular Interest Period but CDOR Rates shall be available for maturities both longer and shorter than such Interest
Period, then the CDOR Rate for such Interest Period shall be a rate per annum which results from interpolating on a linear basis between
(a) the applicable CDOR Rate for the longest maturity for which a CDOR Rate is available that is shorter than such Interest Period and
(b) the applicable CDOR Rate for the shortest maturity for which a CDOR Rate is available that is longer than such Interest Period, in
each case at approximately 11:00 a.m., Local Time, two Business Days prior to the commencement of such Interest Period.
CFC means a Subsidiary that is a controlled foreign corporation under Section 957 of the Code.
CFC Holdco means any Domestic Subsidiary which has no material assets other than the Equity Interests of one or
more CFCs and which conducts no material business other than the ownership of such Equity Interests.
Change in Control means (a) the ownership, directly or indirectly, beneficially or of record, by any Person or group
(in each case, within the meaning of the Securities Exchange Act and the rules of the SEC thereunder as in effect on the Restatement
Effective Date) other than the Restricted Group (or any of them) of Equity Securities representing more than 25% of the aggregate
ordinary voting power represented by Voting Securities of the U.S.

Borrower (determined on a Fully Diluted Basis), (b) the ownership, directly or indirectly, beneficially or of record, by the Restricted
Group (or any of them) of Equity Securities representing more than 40% of the aggregate ordinary voting power represented by the
Voting Securities of the U.S. Borrower (determined on a Fully Diluted Basis) or (c) the failure of the U.S. Borrower to own 100% of the
Equity Interests of the Canadian Borrower (unless, in the case of this clause (c), (i) the Canadian Revolving Sub-Commitment has been
reduced to zero and (ii) the principal of and interest on each Loan made to the Canadian Borrower and all fees, expenses and other
amounts (other than contingent amounts not yet due) payable under any Loan Document by the Canadian Borrower shall have been
paid in full in cash and all Letters of Credit issued for the account of the Canadian Borrower (or for which the Canadian Borrower is a
co-applicant) shall have expired or been terminated (or cash collateralized in an amount equal to 103% of the aggregate undrawn
amount of all such outstanding Letters of Credit (for each such Letter of Credit, denominated in the currency of such Letter of Credit) or
otherwise collateralized (i.e., by issuance of backstop letters of credit to the applicable Issuing Banks in respect thereof), in each case in
a manner satisfactory to the applicable Issuing Bank) and all LC Disbursements in respect of such Letters of Credit shall have been
reimbursed).
Change in Law means (a) the adoption of any law, rule or regulation after the Restatement Effective Date, (b) any
change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the Restatement
Effective Date or (c) compliance by any Lender or any Issuing Bank (or, for purposes of Section 2.14(b), by any lending office of such
Lender or by such Lenders or such Issuing Banks holding company, if any) with any request, guideline or directive (whether or not
having the force of law) of any Governmental Authority made or issued after the Restatement Effective Date; provided that,
notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines or directives promulgated thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or
directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States of America or foreign regulatory authorities, in each case pursuant to Basel III, in each case shall
be deemed to be a Change in Law, regardless of the date enacted, adopted, promulgated or issued.
Class, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are U.S. Revolving Loans, Canadian Revolving Loans or Swingline Loans and, when used in reference to any
Commitment, refers to whether such Commitment is a U.S. Revolving Commitment or a Canadian Revolving Sub-Commitment.
CLO has the meaning assigned to such term in Section 9.04(b).
Code means the Internal Revenue Code of 1986, as amended from time to time.
Collateral means all the Collateral as defined in any Collateral Document.
Collateral Access Agreement has the meaning assigned to such term in the Security Agreements.
Collateral Documents means, collectively, the Security Agreements, the Canadian Hypothecs, the Deposit Account
Control Agreements, the Collateral Access Agreements and each other security agreement or other instrument or document executed
and delivered pursuant to Section 5.10 to secure any of the Secured Obligations.
Collateral Parties means, collectively, the U.S. Collateral Parties and the Canadian Collateral Parties.
Collection Account means the U.S. Collection Account or, as applicable, the Canadian Collection Account.
Commitment means (a) with respect to any Revolving Lender, such Lenders Revolving Commitment and (b) with
respect to the Swingline Lender, its Swingline Commitment.
Commitment Increase Amendment has the meaning assigned to such term in Section 2.19(b).

Commodity Exchange Act means the Commodity Exchange Act (7 U.S.C. 1 et seq.), as amended from time to time,
and any successor statute.
Consolidated Cash Interest Expense means, for any period, the sum, without duplication, of (a) the total net
consolidated interest expense of the U.S. Borrower and the Subsidiaries for such period (as shown on a consolidated income statement
of the U.S. Borrower for such period) plus (b) all cash dividends paid or payable during such period in respect of Disqualified Equity
Interests of the U.S. Borrower or any Subsidiary (but expressly excluding any such dividends paid or payable to the U.S. Borrower or
any Subsidiary).
Consolidated EBITDA means, for any period, (a) Consolidated Net Income for such period before interest, taxes,
depreciation, amortization and other non-cash adjustments (other than adjustments relating to minority interest expense) to Consolidated
Net Income for such period, provided that Consolidated EBITDA shall be decreased by the amount of any cash expenditures in such
period relating to non-cash adjustments added back to Consolidated EBITDA in any prior period, plus (b) without duplication and,
except with respect to clause (xiii), to the extent deducted in determining the Consolidated Net Income for such period, the sum of
(i) fees and expenses incurred by the U.S. Borrower or any Subsidiary during such period constituting the Transaction Costs, (ii) nonrecurring charges incurred by the U.S. Borrower or any Subsidiary during such period in respect of restructurings, plant closings,
headcount reductions or other similar actions (together with business optimization costs and costs incurred in connection with strategic
initiatives, in each case incurred by the U.S. Borrower or any Subsidiary during such period, provided that the aggregate add-back for
such costs for any period shall not to exceed 10.0% of Consolidated EBITDA for such period (calculated prior to giving effect to such
add-back)), (iii) any losses incurred by the U.S. Borrower or any Subsidiary during such period attributable to the early extinguishment
of Indebtedness, (iv) the cumulative effect of a change in accounting principles, (v) the aggregate amount of non-cash settlement
charges of the U.S. Borrower or any Subsidiary during such period arising from post-retirement benefit plans, (vi) non-cash expenses
incurred by the U.S. Borrower and Subsidiary during such period resulting from the grant of stock options or other equity-related
incentives to any director, officer or employee of the U.S. Borrower or any Subsidiary pursuant to a written plan or agreement approved
by the board of directors of the U.S. Borrower, (vii) fees and expenses incurred during such period in connection with any proposed or
actual permitted merger, acquisition, investment, asset sale or other disposition, without regard to the consummation thereof,
(viii) litigation settlement expenses incurred by the U.S. Borrower or any Subsidiary during such period, (ix) losses incurred by the U.S.
Borrower or any Subsidiary during such period from discontinued operations, (x) charges incurred by the U.S. Borrower or any
Subsidiary during such period resulting from the impairment of long-lived assets or intangible assets, (xi) losses incurred by the U.S.
Borrower or any Subsidiary during such period resulting from the sale or disposition of assets of the U.S. Borrower or any Subsidiary
outside the ordinary course of business, (xii) asset retirement obligation accretion expenses incurred by the U.S. Borrower or any
Subsidiary during such period and (xiii) the income from non-consolidated joint ventures in an amount not to exceed the amount of
cash dividends received by the U.S. Borrower and the Subsidiaries from such joint ventures during such period, minus (c) without
duplication and to the extent included in determining the Consolidated Net Income for such period, the sum of (i) the aggregate amount
of non-cash settlement gains of the U.S. Borrower or any Subsidiary during such period arising from post-retirement benefit plans,
(ii) all gains during such period resulting from the sale or disposition of any asset of the U.S. Borrower or any Subsidiary outside the
ordinary course of business, (iii) the cumulative effect of a change in accounting principles, (iv) any gains during such period
attributable to the early extinguishment of Indebtedness, (v) gains during such period from discontinued operations and (vi) litigation
settlement income of the U.S. Borrower or any Subsidiary during such period.
Consolidated Net Income means, for any period, the net income or loss of the U.S. Borrower and the Subsidiaries for
such period determined on a consolidated basis in accordance with GAAP, excluding any extraordinary gains or losses of the U.S.
Borrower and the Subsidiaries for such period, provided that Consolidated Net Income shall not include the income or loss of any
Subsidiary that is not wholly owned by the U.S. Borrower to the extent such income or loss is attributable to the non-controlling interest
in such Subsidiary.
Control means the possession, directly or indirectly, of the power to direct or cause the direction of the management
or policies, or the dismissal or appointment of the management, of a Person, whether through the ability to exercise voting power, by
contract or otherwise. Controlling and Controlled have meanings correlative thereto.

Convertible Securities means securities of the U.S. Borrower that are convertible or exchangeable (whether presently
convertible or exchangeable or not) into Voting Securities.
Credit Party means the Administrative Agent, any Issuing Bank, the Swingline Lender or any other Lender.
DBRS means DBRS Limited.
Default means any event or condition that constitutes an Event of Default or that upon notice, lapse of time or both
would, unless cured or waived, become an Event of Default.
Defaulting Lender means any Revolving Lender that (a) has failed, within three Business Days of the date required to
be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit, Swingline Loans or
Overadvances or (iii) pay over to any Credit Party any other amount required to be paid by such Revolving Lender hereunder, unless,
in the case of clause (i) above, such Revolving Lender notifies the Administrative Agent in writing that such failure is the result of such
Revolving Lenders good faith determination that a condition precedent applicable to such funding (specifically identified and
including the particular default, if any) has not been satisfied, (b) has notified either Borrower or any Credit Party in writing, or has
made a public statement to the effect, that it does not intend or expect to comply with any of its funding obligations (x) under this
Agreement (unless such writing or public statement indicates that such position is based on such Revolving Lenders good faith
determination that a condition precedent applicable to such funding (specifically identified and including the particular default, if any)
cannot be satisfied) or (y) generally under other agreements in which it commits to extend credit, (c) has failed, within three Business
Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such
Revolving Lender that it will comply with its obligations (and is financially able to meet such obligations) to fund prospective Loans
and participations in then outstanding Letters of Credit, Swingline Loans, Overadvances and Protective Advances, provided that such
Revolving Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Partys receipt of such certification
in form and substance satisfactory to it and the Administrative Agent, or (d) has become the subject of a Bankruptcy Event.
Deposit Account Control Agreement has the meaning assigned to such term in the Security Agreements.
Designated Banking Services Obligations means, as of any date, Banking Services Obligations that are Secured
Obligations and that have been designated in writing (or designated in the Borrowing Base Certificate most recently delivered pursuant
to Section 5.01(e) on or prior to such date) by a Borrower in its sole discretion to the Administrative Agent as Designated Banking
Services Obligations; provided that in each case such designation shall not become effective until the third Business Day following the
Administrative Agents receipt of such designation (it being acknowledged and agreed that, unless so designated, no Reserve in respect
of such Banking Services Obligations will be instituted or maintained).
Designated Swap Obligations means, as of any date, Swap Obligations that are Secured Obligations and that have
been designated in writing (or designated in the Borrowing Base Certificate most recently delivered pursuant to Section 5.01(e) on or
prior to such date) by a Borrower in its sole discretion to the Administrative Agent as Designated Swap Obligations; provided that in
each case such designation shall not become effective until the third Business Day following the Administrative Agents receipt of such
designation (it being acknowledged and agreed that, unless so designated, no Reserve in respect of such Swap Obligations will be
instituted or maintained).
Dilution Factors means, without duplication of any reduction to the balance of any Account, with respect to any
period, the aggregate amount of all deductions, credit memos, returns, adjustments, allowances, bad debt write-offs and other non-cash
credits (including all volume discounts, trade discounts and rebates) that are recorded to reduce (x) with respect to the U.S. Borrowing
Base, Accounts of the U.S. Collateral Parties in a manner consistent with current and historical accounting practices of the U.S.
Collateral Parties or (y) with respect to the Canadian Borrowing Base, the Accounts of the Canadian Collateral Parties in a manner
consistent with current and historical accounting practices of the Canadian Collateral Parties.

Dilution Ratio means, at any time, the amount (expressed as a percentage), calculated in connection with the delivery
of the Borrowing Base Certificate for the calendar month most recently ended, equal to (a) with respect to the U.S. Borrowing Base, (i)
the aggregate amount of the applicable Dilution Factors in respect of the Accounts of the U.S. Collateral Parties for the twelve-calendarmonth period ended as of the last day of such calendar month divided by (ii) total gross invoices of the U.S. Collateral Parties for such
twelve-calendar-month period or (b) with respect to the Canadian Borrowing Base, (i) the aggregate amount of the applicable Dilution
Factors in respect of the Accounts of the Canadian Collateral Parties for the twelve-calendar-month period ended as of the last day of
such calendar month divided by (ii) total gross invoices of the Canadian Collateral Parties for such twelve-calendar-month period.
Dilution Reserve means, at any time, (a) with respect to the U.S. Borrowing Base, the product of (i) the excess of (A)
the applicable Dilution Ratio at such time over (B) 5.00%, multiplied by (ii) the aggregate amount of Eligible Accounts of the U.S.
Collateral Parties at such time and (b) with respect to the Canadian Borrowing Base, the product of (i) the excess of (A) the applicable
Dilution Ratio at such time over (B) 5.00%, multiplied by (ii) the aggregate amount of Eligible Accounts of the Canadian Collateral
Parties at such time.
Disclosed Matters means the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.06
or in any SEC Filing.
Disqualified Equity Interests means Equity Interests that (a) mature or are mandatorily redeemable or subject to
mandatory repurchase or redemption or repurchase at the option of the holders thereof (including those Equity Interests that may be
required to be redeemed upon the failure to maintain or achieve any financial performance standards), in each case in whole or in part
and whether upon the occurrence of any event, pursuant to a sinking fund obligation on a fixed date or otherwise, prior to the date that
is 180 days after the Original Maturity Date (other than (i) upon payment in full of the Obligations, reduction of the LC Exposure to
zero and termination of the Commitments or (ii) upon a change in control, provided that any payment required pursuant to this
clause (ii) is contractually subordinated in right of payment to the Obligations on terms reasonably satisfactory to the Administrative
Agent and such requirement is applicable only in circumstances that are market on the date of issuance of such Equity Interests) or (b)
are convertible or exchangeable, automatically or at the option of any holder thereof, into any Indebtedness or Equity Interests or other
assets, in each case, other than Qualified Equity Interests prior to the date that is 180 days after the Original Maturity Date (other than (i)
upon payment in full of the Obligations, reduction of the LC Exposure to zero and termination of the Commitments or (ii) upon a
change in control, provided that any conversion or exchange required pursuant to this clause (ii) is contractually subordinated in right
of payment to the Obligations on terms reasonably satisfactory to the Administrative Agent and such requirement is applicable only in
circumstances that are market on the date of issuance of such Equity Interests).
Domestic Material Subsidiary means any Material Subsidiary that is organized under the laws of the U.S., any State
thereof or the District of Columbia.
Domestic Subsidiary means any Subsidiary that is organized under the laws of the U.S., any State thereof or the
District of Columbia.
Early Maturity Date means, with respect to any series of Senior Notes, the date that is 91 days prior to the stated
maturity date for such series of Senior Notes set forth in the applicable Senior Notes Documents.
Electronic System means any electronic system, including e-mail, e-fax, Intralinks, ClearPar and any other Internet
or extranet-based site, whether such electronic system is owned, operated or hosted by the Administrative Agent and the Issuing Banks
and any of their respective Related Parties or any other Person, providing for access to data protected by passcodes or other security
system.
Eligible Accounts means, at any time and subject to the Borrowing Base Acquisition Adjustment Principles, the
Accounts of (x) the U.S. Collateral Parties at such time, in the case of the U.S. Borrowing Base, or (y) the Canadian Collateral Parties at
such time, in the case of the Canadian Borrowing Base, but excluding any Account:

(a) that is not subject to a first-priority perfected security interest in favor of the Administrative Agent on behalf of the
Secured Parties, except (solely in the case of any Account of a Canadian Collateral Party) as otherwise resulting from the
existence of any Canadian Statutory Priority Lien;
(b) that is subject to any Lien other than (i) a Lien in favor of the Administrative Agent on behalf of the Secured
Parties and (ii) a Lien permitted under clauses (a) through (d), (f) or (k) of Section 6.02 that does not have priority over the Lien
in favor of the Administrative Agent on behalf of the Secured Parties;
(c) with respect to which the scheduled due date is more than 60 days after the original invoice date, is unpaid more
than 90 days after the date of the original invoice therefor or more than 30 days after the original due date, or which has been
written off the books of the applicable Collateral Party or otherwise designated as uncollectible (in determining the aggregate
unpaid amount owing from each Account Debtor with respect to Accounts that are unpaid either more than 90 days after the
date of the original invoice therefor or more than 30 days after the original due date, such aggregate amount shall not be
reduced to give effect to any credits extended by, or amounts owing from, the Collateral Parties to such Account Debtor);
(d) that is owing by an Account Debtor for which more than 50% of the Accounts owing from such Account Debtor
and its Affiliated Account Debtors are ineligible under clause (c) of this definition;
(e) that is owing by an Account Debtor to the extent the aggregate amount of Accounts owing from such Account
Debtor and its Affiliated Account Debtors to (i) in the case of the U.S. Borrowing Base, all U.S. Collateral Parties exceeds (A) if
the corporate credit rating of such Account Debtor is BBB- or higher by S&P or the corporate family rating of such Account
Debtor is Baa3 or higher by Moodys, 20% of the aggregate amount of all Eligible Accounts attributable to the U.S. Borrowing
Base at such time or (B) if the corporate credit rating and the corporate family rating of such Account Debtor are otherwise (or if
such Account Debtor does not have a corporate credit rating or a corporate family rating from S&P and Moodys, respectively),
15% of the aggregate amount of all Eligible Accounts attributable to the U.S. Borrowing Base at such time, or (ii) in the case of
the Canadian Borrowing Base, all Canadian Collateral Parties exceeds (A) if the corporate credit rating of such Account Debtor
is BBB- or higher by S&P, the corporate family rating of such Account Debtor is Baa3 or higher by Moodys or the long-term
debt rating of such Account Debtor is BBB (low) or higher by DBRS, 20% of the aggregate amount of all Eligible Accounts
attributable to the Canadian Borrowing Base at such time or (B) if the corporate credit rating, the corporate family rating and the
long-term debt rating of such Account Debtor are otherwise (or if such Account Debtor does not have a corporate credit rating
or a corporate family rating from S&P and Moodys, respectively), 15% of the aggregate amount of all Eligible Accounts
attributable to the Canadian Borrowing Base at such time;
(f) with respect to which any covenant, representation, or warranty contained in any Loan Document has been
breached or is not true;
(g) that (i) does not arise from the sale of goods or performance of services in the applicable Collateral Partys
ordinary course of business, (ii) is not evidenced by an invoice or other documentation reasonably satisfactory to the
Administrative Agent that has been sent to the Account Debtor, (iii) represents a progress billing, (iv) is contingent upon any
Collateral Partys completion of any further performance, (v) represents a sale on a bill-and-hold, guaranteed sale, sale-andreturn, sale on approval, consignment, cash-on-delivery or any other repurchase or return basis or (vi) relates to payments of
interest;
(h) for which the goods giving rise to such Account have not been shipped or delivered to the Account Debtor (or its
designee) or for which the services giving rise to such Account have not been performed by any Collateral Party or if such
Account was invoiced more than once, provided that any Account for which the invoice has been corrected due to billing errors
and resent to the applicable Account Debtor shall not be deemed to have been invoiced more than once for purposes of this
clause (h);

(i)

with respect to which any check or other instrument of payment therefor has been returned uncollected for any

reason;
(j) that is owed by an Account Debtor that has (i) applied for, suffered or consented to the appointment of any
receiver, custodian, trustee or liquidator of its assets, (ii) had possession of all or a material part of its property taken by any
receiver, custodian, trustee or liquidator, (iii) filed, or had filed against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up or voluntary or involuntary case under any state or
federal bankruptcy laws, (iv) admitted in writing its inability, or is generally unable, to pay its debts as they become due, (v)
become insolvent or (vi) ceased operation of its business;
(k) that is owed by any Account Debtor that has sold all or substantially all of its assets (it being understood, for
purposes of clarity, that any Account that is transferred to the purchaser of all or substantially all of an Account Debtors assets
in connection with any such sale shall be an Account owed by such purchaser and shall not be deemed to be ineligible as a
result of the application of this clause (k));
(l) that is owed by an Account Debtor that (i) does not maintain its chief executive office in the U.S. (including any
State thereof, the District of Columbia and, at the Administrative Agents discretion following a request therefor by the U.S.
Borrower (and following the completion of, and the Administrative Agents satisfaction with, due diligence deemed to be
necessary by the Administrative Agent), any territory thereof (including Puerto Rico, the U.S. Virgin Islands and Guam)) or
Canada (including any province or territory thereof), (ii) is not otherwise a resident of the U.S. (including any State thereof, the
District of Columbia and, at the Administrative Agents discretion following a request therefor by the U.S. Borrower (and
following the completion of, and the Administrative Agents satisfaction with, due diligence deemed to be necessary by the
Administrative Agent), any territory thereof (including Puerto Rico, the U.S. Virgin Islands and Guam)) or Canada (including
any province or territory thereof) for purposes of establishing jurisdiction in the U.S. or Canada over such Account Debtor and
(iii) is not organized under the applicable law of (A) the U.S. or any State or territory thereof (including Puerto Rico, the U.S.
Virgin Islands and Guam) or the District of Columbia or (B) Canada or any province or territory thereof, in each case unless
such Account is backed by a letter of credit, bankers acceptance or other credit support that is acceptable to the Administrative
Agent and that is in the possession of, has been assigned to and is drawable directly by the Administrative Agent;
(m)

that is owed in any currency other than dollars or Canadian dollars;

(n) that is owed by (i) the government (or any department, agency, public (or Crown) corporation or instrumentality
thereof) of any country other than (A) the U.S., in the case of the U.S. Borrowing Base, or (B) the U.S. or Canada (or any
political subdivision thereof), in the case of the Canadian Borrowing Base, in each case, unless such Account (or portion thereof
that is reasonably acceptable to the Administrative Agent) is backed by a letter of credit, guarantee or eligible bankers
acceptance or other credit support that is acceptable to the Administrative Agent and that is in the possession of, has been
assigned to and is drawable directly by the Administrative Agent, (ii) the government of the U.S., or any department, agency,
public corporation or instrumentality thereof, unless the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C.
3727 et seq. and 41 U.S.C. 15 et seq.), and any other steps necessary to perfect the Lien of the Administrative Agent in such
Account have been complied with to the Administrative Agents reasonable satisfaction, or (iii) in the case of the Canadian
Borrowing Base, the government of Canada (or any political subdivision thereof), or any department, agency, Crown
corporation or instrumentality thereof, unless (x) the Financial Administration Act (Canada), as amended, or any comparable
requirements under any other Canadian federal, provincial, territorial or municipal law regarding the assignment of Crown
debts, and any other steps necessary to perfect the Lien of the Administrative Agent in such Account have been complied with
to the Administrative Agents reasonable satisfaction or (y) there are not comparable restrictions on the assignment of Crown
debts of such political subdivision of Canada, or any department, agency, Crown corporation or institution thereof; provided
that, notwithstanding the foregoing, up to $10,000,000 in the

aggregate of Accounts owing by the government (or any department, agency, public (or Crown) corporation or instrumentality
thereof) of the U.S. or Canada (if otherwise eligible hereunder) shall constitute Eligible Accounts whether or not the Federal
Assignment of Claims Act or the Financial Administration Act (Canada) (or comparable provincial legislation) has been
complied with in connection with such Accounts;
(o) that is owed by (i) any Affiliate of any Collateral Party or (ii) to the extent not otherwise constituting an Affiliate of
any Collateral Party, any employee, officer, director or agent of any Collateral Party (other than, in the case of this clause (ii),
any Account in an amount less than $100,000 per person at any time outstanding arising in the ordinary course of business of
the Collateral Parties);
(p) that is (i) owed by an Account Debtor to which (or to whose Affiliated Account Debtor) any Collateral Party is
indebted, but only to the extent of such indebtedness or (ii) subject to any security, deposit, progress payment, retainage or
other similar advance made by or for the benefit of an Account Debtor, in each case to the extent thereof;
(q) that is subject to any counterclaim, deduction, defense, setoff or dispute but only to the extent of any such
counterclaim, deduction, defense, setoff or dispute;
(r)

that is evidenced by any promissory note, chattel paper or instrument;

(s) that is owed by an Account Debtor located in any jurisdiction which requires filing of a Notice of Business
Activities Report or other similar report in order to permit the applicable Collateral Party to seek judicial enforcement in such
jurisdiction of payment of such Account, unless such Collateral Party has filed such report or qualified to do business in such
jurisdiction, provided that any Account that would be an Eligible Account but for a failure to file such report or qualify to do
business in the applicable jurisdiction shall be deemed to be an Eligible Account if such failure to file or qualify may be
retroactively cured by the payment of a nominal amount;
(t) with respect to which the applicable Collateral Party has made any agreement with the Account Debtor for any
reduction thereof, other than discounts and adjustments given in the ordinary course of business, or any Account which was
partially paid and such Collateral Party created a new receivable for the unpaid portion of such Account;
(u) that does not comply in all material respects with the requirements of all applicable laws and regulations, whether
Federal, state or local, including without limitation the Federal Consumer Credit Protection Act, the Federal Truth in Lending
Act and Regulation Z of the Board;
(v) that is for goods that have been sold under a purchase order or pursuant to the terms of a contract or other
agreement or understanding (written or oral) that indicates or purports that any Person other than (i) a U.S. Collateral Party, in
the case of the U.S. Borrowing Base, or (ii) a Canadian Collateral Party, in the case of the Canadian Borrowing Base, has an
ownership interest in such goods, or which indicates any party other than (A) a U.S. Collateral Party, in the case of the U.S.
Borrowing Base, or (B) a Canadian Collateral Party, in the case of the Canadian Borrowing Base, as payee or remittance party;
(w)

that was created on cash-on-delivery terms; or

(x) that the Administrative Agent determines in its Permitted Discretion may not be collectible from the Account
Debtor for any reason.
In determining the amount of an Eligible Account, the face amount of an Account may, in the Administrative Agents
Permitted Discretion, be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued
and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that such Collateral Party may be obligated to rebate to an Account Debtor pursuant to the terms of
any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Account but not
yet applied by such Collateral

Party to reduce the amount of such Account. In addition, for purposes of making any calculation under this Agreement or any other
Loan Document as of any date, the amount of any Eligible Account that is owed in Canadian dollars shall be equal to the U.S. Dollar
Equivalent of the amount of such Eligible Account as of such date determined using the Exchange Rate as of such date.
Eligible Finished Goods Inventory means Eligible Inventory of (x) the U.S. Collateral Parties at such time, in the case
of the U.S. Borrowing Base, or (y) the Canadian Collateral Parties at such time, in the case of the Canadian Borrowing Base, in each
case, consisting of finished goods available for sale (as determined in a manner acceptable to the Administrative Agent in its Permitted
Discretion and consistent with past practices).
Eligible Inventory means, at any time and subject to the Borrowing Base Acquisition Adjustment Principles, the
Inventory of (x) the U.S. Collateral Parties at such time, in the case of the U.S. Borrowing Base, or (y) the Canadian Collateral Parties at
such time, in the case of the Canadian Borrowing Base, but excluding any Inventory:
(a) that is not subject to a first priority perfected Lien in favor of the Administrative Agent on behalf of the Secured
Parties, except as otherwise resulting from (i) the exercise of the Administrative Agents sole discretion under clause (e) of this
defined term with respect to goods held on consignment on behalf of any Collateral Party (as consignor) or (ii) solely in the
case of any Inventory of a Canadian Collateral Party, the existence of any Canadian Statutory Priority Lien;
(b) that is subject to any Lien other than (i) a Lien in favor of the Administrative Agent on behalf of the Secured Parties
and (ii) any Lien permitted under clauses (a) through (d), (f) or (k) of Section 6.02 that does not have priority over the Lien in
favor of the Administrative Agent on behalf of the Secured Parties;
(c) with respect to which any covenant, representation, or warranty contained in any Loan Document has been breached
or is not true and which does not conform to all standards imposed by any applicable Governmental Authority;
(d) in which any Person other than any (x) U.S. Collateral Party, in the case of the U.S. Borrowing Base, or (y) Canadian
Collateral Party, in the case of the Canadian Borrowing Base, shall (i) have any direct or indirect ownership, interest or title to
such Inventory (other than any such interest resulting from a Lien described in subclause (i) or (ii) of clause (b) of this
definition) or (ii) be indicated on any purchase order or invoice with respect to such Inventory as having or purporting to have
an interest therein;
( e ) that constitutes spare or replacement parts (other than those held for sale in the ordinary course of business),
packaging and shipping material, manufacturing supplies, samples, prototypes, displays or display items, goods that are
returned or marked for return, repossessed goods, defective or damaged goods, goods held on consignment by any U.S.
Collateral Party (in the case of the U.S. Borrowing Base) or Canadian Collateral Party (in the case of the Canadian Borrowing
Base) (as consignee), goods held on consignment on behalf of any U.S. Collateral Party (in the case of the U.S. Borrowing
Base) or Canadian Collateral Party (in the case of the Canadian Borrowing Base) (as consignor) (other than up to $15,000,000
of Inventory on consignment with Investment Grade Customers and subject to a Collateral Access Agreement and, if requested
by the Administrative Agent in its sole discretion, with respect to which the applicable Collateral Party has perfected its
purchase money security interest) or goods that are not of a type held for sale in the ordinary course of business;
(f) that is not located in the U.S. or is in transit from the U.S. to Canada for delivery to the Canadian Collateral Parties (in
the case of the U.S. Borrowing Base) or Canada (in the case of the Canadian Borrowing Base) or is in transit with a common
carrier from vendors and suppliers;
(g) that is located in any location leased by a Collateral Party unless (i) the lessor has delivered to the Administrative
Agent a Collateral Access Agreement and such other documentation as the Administrative Agent may reasonably request or (ii)
a Rent Reserve has been established by the Administrative Agent with

respect to such Inventory, provided that any Inventory located at any such location where Inventory on-hand has a book value
of less than $100,000 shall not constitute Eligible Inventory;
(h) that is located in any third party warehouse or other storage facility or is in the possession of a bailee (other than a
third party processor) and is not evidenced by a document (other than bills of lading to the extent permitted by clause (f)
above), unless (i) such warehouseman or bailee has delivered to the Administrative Agent a Collateral Access Agreement and
such other documentation as the Administrative Agent may reasonably request or (ii) a Rent Reserve has been established by
the Administrative Agent with respect to such Inventory, provided that any Inventory located at any such location where
Inventory on-hand has a book value of less than $100,000 shall not constitute Eligible Inventory;
(i) that is being processed offsite at a third party location or outside processor unless (i) such bailee has delivered to the
Administrative Agent a Collateral Access Agreement and such other documentation as the Administrative Agent may
reasonably request or (ii) a Rent Reserve has been established by the Administrative Agent with respect to such Inventory,
provided that any Inventory located at any such location where Inventory on-hand has a book value of less than $100,000 shall
not constitute Eligible Inventory;
(j) that is a discontinued product or component thereof;
(k) that is not reflected in a current perpetual inventory report of the applicable Collateral Party;
(l) for which reclamation rights have been asserted by the seller;
(m) that consists of detonators, explosives or any similar device;
(n) in the case of Inventory consisting of work-in-process related to manufacturing of Inventory sold by any Collateral
Party in the ordinary course of business, that has been determined by an appraiser (or by the Administrative Agent in its
Permitted Discretion in connection with a field exam) as not being commodity-like in nature or not likely to be finished or sold
in its current form; or
(o) that the Administrative Agent determines in its Permitted Discretion is unacceptable.
In determining the value of the Inventory (on a cost basis) at any time, there shall be deducted (x) the aggregate amount
of restocking and delivery fees associated with such Inventory and (y) that portion of the cost of such Inventory attributable to
intercompany profits among the applicable Collateral Party and its Affiliates.
Eligible Raw Material Inventory means Eligible Inventory of (x) the U.S. Collateral Parties at such time, in the case of
the U.S. Borrowing Base, or (y) the Canadian Collateral Parties at such time, in the case of the Canadian Borrowing Base, in each case
consisting of raw materials (as determined in a manner acceptable to the Administrative Agent in its Permitted Discretion and consistent
with past practices).
Eligible WIP Inventory means Eligible Inventory of (x) the U.S. Collateral Parties at such time, in the case of the U.S.
Borrowing Base, or (y) the Canadian Collateral Parties at such time, in the case of the Canadian Borrowing Base, in each case
consisting of work-in-process related to manufacturing of Inventory sold by any Collateral Party in the ordinary course of its business
(as determined in a manner acceptable to the Administrative Agent in its Permitted Discretion and consistent with past practices).
Environmental Laws means all treaties, laws, rules, regulations, codes, ordinances, orders, decrees, judgments,
injunctions, notices or binding agreements issued, promulgated or entered into by or with any Governmental Authority, relating in any
way to the environment, the preservation or reclamation of natural resources, the generation, management, use, presence, Release or
threatened Release of, or exposure to, any Hazardous Material or to health and safety matters.
Environmental Liability means liabilities, obligations, claims, actions, suits, judgments, or orders under or relating to
any Environmental Law for any damages, injunctive relief, losses, fines, penalties, fees, expenses

(including reasonable fees and expenses of attorneys and consultants) or costs, whether contingent or otherwise, including those arising
from or relating to (a) any actual or alleged violation of any Environmental Law or permit, license or approval issued thereunder, (b) the
generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release or threatened Release of any Hazardous Materials or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
Equity Interests means shares of capital stock, partnership interests, membership interests in a limited liability
company, beneficial interests in a trust or other equity ownership interests in a Person.
Equity Securities means, collectively, Voting Securities, Convertible Securities and Rights to Purchase Voting
Securities.
ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time.
ERISA Affiliate means any trade or business (whether or not incorporated) that, together with the U.S. Borrower, is
treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of
the Code, is treated as a single employer under Section 414 of the Code.
ERISA Event means (a) any reportable event, as defined in Section 4043 of ERISA or the regulations issued
thereunder with respect to a Plan (other than an event for which the 30day notice period is waived); (b) any failure by any Plan to
satisfy the minimum funding standards (within the meaning of Section 412 of the Code or Section 302 of ERISA) applicable to such
Plan, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the U.S. Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the U.S. Borrower or
any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to
appoint a trustee to administer any Plan; (f) the incurrence by the U.S. Borrower or any of its ERISA Affiliates of any liability with
respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the U.S. Borrower or any
ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the U.S. Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in
reorganization, within the meaning of Title IV of ERISA.
Eurodollar, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising
such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
Event of Default has the meaning assigned to such term in Article VII.
Excess Availability means, at any time, an amount equal to (a) the lesser of (i) the aggregate Revolving Commitments
of all Revolving Lenders and (ii) the Aggregate Borrowing Base, in each case at such time, minus (b) the aggregate Revolving
Exposure of all Revolving Lenders at such time.
Exchange Rate means, on any day, the rate at which Canadian dollars may be exchanged into dollars, as set forth at
approximately 11:00 a.m. (London time) on such day on the Reuters World Currency Page for Canadian dollars. In the event that such
rate does not appear on any Reuters World Currency Page, the Exchange Rate shall be determined by reference to such other publicly
available service for displaying exchange rates as may be agreed by the Administrative Agent and the U.S. Borrower, or, in the absence
of such agreement, such Exchange Rate shall instead be the arithmetic average of the spot rates of exchange of the Administrative
Agent in the market where its foreign currency exchange operations in respect of such currency are then being conducted, at or about
11:00 a.m., Local Time, on such date for the purchase of the relevant currency for delivery two Business Days later.
Excluded Swap Guarantor means any Loan Party (other than the U.S. Borrower) all or a portion of whose Guarantee
of, or grant of a security interest to secure, any Specified Swap Obligation (or any Guarantee thereof)

is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading
Commission (or the application or official interpretation of any thereof).
Excluded Swap Obligations means, with respect to any Loan Party (other than the U.S. Borrower), any Specified Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such Loan Party of, or the grant by such Loan Party of a
security interest to secure, such Specified Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity
Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official
interpretation of any thereof). If a Specified Swap Obligation arises under a master agreement governing more than one swap, such
exclusion shall apply only to the portion of such Specified Swap Obligation that is attributable to swaps for which such Guarantee or
security interest is or becomes illegal.
Excluded Taxes means, with respect to the Administrative Agent, any Lender, any Issuing Bank or any other recipient
of any payment to be made by or on account of any obligation of a Loan Party hereunder, (a) income or franchise taxes imposed on (or
measured by) its net income by the U.S., or by the jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes
imposed by the U.S. or any similar tax imposed by any other jurisdiction described in clause (a) above, (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by either Borrower under Section 2.18(b)), any U.S. withholding tax resulting from
any law in effect at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office), except to the
extent that such Foreign Lender (or its assignor, if any, or, in the case of an SPV, its Granting Lender) was entitled, immediately before
the time of designation of a new lending office (or assignment or grant, as applicable), to receive additional amounts from a Loan Party
with respect to any withholding Tax pursuant to Section 2.16(a), (d) attributable to such recipients failure to comply with Section
2.16(f), (e) any U.S. federal withholding Taxes imposed under FATCA and (f) any Canadian Taxes imposed on a payment by or on
account of any obligation of a Loan Party to a Credit Party arising as a result of (i) the Loan Party not dealing at arms length (within the
meaning of the Canadian Tax Act) with a Credit Party at the time of making such payment or (ii) the Credit Party being a specified
shareholder (within the meaning of Section 18(5) of the Canadian Tax Act) of any Loan Party that is a resident of Canada for the
purposes of the Canadian Tax Act at the time of payment.
Existing Canadian Facility means the Credit Agreement dated as of June 30, 2009, between the Canadian Borrower
and The Toronto-Dominion Bank, as amended or otherwise modified from time to time prior to the Restatement Effective Date.
Existing Credit Agreement has the meaning assigned to such term in the preamble hereto.
Existing Letters of Credit means the letters of credit previously issued for the account of the U.S. Borrower or any
Subsidiary pursuant to the Existing Credit Agreement that are outstanding thereunder as of the Restatement Effective Date.
FATCA means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or
successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations
or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.
Federal Funds Effective Rate means, for any day, the weighted average (rounded upwards, if necessary, to the next
1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected
by it. Notwithstanding the foregoing, if the Federal Funds Effective Rate, determined as provided above, would otherwise be less than
zero, then the Federal Funds Effective Rate shall be deemed to be zero for all purposes.

Financial Covenant Threshold Amount means, at any time, an amount equal to 10% of the lesser of (a) the aggregate
Revolving Commitment at such time and (b) the Aggregate Borrowing Base at such time.
Financial Officer means, with respect to any Person, the chief financial officer, principal accounting officer, treasurer,
assistant treasurer or controller of such Person. Unless otherwise specified, Financial Officer shall refer to a Financial Officer of the
U.S. Borrower.
Fixed Charges means, with reference to any period, without duplication, (a) the sum of (i) Consolidated Cash Interest
Expense for such period and (ii) any interest accrued and paid in cash during such period in respect of Indebtedness of the U.S.
Borrower or any Subsidiary that is required to be capitalized rather than included in total net consolidated interest expense for such
period in accordance with GAAP, plus (b) principal payments scheduled to be made by the U.S. Borrower or any Subsidiary on
Indebtedness during such period (regardless of whether such payment is actually made in such period, but giving effect to any
reductions thereof resulting from any prepayment thereof in any earlier period), plus (c) prepayments of principal made by the U.S.
Borrower or any Subsidiary on Indebtedness during such period that reduce the scheduled principal payments in respect of such
Indebtedness required to be paid in any subsequent period, plus (d) expense for Taxes paid in cash during such period, plus (e)
Restricted Payments paid in cash during such period by the U.S. Borrower or any Subsidiary (other than any such Restricted Payments
paid to the U.S. Borrower or any Subsidiary), plus (f) cash contributions during such period to any Plan or Canadian Pension Plan, plus
(g) Capital Lease Obligation payments made during such period, all calculated for the U.S. Borrower and the Subsidiaries on a
consolidated basis in accordance with GAAP. Notwithstanding the foregoing, Fixed Charges shall exclude any amounts referenced in
the immediately preceding sentence comprised of (i) principal payments made, escrowed or otherwise set aside or deposited by the U.S.
Borrower in connection with the redemption, repayment, defeasance or other discharge of the Senior Notes (x) until irrevocably paid
and (y) to the extent funded through refinancing, conversion, securities offering, equity contribution or other similar mechanic, or (ii)
principal payments made in the form of Indebtedness or Equity Interests issued by the U.S. Borrower or any Subsidiary (in each case,
only if such issuance is permitted hereunder) or with the net cash proceeds of any such issuance that have not otherwise been applied.
Fixed Charge Coverage Ratio means the ratio, determined as of the end of each fiscal quarter of the U.S. Borrower for
the most-recently ended four fiscal quarters of the U.S. Borrower, of (a) Consolidated EBITDA for such four-fiscal-quarter period minus
the unfinanced portion of Capital Expenditures for such four-fiscal-quarter period to (b) Fixed Charges for such four-fiscal-quarter
period, all calculated for the U.S. Borrower and the Subsidiaries on a consolidated basis in accordance with GAAP.
Foreign Lender means any Lender that is organized under the laws of a jurisdiction other than that in which the U.S.
Borrower is located, except that in respect of the Canadian Borrower, Foreign Lender means a Lender that is not a Canadian Resident.
For purposes of this definition, the U.S., each State thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.
Foreign Subsidiary means any Subsidiary that is not a Domestic Subsidiary.
Fully Diluted Basis means, with respect to the determination of whether a Change in Control has occurred, the Voting
Securities that would be outstanding after giving effect to the conversion or exchange of all outstanding Convertible Securities and the
exercise of all outstanding Rights to Purchase Voting Securities, in each case, whether or not presently convertible, exchangeable or
exercisable.
GAAP means generally accepted accounting principles in the U.S.
Governmental Authority means the government of the U.S., Canada, any other nation or any political subdivision
thereof, whether state, provincial, territorial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or the European Central Bank) having jurisdiction over
the U.S. Borrower, any Subsidiary or any Lender as the context may require.

Granting Lender has the meaning assigned to such term in Section 9.04(e).
Guarantee of or by any Person (the guarantor) means any obligation, contingent or otherwise, of the guarantor
guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the primary
obligor) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance
or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the
purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation, provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary
course of business.
Guarantee Agreement means the Guarantee Agreement, dated as of January 7, 2009, and amended and restated as of
the date hereof, among the Loan Parties and the Administrative Agent, for the benefit of the Secured Parties.
Hazardous Materials means (a) any petroleum products or byproducts and all other hydrocarbons, radon gas, asbestos
or asbestos-containing materials, urea formaldehyde foam insulation, polychlorinated biphenyls, chlorofluorocarbons and all other
ozone-depleting substances; or (b) any chemical, material, substance or waste that is prohibited, limited or regulated by or pursuant to
any Environmental Law.
Incur means create, incur, assume, Guarantee or otherwise become responsible for, and Incurred and Incurrence
shall have correlative meanings.
Indebtedness of any Person means, without duplication and excluding trade accounts payable incurred in the ordinary
course of business, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) [reserved], (d) all obligations of such
Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such
Person in respect of the deferred purchase price of property or services, (f) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired
by such Person, whether or not the Indebtedness secured thereby has been assumed; provided, however, that so long as such Person is
not obligated under such Indebtedness other than with respect to such Lien, such Indebtedness shall be considered to be Indebtedness
of such Person only to the extent of the lesser of the value of (i) any limit in value of the Lien or (ii) the value of the property that is
subject to any such Lien, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (j) all
obligations, contingent or otherwise, of such Person in respect of bankers acceptances and (k) all Disqualified Equity Interests. The
Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a
general partner) to the extent such Person is liable therefor as a result of such Persons ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. Notwithstanding the
foregoing, in connection with any acquisition, the term Indebtedness shall not include contingent post-closing purchase price
adjustments, non-compete payments or earn-outs to which the seller in such acquisition may become entitled.
Indemnified Taxes means Taxes other than Excluded Taxes, imposed on or with respect to any payment made by or
on account of any obligation of any Loan Party.
Interest Election Request means a request by the applicable Borrower to convert or continue a Revolving Borrowing
in accordance with Section 2.07.
Interest Payment Date means (a) with respect to any ABR Loan (including a Swingline Loan) or Canadian Prime
Loan, the last day of each March, June, September and December and the Maturity Date and (b) with

respect to any Eurodollar Loan or CDOR Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a
part and, in the case of a Eurodollar Borrowing or CDOR Borrowing with an Interest Period of more than three months duration, each
day prior to the last day of such Interest Period that occurs at intervals of three months duration after the first day of such Interest
Period.
Interest Period means, with respect to any Eurodollar Borrowing or CDOR Borrowing, the period commencing on the
date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months
thereafter (or twelve months thereafter if, at the time of the relevant Borrowing, all Lenders participating therein agree to make an
interest period of such duration available), as the U.S. Borrower may elect, provided that (a) if any Interest Period would end on a day
other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day
and (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of
such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
Interpolated Screen Rate means, with respect to any Eurodollar Borrowing for any Interest Period, a rate per annum
which results from interpolating on a linear basis between (a) the applicable LIBO Screen Rate for the longest maturity for which a
LIBO Screen Rate is available that is shorter than such Interest Period and (b) the applicable LIBO Screen Rate for the shortest maturity
for which a LIBO Screen Rate is available that is longer than such Interest Period, in each case at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period.
Inventory has the meaning assigned to such term in the Security Agreements.
Inventory Reserves shall mean, without duplication of any other applicable Reserves or eligibility exclusions, reserves
against Inventory equal to the sum of the following:
(a) a reserve for shrink, or discrepancies that arise pertaining to Inventory quantities on hand between a Collateral
Partys perpetual accounting system and physical counts of the Inventory which will be based on the applicable Collateral
Partys historical practice and experience and in an amount acceptable to the Administrative Agent in its Permitted Discretion;
(b) a reserve determined by the U.S. Borrower in accordance with GAAP and satisfactory to the Administrative Agent
in its Permitted Discretion for Inventory that is discontinued, obsolete, slow-moving, unmerchantable, defective or unfit for sale;
(c) the lower of the cost or market reserve for any differences between the applicable Collateral Partys actual cost to
produce such Inventory and the selling price of such Inventory to third parties;
(d) a reserve whereby capitalized favorable variances under the standard cost method of accounting shall be deducted
from Eligible Inventory and unfavorable variances thereunder shall not be added to Eligible Inventory;
(e) a reserve for vendor rebates owed to a Collateral Party; and
(f) any other reserve as deemed appropriate by the Administrative Agent in its Permitted Discretion from time to time.
Investment Grade Customer means, with respect to any Inventory that has been consigned by a Loan Party (as
consignor) in accordance with clause (e) of the definition of Eligible Inventory, a customer of either Borrower or any other Loan
Party that has, at the time of such consignment and thereafter during the term of such consignment, a corporate credit rating of at least
(a) BBB- by S&P, (b) Baa3 by Moodys or (c) in the case of any

customer of a Canadian Collateral Party for purposes of determining the Canadian Borrowing Base, BBB (low) by DBRS.
Issuing Bank means, as the context may require, (a) each of (i) JPMCB, (ii) Bank of America (iii) Wells Fargo and (iv)
any other consenting Revolving Lender, in each case satisfactory to the U.S. Borrower and the Administrative Agent, in each case in its
capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 2.05(i). Each Issuing
Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates or branches of such Issuing Bank
reasonably acceptable to the U.S. Borrower, in which case the term Issuing Bank shall include any such Affiliate or branch with
respect to Letters of Credit issued by such Affiliate or branch.
JPMCB means JPMorgan Chase Bank, N.A., a national banking association, in its individual capacity, and its
successors.
JPMCB Toronto means JPMorgan Chase Bank, N.A., Toronto Branch, in its individual capacity, and its successors.
Judgment Currency has the meaning assigned to such term in Section 9.21(a).
Judgment Currency Conversion Date has the meaning assigned to such term in Section 9.21(a).
LC Disbursement means a payment made by an Issuing Bank pursuant to a Letter of Credit.
LC Exposure means, at any time, the sum of (a) the U.S. LC Exposure and (b) the Canadian LC Exposure, in each
case at such time.
Lenders means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto
pursuant to Section 2.19 or Section 9.04 (together with, in any case, its respective branches or Affiliates as contemplated in Section
2.02(b)), other than any such Person that ceases to be a party hereto pursuant to Section 9.04. Unless the context otherwise requires, the
term Lenders includes the Swingline Lender.
Letter of Credit means any letter of credit issued pursuant to this Agreement (including each Existing Letter of Credit).
LIBO Rate means, with respect to any Eurodollar Borrowing for any Interest Period, a rate per annum equal to the
London interbank offered rate as administered by the ICE Benchmark Administration (or any other Person that takes over the
administration of such rate) for deposits in U.S. dollars (for delivery on the first day of such Interest Period) with a term equivalent to
such Interest Period as displayed on the Reuters screen page that displays such rate (currently page LIBOR01) or, in the event such rate
does not appear on a page of the Reuters screen, on the appropriate page of such other information service that publishes such rate as
shall be selected by the Administrative Agent from time to time in its reasonable discretion (such applicable rate being called the LIBO
Screen Rate), at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period. If no
LIBO Screen Rate shall be available for a particular Interest Period but LIBO Screen Rates shall be available for maturities both longer
and shorter than such Interest Period, then the LIBO Rate for such Interest Period shall be the Interpolated Screen Rate. Notwithstanding
the foregoing, if the LIBO Rate, determined as provided above, would otherwise be less than zero, then the LIBO Rate shall be deemed
to be zero for all purposes.
LIBO Screen Rate has the meaning assigned to such term in the definition of LIBO Rate.
Lien means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or otherwise), pledge,
hypothecation, encumbrance (including a statutory deemed trust), charge or security interest in, on or of such asset, (b) the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having
substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase
option, call or similar right of a third party with respect to such securities.

Liquidity Amount means, as of any time, the sum of (a) the Excess Availability at such time plus (b) the aggregate
amount of Unrestricted Cash (and restricted cash and Permitted Liquid Investments solely to the extent that such cash and Permitted
Liquid Investments is dedicated to the redemption, repayment, defeasance or other discharge of the Senior Notes) of the U.S. Borrower
and the Subsidiaries at such time.
Loan Documents means this Agreement, any promissory notes issued pursuant to this Agreement, the Amendment
and Restatement Agreement, the Collateral Documents, the Guarantee Agreement and all other agreements, instruments, documents and
certificates identified in Section 6 of the Amendment and Restatement Agreement executed and delivered to, or in favor of, the
Administrative Agent, any Issuing Bank or any Lender by any Loan Party and including all other pledges, powers of attorney, consents,
assignments, contracts, notices and all other written matter whether heretofore, now or hereafter executed by or on behalf of any Loan
Party, or any employee of any Loan Party, and delivered to the Administrative Agent, any Issuing Bank or any Lender by any Loan
Party in connection with this Agreement or the transactions contemplated hereby (it being agreed that instruments and documents
entered into in order to establish any Swap Agreement or Banking Services (for purposes of clarity, other than this Agreement, the
Amendment and Restatement Agreement, the Collateral Documents and the Guarantee Agreement) shall not be a Loan Document
hereunder). Any reference in this Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or
schedules thereto, and all amendments, restatements, supplements or other modifications thereto, and shall refer to this Agreement or
such Loan Document as the same may be in effect at any and all times such reference becomes operative.
Loan Parties means, collectively, the U.S. Loan Parties and the Canadian Loan Parties.
Loans means the loans made by the Administrative Agent or the Lenders to either Borrower pursuant to this
Agreement, including Swingline Loans, Overadvances and Protective Advances, as well as any loans made by the Lenders to the
applicable Borrower that are outstanding under the Existing Credit Agreement on the Restatement Effective Date (which loans shall
remain outstanding hereunder on the terms set forth herein).
Local Time means (a) with respect to a Loan or Borrowing made to the U.S. Borrower or a Letter of Credit issued for
the account of the U.S. Borrower or a U.S. Subsidiary, New York City time, and (b) with respect to a Loan or Borrowing made to the
Canadian Borrower, or a Letter of Credit issued for the account of the Canadian Borrower or a Canadian Subsidiary, Toronto time.
Long-Term Indebtedness of any Person as of any date means, without duplication, Indebtedness with a term of greater
than one year from such date; provided that Long-Term Indebtedness shall not include any contingent obligations of such Person
described in clause (i) or (j) of the definition thereof unless the applicable letter of credit, letter of guaranty or bankers acceptance, as
the case may be, supports an obligation that constitutes Indebtedness.
Material Adverse Effect means a material adverse effect on (a) the business, assets or condition, financial or otherwise,
of the U.S. Borrower and the Subsidiaries, taken as a whole, (b) the ability of any Loan Party to perform its material obligations under
any Loan Document or (c) the material rights of or benefits available to the Lenders under any Loan Document.
Material Indebtedness means Indebtedness (other than the Loans and the Letters of Credit), or obligations in respect of
one or more Swap Agreements, of any one or more of the U.S. Borrower and the Subsidiaries in an aggregate principal amount
exceeding $75,000,000. For purposes of determining Material Indebtedness, the principal amount of the obligations of the U.S.
Borrower or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that the U.S. Borrower or such Subsidiary would be required to pay if such Swap Agreement were terminated
at such time.
Material Subsidiary means, at any time, (a) United States Gypsum Company, a Delaware corporation, (b) USG
Interiors, LLC, a Delaware limited liability company, (c) L&W Supply Corporation, a Delaware corporation, (d) California Wholesale
Material Supply, LLC, a Delaware limited liability company, (e) Otsego Paper, Inc., a Delaware corporation, (f) USG Foreign
Investments, Ltd., a Delaware corporation, (g) Livonia Building Materials, LLC, a Michigan limited liability company, (h) CGC Inc., a
New Brunswick corporation, and (i) each other Subsidiary that

is, on or after the Restatement Effective Date, determined to be a significant subsidiary (as such term is defined in Regulation S-X) of
the U.S. Borrower as and when required to be determined in accordance with the periodic and current reporting requirements under the
Securities Exchange Act as well as Regulation S-X (it being understood that the determination as to whether any Subsidiary is a
significant subsidiary shall be made at least annually in connection with the preparation of the annual financial statements of the U.S.
Borrower).
Maturity Date means the Original Maturity Date; provided, however, that if, as of the Early Maturity Date with respect
to any series of Senior Notes, a Senior Notes Event with respect to such series of Senior Notes has not occurred, then the Maturity Date
shall be the Early Maturity Date with respect to such series of Senior Notes (the occurrence of the event described in this proviso, an
Early Maturity Event); provided further, however, that if a Senior Notes Event with respect to such series of Senior Notes has not
occurred prior to the Early Maturity Date with respect to such series of Senior Notes, but as of the Early Maturity Date with respect to
such series of Senior Notes the Liquidity Amount is equal to or greater than $350,000,000, then (i) an Early Maturity Event shall be
deemed not to have occurred and (ii) the Maturity Date shall continue to be the Original Maturity Date unless, as of any time (the date
on which such time occurs, the Accelerated Maturity Date) on or after the Early Maturity Date with respect to such series of Senior
Notes but (x) prior to the occurrence of a Senior Notes Event with respect to such series of Senior Notes, the Liquidity Amount is less
than $350,000,000, in which event the Maturity Date shall be the Accelerated Maturity Date or (y) on or prior to the time immediately
after the occurrence of a Senior Notes Event with respect to such series of Senior Notes, the Liquidity Amount is less than
$250,000,000, in which event the Maturity Date shall be the Accelerated Maturity Date. In addition, with respect to any series of Senior
Notes, if (A) the Senior Notes Documents have been amended in order to cause a Senior Notes Event as set forth in clause (b) of the
definition thereof, or if any of the Senior Notes have been refinanced with Indebtedness in order to cause a Senior Notes Event as set
forth in clause (c) of the definition thereof, and (B) the Senior Notes Documents (or the operative documents in respect of any such
refinancing Indebtedness) are subsequently amended or modified such that the conditions set forth in such clause (b) or (c), as the case
may be, of the definition Senior Notes Event are no longer satisfied, then the Maturity Date shall be the date of such amendment or
modification (or, if such amendment or modification occurs before the Early Maturity Date with respect to such series of Senior Notes,
shall be the Early Maturity Date with respect to such series of Senior Notes).
Moodys means Moodys Investors Service, Inc.
Multiemployer Plan means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
Net Orderly Liquidation Value means, with respect to Inventory of any Person, the orderly liquidation value thereof as
determined in a manner acceptable to the Administrative Agent by an appraiser acceptable to the Administrative Agent in its Permitted
Discretion (including pursuant to an appraisal requested by the U.S. Borrower in accordance with Section 5.07(c)), net of all costs of
liquidation thereof.
Non-Consenting Lender has the meaning assigned to such term in Section 9.02(c).
Obligation Currency has the meaning assigned to such term in Section 9.21(a).
Obligations means, collectively, (a) the Canadian Obligations and (b) the U.S. Obligations.
Original Maturity Date means October 22, 2019, or any earlier date on which the Revolving Commitments are
reduced to zero or are otherwise terminated pursuant to the terms hereof.
Other Taxes means any and all present or future recording, stamp, documentary, excise, transfer, sales, property or
similar Taxes arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or
otherwise with respect to, any Loan Document.
Overadvance has the meaning assigned to such term in Section 2.04(d).
Parent means, with respect to any Revolving Lender, any Person as to which such Revolving Lender is, directly or
indirectly, a subsidiary.

Participant has the meaning assigned to such term in Section 9.04(c)(i).

Participant Register has the meaning assigned to such term in Section 9.04(c)(iv).
Payment Conditions means, at any time of determination, the requirement that either (a) Excess Availability at such
time exceeds an amount equal to the greater of (i) $72,000,000 and (ii) 20% of the lesser of (A) the aggregate Revolving Commitment
at such time and (B) the Aggregate Borrowing Base at such time or (b) each of (x) Excess Availability at such time exceeds an amount
equal to the greater of (i) $54,000,000 and (ii) 15% of the lesser of (A) the aggregate Revolving Commitment at such time and (B) the
Aggregate Borrowing Base at such time and (y) the Fixed Charge Coverage Ratio at such time, determined for the period of four
consecutive fiscal quarters most recently ended at or prior to such time, is greater than or equal to 1.00 to 1.00, in each case, as
calculated after giving pro forma effect to the transaction which is subject to the testing of the Payment Condition.
PBGC means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity
performing similar functions.
Perfection Certificate means a certificate, dated as of the Restatement Effective Date, delivered by the Borrowers on
behalf of the Collateral Parties and in the form of Exhibit G.
Permitted Discretion means a determination made in good faith and in the exercise of reasonable (from the perspective
of a secured asset-based lender) business judgment.
Permitted Encumbrances means:
(a) Liens imposed by law for taxes, assessments or other governmental charges and Canadian Statutory Priority Claims
that are not yet overdue or are being contested in compliance with Section 5.04;
(b) carriers, warehousemens, mechanics, materialmens, repairmens, landlords and other like Liens imposed by
law, arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in compliance with workers compensation,
unemployment insurance and other social security laws or regulations;
(d) pledges and deposits to secure the performance of bids, trade contracts, leases, tenders, statutory obligations,
surety, stay, customs and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary
course of business;
(e)

judgment liens in respect of judgments that do not constitute an Event of Default under clause (k) of Article VII;

(f) easements, zoning restrictions, rights-of-way, covenants and similar encumbrances on real property that do not
secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with
the ordinary conduct of business of the U.S. Borrower or any Subsidiary;
(g) Liens created by sale contracts documenting unconsummated asset dispositions permitted pursuant to this
Agreement, provided that such Liens attach only to assets subject to such sales contracts;
(h) Liens consisting of the interest of the lessee under any lease or sublease granted to others by the U.S. Borrower or
the Subsidiaries in its ordinary course of business, provided that such Liens attach only to the assets subject to such lease or
sublease;
(i) customary rights of setoff, revocation, refund or chargeback under consolidated banking, cash management,
operation of account, credit card, payment processing or deposit agreements or under the

UCC of banks or other financial institutions where the U.S. Borrower or any Subsidiary maintains deposits in the ordinary
course of business;
(j) Liens arising from the granting of a license to any Person in the ordinary course of business of the U.S. Borrower or
any Subsidiary, provided that such Liens attach only to the assets subject to such license and the granting of such license is
permitted hereunder;
(k) Liens attaching to cash earnest money deposits made by the U.S. Borrower or any Subsidiary in connection with
any letter of intent or purchase agreement permitted under Section 6.04;
(l) Liens arising by operation of law or contract on insurance policies and the proceeds thereof to secure premiums
thereunder;
(m) Liens incurred with respect to rights of agents for collection for the U.S. Borrower and the Subsidiaries under
assignments of chattel paper, accounts, instruments or general intangibles for purposes of collection in the ordinary course of
business;
(n) Liens in favor of customs and revenues authorities that secure payment of customs duties in connection with the
importation of goods, provided that such Liens attach solely to such goods being so imported and in respect of which such
duties are owing;
(o) Liens representing any interest or title of a licensor, lessor, sublicensor or sublessor under any lease or license
permitted by this Agreement; and
(p) Liens on consigned Inventory of the Loan Parties (in an aggregate amount not in excess of $15,000,000) in favor
of the creditors of the consignees thereof,
provided that the term Permitted Encumbrances shall not include any Lien securing Indebtedness.
Permitted Investments means any investment permitted pursuant to the U.S. Borrowers Statement of Investment
Objective and Guidelines in effect on the Restatement Effective Date as set forth on Schedule 1.01(a), as the same may be amended
from time to time in a manner not adverse to the Lenders unless otherwise consented to in writing by the Administrative Agent (such
consent not to be unreasonably withheld).
Permitted Liquid Investments means:
(a)
direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by,
the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of
the United States of America) or, in the case of any Canadian Subsidiary (including the Canadian Borrower), the Government of
Canada (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the Government of
Canada), in each case maturing within one year from the date of acquisition thereof;
(b)
investments in commercial paper maturing within 270 days from the date of acquisition thereof and having, at
such date of acquisition, the highest credit rating obtainable from S&P, Moodys or, in the case of any Canadian Subsidiary
(including the Canadian Borrower), DBRS;
(c)
investments in certificates of deposit, bankers acceptances and time or demand deposits maturing within 180
days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State
thereof, or, in the case of any Canadian Subsidiary (including the Canadian Borrower), any commercial bank, trust company or
loan and trust company organized under the laws of Canada or any province thereof, in each case that has a combined capital
and surplus and undivided profits of not less than $500,000,000;

(d)
fully collateralized repurchase agreements with a term of not more than 30 days for securities described in
clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above;
(e)
money market funds that (i) comply with the criteria set forth in Rule 2a7 of the Investment Company Act,
(ii) are rated AAA by S&P and Aaa by Moodys and (iii) have portfolio assets of at least $5,000,000,000; and
(f)
in the case of any Canadian Subsidiary (including the Canadian Borrower), money market mutual funds
having portfolio assets of at least $2,000,000,000 and other short-term investments that are analogous to the foregoing, are of
comparable credit quality and are customarily used by companies in Canada (or any province or territory thereof) for cash
management purposes.
Person means any natural person, corporation, limited liability company, trust, joint venture, association, company,
partnership, Governmental Authority or other entity.
Plan means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV
of ERISA or Section 412 of the Code or Section 302 of ERISA sponsored, maintained or contributed to by the U.S. Borrower or any
ERISA Affiliate.
Poison Pill means any plan, agreement, rights, securities or instruments that are commonly referred to as a poison
pill because they have the effect of diluting or otherwise discriminating against a particular acquiring person (or any similar term) by
reason of such persons ownership of a particular amount of Voting Securities.
Pooled Cash Arrangement means a cash pooling arrangement managed by the U.S. Borrower or a Subsidiary of the
U.S. Borrower.
PPSA means the Personal Property Security Act as in effect from time to time (except as otherwise specified) in any
applicable province of Canada.
Prime Rate means the rate of interest per annum publicly announced from time to time by JPMCB as its prime rate in
effect at its principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change
is publicly announced as being effective.
Pro Forma Basis means, with respect to the determination of Consolidated EBITDA as of any date, that such
calculation shall give pro forma effect to all acquisitions, all issuances, incurrences or assumptions of Indebtedness (with any such
Indebtedness being deemed to be amortized over the applicable testing period in accordance with its terms), all repayments or
prepayments of Indebtedness and all sales, transfers or other dispositions of any material assets outside the ordinary course of business
that have occurred during the four consecutive fiscal quarter period of the U.S. Borrower most-recently ended on or prior to such date
as if they occurred on the first day of such four consecutive fiscal quarter period (including cost savings to the extent such cost savings
would be permitted to be reflected in pro forma financial information complying with the requirements of GAAP and Article XI of
Regulation SX, as interpreted by the Staff of the SEC, and as certified by a Financial Officer).
Protective Advances shall have the meaning assigned to such term in Section 2.21.
Qualified Equity Interests means Equity Interests of the U.S. Borrower other than Disqualified Equity Interests.
Register has the meaning assigned to such term in Section 9.04(b)(iv).
Regulation S-X means Regulation S-X as promulgated by the SEC.
Related Parties means, with respect to any specified Person, such Persons Affiliates and the respective directors,
officers, employees, agents and advisors of such Person and such Persons Affiliates.

Release means any release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge,
dispersal, leaching or migration into or through the environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within or upon any building, structure, facility or fixture.
Rent Reserve means, with respect to any warehouse, distribution center or other location not owned by a Collateral
Party where Inventory on-hand having a book value of at least $100,000 is located and with respect to which no Collateral Access
Agreement is in effect, a reserve equal to (a) three months rent in the case of leased facilities and (b) three months of fees in the case of
third-party warehouses and outside processors.
Report means reports prepared by the Administrative Agent or another Person showing the results of appraisals, field
examinations or audits with respect to the Inventory of the Collateral Parties or the books and records relating to the Accounts of the
Collateral Parties from information furnished by or on behalf of the Collateral Parties, after the Administrative Agent has exercised its
rights of inspection, field examination or appraisal pursuant to this Agreement, which Reports may be distributed to the Lenders by the
Administrative Agent.
Required Lenders means, at any time, Lenders (other than Defaulting Lenders) having Revolving Exposure and
unused Revolving Commitments representing more than 50% of the aggregate Revolving Exposure and unused Revolving
Commitments (in each case, as calculated without giving effect to the Revolving Exposure or unused Revolving Commitment of any
Defaulting Lender) at such time.
Requirement of Law means, with respect to any Person, (a) the charter, articles or certificate of organization or
incorporation and bylaws or other organizational or governing documents of such Person and (b) any statute, law, treaty, rule,
regulation, order, decree, writ, injunction or determination of any arbitrator or court or other Governmental Authority (including
Environmental Laws), in each case applicable to or binding upon such Person or any of its property or to which such Person or any of
its property is subject.
Reserves means Rent Reserves and any other reserves that the Administrative Agent deems necessary, in its Permitted
Discretion, to maintain with respect to the Collateral or any Collateral Party (including reserves in respect of (a) the aggregate amount of
Designated Banking Services Obligations and Designated Swap Obligations (giving effect to any netting agreements) and (b) solely as
it relates to the Canadian Borrowing Base, the aggregate amount of obligations secured by Canadian Statutory Priority Liens (other than
those that are not capable of ranking either prior to or pari passu with the Liens created under the Loan Documents securing the Secured
Obligations) (as such amount shall be estimated, in good faith, by the Borrowers and reflected in each Borrowing Base Certificate), but
not in duplication of any amounts which would otherwise be ineligible for lending against pursuant to the definitions of Eligible
Accounts and/or Eligible Inventory (or any related definitions included therein)), provided that such reserves have been established
upon not less than three Business Days notice to the U.S. Borrower; provided further that no reserve shall be taken with respect to the
solvency deficiency, wind-up deficit or similar deficiency in respect of any Canadian Pension Plan unless and until Excess Availability
is less than $100,000,000 (for clarity, with any such reserve described in this proviso to be established only against the Canadian
Borrowing Base and only if deemed necessary in the Administrative Agents Permitted Discretion, as contemplated by this definition).
Restatement Effective Date has the meaning assigned to such term in the Amendment and Restatement Agreement.
Restatement Transactions means (a) the execution and delivery of the Amendment and Restatement Agreement by
each Person party thereto and the satisfaction of the conditions to the effectiveness thereof and (b) the refinancing of the Existing
Canadian Facility.
Restricted Collateral Party means each of L&W Supply Corporation, a Delaware corporation, United States Gypsum
Company, a Delaware corporation, USG Interiors, Inc., a Delaware corporation, California Wholesale Material Supply, LLC, a
Delaware limited liability company, and CGC Inc., a New Brunswick corporation.
Restricted Group means, collectively, (a) Berkshire, (b) any Controlled Affiliate of Berkshire and (c) any group (that
would be deemed to be a person by Section 13(d)(3) of the Securities Exchange Act with respect to the securities of the U.S.
Borrower) of which Berkshire or any Person directly or indirectly Controlling, Controlled

by or under common Control with Berkshire is a member. For purposes of this definition, Affiliate and Control have the respective
meanings given to such terms under Rule 405 under the Securities Act of 1933, as amended (and Controlled and Controlling shall
have correlative meanings), provided that no Person shall be deemed to Control another Person solely by his or her status as a director
of such other Person.
Restricted Payment means any dividend or other distribution (whether in cash, securities or other property) with
respect to any Equity Interests in the U.S. Borrower or any Subsidiary, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancelation or
termination of any Equity Interests in the U.S. Borrower or any Subsidiary or any option, warrant or other right to acquire any such
Equity Interests in the U.S. Borrower or any Subsidiary, or any other payment (including any payment under any equity Swap
Agreement) that has a substantially similar effect to any of the foregoing. For purposes of clarity, neither (a) the conversion of
convertible Indebtedness of the U.S. Borrower or any Subsidiary into Equity Interests in accordance with the terms of such
Indebtedness nor (b) the repayment, redemption, defeasance or other discharge of any such convertible Indebtedness prior to the
conversion thereof into Equity Interests, shall be a Restricted Payment.
Revolving Borrowing means a Borrowing comprised of Revolving Loans.
Revolving Commitment means, with respect to each Lender, the commitment, if any, of such Lender to make
Revolving Loans and to acquire participations in Letters of Credit, Swingline Loans, Overadvances and Protective Advances hereunder,
expressed as an amount representing the maximum possible aggregate amount of such Lenders Revolving Exposure hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.08, Section 2.18(b) or Section 9.02(c), (b) reduced or
increased from time to time pursuant to assignments by or to such Lender, respectively, pursuant to Section 9.04 and (c) increased from
time to time pursuant to Revolving Commitment Increases made pursuant to Section 2.19. The initial amount of each Lenders
Revolving Commitment is set forth on the Schedule 2.01, or in the Assignment and Assumption or Commitment Increase Amendment
pursuant to which such Lender shall have assumed its Revolving Commitment, as the case may be. The initial aggregate amount of the
Lenders Revolving Commitments on the Restatement Effective Date is $450,000,000.
Revolving Commitment Increase has the meaning assigned to such term in Section 2.19(b).
Revolving Exposure means, with respect to any Lender at any time, the sum of such Lenders U.S. Revolving
Exposure and Canadian Revolving Exposure at such time. The aggregate Revolving Exposure at any time shall be the aggregate
amount of the Revolving Exposure of all Lenders at such time.
Revolving Lender means a Lender with a Revolving Commitment or, if the Revolving Commitments have terminated
or expired, a Lender with Revolving Exposure.
Revolving Loan means a Loan made pursuant to Section 2.01.
Rights to Purchase Voting Securities means options, warrants and rights issued by the U.S. Borrower (whether
presently exercisable or not) to purchase Voting Securities or Convertible Securities, excluding any rights issued under any Poison Pill.
S&P means Standard & Poors Financial Services LLC, a subsidiary of McGraw-Hill Financial, Inc.
Sanctions means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to
time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Treasury Department
or the U.S. Department of State, or (b) the United Nations Security Council, the European Union or Her Majestys Treasury of the
United Kingdom or any other similar sanctions authority.
SEC means the Securities and Exchange Commission or any Governmental Authority succeeding to any of its
principal functions.

SEC Filing has the meaning assigned to such term in Section 3.11.
Secured Obligations means, collectively, (a) the Canadian Secured Obligations and (b) the U.S. Secured Obligations.
Secured Parties means (a) the Lenders, (b) the Administrative Agent, (c) the Issuing Banks, (d) each counterparty to
any Swap Agreement with a Loan Party the obligations under which constitute Secured Obligations, (e) each provider of Banking
Services which constitute Secured Obligations, (f) the beneficiaries of each indemnification obligation undertaken by any Loan Party
under any Loan Document and (g) the successors and assigns of each of the foregoing.
Securities Exchange Act means the Securities Exchange Act of 1934, as amended.
Security Agreements means, collectively, the U.S. Security Agreement and the Canadian Security Agreement.
Senior 6.3% Notes means the U.S. Borrowers 6.3% Notes due 2016, issued pursuant to the Senior Notes Documents.
Senior 7.75% Notes means the U.S. Borrowers 7.75% Notes due 2018, issued pursuant to the Senior Notes
Documents.
Senior 8.375% Notes means the U.S. Borrowers 8.375% Notes due 2018, issued pursuant to the Senior Notes
Documents.
Senior Notes means, collectively, the Senior 6.3% Notes, the Senior 7.75% Notes and the Senior 8.375% Notes.
Senior Notes Documents means the Indenture dated as of November 1, 2006, by and between the U.S. Borrower and
HSBC Bank USA, National Association (as successor to Wells Fargo Bank, National Association), as Trustee (including Supplemental
Indenture No. 3, dated as of November 9, 2010, to such Indenture), all side letters, instruments, agreements and other documents
evidencing or governing any of the Senior Notes, providing for any guarantee or other right in respect thereof, affecting the terms of the
foregoing or entered into in connection therewith and all schedules, exhibits and annexes to each of the foregoing.
Senior Notes Event means, with respect to any series of Senior Notes, any of the following: (a) the redemption,
repayment, defeasance or other discharge, in full, of such series of Senior Notes (including, in each case, all accrued but unpaid
interest, fees and other amounts in respect thereof) in accordance with the terms of the applicable Senior Notes Documents (other than
with the proceeds of Indebtedness); (b) the amendment to or other modification of such series of Senior Notes and the applicable Senior
Notes Documents causing the maturity date of such series of Senior Notes to be extended to a date that is at least 91 days after the
Original Maturity Date; and/or (c) the refinancing of such series of Senior Notes with Indebtedness permitted under Section 6.01 having
a maturity date that is at least 91 days after the Original Maturity Date, provided that, in the case of clauses (b) and (c) of this definition,
such series of Senior Notes as so amended, or any refinancing Indebtedness in respect thereof, do not require (i) any mandatory
prepayment or redemption at the option of the holders thereof (except for redemptions in respect of asset sales and changes in control
on terms (other than with respect to the amount of the premium above par paid to the holders thereof in connection with a mandatory
prepayment or redemption in respect of changes in control) not less favorable to the Lenders than the terms of such series of Senior
Notes as in effect on the date hereof) prior to the date that is 91 days after the Original Maturity Date and (ii) more than 20% of the
original principal amount of such Indebtedness to be amortized prior to the date that is 91 days after the Original Maturity Date.
Specified Swap Obligation means, with respect to any Loan Party (other than the U.S. Borrower), an obligation to pay
or perform under any agreement, contract or transaction that constitutes a swap within the meaning of 1a(47) of the Commodity
Exchange Act.

SPV has the meaning assigned to such term in Section 9.04(e).

Statutory Reserve Rate means a fraction (expressed as a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as Eurocurrency Liabilities in Regulation D of the
Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory
Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
subsidiary means, with respect to any Person (the parent) at any date, any corporation, limited liability company,
partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parents
consolidated financial statements if such financial statements were prepared in accordance with GAAP, as well as any other corporation,
limited liability company, partnership, association or other entity of which securities or other ownership interests representing more than
50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general
partnership interests are, as of such date, owned, controlled or held.
Subsidiary means any direct or indirect subsidiary of the U.S. Borrower (including, for purposes of clarity, the
Canadian Borrower) or, where context requires, of the Canadian Borrower.
Swap Agreement means any agreement with respect to any swap, forward, future or derivative transaction or option or
similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or
securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions, provided that no phantom stock or similar plan providing for payments only on
account of services provided by current or former directors, officers, employees or consultants of the U.S. Borrower or the Subsidiaries
shall be a Swap Agreement.
Swap Obligations of a Loan Party means any and all obligations (including obligations existing as of the Restatement
Effective Date) of such Loan Party, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or
acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (a) any and all Swap
Agreements and (b) any and all cancelations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction.
Swingline Commitment means the commitment of the Swingline Lender to make Swingline Loans.
Swingline Exposure means, at any time, the aggregate principal amount of all Swingline Loans made to the U.S.
Borrower outstanding at such time. The Swingline Exposure of any Lender at any time shall be its Applicable Percentage of the
Swingline Exposure at such time.
Swingline Lender means JPMorgan Chase Bank, N.A., in its capacity as lender of Swingline Loans hereunder.
Swingline Loan means a Loan made pursuant to Section 2.04.
Taxes means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed
by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
Threshold Amount means, at any time, an amount equal to the greater of (a) $45,000,000 and (b) 12.5% of the lesser
of (i) the aggregate Revolving Commitments at such time and (ii) the Aggregate Borrowing Base at such time.

Total Indebtedness means, as of any date, the aggregate principal amount of the Long-Term Indebtedness of the U.S.
Borrower and the Subsidiaries, determined on a consolidated basis as of such date.
Total Net Leverage Ratio means, on any date, the ratio of (a) (i) Total Indebtedness as of such date minus the
aggregate amount of Unrestricted Cash as of such date to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters of
the U.S. Borrower ended on such date (or, if such date is not the last day of a fiscal quarter, ended on the last day of the fiscal quarter of
the U.S. Borrower most recently ended prior to such date).
Transaction Costs means all fees, costs and expenses incurred or payable by the U.S. Borrower or any Subsidiary in
connection with (a) the Transactions, including fees payable on the Restatement Effective Date pursuant to fee letters between the
Administrative Agent and the U.S. Borrower and (b) the Boral Transactions.
Transactions means (a) the execution, delivery and performance by the Loan Parties of this Agreement and the other
Loan Documents to which they are party, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit
hereunder (including the Restatement Transactions) and (b) the payment of the Transaction Costs.
Type, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the
Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate, the Alternate Base Rate, Canadian Prime
Rate or CDOR Rate.
UCC means the Uniform Commercial Code as in effect from time to time in the State of New York or any other state
the laws of which are required to be applied in connection with the issue of perfection of security interests.
Unrestricted Cash means, at any time, the aggregate amount of unrestricted and unencumbered (other than by Liens
created under the Loan Documents) cash and Permitted Liquid Investments of the U.S. Borrower and the Subsidiaries at such time.
USA PATRIOT Act means the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001.
U.S. means the United States of America.
U.S. Banking Services Obligations of the U.S. Loan Parties means any and all obligations (including obligations
existing as of the Restatement Effective Date) of the U.S. Loan Parties, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), in
connection with Banking Services.
U.S. Borrower means USG Corporation, a Delaware corporation.
U.S. Borrowing Base means, at any time and subject to the Borrowing Base Acquisition Adjustment Principles, an
amount equal to the sum of (a) 85% of the Adjusted Eligible Accounts at such time plus (b) the sum of (i) the Available Finished Goods
Inventory, (ii) the Available Raw Materials Inventory and (iii) the Available WIP Inventory (in each case of the U.S. Collateral Parties at
such time) less (b) without duplication of other Reserves included in the foregoing components of the U.S. Borrowing Base, the amount
of any other Reserves established by the Administrative Agent in its Permitted Discretion at such time. The Administrative Agent may,
in its Permitted Discretion and based on new information or a change in circumstances, adjust Reserves, with any such change to be
effective three Business Days after delivery of written notice thereof to the U.S. Borrower and the Lenders. Subject to the immediately
preceding sentence, the U.S. Borrowing Base at any time shall be determined by reference to the Borrowing Base Certificate most
recently delivered to the Administrative Agent pursuant to Section 5.01(e) (or, in the case of the initial Borrowing Base Certificate
delivered in connection with this Agreement, pursuant to Section 6(g) of the Amendment and Restatement Agreement), subject to
adjustments made by the Administrative Agent in its Permitted Discretion to address any events or conditions relating to any of the
Collateral occurring on or after the date with respect to which such Borrowing Base Certificate relates.

U.S. Collateral means Collateral of the U.S. Collateral Parties.

U.S. Collateral Parties means, collectively, the U.S. Loan Parties (in each case, other than any Subsidiary that is not a
wholly owned Subsidiary).
U.S. Collection Account means the Collection Account as defined in the U.S. Security Agreement.
U.S. dollars or $ refers to lawful money of the U.S.
U.S. Dollar Equivalent means, on any date of determination, (a) with respect to any amount in U.S. dollars, such
amount, and (b) with respect to any amount in Canadian dollars, the equivalent in U.S. dollars of such amount, determined by the
Administrative Agent pursuant to Section 1.06 using the Exchange Rate with respect to such currency at that time in effect under the
provisions of such Section (or as otherwise determined in accordance with the express provisions hereof).
U.S. LC Exposure means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of
Credit at such time issued for the account of the U.S. Borrower (or for which the U.S. Borrower is a co-applicant) and (b) the aggregate
amount of all LC Disbursements on Letters of Credit issued for the account of the U.S. Borrower (or for which the U.S. Borrower is a
co-applicant) that have not yet been reimbursed (including with the proceeds of Revolving Loans hereunder) by or on behalf of the
U.S. Borrower at such time. The U.S. LC Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the
aggregate U.S. LC Exposure at such time.
U.S. Loan Party means (a) the U.S. Borrower, (b) each Domestic Material Subsidiary (other than any Domestic
Material Subsidiary that is not required to become a Loan Party in accordance with Section 5.10(a), including any CFC Holdco or any
Domestic Subsidiary of a CFC or CFC Holdco), and (c) each other Domestic Subsidiary designated by the U.S. Borrower, on or after
the Restatement Effective Date, in writing to the Administrative Agent to be a Loan Party hereunder to the extent that the
requirements of Section 5.10 have been satisfied with respect to such Domestic Subsidiary as if such Domestic Subsidiary were a
Domestic Material Subsidiary (it being understood that any such Subsidiary so designated shall be deemed to be a Material Subsidiary
for purposes of the Loan Documents).
U.S. Obligations means (a) the due and punctual payment by the U.S. Borrower of (i) the principal of and interest
(including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding) on the Loans made to the U.S. Borrower, when and as due, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the U.S. Borrower
under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of reimbursement of
disbursements, interest thereon and obligations to provide cash collateral, and (iii) all other monetary obligations of the U.S. Borrower
to any of the Secured Parties under any Loan Document, including obligations to pay fees, expense reimbursement obligations and
indemnification obligations, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations
incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) and (b) the due and punctual payment of all the obligations of each other U.S. Loan Party under or
pursuant to any Loan Document.
U.S. Person means any Person that is a United States Person as defined in Section 7701(a)(30) of the Code.
U.S. Revolving Exposure means, at any time, the sum of (without duplication) (a) the aggregate outstanding principal
amount of U.S. Revolving Loans at such time, (b) the U.S. LC Exposure at such time, (c) the U.S. Swingline Exposure at such time, (d)
the aggregate outstanding principal amount of Overadvances at such time made to the U.S. Borrower and (e) the aggregate outstanding
principal amount of the Protective Advances at such time made to the U.S. Borrower. The U.S. Revolving Exposure of any Lender at
any time shall be such Lenders Applicable Percentage of the U.S. Revolving Exposure at such time.

U.S. Revolving Loan means a Loan made to the U.S. Borrower pursuant to Section 2.01.
U.S. Secured Obligations means all U.S. Obligations, together with (a) U.S. Banking Services Obligations and (b)
Swap Obligations owing by U.S. Loan Parties to one or more Lenders or their respective Affiliates, provided that, except with respect to
Swap Obligations owing to one or more of the Lenders or their respective Affiliates as of the Restatement Effective Date, not later than
the date that is ten calendar days after the date that any transaction relating to such Swap Obligation is executed (or amended,
supplemented or otherwise modified to designate such Swap Obligations as U.S. Secured Obligations), the Lender (or the applicable
Affiliate) party thereto (other than JPMCB) shall have delivered written notice to the Administrative Agent and the U.S. Borrower that
such a transaction has been entered into (or has been amended, supplemented or otherwise modified, as the case may be) and that it
constitutes a U.S. Secured Obligation entitled to the benefits of the Collateral Documents. Notwithstanding the foregoing, for purposes
of clauses (a) and (b) of this defined term, the amount of Swap Obligations and U.S. Banking Services Obligations, as applicable owing
to one or more of the Lenders or their respective Affiliates at any time shall be deemed to be reduced by the aggregate amount of cash
collateral provided in respect of such Swap Obligations or U.S. Banking Services Obligations, as applicable, at such time pursuant to
cash collateralization terms agreed to by the applicable counterparties to such Swap Obligations or the provisions of such U.S. Banking
Services Obligations, as applicable. Notwithstanding the foregoing, in the case of any Excluded Swap Guarantor, U.S. Secured
Obligations shall not include Excluded Swap Obligations of such Excluded Swap Guarantor.
U.S. Security Agreement means that certain Pledge and Security Agreement, dated as of January 7, 2009 (as amended
from time to time, including pursuant to the Amendment and Restatement Agreement), among the U.S. Collateral Parties and the
Administrative Agent, for the benefit of the Secured Parties.
U.S. Tax Compliance Certificate has the meaning assigned to such term in Section 2.16(f).
Vessel Loan Agreement means the $90,000,000 Secured Loan Agreement dated October 21, 2008, among Gypsum
Transportation Limited, the lenders from time to time party thereto and DVB Bank SE, as agent and security trustee.
Voting Securities means the common stock and any other securities of the U.S. Borrower of any kind or class having
power generally to vote for the election of directors of the U.S. Borrower.
Wells Fargo means Wells Fargo Bank, National Association, a national banking association, in its individual capacity,
and its successors.
wholly owned Subsidiary means, with respect to any Person at any date, a subsidiary of such Person of which
securities or other ownership interests representing 100% of the Equity Interests (other than directors qualifying shares) are, as of such
date, owned, controlled or held by such Person or one or more wholly owned Subsidiaries of such Person or by such Person and one or
more wholly owned Subsidiaries of such Person. Unless otherwise specified, wholly owned Subsidiary means a wholly owned
Subsidiary of the U.S. Borrower.
Withdrawal Liability means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
Withholding Agent means the Loan Party making the payment potentially subject to withholding or the Administrative
Agent.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of this Agreement, (a) Loans may be classified
and referred to by Class (e.g., a U.S. Revolving Loan) or by Type (e.g., a Eurodollar Loan) or by Class and Type (e.g., a
Eurodollar U.S. Revolving Loan), and Borrowings also may be classified and referred to by Class (e.g., a U.S. Revolving
Borrowing) or by Type (e.g., a Eurodollar Borrowing) or by Class and Type (e.g., a Eurodollar U.S. Revolving Borrowing) and
(b) Revolving Borrowings means the U.S. Revolving Borrowings, the Canadian Revolving Borrowings or both, as the context may
require

SECTION 1.03. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of
the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter
forms. The words include, includes and including shall be deemed to be followed by the phrase without limitation. The word
will shall be construed to have the same meaning and effect as the word shall. Unless the context requires otherwise, (a) any
definition of or reference to any agreement, instrument or other document herein (other than the Existing Credit Agreement) shall be
construed as referring to such agreement, instrument or other document as from time to time amended, amended and restated,
supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such Persons successors and assigns, (c) the words herein,
hereof and hereunder, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any
particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles
and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words asset and property shall be construed to have the
same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts
and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from time to time, provided that (i) if the U.S. Borrower
notifies the Administrative Agent that the U.S. Borrower requests an amendment to any provision (including any definition) hereof to
eliminate the effect of any change occurring after the Restatement Effective Date in GAAP or in the application thereof on the operation
of such provision (or if the Administrative Agent notifies the U.S. Borrower that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the
application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such
change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith
and (ii) notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be
construed, and all computations of amounts, baskets and ratios referred to herein (including, for purposes of clause (B), Indebtedness
(and payments thereon) and Liens) shall be made, (A) without giving effect to any elections under Statement of Financial Accounting
Standards 159, The Fair Value Option for Financial Assets and Financial Liabilities, or any successor thereto (including pursuant to
Accounting Standard Codifications), to value any Indebtedness of the U.S. Borrower or any Subsidiary at fair value, as defined
therein and (B) without giving effect to any change to GAAP occurring after the date hereof as a result of the adoption of any proposals
set forth in the Proposed Accounting Standards Update, Leases (Topic 840), issued by the Financial Accounting Standards Board on
August 17, 2010, or any other proposals issued by the Financial Accounting Standards Board in connection therewith, in each case if
such change would require treating any lease (or similar arrangement conveying the right to use) as a capital lease where such lease (or
similar arrangement) would not have been required to be so treated under GAAP as in effect on the date hereof.
SECTION 1.05. Pro Forma Calculations. With respect to any period during which any acquisition, sale, transfer or other
disposition of any material assets outside the ordinary course of business occurs, for purposes of determining Consolidated EBITDA,
calculations with respect to such period shall be made on a Pro Forma Basis.
SECTION 1.06. Currency Translation . (a) Except as specifically provided in paragraph (b) of this Section 1.06, for
purposes of determining compliance as of any date with the terms of any Loan Document, amounts incurred or outstanding in Canadian
dollars shall be translated into U.S. dollars at the exchange rates in effect on the first Business Day of the fiscal quarter in which such
determination occurs or in respect of which such determination is being made, as such exchange rates shall be determined in good faith
by the U.S. Borrower. No Default or Event of Default shall arise as a result of any limitation or threshold set forth in U.S. dollars in any
Loan Document (other than the limits and sublimits for Revolving Exposure set forth in Article II of this Agreement) being exceeded
solely as a result of changes in currency exchange rates from those rates applicable on the first day of the fiscal quarter in which such
determination occurs or in respect of which such determination is being made.
( b ) (i)The Administrative Agent shall determine the U.S. Dollar Equivalent of any Borrowing, LC
Disbursement or Letter of Credit denominated in Canadian dollars, as well as of each component

of each Borrowing Base, as of each date (with such date to be reasonably determined by the Administrative Agent)
that is on or about the date of each request for the issuance, amendment, renewal or extension of such Letter of Credit,
using the Exchange Rate for the applicable currency in relation to U.S. dollars in effect on the date of determination,
and each such amount shall be the U.S. Dollar Equivalent of such Letter of Credit (or such Borrowing Base
component, as the case may be) until the next required calculation thereof pursuant to this paragraph (b)(i) (or, in the
case of such Borrowing Base component, pursuant to paragraph (b)(ii) or (b)(iv)) of this Section 1.06.
(ii) The Administrative Agent shall determine the U.S. Dollar Equivalent of any Borrowing denominated in
Canadian Dollars, as well as of each component of each Borrowing Base, as of each date (with such date to be
reasonably determined by the Administrative Agent) that is on or about the date of a Borrowing Request or Interest
Election Request, or as of each date of any termination or reduction of Commitments hereunder or the prepayment of
Loans hereunder, in each case using the Exchange Rate for the applicable currency in relation to U.S. dollars in effect
on the date of determination, and each such amount shall be the U.S. Dollar Equivalent of such Borrowing (or such
Borrowing Base component, as the case may be) until the next required calculation thereof pursuant to this paragraph
(b)(ii) (or, in the case of such Borrowing Base component, pursuant to paragraph (b)(i) or (b)(iv)) of this Section 1.06.
(iii) The Administrative Agent shall notify the Borrowers, the Lenders and the Issuing Banks of each calculation
of the U.S. Dollar Equivalent of each Letter of Credit, Borrowing and LC Disbursement.
( i v ) In addition to the requirements set forth in paragraphs (b)(i) and (b)(ii) of this Section 1.06, the
Administrative Agent shall determine the U.S. Dollar Equivalent of each applicable component of each Borrowing Base
as of each date (with such date to be reasonably determined by the Administrative Agent) that is on or about the date of
delivery of each Borrowing Base Certificate hereunder, in each case using the Exchange Rate for the applicable
currency in relation to U.S. dollars in effect on the date of determination, and each such amount shall be the U.S. Dollar
Equivalent of such Borrowing Base component until the next required calculation thereof pursuant to paragraph (b)(i),
(b)(ii) or (b)(iv) of this Section 1.06.
ARTICLE II
The Credits
SECTION 2.01. Revolving Commitments. (a) Subject to the terms and conditions set forth herein, each Lender agrees to
make Revolving Loans to the U.S. Borrower from time to time during the Availability Period in an aggregate principal amount that will
not result in (i) such Lenders Revolving Exposure exceeding such Lenders Revolving Commitment, in each case at such time, (ii) the
aggregate Revolving Exposure exceeding the aggregate Revolving Commitments, in each case at such time or (iii) the aggregate U.S.
Revolving Exposure at such time exceeding the lesser of (A) the Revolving Commitments at such time minus the Canadian Revolving
Exposure at such time and (B) (1) the U.S. Borrowing Base at such time minus (2) the amount by which (x) the aggregate Canadian
Revolving Exposure at such time exceeds (y) the Canadian Borrowing Base at such time, subject in each case to the Administrative
Agents authority, in its sole discretion, to make Overadvances pursuant to the terms of Section 2.04 and Protective Advances pursuant
to the terms of 2.21. Within the foregoing limits and subject to the terms and conditions set forth herein, the U.S. Borrower may borrow,
prepay and reborrow Revolving Loans. All U.S. Loans shall be made in dollars.
(b) Subject to the terms and conditions set forth herein, each Lender agrees to make Revolving Loans to the Canadian
Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (i) such Lenders
Revolving Exposure exceeding such Lenders Revolving Commitment, in each case at such time, (ii) such Lenders Canadian
Revolving Exposure exceeding such Lenders Canadian Revolving

Sub-Commitment, in each case at such time, (iii) the aggregate Revolving Exposure at such time exceeding the aggregate Revolving
Commitments at such time or (iv) the aggregate Canadian Revolving Exposure at such time exceeding the lesser of (A) the aggregate
Canadian Revolving Sub-Commitments at such time and (B) (1) the Aggregate Borrowing Base at such time minus (2) the aggregate
U.S. Revolving Exposure at such time. Within the foregoing limits and subject to the terms and conditions set forth herein, the
Canadian Borrower may borrow, prepay and reborrow Revolving Loans. All Canadian Loans shall be made in U.S. dollars or
Canadian dollars.
(c) All Revolving Loans, Overadvances, Swingline Loans and Letters of Credit outstanding under the Existing Credit
Agreement on the Restatement Effective Date shall remain outstanding hereunder on the terms set forth herein.
SECTION 2.02. Loans and Borrowings. ( a ) Each Loan (other than a Swingline Loan, Overadvance or Protective
Advance) shall be made as part of a Borrowing consisting of Loans of the same Class, Type and currency made by the Lenders (i) in
the case of U.S. Revolving Borrowings, ratably in accordance with their respective Revolving Commitments and (ii) in the case of
Canadian Revolving Borrowings, ratably in accordance with their respective Canadian Revolving Sub-Commitments, in each case as of
the date of such Borrowing. Any Overadvance and any Swingline Loan shall be made in accordance with the procedures set forth in
Section 2.04, and any Protective Advance shall be made in accordance with the procedures set forth in Section 2.21. The failure of any
Lender to make any Loan required to be made by it hereunder shall not relieve any other Lender of its obligations hereunder, provided
that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lenders failure to make Loans as
required.
(b) Subject to Section 2.13, (i) each U.S. Revolving Borrowing shall be comprised entirely of ABR Revolving Loans
or Eurodollar Revolving Loans as the U.S. Borrower may request in accordance herewith and (ii) each Canadian Revolving
Borrowing shall be (x) if denominated in U.S. dollars, comprised entirely of ABR Revolving Loans or Eurodollar Revolving Loans or
(y) if denominated in Canadian dollars, comprised entirely of Canadian Prime Loans or CDOR Loans, in each case as the Canadian
Borrower may request in accordance herewith. Each Swingline Loan, Overadvance and Protective Advance shall be an ABR Loan
(or, in the case of an Overadvance or Protective Advance denominated in Canadian dollars, a Canadian Prime Loan). Each Lender at
its option may (A) allocate its portion of the Canadian Revolving Sub-Commitment to any domestic or foreign branch or Affiliate of
such Lender, and cause such branch or Affiliate to make any Loan, or fund any participation in any Letter of Credit, under or in
respect of the Canadian Revolving Sub-Commitment and (B) otherwise, make any Loan, or fund any participation in any Letter of
Credit, by causing any such branch or Affiliate to make such Loan or fund such participation; provided that (x) any exercise of any
such option shall not affect the obligation of either Borrower to repay any such Loan or participation in accordance with the terms of
this Agreement and (y) each such branch or Affiliate shall, for all purposes of this Agreement and the other Loan Documents, be
treated in the same manner as the respective Lender (and shall have all rights hereunder and obligations hereunder and thereunder to
the extent of such allocation, and shall be entitled to all indemnities and similar provisions in respect of its acting as such, subject to
all of the requirements and limitations herein or therein).
(c) At the commencement of each Interest Period for any Eurodollar Revolving Borrowing or CDOR Revolving
Borrowing, such Borrowing shall be in an aggregate principal amount that is an integral multiple of $1,000,000 and not less than
$5,000,000. At the time that each ABR Revolving Borrowing or Canadian Prime Revolving Borrowing is made, such Borrowing shall
be in an aggregate amount that is an integral multiple of $1,000,000 and not less than $1,000,000. Each Swingline Loan shall be in
an amount that is not less than $500,000. Borrowings of more than one Type may be outstanding at the same time, provided that
there shall not at any time be more than a total of ten Eurodollar Borrowings and CDOR Borrowings, in the aggregate, outstanding.
Notwithstanding anything to the contrary in this Section 2.02(c), (A) an ABR Revolving Borrowing or a Swingline Loan may be in an
aggregate amount that is equal to the entire unused balance of the aggregate Revolving Commitments or that is required to finance
the reimbursement of an LC Disbursement as contemplated by Section 2.05(e) and (B) a Canadian Prime Revolving Borrowing may
be in the aggregate amount which is equal to (or the U.S. Dollar Equivalent is equal to) the entire unused balance of the aggregate
Canadian Revolving Sub-Commitments or that is required to finance the reimbursement of an LC Disbursement as contemplated by
Section 2.05(e).

(d)Notwithstanding any other provision of this Agreement, neither Borrower shall be entitled to request, or to elect to
convert or continue, any Eurodollar Borrowing or CDOR Borrowing if the Interest Period requested with respect thereto would end
after the Original Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Revolving Borrowing, the applicable Borrower shall notify the
Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., Local Time,
three Business Days before the date of the proposed Borrowing, (b) in the case of an ABR Borrowing, not later than 11:00 a.m., New
York City time, one Business Day before the date of the proposed Borrowing, provided that any such notice of an ABR Revolving
Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.05(e) may be given not later than 10:00
a.m., Local Time, on the date of the proposed Borrowing, (c) in the case of a Canadian Prime Borrowing, not later than 12:00 p.m.,
Local Time, one Business Day before the date of the proposed Borrowing, provided that any such notice of a Canadian Prime
Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.05(e) may be given not later than 10:00
a.m., Local Time, on the date of the proposed Borrowing or (d) in the case of a CDOR Borrowing, not later than 12:00 p.m., Local
Time, two Business Days before the date of the proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy or Adobe pdf file to the Administrative Agent of a written Borrowing Request
substantially in the form of Exhibit C signed by the applicable Borrower. Each such telephonic and written Borrowing Request shall
specify the following information:
(a)

the Borrower requesting such Borrowing;

(b)

the currency and aggregate amount of such Borrowing;

(c)

the date of such Borrowing, which shall be a Business Day;

(d) whether such Borrowing is to be an ABR Borrowing, a Eurodollar Borrowing, a Canadian Prime Borrowing or a
CDOR Borrowing;
(e) in the case of a Eurodollar Borrowing or a CDOR Borrowing, the initial Interest Period to be applicable thereto,
which shall be a period contemplated by the definition of the term Interest Period;
(f)
the location and number of the applicable Borrowers account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.06; and
(g)

that as of such date the conditions set forth in Sections 4.02(a) and (b) are satisfied.

If no election as to the Type of Revolving Borrowing is specified, then the requested Revolving Borrowing shall be (A) in the case of a
U.S. Revolving Borrowing, an ABR Borrowing and (B) in the case of a Canadian Revolving Borrowing, a Canadian Prime Borrowing.
If no Interest Period is specified with respect to any requested Eurodollar Revolving Borrowing or CDOR Revolving Borrowing, then
the applicable Borrower shall be deemed to have selected an Interest Period of one months duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lenders Loan to be made as part of the requested Borrowing. If no currency is specified with respect to any Canadian
Revolving Borrowing, then the currency of such Canadian Revolving Borrowing shall be Canadian dollars (unless the applicable
Borrowing request otherwise specified that such Borrowing shall be an ABR Revolving Borrowing or Eurodollar Revolving Borrowing,
in which case the currency of such Canadian Revolving Borrowing shall be U.S. dollars).
SECTION 2.04. Swingline Loans and Overadvances. ( a ) Subject to the terms and conditions set forth herein, the
Swingline Lender agrees to make Swingline Loans to the U.S. Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline
Loans exceeding $20,000,000, (ii) the aggregate Revolving Exposure exceeding the aggregate Revolving Commitments, in each case
at such time or (iii) the aggregate U.S. Revolving Exposure at such time exceeding the lesser of (A) the aggregate Revolving
Commitments at such time minus the Canadian Revolving Exposure at such time or (B) (1) the U.S. Borrowing Base at such time minus
(2) the amount by

which (x) the aggregate Canadian Revolving Exposure at such time exceeds (y) the Canadian Borrowing Base at such time, provided
that the Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the
foregoing limits and subject to the terms and conditions set forth herein, the U.S. Borrower may borrow, prepay and reborrow
Swingline Loans.
(b) To request a Swingline Loan, the U.S. Borrower shall notify the Administrative Agent of such request by telephone
(confirmed by telecopy or by Adobe pdf file), not later than 12:00 noon, New York City time, on the day of such proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and amount of the
requested Swingline Loan. The Administrative Agent will promptly advise the Swingline Lender of any such notice received from the
U.S. Borrower. The Swingline Lender shall make each Swingline Loan available to the U.S. Borrower by means of a credit to the
general deposit account of the U.S. Borrower maintained with the Swingline Lender (or (i) in the case of a Swingline Loan made to
finance the reimbursement of an LC Disbursement as provided in Section 2.05(e), by remittance to the applicable Issuing Bank or, to
the extent that the Revolving Lenders have made payments pursuant to Section 2.05(e) to reimburse such Issuing Bank, to such
Lenders and such Issuing Bank as their interests may appear and (ii) in the case of a Swingline Loan made to finance the repayment of
another Loan or fees or expenses as provided by Section 2.17(c), by remittance to the Administrative Agent to be distributed to the
Lenders as their interests may appear) by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the Administrative Agent not later than 12:00 noon, New York
City time, on any Business Day (but, in any event with respect to a Swingline Loan, not later than seven Business Days after such
Swingline Loan was funded by the Swingline Lender), require the Revolving Lenders to acquire participations on such Business Day in
all or a portion of the Swingline Loans outstanding. Such notice shall specify the aggregate amount of Swingline Loans in which
Revolving Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each
Revolving Lender, specifying in such notice such Lenders Applicable Percentage of such Swingline Loan or Swingline Loans. Each
Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative
Agent, for the account of the Swingline Lender, such Lenders Applicable Percentage of such Swingline Loan or Swingline Loans. Each
Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is
absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a
Default or reduction or termination of the Revolving Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in Section 2.06 with respect to Loans made by such Lender
(and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent
shall promptly pay to the Swingline Lender the amounts so received by it from the Revolving Lenders. The Administrative Agent shall
notify the U.S. Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments in
respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the U.S. Borrower (or other party on behalf of the U.S. Borrower) in respect of a Swingline Loan after
receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative
Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the
Revolving Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may
appear, provided that any such payment so remitted shall be repaid to the Swingline Lender or the Administrative Agent, as the case
may be, if and to the extent such payment is required to be refunded to the U.S. Borrower for any reason. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve the U.S. Borrower of any default in the payment thereof.
(d) Any provision of this Agreement to the contrary notwithstanding, at the request of a Borrower, the Administrative
Agent may in its sole discretion (but with absolutely no obligation) make Loans to such Borrower, on behalf of the Revolving Lenders,
in amounts that exceed the availability pursuant to Sections 2.01(a) and 2.01(b), as applicable, immediately prior to the making of such
Loans (any such excess Loans are herein referred to collectively as Overadvances), provided that no Overadvance shall result in a
Default due to the U.S. Borrowers failure to

comply with Section 2.01 for so long as such Overadvance remains outstanding in accordance with the terms of this paragraph, but
solely with respect to the amount of such Overadvance. All Overadvances shall be (i) ABR Borrowings, in the case of
(x) Overadvances made to the U.S. Borrower and (y) Overadvances denominated in U.S. dollars made to the Canadian Borrower, or
(ii) Canadian Prime Borrowings, in the case of Overadvances denominated in Canadian dollars made to the Canadian Borrower. The
authority of the Administrative Agent to make Overadvances is limited to an aggregate amount the U.S. Dollar Equivalent of which is
not to exceed $25,000,000 at any time, no Overadvance may remain outstanding for more than 30 days and no Overadvance shall
cause any Lenders Revolving Exposure to exceed its Revolving Commitment, provided that the Required Lenders may at any time
revoke the Administrative Agents authorization to make Overadvances. Any such revocation must be in writing and shall become
effective prospectively upon the Administrative Agents receipt thereof.
(e) Upon the making of an Overadvance by the Administrative Agent, each Revolving Lender shall be deemed, without
further action by any party hereto, to have unconditionally and irrevocably purchased from the Administrative Agent without recourse
or warranty, an undivided interest and participation in such Overadvance in proportion to its Applicable Percentage of the Revolving
Commitment. The Administrative Agent may, at any time, require the Revolving Lenders to fund their participations in any
Overadvance. From and after the date, if any, on which any Revolving Lender is required to fund its participation in any Overadvance
purchased hereunder, the Administrative Agent shall promptly distribute to such Lender, such Lenders Applicable Percentage of all
payments of principal and interest and all proceeds of Collateral received by the Administrative Agent in respect of such Overadvance.
SECTION 2.05. Letters of Credit. (a) General. As of the Restatement Effective Date, each Existing Letter of Credit,
automatically and without any action on the part of any Person, has been deemed to be a Letter of Credit issued hereunder for all
purposes of this Agreement and the other Loan Documents. Subject to the terms and conditions set forth herein, the U.S. Borrower may
request the issuance of Letters of Credit for its own account (or for the account of any Subsidiary so long as the U.S. Borrower and such
Subsidiary are co-applicants), in a form reasonably acceptable to the Administrative Agent and the applicable Issuing Bank, at any time
and from time to time during the Availability Period. All Letters of Credit issued for the account of the U.S. Borrower or any Subsidiary
(with respect to which the U.S. Borrower is a co-applicant) shall be denominated in U.S. dollars. Subject to the terms and conditions set
forth herein, the Canadian Borrower may request the issuance of Letters of Credit for its own account (or for the account of any
Canadian Subsidiary so long as the Canadian Borrower and such Canadian Subsidiary are co-applicants), in a form reasonably
acceptable to the Administrative Agent and the applicable Issuing Bank, at any time and from time to time during the Availability
Period. All Letters of Credit issued for the account of the Canadian Borrower or any Canadian Subsidiary (with respect to which the
Canadian Borrower is a co-applicant) shall be denominated in either U.S. dollars or Canadian dollars. In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other
agreement submitted by either Borrower to, or entered into by either Borrower with, an Issuing Bank relating to any Letter of Credit, the
terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request the issuance of a Letter of
Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the applicable Borrower shall hand deliver or
telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the applicable Issuing Bank)
to the applicable Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed
or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount and currency of such
Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend,
renew or extend such Letter of Credit. If requested by the applicable Issuing Bank, the applicable Borrower also shall submit a letter
of credit application on such Issuing Banks standard form in connection with any request for a Letter of Credit. A Letter of Credit
shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit
the applicable Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or
extension, (i) the LC

Exposure shall not exceed $200,000,000, (ii) the Canadian LC Exposure shall not exceed $5,000,000, (iii) none of JPMCB, Bank of
America or Wells Fargo shall have LC Exposure that exceeds $75,000,000 each, (iv) the aggregate Revolving Exposure shall not
exceed the Revolving Commitments, in each case at such time, (v) the aggregate U.S. Revolving Exposure at such time shall not
exceed the lesser of (A) the Revolving Commitments at such time minus the Canadian Revolving Exposure at time and (B) (1) the
U.S. Borrowing Base at such time minus (2) the amount by which (x) the aggregate Canadian Revolving Exposure at such time
exceeds (y) the Canadian Borrowing Base at such time, and (vi) the aggregate Canadian Revolving Exposure shall not exceed the
lesser of (A) the aggregate Canadian Revolving Sub-Commitments at such time and (B) (1) the Aggregate Borrowing Base at such
time minus (2) the aggregate U.S. Revolving Exposure at such time. Notwithstanding the foregoing, neither Wells Fargo or any of its
Affiliates shall be under any obligation to issue Letters of Credit for the account of the Canadian Borrower (or for which the Canadian
Borrower is a co-applicant), it being agreed that this provision shall not be deemed to limit Wells Fargos obligation to participate in
any such Letters of Credit issued for the account of the Canadian Borrower (or for which the Canadian Borrower is a co-applicant) in
accordance with Section 2.05(d).
(c) Expiration Date. Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date
that is one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year
after such renewal or extension) and (ii) the date that is five Business Days prior to the Original Maturity Date; provided, however,
that a Letter of Credit may, upon the request of the applicable Borrower and with the consent of applicable Issuing Bank, include a
provision whereby such Letter of Credit shall be renewed automatically for additional consecutive periods of one year or less (but not
beyond the date that is five Business Days prior to the Original Maturity Date) unless such Issuing Bank, in its discretion, notifies the
beneficiary thereof at least 30 days prior to the then-applicable expiration date that such Letter of Credit will not be renewed.
Notwithstanding the foregoing, any Letters of Credit may mature later than five Business Days prior to the Original Maturity Date if
the applicable Borrower has entered into a cash collateral arrangement with respect to such Letter of Credit on terms satisfactory to
the applicable Issuing Bank.
(d) Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount
thereof) and without any further action on the part of the applicable Issuing Bank or the Lenders, each Issuing Bank hereby grants to
each Revolving Lender, and each Revolving Lender hereby acquires from such Issuing Bank, a participation in such Letter of Credit
equal to such Lenders Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit. In
consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, for the account of the applicable Issuing Bank, such Lenders Applicable Percentage of each LC Disbursement
made such the Issuing Bank and not reimbursed by the applicable Borrower or the applicable Subsidiary on the date due as provided
in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the applicable Borrower or the
applicable Subsidiary for any reason. Each Revolving Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.
( e ) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the
applicable Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 3:00 p.m., Local Time, on the date that such LC Disbursement is made, if the applicable Borrower shall
have received notice of such LC Disbursement prior to 10:00 a.m., Local Time, on such date, or, if such notice has not been received
by the applicable Borrower prior to such time on such date, then not later than (i) 3:00 p.m., Local Time, on the Business Day that the
applicable Borrower receives such notice, if such notice is received prior to 10:00 a.m., Local Time, on the day of receipt, or
(ii) 12:00 noon, Local Time, on the Business Day immediately following the day that the applicable Borrower receives such notice, if
such notice is not received prior to 10:00 a.m., Local Time, on the day of receipt, provided that, if such LC Disbursement is not less
than $250,000, the applicable Borrower may, subject to the conditions to borrowing set forth herein (other than the minimum
borrowing amount requirements set forth in Section 2.02(c)), request in accordance with

Section 2.03 or 2.04 that such payment be financed with (A) in the case of a Letter of Credit issued for the account of the U.S.
Borrower or a Subsidiary (with respect to which the U.S. Borrower is a co-applicant), an ABR Revolving Borrowing or Swingline
Loan, in each case made by the U.S. Borrower, and (B) in the case of a Letter of Credit issued for the account of the Canadian
Borrower or a Canadian Subsidiary (with respect to which the Canadian Borrower is a co-applicant), (x) if such Letter of Credit is
denominated in U.S. dollars, an ABR Revolving Borrowing or (y) if such Letter of Credit is denominated in Canadian dollars, a
Canadian Prime Revolving Borrowing, in each case made by the Canadian Borrower, and in each of cases (A) and (B), in an
equivalent amount and, to the extent so financed, the applicable Borrowers obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing, Canadian Prime Revolving Borrowing or Swingline Loan. If the applicable
Borrower fails to make such payment when due, the Administrative Agent shall notify each Revolving Lender of the applicable LC
Disbursement, the payment then due from the applicable Borrower in respect thereof and such Lenders Applicable Percentage
thereof. Promptly following receipt of such notice, each Revolving Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the applicable Borrower, in the same manner as provided in Section 2.06 with respect to
Loans made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders)
and in the same currency as the applicable LC Disbursement, and the Administrative Agent shall promptly pay to the applicable
Issuing Bank the amounts so received by it from the Revolving Lenders. Promptly following receipt by the Administrative Agent of
any payment from the applicable Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the
applicable Issuing Bank or, to the extent that Revolving Lenders have made payments pursuant to this paragraph to reimburse such
Issuing Bank, then to such Lenders and such Issuing Bank as their interests may appear. Any payment made by a Revolving Lender
pursuant to this paragraph to reimburse an Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans,
Canadian Prime Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the
applicable Borrower of its obligation to reimburse such LC Disbursement.
( f ) Obligations Absolute. The applicable Borrowers obligation to reimburse LC Disbursements as provided in
paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the
terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of
any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect,
(iii) payment by an Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with
the terms of such Letter of Credit or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing,
that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the
applicable Borrowers obligations hereunder. Neither the Administrative Agent, the Lenders nor the Issuing Banks, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of
Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error
in interpretation of technical terms or any consequence arising from causes beyond the control of the applicable Issuing Bank,
provided that the foregoing shall not be construed to excuse such Issuing Bank from liability to the applicable Borrower to the extent
of any direct damages (as opposed to consequential or punitive damages, claims in respect of which are hereby waived by the
applicable Borrower to the extent permitted by applicable law) suffered by the applicable Borrower that are caused by such Issuing
Banks failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with
the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or wilful misconduct on the part of the
applicable Issuing Bank (as finally determined by a court of competent jurisdiction), such Issuing Bank shall be deemed to have
exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof (and except as
otherwise required by applicable law), the parties agree that, with respect to documents presented that appear on their face to be in
substantial compliance with the terms of a Letter of Credit, each Issuing Bank may, in its sole discretion, either accept and make
payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such documents

if such documents are not in strict compliance with the terms of such Letter of Credit, and any such acceptance or refusal shall be
deemed not to constitute gross negligence or wilful misconduct.
(g) Disbursement Procedures. Each Issuing Bank shall, promptly following its receipt thereof, examine all documents
purporting to represent a demand for payment under a Letter of Credit. Each Issuing Bank shall promptly notify the Administrative
Agent and the applicable Borrower by telephone (confirmed by telecopy) of such demand for payment and whether such Issuing
Bank has made or will make an LC Disbursement thereunder, provided that any failure to give or delay in giving such notice shall not
relieve the applicable Borrower of its obligation to reimburse such Issuing Bank and the Revolving Lenders with respect to any such
LC Disbursement in accordance with paragraph (e) of this Section.
(h) Interim Interest. If an Issuing Bank shall make any LC Disbursement, then, unless the applicable Borrower shall
reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for
each day from and including the date such LC Disbursement is made to but excluding the date that the applicable Borrower
reimburses such LC Disbursement, at the rate per annum then applicable to (i) ABR Revolving Loans, in the case of (x) Letters of
Credit issued for the account of the U.S. Borrower or any Domestic Subsidiary and (y) Letters of Credit denominated in U.S. dollars
that are issued for the account of the Canadian Borrower or any Canadian Subsidiary, and (ii) Canadian Prime Loans, in the case of
Letters of Credit denominated in Canadian dollars that are issued for the account of the Canadian Borrower or any Canadian
Subsidiary, provided that, if the applicable Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of
this Section, then Section 2.12(d) shall apply. Interest accrued pursuant to this paragraph shall be for the account of the applicable
Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to paragraph (e) of this
Section to reimburse such Issuing Bank shall be for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Banks. An Issuing Bank may be replaced at any time by written agreement among the
Borrowers, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall
notify the Lenders of any such replacement of an Issuing Bank. At the time any such replacement shall become effective, the
applicable Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.11(d). From
and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term
Issuing Bank shall be deemed to include such successor Issuing Bank. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under
this Agreement with respect to Letters of Credit issued by it prior to such replacement, but shall not be required to issue additional
Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be continuing, on or after the Business Day on
which either Borrower receives notice from the Administrative Agent or the Required Lenders that the maturity of the Loans has been
accelerated and the Revolving Commitments have been terminated, Revolving Lenders with LC Exposure representing greater than
50% of the LC Exposure may demand the deposit of cash collateral pursuant to this paragraph, and the U.S. Borrower (in the case of
the U.S. LC Exposure) and the Canadian Borrower (in the case of the Canadian LC Exposure) shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, an amount in cash equal to (x)
103% of the sum of the U.S. LC Exposure and that portion of the Canadian LC Exposure attributable to Letters of Credit denominated
in U.S. dollars, in each case as of such date plus any accrued and unpaid interest thereon (the cash collateral deposited pursuant to
this clause (x) to be denominated in U.S. dollars) and (y) 103% of the portion of the Canadian LC Exposure attributable to Letters of
Credit denominated in Canadian dollars as of such date plus any accrued and unpaid interest thereon (the cash collateral deposited
pursuant to this clause (y) to be denominated in Canadian dollars), provided that the obligation to deposit such cash collateral shall
become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any
kind, upon the occurrence of any Event of Default with respect to either Borrower described in paragraph (h) or (i) of Article VII. The
Borrowers also shall deposit cash collateral pursuant to this paragraph (including with respect to the percentage

of the face amount of Letters of Credit and the applicable currency of the deposit as described in the immediately preceding sentence)
as and to the extent required by Section 2.09(b) or Section 2.10(b). Each such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the obligations of the applicable Borrower under this Agreement. The Administrative
Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the
Administrative Agent and at the Borrowers risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the
Issuing Banks for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the
satisfaction of the reimbursement obligations of the applicable Borrower for the applicable LC Exposure at such time or, if the
maturity of the Loans has been accelerated (but subject to the consent of Revolving Lenders with LC Exposure representing greater
than 50% of the LC Exposure), be applied to satisfy other obligations of the applicable Borrower under this Agreement. If the
Borrowers are required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default and
acceleration of the maturity of the Loans, as described above, such amount (to the extent not applied as aforesaid) shall be returned to
the applicable Borrower within three Business Days after all Events of Default have been cured or waived. If either Borrower is
required to provide an amount of cash collateral hereunder pursuant to Section 2.10(b), such amount (to the extent not applied as
aforesaid) shall be returned to the applicable Borrower as and to the extent that, after giving effect to such return, the applicable
Borrower would remain in compliance with Section 2.10(b) and no Default shall have occurred and be continuing.
SECTION 2.06. Funding of Borrowings. (a) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Local Time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the Lenders, provided that Swingline Loans and Overadvances shall
be made as provided in Section 2.04 and Protective Advances shall be made as provided in Section 2.21. The Administrative Agent will
make such Loans available to the applicable Borrower by promptly, and in no event later than 3:00 p.m., Local Time, crediting the
amounts so received, in like funds, to an account of such Borrower maintained with the Administrative Agent in New York City or
Toronto, as the case may be, and designated by such Borrower in the applicable Borrowing Request, provided that ABR Revolving
Loans and Canadian Prime Revolving Loans made to finance the reimbursement of (i) an LC Disbursement as provided in
Section 2.05(e) shall be remitted by the Administrative Agent to the applicable Issuing Bank or, to the extent that the Revolving
Lenders have made payments pursuant to Section 2.05(e) to reimburse such Issuing Bank, then to such Lenders and such Issuing Bank
as their interests may appear, (ii) an Overadvance shall be retained by the Administrative Agent or, to the extent that the Revolving
Lenders have made payments pursuant to Section 2.04(e) to reimburse the Administrative Agent in respect of any such Overadvance,
remitted by the Administrative Agent to such Revolving Lenders as their interests may appear or (iii) a Protective Advance shall be
retained by the Administrative Agent or, to the extent that the Revolving Lenders have made payments pursuant to Section 2.21(b) to
finance the repayment of a Protective Advance, applied by the Administrative Agent for such purpose.
( b ) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any
Borrowing that such Lender will not make available to the Administrative Agent such Lenders share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of
this Section and may, in reliance upon such assumption and in its sole discretion, make available to the applicable Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the applicable Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made
available to the applicable Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender,
the greater of (A) (1) if such amount corresponds to a Borrowing made by the U.S. Borrower, the Federal Funds Effective Rate and
(2) if such amount corresponds to a Borrowing made by the Canadian Borrower, the rate reasonably determined by the Administrative
Agent to be the cost to it of funding such amount and (B) a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation or (ii) in the case of the applicable Borrower,

the interest rate applicable to such Loan. If such Lender pays such amount to the Administrative Agent, then such amount (less interest)
shall constitute such Lenders Loan included in such Borrowing.
SECTION 2.07. Interest Elections. ( a ) Each Revolving Borrowing initially shall be of the Type specified in the
applicable Borrowing Request or designated by Section 2.03 and, in the case of a Eurodollar Borrowing or CDOR Borrowing, shall
have an initial Interest Period as specified in such Borrowing Request or designated by Section 2.03. Thereafter, the applicable
Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar
Borrowing or CDOR Borrowing, may elect Interest Periods therefor, all as provided in this Section. The applicable Borrower may elect
different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. This Section shall not apply to Swingline Borrowings, Overadvances or Protective Advances, which may not be
converted or continued.
(b) To make an election pursuant to this Section, the applicable Borrower shall notify the Administrative Agent of such
election by telephone by the time that a Borrowing Request would be required under Section 2.03 if such Borrower were requesting a
Revolving Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy or by Adobe pdf file to the
Administrative Agent of a written Interest Election Request substantially in the form of Exhibit D signed by the applicable Borrower.
Notwithstanding the foregoing, no Borrower shall be permitted to (i) change the currency of any Borrowing, (ii) elect an Interest Period
for any Eurodollar Revolving Borrowing or CDOR Revolving Borrowing that does not comply with Section 2.02(d) or (iii) convert any
Borrowing to a Borrowing not available under the Class of Commitments pursuant to which such Borrowing was made.
(c) Each telephonic and written Interest Election Request shall specify the following information in compliance with
Section 2.02:
(i)
the Borrowing to which such Interest Election Request applies and, if different options are being
elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);
(ii)
Business Day

the effective date of the election made pursuant to such Interest Election Request, which shall be a

(iii)
whether the resulting Borrowing is to be an ABR Borrowing, a Eurodollar Borrowing, a Canadian
Prime Borrowing or a CDOR Borrowing; and
(iv)
if the resulting Borrowing is a Eurodollar Borrowing or a CDOR Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term
Interest Period.
If any such Interest Election Request requests a Eurodollar Borrowing or a CDOR Borrowing but does not specify an Interest Period,
then the applicable Borrower shall be deemed to have selected an Interest Period of one months duration.
(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the
details thereof and of such Lenders portion of each resulting Borrowing.
(e) If the applicable Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing
or a CDOR Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period, (i) in the case of a Eurodollar Borrowing,

such Borrowing shall be converted to an ABR Borrowing or (ii) in the case of a CDOR Borrowing, such Borrowing shall be converted
to a Canadian Prime Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing
and the Administrative Agent, at the request of the Required Lenders, so notifies the applicable Borrower, then, so long as an Event of
Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing or CDOR Borrowing
and (ii) unless repaid, each Eurodollar Borrowing or CDOR Borrowing shall be converted to an ABR Borrowing or a Canadian Prime
Borrowing, respectively, at the end of the Interest Period applicable thereto.
SECTION 2.08. Termination and Reduction of Revolving Commitments. ( a ) Unless previously terminated, the
Revolving Commitments shall terminate on the Maturity Date.
(b) The Borrowers may at any time terminate, or from time to time reduce, in either case, without premium or penalty
(other than, with respect to Eurodollar Borrowings, payments that may become due under Section 2.15), the Revolving Commitments
or the Canadian Revolving Sub-Commitments, provided that (i) each reduction of the Revolving Commitments shall be in an amount
that is an integral multiple of $1,000,000 and not less than $5,000,000, (ii) the Borrowers shall not terminate or reduce the Revolving
Commitments if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.10, the
aggregate Revolving Exposure (excluding, in the case of any termination of the Revolving Commitments, the portion of the Revolving
Exposure attributable to outstanding Letters of Credit if and to the extent that the applicable Borrower has made arrangements
satisfactory to the Administrative Agent and the applicable Issuing Bank with respect to such Letters of Credit) would exceed the
aggregate Revolving Commitments, (iii) the Borrowers shall not terminate or reduce the Revolving Commitments if, after giving effect
to any concurrent prepayment of the U.S. Revolving Loans in accordance with Section 2.10, the aggregate U.S. Revolving Exposure
would exceed the lesser of (A) the aggregate Revolving Commitments at such time minus the Canadian Revolving Exposure at such
time or (B) (1) the U.S. Borrowing Base at such time minus (2) the amount by which (x) the aggregate Canadian Revolving Exposure at
such time exceeds (y) the Canadian Borrowing Base at such time, (iv) the Borrowers shall not terminate or reduce the Canadian
Revolving Sub-Commitments if, after giving effect to any concurrent prepayment of the Canadian Revolving Loans in accordance with
Section 2.10, the aggregate Canadian Revolving Exposure would exceed the lesser of (A) the aggregate Canadian Revolving SubCommitments and (B) (x) the Aggregate Borrowing Base at such time minus (y) the aggregate U.S. Revolving Exposure at such time
and (v) the Borrowers shall not terminate or reduce the Revolving Commitments if, after giving effect to such termination or reduction,
the aggregate Canadian Revolving Sub-Commitments would exceed the aggregate Revolving Commitments.
( c ) The Borrowers shall notify the Administrative Agent of any election to terminate or reduce the Revolving
Commitments or Canadian Revolving Sub-Commitments under paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of
any such notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrowers
pursuant to this Section shall be irrevocable, provided that a notice of termination or reduction of Revolving Commitments or Canadian
Revolving Sub-Commitments delivered by the Borrowers may state that such notice is conditioned upon the effectiveness of other
credit facilities or the receipt of the proceeds from the issuance of other Indebtedness or any other event, in which case such notice may
be revoked by the Borrowers (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Revolving Commitments or Canadian Revolving Sub-Commitments shall be permanent,
subject to any increases effected pursuant to Section 2.19. Each reduction of the Revolving Commitments or Canadian Revolving SubCommitments shall be made ratably among the Lenders in accordance with their respective Revolving Commitments or Canadian
Revolving Sub-Commitments.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) Each Borrower hereby unconditionally promises to pay
(i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan of such
Lender to such Borrower on the Maturity Date, (ii) to the Swingline Lender the then unpaid principal amount of each Swingline Loan to
such Borrower on the Maturity Date, provided that on each date that a U.S. Revolving Borrowing is made, the U.S. Borrower shall
repay all Swingline Loans that were outstanding on the date such Borrowing was requested, (iii) to the Administrative Agent the then
unpaid principal amount of each

Overadvance on the earliest of (x) the Maturity Date, (y) the day that is 30 days after the making of such Overadvance and (z) demand
by the Administrative Agent, and (iv) to the Administrative Agent the then unpaid principal amount of each Protective Advance on the
earlier of (x) the Maturity Date and (y) demand by the Administrative Agent.
(b) On each Business Day during any Cash Dominion Period, the Administrative Agent shall apply, subject to Section
9.19, all immediately available funds credited to (i) the Canadian Collection Account to the Canadian Secured Obligations and (ii) the
U.S. Collection Account to the U.S. Secured Obligations or, in the Administrative Agents discretion if no funds are then credited to
the Canadian Collection Account, the Canadian Secured Obligations, in each case, first to prepay any Overadvances that may be
outstanding, pro rata, second to prepay any Protective Advances that may be outstanding, pro rata, third, to prepay Swingline Loans
and to reimburse any LC Disbursements that may be outstanding, pro rata, and fourth to prepay any Revolving Loans that may be
outstanding and, if no such Loans are outstanding, to deposit cash collateral in an account with the Administrative Agent to be
retained pursuant to Section 2.05(j), it being understood that any prepayments of Revolving Loans shall be applied in accordance
with the penultimate sentence of Section 2.17(b).
( c ) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the
indebtedness of each Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(d ) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made
hereunder, the Type and Class thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from each Borrower to each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder for the account of the Lenders and each Lenders share thereof.
(e) The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be prima facie
evidence of the existence and amounts of the obligations recorded therein (absent manifest error), provided that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of
either Borrower to repay the Loans and pay interest thereon in accordance with the terms of this Agreement.
(f) Any Lender may request that Revolving Loans made by it be evidenced by a promissory note. In such event, the
applicable Borrower shall prepare, execute and deliver to such Lender a promissory note, substantially in the form of Exhibit H,
payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns). Thereafter, the Loans evidenced
by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by
one or more promissory notes in such form payable to the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).
SECTION 2.10. Prepayment of Loans. (a) Each Borrower shall have the right at any time and from time to time to
prepay without premium or penalty (other than, with respect to Eurodollar Borrowings, payments that may become due under Section
2.15) any Borrowing by such Borrower in whole or in part, subject to the requirements of this Section.
(b) Except for Overadvances permitted under Section 2.04, (i) in the event and on such occasion that the aggregate U.S.
Revolving Exposure exceeds the lesser of (A) the aggregate Revolving Commitments at such time minus the Canadian Revolving
Exposure at such time and (B) (1) the U.S. Borrowing Base at such time minus (2) the amount by which (x) the aggregate Canadian
Revolving Exposure at such time exceeds (y) the Canadian Borrowing Base at such time, the U.S. Borrower shall prepay Protective
Advances made to the U.S. Borrower, U.S. Revolving Borrowings and/or Swingline Borrowings (or, if no such Borrowings are
outstanding, deposit cash collateral in an account with the Administrative Agent to be retained pursuant to Section 2.05(j) for so long as
such condition exists) in an aggregate amount equal to such excess and (ii) in the event and on such occasion that the aggregate
Canadian Revolving Exposure exceeds the lesser of (A) the aggregate Canadian Revolving Sub-Commitments at such time and
(B) (x) the Aggregate Borrowing Base at such time minus (y) the aggregate U.S. Revolving Exposure at such time,

the Canadian Borrower shall prepay Protective Advances made to the Canadian Borrower and/or the Canadian Revolving Borrowings
(or, if no such Borrowings are outstanding, deposit cash collateral in an account with the Administrative Agent to be retained pursuant
to Section 2.05(j) for so long as such condition exists) in an aggregate amount equal to such excess.
(c) Prior to any optional prepayment or mandatory prepayment of Borrowings hereunder, the applicable Borrower shall
select the Borrowing or Borrowings to be prepaid and shall specify such selection in the notice of such prepayment pursuant to
paragraph (d) of this Section.
(d) The applicable Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan,
the Swingline Lender) by telephone (confirmed by telecopy or by Adobe pdf file) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing or CDOR Borrowing, not later than 11:00 a.m., Local Time, three Business Days before the date
of prepayment, (ii) in the case of prepayment of an ABR Borrowing or Canadian Prime Borrowing, not later than 11:00 a.m., Local
Time, one Business Day before the date of prepayment or (iii) in the case of prepayment of a Swingline Loan, not later than 12:00
noon, Local Time, on the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date, the principal
amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed
calculation of the amount of such prepayment, provided that a notice of optional prepayment may state that such notice is conditioned
upon the effectiveness of other credit facilities or the receipt of the proceeds from the issuance of other Indebtedness or any other event,
in which case such notice of prepayment may be revoked by the applicable Borrower (by notice to the Administrative Agent on or prior
to the specified date) if such condition is not satisfied. Promptly following receipt of any such notice (other than a notice relating solely
to Swingline Loans) the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any
Revolving Borrowing shall be in an amount that would be permitted in the case of an advance of a Revolving Borrowing of the same
Class and Type as provided in Section 2.02, except as necessary to apply fully the required amount of a mandatory prepayment. Each
prepayment of a Revolving Borrowing shall be applied ratably to the Revolving Loans included in the prepaid Borrowing. Prepayments
shall be accompanied by accrued interest to the extent required by Section 2.12.
SECTION 2.11. Fees. (a) The U.S. Borrower agrees to pay to the Administrative Agent for the account of each Lender
an unused commitment fee, which shall accrue at the rate of 0.25% per annum on the average daily unused amount of the Revolving
Commitment of such Lender during the period from and including the Restatement Effective Date to but excluding the date on which
the Revolving Commitments terminate. Accrued unused commitment fees shall be payable in arrears on the third Business Day
following the last day of each March, June, September and December of each year and on the date on which the Revolving
Commitments terminate, commencing on the first such date to occur after the Restatement Effective Date. All unused commitment fees
shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day
but excluding the last day). For purposes of computing unused commitment fees, a Revolving Commitment of a Lender shall be
deemed to be used to the extent of the outstanding Revolving Loans and LC Exposure of such Lender (and each of the Swingline
Exposure of such Lender and such Lenders participation in Overadvances and Protective Advances shall be disregarded for such
purpose).
(b) Each of the U.S. Borrower (with respect to the portion of the LC Exposure constituting U.S. LC Exposure) and the
Canadian Borrower (with respect to the portion of the LC Exposure constituting Canadian LC Exposure) agrees to pay (i) to the
Administrative Agent for the account of each Revolving Lender a participation fee with respect to its participations in the applicable
Letters of Credit, which shall accrue at the same Applicable Rate used to determine the interest rate applicable to Eurodollar Revolving
Loans on the average daily amount of such Lenders LC Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Restatement Effective Date to but excluding the later of the date on which
such Lenders Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to each
Issuing Bank a fronting fee, which shall accrue at a rate equal to 0.125% per annum on the average daily amount of the applicable LC
Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the
Restatement Effective Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which
there ceases to be any LC Exposure, as well as such Issuing Banks

standard fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day, commencing on the first such date to occur after the
Restatement Effective Date, provided that all such fees shall be payable on the date on which the Revolving Commitments terminate
and any such fees accruing after the date on which the Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Banks pursuant to this paragraph shall be payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(c) The U.S. Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and
at the times separately agreed upon in writing between the U.S. Borrower and the Administrative Agent.
(d ) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative
Agent (or to the applicable Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders entitled thereto. Fees paid shall not be refundable under any circumstances.
SECTION 2.12. Interest. (a) Except as set forth in Section 2.12(c), (i) the Loans comprising each ABR Borrowing
(including each Swingline Loan) shall bear interest at the Alternate Base Rate plus the Applicable Rate, (ii) the Loans comprising each
Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate, (iii) the Loans comprising each Canadian Prime Borrowing shall bear interest at the Canadian Prime Rate plus the
Applicable Rate and (iv) the Loans comprising each CDOR Borrowing shall bear interest at the CDOR Rate plus the Applicable Rate.
All Borrowings denominated in Canadian dollars shall be either Canadian Prime Borrowings or CDOR Borrowings.
(b) [Reserved.]
(c) Each Overadvance and Protective Advance shall bear interest at (i) in the case of Overadvances and Protective
Advances denominated in U.S. dollars, the Alternate Base Rate plus the Applicable Rate plus 2.00% and (ii) in the case of
Overadvances and Protective Advances denominated in Canadian dollars, the Canadian Prime Rate plus the Applicable Rate plus
2.00%.
(d) Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the
applicable Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount
shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2.00%
plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other
amount, 2.00% plus the rate applicable to (A) in the case of amounts owed by the U.S. Borrower, ABR Revolving Loans as provided in
paragraph (a) of this Section, (B) in the case of an amount owed by the Canadian Borrower and denominated in U.S. Dollars, ABR
Revolving Loans as provided in paragraph (a) of this Section, or (C) in the case of an amount owed by the Canadian Borrower
denominated in Canadian Dollars, Canadian Prime Loans as provided in paragraph (a) of this Section.
(e) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon
termination of the Revolving Commitments, provided that (i) interest accrued pursuant to paragraph (c) or (d) of this Section shall be
payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving
Loan or a Canadian Prime Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid
or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar
Loan or CDOR Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.

(f) All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by
reference to (i) the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate, (ii) the Canadian Prime Rate
or (iii) CDOR Rate shall be computed on the basis of a year of 365 days (or, only in the case of clause (i) hereof, 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The
applicable Alternate Base Rate, Adjusted LIBO Rate, Canadian Prime Rate or CDOR Rate shall be determined by the Administrative
Agent, and such determination shall be conclusive absent manifest error.
(g) Solely for purposes of the Interest Act (Canada), (i) whenever any interest or fee under this Agreement is calculated
based on a year of 360 days or 365 days, as the case may be, the rate used pursuant to such calculation, when expressed as an annual
rate, is equivalent to such rate multiplied by a fraction, the numerator of which is the actual number of days in the relevant calendar
year and the denominator of which is 360 or 365, as the case may be, (ii) the rates of interest under this Agreement are nominal rates
and not effective rates or yields and (iii) the principle of deemed reinvestment of interest does not apply to any interest calculation
under this Agreement.
SECTION 2.13. Alternate Rate of Interest. If prior to the commencement of any Interest Period for a Eurodollar
Borrowing:
(i) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that
adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the CDOR Rate, as the case may
be, for such Interest Period; or
(ii) the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or CDOR Rate, as
the case may be, for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the applicable Borrower and the Lenders by telephone or telecopy or by
Adobe pdf file as promptly as practicable thereafter and, until the Administrative Agent notifies the applicable Borrower and the
Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion
of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing or CDOR Borrowing, as the case may be, shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing or CDOR Borrowing, such Borrowing Request shall be
deemed a request for (A) in the case of a Borrowing Request for a Borrowing denominated in U.S. dollars, an ABR Borrowing and (B)
in the case of a Borrowing Request for a Borrowing denominated in Canadian dollars, Canadian Prime Borrowing, provided that
following the first day that such condition shall cease to exist, such Borrowings may be made as or converted to Eurodollar Borrowings
(in the case of Borrowings denominated in U.S. dollars) or CDOR Borrowings (in the case of Borrowings denominated in Canadian
dollars) (at the request of and in accordance with the elections of the applicable Borrower).
SECTION 2.14. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit extended by, any Lender or any Issuing Bank
(except any such reserve requirement reflected in the Adjusted LIBO Rate);
(ii) impose on any Lender or any Issuing Bank or the London interbank market any other condition, cost or
expense (other than Taxes) affecting this Agreement or Eurodollar Loans or CDOR Loans made by such Lender or any
Letter of Credit or participation therein; or
(iii) subject the Administrative Agent, any Lender or any Issuing Bank to any Taxes (other than (A) Indemnified
Taxes and (B) Excluded Taxes) on its loans, loan principal, letters of credit,

commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;
and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Loan (or of maintaining
its obligation to make any such Loan) or to increase the cost to such Lender or such Issuing Bank of participating in, issuing or
maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or such Issuing Bank
hereunder (whether of principal, interest or otherwise), then, upon the request of such Lender or such Issuing Bank, as applicable, the
applicable Borrower (in accordance with Section 9.19) will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or any Issuing Bank determines that any Change in Law regarding capital or liquidity requirements
has or would have the effect of reducing the rate of return on such Lenders or such Issuing Banks capital or on the capital of such
Lenders or such Issuing Banks holding company, if any, as a consequence of this Agreement or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that
which such Lender or such Issuing Bank or such Lenders or such Issuing Banks holding company could have achieved but for such
Change in Law (taking into consideration such Lenders or such Issuing Banks policies and the policies of such Lenders or such
Issuing Banks holding company with respect to capital adequacy or liquidity), then from time to time the applicable Borrower (in
accordance with Section 9.19) will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or amounts
as will compensate such Lender or such Issuing Bank or such Lenders or such Issuing Banks holding company for any such
reduction suffered.
(c) A certificate of a Lender or an Issuing Bank setting forth in reasonable detail calculations of the amount or
amounts necessary to compensate such Lender or such Issuing Bank or its holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section shall be delivered to the applicable Borrower and shall be conclusive absent manifest error. The
applicable Borrower shall pay such Lender or such Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant to this Section
shall not constitute a waiver of such Lenders or such Issuing Banks right to demand such compensation, provided that no Borrower
shall be required to compensate a Lender or an Issuing Bank pursuant to this Section for any increased costs or reductions incurred
more than 270 days prior to the date that such Lender or such Issuing Bank, as the case may be, notifies the applicable Borrower of
the Change in Law giving rise to such increased costs or reductions and of such Lenders or such Issuing Banks intention to claim
compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive,
then the 270-day period referred to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan or
CDOR Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the
conversion of any Eurodollar Loan or CDOR Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to
borrow, convert, continue or prepay any Eurodollar Loan or CDOR Loan (or to convert any ABR Loan into a Eurodollar Loan or
Canadian Prime Loan into a CDOR Loan) on the date specified in any notice delivered pursuant hereto (regardless of whether such
notice may be revoked under Section 2.10(d) and is revoked in accordance therewith) or (d) the assignment of any Eurodollar Loan or
CDOR Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the applicable Borrower to
replace a Lender pursuant to Section 2.18(b) or Section 9.02(c), then, in any such event, the applicable Borrower (in accordance with
Section 9.19) shall compensate each Lender for the loss, cost and reasonable expense attributable to such event. In the case of a
Eurodollar Loan or CDOR Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such
Lender to be the excess, if any, of (i) the amount of interest that would have accrued on the principal amount of such Loan had such
event not occurred, at the LIBO Rate or CDOR Rate, as applicable (without consideration of the Applicable Rate) that would have been
applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the
case of a failure to

borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest that
would accrue on such principal amount for such period at the interest rate that such Lender would bid were it to bid, at the
commencement of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market
(without consideration of the Applicable Rate). A certificate of any Lender setting forth any amount or amounts that such Lender is
entitled to receive pursuant to this Section shall be delivered to the applicable Borrower and shall be conclusive absent manifest error.
The applicable Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after such Borrowers
receipt thereof.
SECTION 2.16. Taxes. (a) Any and all payments by or on account of any obligation any Loan Party under any Loan
Document shall be made free and clear of and without deduction for any Taxes, provided that if any Loan Party shall be required to
deduct any Taxes from such payments, then (i) in the case of any Indemnified Taxes or Other Taxes, the sum payable shall be
increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, Lender or Issuing Bank (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) such Loan Party shall make such deductions and (iii) such Loan Party shall timely pay
the full amount deducted to the relevant Governmental Authority in accordance with applicable law.
(b) Without limiting the provisions of paragraph (a) above, each Loan Party shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) Subject to Section 9.19, each Loan Party shall severally indemnify the Administrative Agent, each Lender and each
Issuing Bank, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or such Issuing Bank, as the case may be, on or with respect to any payment by or on account of
any obligation of such Loan Party under any Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or liability delivered to the applicable Loan Party by a
Lender or an Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a Lender or an Issuing Bank, shall be
conclusive absent manifest error.
(d ) Subject to Section 9.19, each Lender shall severally indemnify the Administrative Agent within 10 days after
demand therefor, for the full amount of (i) any Indemnified Taxes or Other Taxes attributable to such Lender (but only to the extent
that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes or Other Taxes and without
limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lenders failure to comply with the provisions
of Section 9.04(c)(iv) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in
each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and reasonable expenses
arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative
Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any
and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to
the Lender from any other source against any amount due to the Administrative Agent under this paragraph (d).
( e ) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Loan Party to a
Governmental Authority pursuant to this Section 2.16, such Loan Party shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such
payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
( f ) ( i) Any Lender that is entitled to an exemption from or reduction of withholding tax under the law of the
jurisdiction in which a Borrower is located, or any treaty to which such jurisdiction is a party, with respect

to payments under this Agreement shall deliver to such Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by such Borrower or the Administrative Agent, such properly completed and
executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced
rate. In addition, any Lender, if requested by either Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by applicable law or reasonably requested by such Borrower or the Administrative Agent as will enable such Borrower or
the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting
requirements.
(ii) Without limiting the generality of the foregoing, in the event that a Borrower is a United States Person (as defined in
Section 7701(a)(30) of the Code)),
(A)
any Lender that is a United States Person (as defined in Section 7701(a)(30) of the Code) shall deliver
to such Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under
this Agreement (and from time to time thereafter upon the request of such Borrower or the Administrative Agent),
executed originals of Internal Revenue Service Form W-9 certifying that such Lender is exempt from U.S. federal
backup withholding tax;
(B)
any Foreign Lender shall deliver to such Borrower and the Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender
under this Agreement (and from time to time thereafter upon the request of such Borrower or the Administrative Agent,
but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:
(1) duly completed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E claiming eligibility for
benefits of an income tax treaty to which the U.S. is a party,
(2) duly completed copies of Internal Revenue Service Form W-8ECI,
(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section
881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not (x) a bank within the
meaning of section 881(c)(3)(A) of the Code, (y) a 10 percent shareholder of such Borrower within the
meaning of section 881(c)(3)(B) of the Code, or (z) a controlled foreign corporation described in section
881(c)(3)(C) of the Code (a U.S. Tax Compliance Certificate) and (y) duly completed copies of Internal
Revenue Service Form W-8BEN or W-8BEN-E,
(4) to the extent a Foreign Lender is not the beneficial owner, duly completed copies of Internal Revenue
Service Form W-8IMY, accompanied by Internal Revenue Service Form W-8ECI, Internal Revenue Service
Form W-8BEN, Internal Revenue Service Form W-8BEN-E, a U.S. Tax Compliance Certificate, Internal
Revenue Service Form W-9 and/or other certification documents from each beneficial owner, as applicable,
or
(5) any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S.
Federal withholding Tax duly completed together with such supplementary documentation as may be
prescribed by applicable law to permit such Borrower to determine the withholding or deduction required to
be made.
(iii) If a payment made to a Lender under this Agreement or any Loan Document would be subject to U.S. Federal
withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA
(including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Withholding
Agent, at the time or times prescribed by law and at such time or times reasonably requested by the Withholding Agent, such
documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional
documentation reasonably

requested by the Withholding Agent as may be necessary for the Withholding Agent to comply with its obligations under FATCA, to
determine that such Lender has complied with such Lender's obligations under FATCA or to determine the amount to deduct and
withhold from such payment. Solely for purposes of this clause (iii), FATCA shall include any amendments made to FATCA after
the date of this Agreement.
Each Lender agrees that if any form or certification previously delivered by such Lender pursuant to this Section 2.16
expires or becomes obsolete or inaccurate in any material respect, such Lender shall update such form or certification or promptly
notify such Borrower and the Administrative Agent in writing of such Lenders legal inability to do so.
(g) If the Administrative Agent, a Lender or an Issuing Bank determines, in its sole discretion, that it has received a
refund of any Indemnified Taxes or Other Taxes as to which it has been indemnified by a Loan Party or with respect to which a Loan
Party has paid additional amounts pursuant to this Section 2.16, it shall pay to such Loan Party an amount equal to such refund (but
only to the extent of indemnity payments made under this Section with respect to the Indemnified Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such refund). Such Loan Party, upon the request of such
indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to
repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will
the indemnified party be required to pay any amount to a Loan Party pursuant to this paragraph (g) the payment of which would
place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject
to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require the
Administrative Agent, any Lender or any Issuing Bank to make available its Tax returns (or any other information relating to its taxes
that it deems confidential) to any Loan Party or any other Person.
(h) For purposes of determining withholding Taxes imposed under FATCA, from and after the effective date of this
Agreement, the Borrower and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to
treat) this Agreement as not qualifying as a grandfathered obligation within the meaning of Treasury Regulation Section 1.14712(b)(2)(i).
(i) Each partys obligations under this Section 2.16 shall survive the resignation or replacement of the Administrative
Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment,
satisfaction or discharge of all obligations under any Loan Document.
SECTION 2.17. Payments Generally; Allocation of Proceeds; Sharing of Setoffs. (a) Each Borrower shall make each
payment required to be made by it under any Loan Document (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.14, 2.15, 2.16 or 9.03, or otherwise) at or prior to the time expressly required
hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, prior to 12:00 noon, Local
Time), on the date when due, in immediately available funds, without setoff or counterclaim. Any amounts received after such time on
any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for
purposes of calculating interest thereon. All such payments shall be made to such account or accounts as may be specified by the
Administrative Agent, except payments to be made directly to any Issuing Bank or the Swingline Lender as expressly provided herein
and except that payments pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the Persons entitled thereto and
payments pursuant to other Loan Documents shall be made to the Persons specified therein. The Administrative Agent shall distribute
any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If
any payment under any Loan Document shall be due on a day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such
extension. All payments under each Loan Document of principal or interest in respect of any Loan or of any breakage indemnity in

respect of any Loan shall be made in the currency of such Loan; all other payments under each Loan Document shall be made in U.S.
dollars, except as otherwise expressly provided therein.
(b) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts
of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied to the U.S. Secured
Obligations and the Canadian Secured Obligations, as applicable (and subject to Section 9.19) (i) first, towards payment of interest
and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due
to such parties (based on the U.S. Dollar Equivalent of such amounts, determined using the Exchange Rate at such time), and
(ii) second, towards payment of principal and unreimbursed LC Disbursements then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties (based on the U.S.
Dollar Equivalent of such amounts, determined using the Exchange Rate at such time). Notwithstanding the immediately preceding
sentence, any proceeds of Collateral received by the Administrative Agent (i) not constituting either (A) a specific payment of
principal, interest, fees, reimbursement of LC Disbursements or other sum payable under the Loan Documents (which shall be applied
as specified by the applicable Borrower in accordance with the terms hereof), (B) a mandatory prepayment (which shall be applied in
accordance with Section 2.10) or (C) amounts to be applied from the Collection Account during any Cash Dominion Period (which
shall be applied in accordance with Section 2.09(b)) or (ii) after an Event of Default has occurred and is continuing and the
Administrative Agent so elects or the Required Lenders so direct, shall be applied (in each case ratably as interests may appear (based
on the U.S. Dollar Equivalents of the amounts so owing, determined using the Exchange Rate at such time)) as follows: (x) in the case
of U.S. Collateral, first, to pay any fees, indemnities, or expense reimbursements then due to the Administrative Agent from the Loan
Parties (other than in connection with Banking Services Obligations or Swap Obligations), second, to pay any fees or expense
reimbursements then due to the Lenders from the Loan Parties (other than in connection with Banking Services Obligations or Swap
Obligations), third, to pay interest due in respect of the Overadvances, fourth, to pay the principal of the Overadvances, fifth, to pay
interest due in respect of the Protective Advances, sixth, to pay the principal of the Protective Advances, seventh, to pay interest then
due and payable on the Loans, eighth, to prepay principal on the Loans and unreimbursed LC Disbursements and, to the extent that
Reserves have been established with respect to such amounts, amounts owing with respect to Designated Banking Services
Obligations and Designated Swap Obligations, ninth, to pay an amount to the Administrative Agent equal to 103% of the aggregate
undrawn face amount of all outstanding Letters of Credit (for each Letter of Credit, to be denominated in the currency of such Letter
of Credit) to be held as cash collateral for such Obligations, tenth, to the payment of any other Secured Obligation (other than
Banking Services Obligations and Swap Obligations) due to the Secured Parties by the Loan Parties, and eleventh, to pay any
amounts owing with respect to all other Banking Services Obligations and Swap Obligations that are Secured Obligations, and (y) in
the case of Canadian Collateral, first, to pay any fees, indemnities, or expense reimbursements then due to the Administrative Agent
from the Canadian Loan Parties (other than in connection with Banking Services Obligations or Swap Obligations), second, to pay
any fees or expense reimbursements then due to the Lenders from the Canadian Loan Parties (other than in connection with Banking
Services Obligations or Swap Obligations), third, to pay interest due in respect of the Overadvances that are Canadian Secured
Obligations, fourth, to pay the principal of the Overadvances, fifth, to pay interest due in respect of the Protective Advances that are
Canadian Secured Obligations, sixth, to pay the principal of the Protective Advances that are Canadian Secured Obligations, seventh,
to pay interest then due and payable on the Loans made to the Canadian Borrower, eighth, to prepay principal on the Loans made to
the Canadian Borrower and unreimbursed LC Disbursements in respect of Letters of Credit issued for the account of the Canadian
Borrower (or any Canadian Subsidiary) and, to the extent that Reserves have been established with respect to such amounts, amounts
owing with respect to Designated Banking Services Obligations and Designated Swap Obligations, in each case, that are Canadian
Secured Obligations, ninth, to pay an amount to the Administrative Agent equal to 103% of the aggregate undrawn face amount of all
outstanding Letters of Credit issued for the account of the Canadian Borrower (or any Canadian Subsidiary with respect to which the
Canadian Borrower is a co-applicant) (for each Letter of Credit, to be denominated in the currency of such Letter of Credit) to be held
as cash collateral for such Obligations, tenth, to the payment of any other Canadian Secured Obligation (other than Banking Services
Obligations and Swap Obligations) due to the Secured Parties by the Loan Parties, and eleventh, to pay any amounts owing with
respect to all other Banking Services Obligations and Swap Obligations that are Canadian Secured Obligations; provided, however,
that the proceeds of U.S. Collateral shall not be applied to the Canadian Secured

Obligations until such time as the proceeds of all Canadian Collateral have been applied to the Canadian Secured Obligations.
Notwithstanding anything to the contrary contained in this Agreement, unless so directed by the U.S. Borrower, or unless an Event of
Default has occurred and is continuing, neither the Administrative Agent nor any Lender shall apply any payment that it receives to a
Eurodollar Loan or CDOR Loan, as applicable, except (x) on the expiration date of the Interest Period applicable to any such
Eurodollar Loan or CDOR Loan, as applicable or (y) in the event, and only to the extent, that there are no outstanding ABR Loans or
Canadian Prime Loans, respectively, and, in any such event, the applicable Borrower shall pay the break funding payment required in
accordance with Section 2.15. The Administrative Agent and the Lenders shall have the continuing and exclusive right to apply and
reverse and reapply any and all such proceeds and payments to any portion of the Secured Obligations in accordance with the terms
of this Agreement.
(c) At the election of the Administrative Agent, all payments of principal, interest, fees, premiums, reimbursable
expenses (including all reimbursement for fees and expenses pursuant to Section 9.03) and other sums payable under the Loan
Documents that are not paid when due in accordance with the Loan Documents (after giving effect to any applicable grace period(s))
may be paid from the proceeds of Borrowings made hereunder whether made following a request by the applicable Borrower
pursuant to Section 2.03 or a deemed request as provided in this Section or may be deducted from any deposit account of applicable
Borrower maintained with the Administrative Agent. Each Borrower hereby irrevocably authorizes (i) the Administrative Agent to
make a Borrowing in the name of the applicable Borrower for the purpose of paying each payment of principal, interest and fees
payable by such Borrower as it becomes due hereunder or any other amount due under the Loan Documents and agrees that all such
amounts charged shall constitute Loans (including Swingline Loans and Overadvances, as the case may be, but such a Borrowing
may only constitute a Protective Advance if it is to reimburse costs, fees and expenses as described in Section 9.03) and that all such
Borrowings shall be deemed to have been requested pursuant to Sections 2.03, 2.04 or 2.21, as applicable, and (ii) if an Event of
Default has occurred and is continuing, the Administrative Agent to charge any deposit account of such Borrower maintained with
the Administrative Agent for each payment of principal, interest and fees payable by such Borrower as it becomes due hereunder or
any other amount due under the Loan Documents.
(d) If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of
any principal of or interest on any of its Revolving Loans or participations in LC Disbursements, Swingline Loans, Overadvances or
Protective Advances resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving
Loans and participations in LC Disbursements, Swingline Loans, Overadvances and Protective Advances and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face
value) participations in the Revolving Loans and participations in LC Disbursements, Swingline Loans, Overadvances and Protective
Advances of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Loans and participations in
LC Disbursements, Swingline Loans, Overadvances and Protective Advances, provided that (i) if any such participations are
purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, (ii) the provisions of this paragraph shall not be construed to
apply to any payment made by either Borrower pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in
LC Disbursements to any assignee or participant, other than to the U.S. Borrower or any Subsidiary or other Affiliate thereof (as to
which the provisions of this paragraph shall apply) and (iii) no Lender shall exercise any right of setoff, counterclaim or otherwise
against any Canadian Loan Party or any of its assets with respect to any Obligations other than Canadian Secured Obligations. Each
Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring
a participation pursuant to the foregoing arrangements may exercise against the applicable Borrower rights of setoff and counterclaim
with respect to such participation as fully as if such Lender were a direct creditor of such Borrower in the amount of such
participation.
(e) Unless the Administrative Agent shall have received notice from the applicable Borrower prior to the date on
which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing

Banks hereunder that such Borrower will not make such payment, the Administrative Agent may assume that such Borrower has
made such payment on such date in accordance herewith and may, in reliance upon such assumption and in its sole discretion,
distribute to the Lenders or the Issuing Banks, as the case may be, the amount due. In such event, if the applicable Borrower has not
in fact made such payment, then each of the Lenders or the Issuing Banks, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such Lender or such Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of (i)(A) in the case of Loans made to, and LC Disbursements under Letters of Credit issued for the account of,
the U.S. Borrower (or in the case of Letters of Credit, any Domestic Subsidiary), the Federal Funds Effective Rate or (B) in the case of
Loans made to, and LC Disbursements under Letters of Credit issued for the account of, the Canadian Borrower (or, in the case of
Letters of Credit, any Canadian Subsidiary), the rate reasonably determined by the Administrative Agent to be the cost of it funding
such amount, and (ii) a rate determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation.
(f) If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.04(c) or (e), 2.05 (d)
or (e), 2.06(a) or (b), 2.17(e) or 9.03(c), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision
hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lenders
obligations under such Sections until all such unsatisfied obligations are fully paid.
(g) In the event that any financial statements delivered under Section 5.01(a) or 5.01(b), or any compliance certificate
delivered under Section 5.01(c), shall prove to have been materially inaccurate, and such inaccuracy shall have resulted in the
payment of any interest or fees at rates lower than those that were in fact applicable for any period (based on the actual Total Net
Leverage Ratio), then, if such inaccuracy is discovered prior to the termination of the Revolving Commitments and the repayment in
full of the principal of all Loans and the reduction of the LC Exposure to zero, each Borrower shall pay to the Administrative Agent,
for distribution to the Lenders and the Issuing Banks (or former Lenders and Issuing Banks) as their interests may appear, the accrued
interest or fees that should have been paid by such Borrower but were not paid as a result of such misstatement.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders. (a) If any Lender requests compensation under Section
2.14, or if either Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.16, then such Lender shall use reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the
judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.14 or
2.16, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not be
inconsistent with its internal policies or otherwise be disadvantageous to such Lender. Each Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender on behalf of such Borrower in connection with any such designation or
assignment.
(b) If any Lender requests compensation under Section 2.14, or if either Borrower is required to pay any additional
amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.16, or if any Lender
becomes a Defaulting Lender, then the U.S. Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate (without its signature or consent), without recourse (in accordance
with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an
assignee acceptable to the U.S. Borrower that shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment), provided that (i) the U.S. Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Commitment is being assigned, each Issuing Bank and the Swingline Lender), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans
and funded participations in LC Disbursements, Swingline Loans, Overadvances and Protective Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the applicable Borrower (in the case of

all other amounts), (iii) the U.S. Borrower or such assignee shall have paid to the Administrative Agent the processing and
recordation fee specified in Section 9.04(b) and (iv) in the case of any such assignment resulting from a claim for compensation
under Section 2.14 or payments required to be made pursuant to Section 2.16, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of
a waiver by such Lender or otherwise (including as a result of any action taken by such Lender under paragraph (a) above), the
circumstances entitling the U.S. Borrower to require such assignment and delegation cease to apply.
SECTION 2.19. Revolving Commitment Increases. (a) The U.S. Borrower may from time to time (and more than one
time), by written notice to the Administrative Agent (which shall promptly deliver a copy to each of the Lenders), request that the
aggregate Revolving Commitments be increased by an amount not less than $15,000,000 for any such increase, except to the extent
necessary to utilize the remaining unused amount of increase permitted under this Section 2.19(a), provided that after giving effect to
any such increase the sum of the total Revolving Commitments shall not exceed $650,000,000. Such notice shall set forth the amount
of the requested increase in the Revolving Commitments and the date on which such increase is requested to become effective (which
shall be not less than ten Business Days or more than 60 days after the date of such notice), and shall offer each Lender (provided that
such Lender shall be reasonably satisfactory to the Administrative Agent) the opportunity to increase its Revolving Commitment by
such Lenders Applicable Percentage of the proposed increased amount. Each Lender shall, by notice to the U.S. Borrower and the
Administrative Agent given not more than ten days after the date of the U.S. Borrowers notice, either agree to increase its applicable
Revolving Commitment by all or a portion of the offered amount or decline to increase its applicable Commitment (and any Lender that
does not deliver such a notice within such period of ten days shall be deemed to have declined to increase its Commitment). In the
event that, on the tenth day after the U.S. Borrower shall have delivered a notice pursuant to the first sentence of this paragraph, the
Lenders shall have declined to increase their Revolving Commitments or have agreed pursuant to the preceding sentence to increase
their Revolving Commitments by an aggregate amount less than the increase in the total Revolving Commitments requested by the U.S.
Borrower, the U.S. Borrower may arrange for one or more banks or other financial institutions (any such bank or other financial
institution, together with any existing Lender that agrees to increase its applicable Revolving Commitment pursuant to the immediately
preceding sentence, being called an Augmenting Lender) to provide Revolving Commitments or increase their existing Revolving
Commitments in an aggregate amount equal to the unsubscribed amount, provided that each Augmenting Lender (other than any such
Augmenting Lender that is a Lender immediately prior to giving effect to the applicable Revolving Commitment Increase) shall be
subject to the approval of the Administrative Agent (which approval shall not be unreasonably withheld) and shall not be subject to the
approval of any other Lenders, and the U.S. Borrower and each Augmenting Lender shall execute all such documentation as the
Administrative Agent shall reasonably specify to evidence the Revolving Commitment of such Augmenting Lender and/or its status as a
Lender hereunder. Any increase in the aggregate Revolving Commitments may be made in an amount that is less than the increase
requested by the U.S. Borrower if the U.S. Borrower is unable to arrange for, or chooses not to arrange for, Augmenting Lenders. For
purposes of clarity, the Canadian Revolving Sub-Commitment may not be increased pursuant to this Section 2.19.
(b) Each of the parties hereto hereby agrees that, upon the effectiveness of any increase in the aggregate Revolving
Commitments pursuant to this Section 2.19 (the Revolving Commitment Increase), this Agreement may be amended (such
amendment, a Commitment Increase Amendment) without the consent of any Lenders to the extent (but only to the extent)
necessary to reflect the existence and terms of the Revolving Commitment Increase evidenced thereby as provided for in
Section 9.02(b). Upon each Revolving Commitment Increase pursuant to this Section, (i) each Lender immediately prior to such
increase will automatically and without further act be deemed to have assigned to each Augmenting Lender providing a portion of
such Revolving Commitment Increase, and each such Augmenting Lender will automatically and without further act be deemed to
have assumed, a portion of such Lenders participations hereunder in outstanding Letters of Credit, Swingline Loans, Overadvances
and Protective Advances such that, after giving effect to such Revolving Commitment Increase and each such deemed assignment
and assumption of participations, the percentage of the aggregate outstanding (A) participations hereunder in Letters of Credit, (B)
participations hereunder in Swingline Loans, (C) participations hereunder in Overadvances and (D) participations hereunder in
Protective Advances held by each Lender (including each such Augmenting Lender) will equal such Lenders Applicable Percentage
and (ii) if, on the date of such Revolving Commitment Increase, there

are any Revolving Loans outstanding, such Revolving Loans shall on or prior to the effectiveness of such Revolving Commitment
Increase be prepaid from the proceeds of additional Revolving Loans made hereunder (reflecting such Revolving Commitment
Increase), which prepayment shall be accompanied by accrued interest on the Revolving Loans being prepaid and any costs incurred
by any Lender in accordance with Section 2.15. The Administrative Agent and the Lenders hereby agree that the minimum
borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the
transactions effected pursuant to the immediately preceding sentence.
(c) Increases and new Revolving Commitments created pursuant to this Section 2.19 shall become effective on the
date specified in the notice delivered by the U.S. Borrower pursuant to the first sentence of paragraph (a) above or on such other date
as agreed upon by the U.S. Borrower, the Administrative Agent and the applicable Augmenting Lenders.
(d) Notwithstanding the foregoing, no increase in the Revolving Commitments (or in any Commitment of any Lender)
or addition of an Augmenting Lender shall become effective under this Section unless on the date of such increase, the conditions set
forth in paragraphs (a) and (b) of Section 4.02 shall be satisfied as of such date (as though the effectiveness of such increase were a
Borrowing) and the Administrative Agent shall have received a certificate to that effect dated such date and executed by a Financial
Officer.
SECTION 2.20. Defaulting Lenders. Notwithstanding any provision of this Agreement to the contrary, if any Revolving
Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Revolving Lender is a Defaulting
Lender:
(a) fees shall cease to accrue on the unfunded portion of the Revolving Commitment of such Defaulting Lender
pursuant to Section 2.11(a);
( b ) the Revolving Commitment and Revolving Exposure of such Defaulting Lender shall not be included in
determining whether the Required Lenders have taken or may take any action hereunder (including any consent to any amendment,
waiver or other modification pursuant to Section 9.02), provided that this clause (b) shall not apply to the vote of a Defaulting Lender
in the case of an amendment, waiver or other modification requiring the consent of such Lender or each Lender affected thereby;
(c) if any Swingline Exposure or LC Exposure exists, or any Overadvance or Protective Advance is outstanding, at the
time such Revolving Lender becomes a Defaulting Lender, then:
( i ) all or any part of the Swingline Exposure, LC Exposure, participation interest in Overadvances or
participation interest in Protective Advances of such Defaulting Lender shall be reallocated among the non-Defaulting
Lenders in accordance with their respective Applicable Percentages but only to the extent that and so long as (A) the
sum of all non-Defaulting Lenders Revolving Exposure plus such Defaulting Lenders Swingline Exposure, LC
Exposure, participation interest in Overadvances and participation interest in Protective Advances does not exceed the
total of all non-Defaulting Lenders Revolving Commitments, (B) the sum of any non-Defaulting Lenders Revolving
Exposure plus such non-Defaulting Lenders Applicable Percentage of the Defaulting Lenders Swingline Exposure, LC
Exposure, participation interest in Overadvances and participation interest in Protective Advances does not exceed such
non-Defaulting Lenders Revolving Commitment and (C) the conditions set forth in Sections 4.02(a) and (b) are satisfied
as of the date of such reallocation (assuming, solely for purpose of this clause (C), that such reallocation is a
Borrowing as such term is used in Section 4.02);
(ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the applicable
Borrower shall within one Business Day following notice by the Administrative Agent (w) first, prepay such Swingline
Exposure (or, if agreed by the Swingline Lender, cash collateralize the Swingline Exposure of the Defaulting Lender on
terms satisfactory to the Swingline Lender), (x)

second, prepay such Overadvance (or, if agreed by the Administrative Agent, cash collateralize that portion of such
Overadvance attributable to such Defaulting Lenders participation interest therein on terms satisfactory to the
Administrative Agent, (y), third, prepay such Protective Advance (or, if agreed by the Administrative Agent, cash
collateralize that portion of such Protective Advance attributable to such Defaulting Lenders participation interest
therein on terms satisfactory to the Administrative Agent and (z) fourth, cash collateralize for the benefit of the Issuing
Banks only the applicable Borrowers obligations corresponding to such Defaulting Lenders LC Exposure (after giving
effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section
2.05(j) for so long as such LC Exposure is outstanding;
(iii) if either Borrower cash collateralizes any portion of such Defaulting Lenders LC Exposure (after giving
effect to any partial reallocation pursuant to clause (i) above) pursuant to clause (ii) above, the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.11(b) with respect to such Defaulting Lenders
LC Exposure during the period such Defaulting Lenders LC Exposure is cash collateralized;
(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to clause (i) above, then the fees
payable to the Revolving Lenders pursuant to Section 2.11(b) shall be adjusted in accordance with such non-Defaulting
Lenders respective Applicable Percentages; and
(v) if all or any portion of such Defaulting Lenders LC Exposure is neither reallocated nor cash collateralized
pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of any Issuing Bank or any other
Revolving Lender hereunder, all participation fees payable under Section 2.11(b) with respect to such Defaulting
Lenders LC Exposure shall be payable to the applicable Issuing Banks until and to the extent that such LC Exposure is
so reallocated and/or cash collateralized; and
(d) so long as such Revolving Lender is a Defaulting Lender, the Administrative Agent shall not be required to fund
any Overadvance or Protective Advance, the Swingline Lender shall not be required to fund any Swingline Loan and the Issuing
Banks shall not be required to issue, amend or increase any Letter of Credit, in each case unless it is satisfied that the related exposure
and the Defaulting Lenders then outstanding LC Exposure, Swingline Exposure and participation interest in Overadvances and
Protective Advances will be 100% covered by the Revolving Commitments of the non-Defaulting Lenders and/or cash collateral will
be provided by the applicable Borrower in accordance with Section 2.20(c), and participation interests in any newly-made Swingline
Loan, Overadvance or Protective Advance or any newly-issued, amended or increased Letter of Credit shall be allocated among the
non-Defaulting Lenders in a manner consistent with Section 2.20(c)(i) (and such Defaulting Lender shall not participate therein).
If (i) a Bankruptcy Event with respect to a Parent of any Revolving Lender shall occur following the date hereof and for
so long as such event shall continue or (ii) the Administrative Agent, the Swingline Lender or any Issuing Bank has a good faith belief
that any Revolving Lender has defaulted in fulfilling its obligations under one or more other agreements in which such Revolving
Lender commits to extend credit, then the Administrative Agent shall not be required to fund any Overadvance or Protective Advance,
the Swingline Lender shall not be required to fund any Swingline Loan and such Issuing Bank shall not be required to issue, amend or
increase any Letter of Credit, unless (A) the Administrative Agent, the Swingline Lender or such Issuing Bank, as the case may be, shall
have entered into arrangements with the applicable Borrower or such Lender, satisfactory to the Administrative Agent, the Swingline
Lender or such Issuing Bank, as the case may be, to address any risk to it in respect of such Revolving Lender hereunder or (B) in the
case of an event specified in clause (i) of this paragraph, the requirements set forth in Section 2.20(d) are satisfied in respect of such
Revolving Lender, in which case such Revolving Lender shall be deemed to be a Defaulting Lender for purposes of this Section 2.20.
In the event that the Administrative Agent, the Borrower, the Swingline Lender and each Issuing Bank each agrees that a
Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting

Lender, then the Swingline Exposure, the LC Exposure and the participations in Overadvances and Protective Advances of the
Revolving Lenders shall be readjusted to reflect the inclusion of such Revolving Lenders Commitment and on such date such Lender
shall purchase at par such of the Loans of the other Revolving Lenders (other than Swingline Loans) as the Administrative Agent shall
determine may be necessary in order for such Lender to hold such Loans in accordance with its Applicable Percentage.
SECTION 2.21. Protective Advances. ( a ) Subject to the limitations set forth below, the Administrative Agent is
authorized by the Borrowers and the Revolving Lenders, from time to time in the Administrative Agents sole discretion (but shall have
absolutely no obligation), to make Loans to either Borrower, on behalf of all Revolving Lenders, which the Administrative Agent, in its
Permitted Discretion, deems necessary or desirable (i) to preserve or protect the Collateral or any portion thereof, (ii) to enhance the
likelihood of, or maximize the amount of, repayment of the Loans and other Obligations or (iii) to pay any other amount chargeable to
or required to be paid by the Borrowers pursuant to the terms of this Agreement, including payments of reimbursable expenses
(including costs, fees, and expenses described in Section 9.03) and other sums payable under the Loan Documents (any such Loans are
herein referred to as Protective Advances); provided that the aggregate amount of Protective Advances outstanding at any time shall
not exceed an amount the U.S. Dollar Equivalent of which is $25,000,000; provided further, that the making of any such Loan will not
result in (A) the aggregate Revolving Exposure exceeding the aggregate Revolving Commitments, in each case at such time, (B) the
aggregate U.S. Revolving Exposure at such time exceeding the lesser of (1) the aggregate Revolving Commitments at such time minus
the Canadian Revolving Exposure at such time and (2) the U.S. Borrowing Base at such time minus the amount by which (x) the
aggregate Canadian Revolving Exposure at such time exceeds (y) the Canadian Borrowing Base at such time or (C) the aggregate
Canadian Revolving Exposure at such time exceeding the lesser of (1) the aggregate Canadian Revolving Sub-Commitments at such
time and (2) (x) the Aggregate Borrowing Base at such time minus (y) the aggregate U.S. Revolving Exposure at such time. Protective
Advances may be made even when a Default exists or the conditions precedent set forth in Section 4.02 are not otherwise satisfied. The
Protective Advances shall be secured by the Liens created by the Collateral Documents and shall constitute Obligations. All Protective
Advances shall be (i) ABR Borrowings, in the case of (x) Protective Advances made to the U.S. Borrower and (y) Protective Advances
denominated in U.S. dollars made to the Canadian Borrower, or (ii) Canadian Prime Borrowings, in the case of Protective Advances
denominated in Canadian dollars made to the Canadian Borrower. Without affecting Protective Advances already made, the
Administrative Agents authorization to make future Protective Advances may be revoked at any time by the Required Lenders. Any
such revocation must be in writing and shall become effective prospectively upon the Administrative Agents receipt thereof. The
Administrative Agent may at any time (i) request, on behalf of the applicable Borrower, the Revolving Lenders to make, subject to the
limitations set forth in Section 2.01 and to the satisfaction of the conditions precedent set forth in Section 4.02, (x) ABR Loans to repay
any Protective Advance that is denominated in U.S. dollars or (y) Canadian Prime Loan to repay and Protective Advances denominated
in Canadian dollars or (ii) require the Lenders to acquire participations in any Protective Advance as provided in paragraph (b) of this
Section.
(b) Upon the making of a Protective Advance by the Administrative Agent (whether before or after the occurrence of
a Default), each Lender shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably
purchased from the Administrative Agent, without recourse or warranty, an undivided interest and participation in such Protective
Advance in proportion to its Applicable Percentage. From and after the date, if any, on which any Lender is required to fund its
participation in any Protective Advance purchased hereunder, the Administrative Agent shall promptly distribute to such Lender, such
Lender's Applicable Percentage of all payments of principal and interest and all proceeds of Collateral received by the Administrative
Agent and applied in respect of such Protective Advance.
ARTICLE III
Representations and Warranties
The Borrowers represent and warrant to the Lenders that:
SECTION 3.01. Organization; Powers. Each Borrower and each of the Material Subsidiaries is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization, has all requisite

power and authority to carry on its business as now conducted and as proposed to be conducted, to execute, deliver and perform its
obligations under each Loan Document to which it is a party and to effect the Transactions and, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is required.
SECTION 3.02. Authorization; Enforceability. The Transactions to be entered into by each Loan Party have been duly
authorized by all necessary corporate or other action and, if required, action by the holders of such Loan Partys Equity Interests. This
Agreement has been duly executed and delivered by the Borrowers and constitutes, and each other Loan Document to which any Loan
Party is to be a party, when executed and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of the
Borrowers or such Loan Party (as the case may be), enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority, except (i) filings with any Governmental Authority
necessary to perfect Liens created under the Loan Documents and (ii) such as have been obtained or made and are in full force and
effect, except such consents, approvals, registrations or filings, the failure of which to have been obtained, received or made will not
materially impair the effectiveness of the Transactions or materially adversely affect the operations of the U.S. Borrower and the
Subsidiaries, taken as a whole, (b) will not violate any material Requirement of Law applicable to the U.S. Borrower or any Material
Subsidiary, (c) will not violate or result in a material default under any material indenture, agreement or other instrument binding upon
the U.S. Borrower or any Material Subsidiary or their respective assets, or give rise to a right thereunder to require any material payment
to be made by the U.S. Borrower or any Material Subsidiary or give rise to a right of, or result in, termination, cancelation or
acceleration of any material obligation thereunder, and (d) will not result in the creation or imposition of any Lien (other than a Lien
permitted under Section 6.02) on any asset of the U.S. Borrower or any Material Subsidiary.
SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The U.S. Borrower has heretofore furnished to
the Lenders its consolidated balance sheet and consolidated statements of income, stockholders equity and cash flows (i) as of and for
the fiscal year ended December 31, 2013, reported on by Deloitte & Touche LLP, independent public accountants, and (ii) as of and for
the fiscal quarters and the portions of the fiscal year ended March 31, 2014, and June 30, 2014 (and comparable period for the prior
fiscal year). Such financial statements present fairly, in all material respects, the financial position and results of operations and cash
flows of the U.S. Borrower and the Subsidiaries as of such dates and for such periods in accordance with GAAP consistently applied,
subject to year end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii) above.
(b) On and as of the Restatement Effective Date, except as arising out of the Disclosed Matters, no event, change or
condition has occurred that has had, or could reasonably be expected to have, a material adverse effect on the business, operations,
properties, assets, condition (financial or otherwise), liabilities (including contingent liabilities) or prospects of the U.S. Borrower and
the Subsidiaries, taken as a whole, since December 31, 2013.
SECTION 3.05. Properties. (a) The U.S. Borrower and each of the Material Subsidiaries has good title to, or valid
leasehold interests in, all its real and personal property, except for any defects that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
(b) The U.S. Borrower and each of the Material Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, patents and other intellectual property material to its business, and the use thereof by the U.S. Borrower and the Material
Subsidiaries does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.06. Litigation and Environmental Matters. (a) There are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of the U.S. Borrower or any Material Subsidiary, threatened
against or affecting the U.S. Borrower or any Material Subsidiary (i) as to which there is a reasonable likelihood of an adverse
determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material
Adverse Effect (other than Disclosed Matters) or (ii) that involve any of the Loan Documents or the Transactions.
(b) Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect, neither the U.S. Borrower nor any Material Subsidiary (i) has
failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with
respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.
SECTION 3.07. Compliance with Laws and Agreements. Each Borrower and each of the Material Subsidiaries is in
compliance with (a) all Requirements of Law applicable to it or its property and (b) all indentures, agreements and other instruments
binding upon it or its property, except, in each of the cases of (a) and (b) above, where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.08. Investment Company Status. Neither the U.S. Borrower nor any Subsidiary is an investment company
as defined in, or subject to regulation under, the Investment Company Act of 1940.
SECTION 3.09. Taxes. The U.S. Borrower and each of the Subsidiaries (a) has timely filed or caused to be filed all Tax
returns and reports required to have been filed, except to the extent that failure to do so could not reasonably be expected to result in a
Material Adverse Effect, and (b) has paid or caused to be paid all Taxes required to have been paid by it, except any Taxes that are
being contested in good faith by appropriate proceedings, provided that the U.S. Borrower or such Subsidiary, as the case may be, has
set aside on its books adequate reserves therefor and the failure to pay such Taxes would not reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.10. ERISA. (a) No ERISA Event has occurred or is reasonably expected to occur that, when taken together
with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect.
(b) Except as could not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse
Effect, (i) each Canadian Pension Plan has been maintained in compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been maintained, where required, in good standing with applicable
regulatory authorities and all contributions thereto have been withheld, remitted and paid in a timely manner in accordance with its
terms and the requirements of any and all applicable laws, statutes, regulations and orders, (ii) no Canadian Pension Plan Event has
occurred or is reasonably expected to occur and (iii) neither of the Borrowers nor any Subsidiary has sponsored, sponsors, has
contributed to or contributes to a Canadian Multi-Employer Plan.
(c) Except as disclosed in Schedule 3.10(c), as of the date hereof, each Canadian Pension Plan that provides benefits
on a defined benefit basis is fully funded on a solvency basis, going concern basis and wind-up basis (using actuarial methods and
assumptions which are consistent with the valuations last filed with the applicable Governmental Authorities).
(d) There are no pending or, to the best knowledge of Borrowers, threatened claims, actions or lawsuits, or action by
any Governmental Authority or any Canadian Pension Plan administrator or trustee, with respect to any Canadian Pension Plan which
has resulted in or could reasonably be expected to result in a Material Adverse Effect. There has been no breach of the prohibited
transaction or fiduciary responsibility rules with respect to any Canadian Pension Plan, as set forth under applicable law, or any
breach by any Loan Party of the terms of any Canadian

Pension Plans or any whole or partial termination or wind-up of any Canadian Pension Plan, in each case which has resulted in or
could reasonably be expected to result in a Material Adverse Effect.
SECTION 3.11. Disclosure. None of (i) the U.S. Borrowers Quarterly Reports on Form 10-Q for the periods ended
March 31, 2014, and June 30, 2014, its Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and the other
filings of the U.S. Borrower made with the SEC in 2014 (but prior to the Restatement Effective Date) (collectively, the SEC Filings)
nor (ii) any of the other reports, financial statements, certificates or other information furnished by or on behalf of the U.S. Borrower to
the Administrative Agent or any Lender pursuant to any Loan Document or delivered thereunder (as modified or supplemented by
other information furnished by or on behalf of the U.S. Borrower to the Administrative Agent in connection herewith), as of the date
such disclosures are delivered, contains any material misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were made, not misleading, provided that, with respect to
projected financial information or forward looking statements, the U.S. Borrower represents only that such information or statements
were prepared or made in good faith based upon assumptions believed by it to be reasonable at the time delivered (unless otherwise
updated subsequent thereto, in which case such information was prepared in good faith based upon assumptions believed by it to be
reasonable at the time updated).
SECTION 3.12. Insurance. On the Restatement Effective Date, the U.S. Borrower provided to the Administrative Agent
a description of all insurance maintained by or on behalf of the Loan Parties and the Material Subsidiaries as of the Restatement
Effective Date. As of the Restatement Effective Date, all premiums due in respect of such insurance have been paid.
SECTION 3.13. Security Interest in Collateral. The provisions of this Agreement and the other Loan Documents create
legal and valid Liens on all the Collateral in favor of the Administrative Agent, for the benefit of the Secured Parties, and, for so long as
UCC financing statements, PPSA financing statements or Deposit Account Control Agreements or, where applicable, possession
thereof, as the case may be, with respect to such Collateral have not been terminated by the Administrative Agent (or otherwise
amended by the Administrative Agent in a manner that adversely affects the Lien in favor of the Secured Parties thereby perfected),
such Liens constitute perfected and continuing Liens on the Collateral, securing the Secured Obligations, enforceable against the
applicable Loan Party and all third parties, and having priority over all other Liens on the Collateral except in the case of Liens
permitted under clauses (b) through (d), (f) and (k) of Section 6.02, to the extent any such Liens would have priority over the Liens in
favor of the Administrative Agent pursuant to any applicable law.
SECTION 3.14. Labor Matters. As of the Restatement Effective Date, there are no material strikes, lockouts or
slowdowns or any other material labor disputes against the U.S. Borrower or any Material Subsidiary pending or, to the knowledge of
the U.S. Borrower or any Material Subsidiary, threatened or planned.
SECTION 3.15. Anti-Terrorism Laws; Anti-Corruption Laws.
(a)
To the extent applicable, the U.S. Borrower and each of the Subsidiaries are in compliance, in all material
respects, with (i) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States
Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating
thereto, and the applicable similar laws of Canada, including the Special Economic Measures Act (Canada) and the regulations
thereunder, as amended, and (ii) the USA PATRIOT Act. No part of the proceeds of the Loans or any Letter of Credit will be used by
the U.S. Borrower or any of the Subsidiaries, directly or, to the knowledge of the U.S. Borrower or any Subsidiary, indirectly, for any
payments to any governmental official or employee, political party, official of a political party, candidate for political office, or
anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended, or the applicable similar anti-bribery and anti-corruption laws
of Canada, if such use of proceeds or Letter of Credit (x) has, or would reasonably be expected to have, an adverse effect in any
respect on the Administrative Agent, any Arranger or any Lender or any Affiliate of any of the foregoing or (y) has, or would
reasonably be expected to have, an adverse effect, in any material respect, on the U.S. Borrower or any Subsidiary.

(b)
Neither the U.S. Borrower nor any Subsidiary nor, to the knowledge of the U.S. Borrower or any Subsidiary,
any director, officer, agent, employee or Affiliate of the U.S. Borrower or any Subsidiary, (i) is a Blocked Person or (ii) is currently
the target of any U.S. Sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department or by any
Canadian Governmental Authority; and neither the U.S. Borrower nor any Subsidiary will directly, or, to the knowledge of the U.S.
Borrower or any Subsidiary, indirectly, unlawfully use the proceeds of the Loans or any Letter of Credit for the purpose of financing
the activities of any Person, or in any country or territory, that is, at the time of such use, the target of, or whose government is the
target of, any U.S. Sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department or similar
Canadian Sanctions, if such use of proceeds or Letter of Credit (x) has, or would reasonably be expected to have, an adverse effect in
any respect on the Administrative Agent, any Arranger or any Lender or any Affiliate of any of the foregoing or (y) has, or would
reasonably be expected to have, an adverse effect in any material respect on the U.S. Borrower or any Subsidiary
ARTICLE IV
Conditions
SECTION 4.01. [Intentionally Omitted]
SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing
(other than a deemed Borrowing under Section 2.17(c) and a Protective Advance made under Section 2.21), and of each Issuing Bank
to issue, amend, renew or extend any Letter of Credit, is subject to the receipt by the Administrative Agent of the request therefor in
accordance herewith and to the satisfaction of the following conditions:
(i)
Other than the representation and warranty set forth in Section 3.04(b), the representations and
warranties of the Loan Parties set forth in the Loan Documents that are qualified by materiality shall be true and correct
and the representations and warranties that are not so qualified shall be true and correct in all material respects on and as
of the date of such Borrowing or the date of issuance, amendment, renewal or extension of such Letter of Credit, as the
case may be, except to the extent such representations and warranties expressly relate to an earlier date (in which case
such representations and warranties shall be true and correct as of such earlier date).
(ii)
At the time of and immediately after giving effect to such Borrowing or the issuance, amendment,
renewal or extension of such Letter of Credit, as the case may be, no Default shall have occurred and be continuing.
Each Borrowing (provided that a conversion or a continuation of a Borrowing shall not constitute a Borrowing for purposes of this
Section) and each issuance, amendment, renewal or extension of a Letter of Credit shall be deemed to constitute a representation and
warranty by the Borrowers on the date thereof as to the matters specified in paragraphs (a) and (b) of this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees,
expenses and other amounts (other than contingent amounts not yet due) payable under any Loan Document shall have been paid in
full in cash and all Letters of Credit shall have expired or been terminated (or cash collateralized in an amount equal to 103% of the
aggregate undrawn amount of all outstanding Letters of Credit (for each Letter of Credit, denominated in the currency of such Letter of
Credit) or otherwise collateralized (i.e., by issuance of backstop letters of credit to the applicable Issuing Banks in respect thereof), in
each case in a manner satisfactory to the applicable

Issuing Banks) and all LC Disbursements shall have been reimbursed, each Borrower covenants and agrees with the Lenders that:
SECTION 5.01. Financial Statements; Borrowing Base and Other Information. The U.S. Borrower will furnish to the
Administrative Agent for prompt delivery to each Lender:
(a) within 90 days after the end of each fiscal year of the U.S. Borrower, the U.S. Borrowers audited consolidated
balance sheet and audited consolidated statements of operations, stockholders equity and cash flows as of the end of and for
such year, and related notes thereto, setting forth in each case in comparative form the figures for the previous fiscal year, all
reported on by Deloitte & Touche LLP or other independent public accountants of recognized national standing (without a
going concern or like qualification or exception and without any qualification or exception as to the scope of such audit) to
the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of
operations of the U.S. Borrower and the Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the U.S. Borrower, the U.S.
Borrowers unaudited consolidated balance sheet and unaudited consolidated statements of operations, stockholders equity and
cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, all certified by a Financial Officer as presenting fairly in all material respects the financial condition and
results of operations of the U.S. Borrower and the Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery or deemed delivery of financial statements under paragraph (a) or (b) above, a
certificate of a Financial Officer substantially in the form of Exhibit E (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting
forth reasonably detailed calculations of the financial covenant (and the components thereof) contained in Section 6.12, (iii)
setting forth reasonably detailed calculations of the Total Net Leverage Ratio (and the components thereof) as of the last day of
the applicable fiscal quarter or fiscal year and (iv) stating whether any change in GAAP or in the application thereof has
occurred since the later of the date of the U.S. Borrowers most recent audited financial statements referred to in Section 3.04
and the date of the prior certificate delivered pursuant to this paragraph (c) indicating such a change and, if any such change has
occurred, specifying the effect of such change on the financial statements accompanying such certificate;
( d ) not later than 90 days subsequent to the commencement of each fiscal year of the U.S. Borrower, a detailed
consolidated budget for such fiscal year (including a projected consolidated balance sheet and consolidated statements of
projected operations, comprehensive income and cash flows as of the end of and for such fiscal year and setting forth the
assumptions used for purposes of preparing such budget) and, promptly when available, any significant revisions of such
budget;
(e) as soon as available but in any event within 15 Business Days of the end of each calendar month, as of the last day
of the preceding calendar month, a Borrowing Base Certificate and supporting information in connection therewith, together
with any additional reports with respect to each Borrowing Base as the Administrative Agent may reasonably request (it being
understood that certain categories of ineligible Accounts and Inventory will be computed using a deemed ineligible amount
determined annually based on historical ineligibility amounts for the preceding fiscal year, in each case as notified by the
Borrowers to the Administrative Agent; provided that if, and for so long as, (i) an Event of Default is continuing or (ii) the
aggregate Revolving Exposure as of the applicable date of determination exceeds the lesser of (x) $150,000,000 and (y) 33
1/3% of the aggregate Revolving Commitment as of such date, the Administrative Agent may, in its Permitted Discretion, by
written notice to the Borrowers, not permit the Borrowers to use such annual computations and, instead, require the Borrowers
to use actual computations of such categories of ineligible

Accounts and Inventory in lieu thereof). Notwithstanding any provision of this Agreement to the contrary, commencing on any
date on which Excess Availability has been less than the Threshold Amount for a period of five consecutive Business Days (and
ending on the next subsequent date on which Excess Availability has exceeded the Threshold Amount for a period of thirty
consecutive calendar days), the U.S. Borrower shall be required to deliver a Borrowing Base Certificate no earlier than three
Business Days prior to any new Borrowing or request for issuance of any Letter of Credit; provided that a conversion or a
continuation of a Borrowing shall not constitute a Borrowing for purposes of this sentence;
(f) concurrently with the delivery of each Borrowing Base Certificate, and at such other times as may be reasonably
requested by the Administrative Agent, all Borrowing Base Supplemental Documentation (unless otherwise agreed by the
Administrative Agent in its sole discretion) for the month (or such shorter period as contemplated by clause (e) of this Section)
then ended;
(g) promptly as reasonably practicable after the request therefor, such additional information concerning the Accounts
and Inventory of the Collateral Parties or adjustments thereto as may be reasonably requested by the Administrative Agent from
time to time;
(h) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and
other materials filed by the U.S. Borrower or any Subsidiary with the SEC or with any national securities exchange, or
distributed by the U.S. Borrower to the holders of its Equity Interests generally, as the case may be;
(i) promptly upon obtaining knowledge of any such event, circumstance or change, a written notice of any event,
circumstance or change that has occurred since the delivery of the most recent Borrowing Base Certificate in accordance with
the terms of this Agreement that would materially reduce the aggregate amount of the Eligible Accounts or the Eligible
Inventory or result in a material portion of the Eligible Accounts ceasing to be Eligible Accounts or a material portion of the
Eligible Inventory ceasing to be Eligible Inventory;
( j) promptly following any request therefor, such other information regarding the operations, business affairs and
financial condition of the U.S. Borrower or any Subsidiary, or compliance with the terms of any Loan Document, as the
Administrative Agent (on behalf of any Lender) may reasonably request;
(k) promptly upon receipt thereof, a copy of (i) any notice of any Governmental Authoritys intention to terminate a
defined benefit plan or have a third party appointed to administer such defined benefit plan or determination that a whole or
partial termination has occurred in respect of a defined benefit pension plan and (ii) any material notice of non-compliance in
respect of a defined benefit pension plan received from a Governmental Authority; and
(l) (i) promptly upon receipt thereof, final plan texts for all defined benefit Canadian Pension Plans, (ii) promptly upon
receipt thereof, each annual information return and actuarial report (including schedules) in respect thereof, (iii) where an
actuarial report on a defined benefit Canadian Pension Plan discloses a solvency or wind-up deficiency, on a quarterly basis
thereafter whenever and for so long as a solvency or wind-up deficiency exists promptly following the end of each fiscal quarter
of the Canadian Borrower, a summary actuarial update for such defined benefit Canadian Pension Plan, which summary update
shall reflect the updated value of the assets of the defined benefit Canadian Pension Plan and discount rates at the end of the
quarter to which the summary relates but otherwise utilizing the facts and assumptions set forth in the most recently delivered
actuarial report, and (iv) when requested by the Administrative Agent, the most recent defined benefit Canadian Pension Plan
financial statements.
Information required to be delivered pursuant to Sections 5.01(a), (b) and (h) shall be deemed to have been delivered on the date on
which the U.S. Borrower provides notice to the Administrative Agent that such information has been posted on the SEC website on the
Internet at www.sec.gov, or through a link on the Borrowers website at www.usg.com,

or at another website identified in such notice and accessible by the Lenders without charge, provided that such notice may be included
in a certificate delivered pursuant to Section 5.01(c).
SECTION 5.02. Notices of Material Events. The U.S. Borrower will furnish to the Administrative Agent (for prompt
distribution to each Lender through the Administrative Agent) written notice promptly, but in any event within five Business Days of,
when any of the Chief Executive Officer, the President or the General Counsel of the U.S. Borrower or any Financial Officer (or, with
respect to any Canadian Pension Event, any senior officer of the Canadian Borrower) obtains actual knowledge of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority
against or, to the knowledge of a Financial Officer or another executive officer of the U.S. Borrower or any Subsidiary, affecting
U.S. Borrower or any Affiliate thereof that has a reasonable likelihood of being adversely determined, and, if adversely
determined, could reasonably be expected to result in a Material Adverse Effect;
(c) any Lien (other than Liens permitted by clauses (a) through (d), (f) or (k) of Section 6.02) or claim made or asserted
against any of the Collateral;
(d ) the occurrence of any ERISA Event or Canadian Pension Event or any fact or circumstance that gives rise to a
reasonable expectation that any ERISA Event or Canadian Pension Event will occur that, in either case, alone or together with
any other ERISA Events or Canadian Pension Event that have occurred or are reasonably expected to occur, could reasonably
be expected to result in a Material Adverse Effect;
(e) any negative change in the U.S. Borrowers corporate credit rating by S&P or Moodys, or any notice from either
such agency indicating its intent to effect such a change or to place the credit facilities on a CreditWatch or WatchList or
any similar list, in each case with negative implications, or its cessation of, or its intent to cease, issuing a corporate credit rating
for the U.S. Borrower; and
(f) any other development (including notice of any Environmental Liability and any violation of any applicable law) that
results in, or could reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a written statement of a Financial Officer or other executive officer of
the U.S. Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be
taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. Each Borrower will, and will cause each Material Subsidiary to, do or
cause to be done all things necessary to obtain, preserve, renew and keep in full force and effect its legal existence and, except where
the failure to do so could not reasonably be expected to have a Material Adverse Effect, the rights, licenses, permits, privileges,
franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03.
SECTION 5.04. Payment of Taxes. Each Borrower will, and will cause each Subsidiary to, pay its liabilities for those
Taxes and Canadian Statutory Priority Claims, the amounts of which are material to such Borrower and the Subsidiaries taken as a
whole, before such liabilities shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in
good faith by appropriate proceedings, (b) such Borrower or such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP, (c) such contest effectively suspends collection of the contested obligation and the enforcement of
any Lien securing such obligation and (d) the failure to make payment pending such contest could not reasonably be expected to result
in a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties. Each Borrower will, and will cause each Subsidiary to, keep and maintain all
property used in the conduct of its business in good working order and condition, ordinary wear and tear excepted, except for
properties, the failure of which to maintain, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06. Insurance. (a) Each Borrower will, and will cause each Material Subsidiary to, maintain, with financially
sound and reputable insurance companies, (i) insurance in such amounts (with no greater risk retention) and against such risks as is (A)
customarily maintained by companies of established repute engaged in the same or similar businesses operating in the same or similar
locations and (B) considered adequate by each Borrower and (ii) all other insurance as may be required by law, provided that selfinsurance through any captive insurance Subsidiary or through deductibles or copayments shall not be deemed a violation of this
covenant to the extent that companies engaged in similar businesses similarly self-insure. Each Borrower will furnish to the Lenders,
upon the reasonable request of the Administrative Agent, information in reasonable detail as to the insurance so maintained.
(b ) All insurance policies required under paragraph (a) of this Section 5.06, to the extent such insurance policies
insure any portion of the Collateral, shall name the Administrative Agent (for the benefit of the Secured Parties) as an additional
insured or as loss payee, as applicable, and shall contain loss payable clauses or mortgagee clauses, through endorsements in form
and substance reasonably satisfactory to the Administrative Agent, that provide that (i) all proceeds thereunder with respect to any
Collateral shall be jointly payable to the Collateral Parties and the Administrative Agent and (ii) such policy and loss payable or
mortgagee clauses may be canceled, amended or terminated only upon at least 30 days prior written notice given to the
Administrative Agent.
(c) If the U.S. Borrower or any Material Subsidiary shall fail to obtain any insurance as required by paragraph (a) of
this Section 5.06, the Administrative Agent may obtain such insurance at the Borrowers expense. By purchasing such insurance, the
Administrative Agent shall not be deemed to have waived any Default arising from the U.S. Borrowers or such Material Subsidiarys
failure to maintain such insurance.
SECTION 5.07. Books and Records; Inspection Rights; Field Examinations; Inventory Appraisals. (a) Each Borrower
will, and will cause each Subsidiary to, keep proper books of record and account in which entries that are full, true and correct in all
material respects are made of all material dealings and transactions in relation to its business and activities. Each Borrower will, and will
cause each Loan Party to, permit any representatives designated by the Administrative Agent (who may be accompanied by a
representative of any Lender at such Lenders expense), upon reasonable prior notice and during normal workings hours, periodically
(but no more frequently than annually, except if an Event of Default shall be continuing), to visit and inspect its properties, to examine
and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent
accountants.
(b) The Administrative Agent shall be entitled to conduct, at its reasonable discretion, on reasonable prior notice and
during normal working hours, periodic field examinations of the books and records relating to the Accounts of the Collateral Parties
and the Inventory of the Collateral Parties, in each case to ensure the adequacy of the Collateral that constitutes the U.S. Borrowing
Base and the Canadian Borrowing Base and the related reporting and control systems; provided, however, that so long as no Event of
Default has occurred and is continuing, the Administrative Agent shall be limited in any twelve-calendar-month period to (i) one such
field examination and (ii) an additional field examination if such field examination is commenced at a time that Excess Availability is
less than the Threshold Amount.
(c) At any time that the Administrative Agent requests, each of the Collateral Parties will provide the Administrative
Agent with appraisals or updates thereof of its Inventory from an appraiser selected and engaged by the Administrative Agent, and
prepared on a basis satisfactory to the Administrative Agent, and such appraisals or updates, as the case may be, will include
information required by applicable law and regulations; provided, however, that (unless the U.S. Borrower otherwise requests in
writing to the Administrative Agent that additional appraisals of Inventory be conducted in the relevant twelve-calendar-month
period) so long as no Event of Default has occurred and is continuing, the Administrative Agent shall be limited in any twelvecalendar-month period to (i) one such

appraisal and (ii) an additional appraisal if such appraisal is commenced at a time that Excess Availability is less than the Threshold
Amount. Each such appraisal shall be at the sole expense of the Collateral Parties.
( d ) Each Borrower acknowledges that the Administrative Agent, after exercising its rights of inspection, field
examination or appraisal pursuant to this Section 5.07, may prepare and distribute to the Lenders certain Reports pertaining to the
Loan Parties assets for internal use by the Administrative Agent and the Lenders.
SECTION 5.08. Compliance with Laws. Each Borrower will, and will cause each Subsidiary to, comply with all
Requirements of Law with respect to it or its property, except where non-compliance could not reasonably be expected to result in a
Material Adverse Effect or where the necessity of compliance therewith is contested in good faith by appropriate proceedings.
SECTION 5.09. Use of Proceeds and Letters of Credit. The proceeds of the Loans will be used only to (i) repay all
outstanding obligations under the Existing Canadian Facility and (ii) finance general working capital needs and for other general
corporate purposes (including acquisitions), in each case of the U.S. Borrower and the Subsidiaries. No part of the proceeds of any
Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X. Letters of Credit will be used only for general corporate purposes. Neither Borrower nor any
Subsidiary will use the proceeds of any Loan or any Letter of Credit in violation of the representation set forth in Section 3.15.
SECTION 5.10. Further Assurances. (a) Each Borrower shall cause (i) (A) each Domestic Material Subsidiary and each
Canadian Material Subsidiary, in each case formed or acquired on or after the date of this Agreement in compliance with the terms of
this Agreement and (B) each Subsidiary that otherwise qualifies as either a Domestic Material Subsidiary or a Canadian Material
Subsidiary on or after the date of this Agreement, in each case, to become a Loan Party by executing a supplement to the Guarantee
Agreement in the form attached to the Guarantee Agreement and (ii) (A) each Domestic Material Subsidiary and each Canadian
Materially Subsidiary, in each case that is a wholly owned Subsidiary and formed or acquired on or after the date of this Agreement in
compliance with the terms of this Agreement and (B) each Subsidiary that otherwise qualifies as a Domestic Material Subsidiary or a
Canadian Material Subsidiary that is a wholly owned Subsidiary on or after the date of this Agreement, in each case, to become a
Collateral Party by executing a supplement to (1) in the case of a Domestic Subsidiary, the U.S. Security Agreement in the form
attached thereto and (2) in the case of a Canadian Subsidiary, the Canadian Security Agreement in the form attached thereto, provided
that the terms of this Section 5.10(a) shall not be required to be satisfied with respect to any Subsidiary (x) that is subject to any legal or
any contractual restriction (to the extent such restriction does not violate any of the terms of any Loan Document) preventing or
prohibiting it from satisfying such requirement, (y) that is a CFC Holdco or a Domestic Subsidiary of a CFC or CFC Holdco or (z) with
respect to which the Administrative Agent determines that the cost of satisfaction of such requirement with respect thereto exceeds the
value afforded thereby (and any such Subsidiary that does not so satisfy the terms of this Section 5.10(a) shall not become a Loan Party
and/or a Collateral Party hereunder). Notwithstanding the foregoing and for the avoidance of doubt, neither the Canadian Loan Parties
nor any other CFC shall guarantee, pledge assets in support of, or otherwise be liable for, the U.S. Secured Obligations.
(b) Subject to the limitations set forth in the applicable Security Agreement, each Borrower will, and will cause each
Loan Party to, execute any and all further documents, financing statements, agreements and instruments, and take all such further
actions (including the filing and recording of financing statements and other documents), that may be required under any applicable
law, or that the Administrative Agent or the Required Lenders may reasonably request, to carry out the terms and conditions of this
Agreement and the other Loan Documents, and to ensure perfection and priority of the Liens created or intended to be created by the
Collateral Documents, all at the expense of the Loan Parties. Each Borrower also agrees to provide to the Administrative Agent, from
time to time upon request, evidence reasonably satisfactory to the Administrative Agent as to the perfection and priority of the Liens
created or intended to be created by the Collateral Documents.
(c) Not earlier than the date that is three months after the Restatement Effective Date, if requested by The TorontoDominion Bank, the Borrowers shall designate, in the manner contemplated by the definition of Designated Banking Services
Obligations, the Canadian Banking Services Obligations owing to The Toronto-

Dominion Bank in respect of its Electronic Funds Transfer Credit Service as Designated Banking Services Obligations.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees,
expenses and other amounts payable (other than contingent amounts not yet due) under any Loan Document have been paid in full in
cash and all Letters of Credit have expired or been terminated (or cash collateralized in an amount equal to 103% of the aggregate
undrawn amount of all outstanding Letters of Credit (for each Letter of Credit, denominated in the currency of such Letter of Credit) or
otherwise collateralized (i.e., by issuance of backstop letters of credit to the applicable Issuing Banks in respect thereof), in each case in
a manner satisfactory to the applicable Issuing Banks) and all LC Disbursements shall have been reimbursed, each Borrower covenants
and agrees with the Lenders that:
SECTION 6.01. Indebtedness. (a) Neither the U.S. Borrower nor any of the Subsidiaries shall directly or indirectly
create, incur, assume or otherwise become or remain directly or indirectly liable with respect to any Indebtedness, the incurrence of
which would cause the U.S. Borrower to violate the financial covenant set forth in Section 6.12 (giving effect to such incurrence of
Indebtedness on a pro forma basis as if such incurrence (and the application of any proceeds therefrom, including the repayment of any
Indebtedness with the proceeds of the Indebtedness being so incurred) occurred on the first day of the applicable four fiscal quarter
period ended immediately prior to such incurrence) to the extent such Section is in effect as of the date of such determination (or would
be in effect after giving effect to such incurrence of Indebtedness). It is understood and agreed that any Indebtedness incurred (or
deemed to be incurred) under Section 6.01(a) of the Existing Credit Agreement, to the extent such Indebtedness was, at the time of such
incurrence (or deemed incurrence), permitted to be so incurred thereunder (or deemed incurred thereunder), shall be deemed to have
been incurred under, and in compliance with, this Section 6.01(a) as of the Restatement Effective Date.
(b) Neither the U.S. Borrower nor any of the Subsidiaries shall at any time permit the sum, without duplication, of (i)
all Indebtedness of the U.S. Borrower and the Subsidiaries secured by Liens plus (ii) all Indebtedness of the Subsidiaries (including
Subsidiaries acquired after the Restatement Effective Date) to exceed $500,000,000 at any time outstanding.
(c) Notwithstanding anything to the contrary in paragraph (b) of this Section 6.01, the following Indebtedness of the
U.S. Borrower and the Subsidiaries (including Subsidiaries acquired after the Restatement Effective Date) shall not be prohibited by
Section 6.01(b) and shall not be included in calculating the levels of Indebtedness permitted under Section 6.01(b) regardless of
whether such Indebtedness is secured as permitted by Section 6.02:
(i) (x) Indebtedness created under the Loan Documents and (y) other Indebtedness existing on the Restatement
Effective Date and set forth in Schedule 6.01 and extensions, renewals and replacements of any such Indebtedness,
provided that such extending, renewal or replacement Indebtedness (A) shall not be Indebtedness of an obligor that was
not an obligor with respect to the original Indebtedness being extended, renewed or replaced (other than in the case of
Guarantees otherwise permitted by clause (iii) of this Section 6.01(c)), (B) shall not be in a principal amount that
exceeds the principal amount of the Indebtedness being extended, renewed or replaced (plus any accrued but unpaid
interest and redemption premium thereon), (C) shall not have an earlier maturity date or shorter weighted average life to
maturity than the Indebtedness being extended, renewed or replaced and (D) shall be subordinated to the Obligations to
the same extent as the Indebtedness being extended, renewed or replaced, if applicable;

(ii) Indebtedness of the U.S. Borrower to any Subsidiary and of any Subsidiary to the U.S. Borrower or any other
Subsidiary, provided that (A) Indebtedness of any Subsidiary (other than a Loan Party) owing to any Loan Party shall be
subject to Section 6.04 and (B) Indebtedness of either Borrower to any Subsidiary or of any other Loan Party to any
other Subsidiary (other than a Loan Party) shall be subordinated to the Obligations on terms reasonably satisfactory to
the Administrative Agent;
(iii) Guarantees by the U.S. Borrower of Indebtedness of any Subsidiary, and by any Subsidiary of Indebtedness
of the U.S. Borrower or any other Subsidiary, provided that (A) the Indebtedness so Guaranteed shall not be prohibited
by this Section (other than clause (c)(ii)) and (B) Guarantees by any Loan Party of Indebtedness of any Subsidiary (other
than a Loan Party) shall be subject to Section 6.04;
(iv) (A) Indebtedness of the U.S. Borrower or any Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness that is assumed
by the U.S. Borrower or any Subsidiary or that remains Indebtedness of an acquired entity in connection with the
acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, provided that such
Indebtedness is incurred prior to or within 90 days after such acquisition or the completion of such construction or
improvement, and (B) extensions, renewals and replacements of any such Indebtedness so long as the outstanding
principal amount of such extensions, renewals and replacements does not exceed the principal of the Indebtedness being
extended, renewed or replaced (plus any accrued but unpaid interest and premium thereon), provided that the aggregate
principal amount of Indebtedness permitted by this clause (iv) incurred after the Restatement Effective Date shall not
exceed $125,000,000 at any time outstanding;
(v) Indebtedness in respect of Swap Agreements permitted by Section 6.06; and
(vi) Indebtedness in respect of any financing or capital lease financing relating to the U.S. Borrowers or any
Subsidiarys sea vessels in an amount not to exceed $50,000,000 at any time outstanding.
SECTION 6.02. Liens. Neither Borrower will, nor will it permit any Subsidiary to, create, incur, assume or permit to
exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including
accounts receivable) or rights in respect of any thereof, except:
(a) Liens created pursuant to any Loan Document;
(b) Permitted Encumbrances;
(c) any Lien on any property or asset of the U.S. Borrower or any Subsidiary existing on the Restatement Effective Date
and set forth in Schedule 6.02, provided that (A) such Lien shall not apply to any other property or asset of the U.S. Borrower or
any Subsidiary (other than assets financed by the same financing source pursuant to the same financing scheme in the ordinary
course of business) and (B) such Lien shall secure only those obligations that it secured on the Restatement Effective Date and
extensions, renewals and replacements thereof so long as the principal amount of such extensions, renewals and replacements
does not exceed the principal amount of the obligations being extended, renewed or replaced (plus any accrued but unpaid
interest and premium thereon);
(d) any Lien existing on any property or asset prior to the acquisition thereof by the U.S. Borrower or any Subsidiary or
existing on any property or asset of any Person that becomes a Subsidiary after the Restatement Effective Date prior to the time
such Person becomes a Subsidiary, provided that (A) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary,

as the case may be, (B) such Lien shall not apply to any other property or asset of the U.S. Borrower or any Subsidiary (other
than assets financed by the same financing source pursuant to the same financing scheme in the ordinary course of business)
and (C) such Lien shall secure only those obligations that it secures on the date of such acquisition or the date such Person
becomes a Subsidiary, as the case may be, and extensions, renewals and replacements thereof so long as the principal amount
of such extensions, renewals and replacements does not exceed the principal amount of the obligations being extended,
renewed or replaced (plus any accrued but unpaid interest and premium thereon);
(e) Liens on fixed or capital assets acquired, constructed or improved (including any such assets made the subject of a
Capital Lease Obligation incurred) by either the U.S. Borrower or any Subsidiary after the Restatement Effective Date, provided
that (A) such Liens secure Indebtedness incurred to finance such acquisition, construction or improvement and permitted by
clause (iv)(A) of Section 6.01(c) or to extend, renew or replace such Indebtedness and permitted by clause (iv)(B) of Section
6.01(c), (B) such Liens and the Indebtedness secured thereby are incurred prior to or within 90 days after such acquisition or the
completion of such construction or improvement (provided that this clause (B) shall not apply to any Indebtedness permitted by
clause (iv)(B) of Section 6.01(c) or any Lien securing such Indebtedness), (C) the Indebtedness secured thereby does not
exceed the lesser of the cost of acquiring, constructing or improving such fixed or capital asset or, in the case of Indebtedness
permitted by clause (iv)(A) of Section 6.01(c), its fair market value at the time such security interest attaches, and in any event,
the aggregate principal amount of such Indebtedness does not exceed $125,000,000 at any time outstanding and (D) such Liens
shall not apply to any other property or assets of the U.S. Borrower or any Subsidiary (except assets financed by the same
financing source pursuant to the same financing scheme in the ordinary course of business);
( f ) Liens of a collecting bank arising in the ordinary course of business under Section 4-208 (or the applicable
corresponding section) of the Uniform Commercial Code in effect in the relevant jurisdiction covering only the items being
collected upon;
(g) Liens granted by a Subsidiary in respect of Indebtedness permitted by Section 6.01;
(h) Liens securing obligations (other than Designated Swap Obligations) under Swap Agreements (and related netting
agreements) entered into after the Restatement Effective Date and permitted under Section 6.06 in an amount not to exceed
$150,000,000 on a marked-to-market basis at any time outstanding (after giving effect to any such netting agreements);
(i) Liens existing or deemed to exist securing the ship financing Indebtedness described in Section 6.01(c)(vi) in an
amount not to exceed $50,000,000, provided that such Liens shall apply only to those assets and rights of the type pledged
under the Vessel Loan Agreement and the collateral documents entered into in connection therewith (as the Vessel Loan
Agreement and such other documents are in effect on the Restatement Effective Date) and shall not apply to any other property
or asset of the U.S. Borrower or any Subsidiary;
(j) Liens not otherwise permitted by this Section to the extent that the aggregate outstanding principal amount of the
obligations secured thereby does not at any time exceed $100,000,000;
(k ) Liens created by sales contracts documenting unconsummated asset dispositions permitted hereby, provided that
such Liens attach only to those assets that are the subject of the applicable sales contract; and
(l) Liens on cash collateral with respect to letters of credit issued under the Existing Canadian Facility having a face
amount not to exceed $1,000,000; provided that such letters of credit shall expire no later than the expiration date therefor as of
the Restatement Effective Date.
Notwithstanding the foregoing, none of the Liens permitted pursuant to this Section 6.02 may at any time attach to any Collateral, other
than those permitted under clauses (a) through (d), (f) and (k) of this Section 6.02.

SECTION 6.03. Fundamental Changes. (a) Neither Borrower will, nor will it permit any Material Subsidiary (other than
in connection with a transaction permitted under Section 6.03(c)) to, merge into or consolidate with any other Person, or permit any
other Person to merge into or consolidate with it, or liquidate or dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Default shall have occurred and be continuing (i) any Person may merge into either Borrower in a transaction in which
such Borrower is the surviving corporation and (ii) any Person (other than a Borrower) may merge into any Subsidiary (other than the
Canadian Borrower) in a transaction in which the surviving entity is a Subsidiary and (if any party to such merger is a Restricted
Collateral Party, a Collateral Party or a Loan Party) is a Restricted Collateral Party, a Collateral Party or a Loan Party, as the case may
be, provided that any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not
be permitted unless also permitted by Section 6.04.
(b) Neither Borrower will, nor will it permit any Material Subsidiary to, engage to any material extent in any business
other than businesses of the type conducted by the U.S. Borrower and the Subsidiaries on the Restatement Effective Date and
businesses reasonably related thereto.
(c) Neither Borrower will, nor will it permit any other Loan Party, to sell, transfer, lease or otherwise dispose of all or
substantially all its assets, provided that this clause (c) shall not prohibit any such sale, transfer, lease or other disposition (i) by any
Collateral Party to any other Collateral Party, (ii) by any wholly owned Subsidiary (other than a Collateral Party) to either Borrower or
any other wholly owned Subsidiary or (iii) of assets the aggregate fair value of which, determined as of the date of such sale, transfer,
lease or other disposition and when combined with the aggregate fair value of all assets sold, transferred, leased or otherwise disposed
of pursuant to this clause (iii) (in each case, determined as of the date of the sale, transfer, lease or other disposition of the applicable
assets), does not exceed 15% of the consolidated assets of the Loan Parties as determined on such date. Notwithstanding the
foregoing, (A) no Restricted Collateral Party may issue any Equity Interests (other than to the U.S. Borrower or to another wholly
owned Subsidiary), (B) neither the U.S. Borrower nor any other Subsidiary may sell, transfer or otherwise dispose of any Equity
Interests of any Restricted Collateral Party (other than to the U.S. Borrower or to any wholly owned Subsidiary) except in a
transaction pursuant to clause (iii) of this paragraph (c) in which 100% of the Equity Interests of such Restricted Collateral Party are
sold, transferred or otherwise disposed of and (C) neither the U.S. Borrower nor any Restricted Collateral Party may sell, transfer,
lease or otherwise dispose of all or substantially all its assets (other than to the U.S. Borrower or to another Restricted Collateral Party)
except in a transaction pursuant to clause (iii) of this paragraph (c).
SECTION 6.04. Investments. Neither Borrower will, nor will it permit any Loan Party to, purchase or acquire (including
pursuant to any merger with such Person) any Equity Interests in or evidences of Indebtedness or other securities (including any option,
warrant or other right to acquire any of the foregoing) of, make any loans or advances to, or Guarantee any Indebtedness of, any other
Person (other than a Loan Party), or purchase or otherwise acquire (in one transaction or a series of transactions) any of the assets of
any other Person (other than a Loan Party, provided that only a Collateral Party may acquire such assets of any other Collateral Party
pursuant to this exception) constituting a business unit (each, an Investment), at any time when the Payment Conditions are not
satisfied or if, immediately after giving effect to such Investment (and the establishment of any Reserve in connection with such
Investment, including any Reserve with respect to the solvency deficiency, wind-up deficit or similar deficiency in respect of Canadian
Pension Plans of the U.S. Borrower, any Subsidiary and any Person to be acquired by the U.S. Borrower or any Subsidiary in
connection with such Investment), the Payment Conditions would not be satisfied. Notwithstanding the foregoing, the following
Investments shall be deemed not to be covered or restricted by this Section:
(a) Investments existing on the Restatement Effective Date and set forth on Schedule 6.04 and Permitted Investments;
(b) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be
treated as expenses of the U.S. Borrower or any Subsidiary for accounting purposes and that are made in the ordinary course of
business;

(c) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts
and disputes with, customers and suppliers, in each case in the ordinary course of business;
(d) Investments in the form of Swap Agreements permitted by Section 6.06;
(e) Investments of any Person existing at the time such Person becomes a Subsidiary or consolidates or merges with the
U.S. Borrower or any Subsidiary so long as such Investments were not made in contemplation of such Person becoming a
Subsidiary or of such consolidation or merger;
(f) Investments resulting from pledges or deposits described in clause (c) or (d) of the definition of the term Permitted
Encumbrance;
(g) Investments received in connection with the disposition of any asset permitted by Section 6.03(c);
(h) receivables or other trade payables owing to the U.S. Borrower or a Subsidiary if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with customary trade terms, provided that such trade terms may
include such concessionary trade terms as the U.S. Borrower or any Subsidiary deems reasonable under the circumstances;
(i) Investments in or to any Loan Party;
(j) Investments to the extent funded with the proceeds of any substantially concurrent issuance of Qualified Equity
Interests to the extent that such issuance does not result in a Change in Control;
(k) Investments made or outstanding at any time the Payment Conditions were satisfied (so long as any such Investment
did not result in the Payment Conditions failing to be satisfied) and any extension or refinancing thereof; provided that such
extension or refinancing shall not increase the aggregate amount of such Investment;
(l) Investments in the form of (i) Guarantees by a Loan Party of the Indebtedness of any Subsidiary other than a Loan
Party and (ii) loans by a Loan Party to another Subsidiary other than a Loan Party; provided that the sum of (x) aggregate
principal amount of Indebtedness at any time outstanding that is subject to a Guarantee made in reliance on subclause (i) of this
clause (l) and (y) the aggregate principal amount of loans at such time outstanding made in reliance on subclause (ii) of this
clause (l) shall not exceed $20,000,000; and
(m) so long as, at the time such Investment is made, no Event of Default has occurred and is continuing or would result
therefrom, Investments utilizing cash from any Pooled Cash Arrangement; provided that all such cash to be utilized was pooled
under such Pooled Cash Arrangement at a time when the Payment Conditions were satisfied (and such pooling did not result in
the Payment Conditions failing to be satisfied).
SECTION 6.05. Sale and Leaseback Transactions. Neither the U.S. Borrower nor any of the Subsidiaries shall become
liable, directly or by way of a Guarantee, with respect to any lease, whether or not such lease results in a Capital Lease Obligation, of
any property (whether real or personal or mixed) whether now owned or hereafter acquired, that the U.S. Borrower or any Subsidiary
has sold or transferred or is to sell or transfer to any other Person after the Restatement Effective Date (a Sale and Leaseback
Transaction), provided that the U.S. Borrower or a Subsidiary may enter into a Sale and Leaseback Transaction if (a) at the time of
such Sale and Leaseback Transaction, no Event of Default is continuing, (b) the proceeds from the sale of the subject property shall be
at least equal to 80% of its fair market value and (c) if such Sale and Leaseback Transaction results in a Capital Lease Obligation, such
Capital Lease Obligation is not prohibited by Section 6.01 and any Lien made the subject of such Capital Lease Obligation is not
prohibited by Section 6.02.

SECTION 6.06. Swap Agreements. Neither Borrower will, nor will it permit any Subsidiary to, enter into any Swap
Agreement for speculative purposes.
SECTION 6.07. Restricted Payments. Neither Borrower will, nor will it permit any Subsidiary to, declare or make, or
agree to pay or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, if (a) a
Default has occurred and is continuing or would result therefrom, (b) such Restricted Payment is not at the time permitted by a
Requirement of Law or any agreement or instrument applicable to such Borrower or such Subsidiary or (c) the Payment Conditions are
not satisfied at the time such Restricted Payment is made and immediately after giving effect thereto, provided that this Section 6.07
shall not restrict (x) dividends or similar distributions, payable solely in Qualified Equity Interests, (y) dividends or similar distributions
made by Subsidiaries to wholly owned Subsidiaries or to the U.S. Borrower (it being understood that this proviso shall not permit any
such dividend or similar distribution (A) from a Domestic Subsidiary to a Foreign Subsidiary (other than a Collateral Party) or (B) in the
case of any such dividend or distribution comprised of Collateral, from a Collateral Party to an entity that is not a Collateral Party) or (z)
so long as no Event of Default has occurred and is continuing or would result therefrom, dividends or similar distributions utilizing cash
from any Pooled Cash Arrangement; provided that, in this case of this clause (z), all such cash was pooled under such Pooled Cash
Arrangement at a time when the Payment Conditions were satisfied (and such pooling did not result in the Payment Conditions failing
to be satisfied).
SECTION 6.08. Transactions with Affiliates. Neither Borrower shall, nor shall it suffer or permit any Material Subsidiary
to, enter into any transaction with any Affiliate (other than the U.S. Borrower or a wholly owned Subsidiary) of the U.S. Borrower,
except (a) transactions (i) entered into in good faith and (ii) at prices and on terms and conditions not less favorable to the U.S.
Borrower or such Subsidiary than could be obtained on an arms-length basis from unrelated third parties and (b) transactions not
otherwise permitted under this Section 6.08 involving aggregate consideration of not more than $30,000,000 in any calendar year.
SECTION 6.09. Restrictive Agreements. Neither Borrower will, nor will it permit any Material Subsidiary to, directly or
indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon
(a) the ability of the U.S. Borrower or any Material Subsidiary to create, incur or permit to exist any Lien upon any of its property or
assets or (b) the ability of any Material Subsidiary to pay dividends or other distributions with respect to any of its Equity Interests or to
make or repay loans or advances to the U.S. Borrower or any other Subsidiary or to Guarantee Indebtedness of either Borrower or any
other Subsidiary, provided that (i) the foregoing shall not apply to restrictions and conditions imposed by (A) law or (B) any Loan
Document, (ii) the foregoing shall not apply to restrictions or conditions existing on the Restatement Effective Date and identified on
Schedule 6.09 (but shall apply to any extension or renewal of, or any amendment, modification or replacement expanding the scope of,
any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary or any assets pending such sale, provided that such restrictions and conditions apply only to the
Subsidiary or assets that is or are to be sold and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness, (v) clause (a) of the foregoing shall not apply to customary
provisions in leases and other contracts restricting the assignment thereof, (vi) clause (a) of the foregoing shall not apply to any existing
or future joint venture agreement that restricts the ability of any party to such agreement to create, incur or permit a Lien on the equity
interests in the joint venture, provided that the U.S. Borrower and any Material Subsidiary party to such agreement collectively own no
more than 81 percent of the equity interests in such joint venture and (vii) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement if the terms of such agreement expressly permit the creation, incurrence and existence of Liens to
secure Indebtedness or other Secured Obligations under this Agreement and extensions, renewals and replacements of any such
Indebtedness or other Secured Obligations.
SECTION 6.10. Amendment of Material Documents. Neither Borrower will, nor will it permit any Subsidiary to, amend,
modify, waive, terminate or release its certificate of incorporation, by-laws or other organizational documents, if the effect of such
amendment, modification, waiver, termination or release is materially adverse to the U.S. Borrower and the Subsidiaries, taken as a
whole, or the Lenders.

SECTION 6.11. Changes in Fiscal Periods. Without the prior consent of the Administrative Agent, the U.S. Borrower
will neither (a) permit its fiscal year or the fiscal year of any Subsidiary to end on a day other than December 31, nor (b) change its
method of determining fiscal quarters.
SECTION 6.12. Fixed Charge Coverage Ratio. If, at any time, Excess Availability is less than the Financial Covenant
Threshold Amount, then, until the next subsequent date on which Excess Availability has exceeded the Financial Covenant Threshold
Amount for a period of thirty consecutive calendar days, the U.S. Borrower will not permit the Fixed Charge Coverage Ratio to be less
than 1.00 to 1.00.
ARTICLE VII
Events of Default
If any of the following events (any such event, an Event of Default) shall occur:
(a) either Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC
Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or otherwise;
(b) either Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount
referred to in paragraph (a) of this Article) payable under any Loan Document, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five Business Days;
( c ) any representation or warranty made or deemed made by or on behalf of the U.S. Borrower or any Material
Subsidiary in or in connection with the Existing Credit Agreement (to the extent made prior to the Restatement Effective Date
and not waived), any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document or any
amendment or modification thereof or waiver thereunder that is qualified by materiality shall prove to have been incorrect or
any representation or warranty that is not so qualified shall prove to have been incorrect in any material respect when made or
deemed made;
(d) either Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02,
5.03 (with respect to the existence of either Borrower) or 5.09 or in Article VI of this Agreement or any Collateral Party shall fail
to observe or perform any covenant, condition or agreement contained in Section 4.01(j) or Article VII, in each case of either
Security Agreement; provided, however, that, without limiting the effect of any other Default or Event of Default under this
Article VII, any Default arising under Section 5.02 (or any Default arising under a failure of the conditions set forth in Section
4.02 arising solely as a result of a failure to comply with Section 5.02) or under Section 4.01(j) of either Security Agreement, in
each case shall be deemed to be cured upon the giving of such notice by the U.S. Borrower;
(e) the U.S. Borrower or any other Loan Party shall fail to observe or perform any covenant, condition or agreement
contained in any Loan Document (other than those specified in paragraph (a), (b) or (d) of this Article), and, except as otherwise
provided in such Loan Document, such failure shall continue unremedied for a period of 30 days after notice thereof from any
Lender or the Administrative Agent to the U.S. Borrower;
(f) the U.S. Borrower or any Subsidiary shall fail to make any payment of principal or interest (regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become due and payable after the expiration of any applicable
grace periods;
(g) any event or condition occurs (including the triggering of any change in control or similar event with respect to
either Borrower) (i) that results in any Material Indebtedness becoming due prior to its scheduled

maturity or that enables or permits (with all applicable grace periods having expired, provided that, during the applicable grace
period, no additional consideration is paid or additional rights are granted in respect of such Material Indebtedness) the holder
or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to
become due or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity or (ii)
the effect of which event or condition is to cause, or to permit the holder or holders of any Material Indebtedness (or a trustee or
agent on behalf of such holder or holders) to require, with the giving of notice if required, any Material Indebtedness to be
repurchased, prepaid, defeased or redeemed (automatically or otherwise), prior to its stated maturity, provided that this
paragraph (g) shall not apply to secured Indebtedness that becomes due as a result of the sale, transfer or other disposition
(including as a result of a casualty or condemnation event) of the property or assets securing such Indebtedness (to the extent
such sale, transfer or other disposition is not prohibited under this Agreement);
(h ) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of either Borrower or any Material Subsidiary or their debts, or of a substantial part of
their assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect
(including the Bankruptcy and Insolvency Act of Canada and the Companies Creditors Arrangement Act of Canada) or (ii) the
appointment of a receiver, interim receiver, monitor, trustee, custodian, sequestrator, conservator or similar official for the U.S.
Borrower or any Material Subsidiary or for a substantial part of their assets, and, in any such case, such proceeding or petition
shall continue undismissed or unstayed for 60 days or an order or decree approving or ordering any of the foregoing shall be
entered;
(i) the U.S. Borrower or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition
seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or
similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in paragraph (h) of this Article, (iii) apply for or consent to the appointment of a receiver,
interim receiver, monitor, trustee, custodian, sequestrator, conservator or similar official for the U.S. Borrower or any Material
Subsidiary or for a substantial part of their assets, (iv) file an answer admitting the material allegations of a petition filed against
it in any such proceeding, (v) make a general assignment for the benefit of creditors, (vi) file any proposal or notice of intention
to file a proposal under the Bankruptcy and Insolvency Act of Canada or the Companies Creditors Arrangement Act of Canada
or (vii) take any action for the purpose of effecting any of the foregoing;
(j) the U.S. Borrower or any Material Subsidiary shall become unable, admit in writing its inability or fail generally to
pay its debts as they become due;
(k ) one or more judgments for the payment of money in an aggregate amount in excess of $75,000,000 shall be
rendered against either Borrower, any Material Subsidiary or any combination thereof (provided that in determining whether the
foregoing threshold is satisfied, there shall be excluded any portion of such judgments that is fully covered by a third party
insurance company rated not less that B++ by A.M. Best (less any applicable deductible) and as to which the insurer has not
disputed, in writing, its responsibility to cover such judgment) and the same shall remain unpaid or undischarged for a period of
30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any assets of either Borrower or any Material Subsidiary to enforce any such judgment;
(l) an ERISA Event or Canadian Pension Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with all other ERISA Events or Canadian Pension Events that have occurred, could reasonably be expected to
have a Material Adverse Effect;
(m) any Loan Document shall for any reason be asserted by either Borrower not to be a legal, valid and binding
obligation of such Borrower;

(n) a Change in Control shall occur;

(o) the Guarantee Agreement shall fail to remain in full force or effect or any action shall be taken by any Loan Party to
discontinue or to assert the invalidity or unenforceability of the Guarantee Agreement, or any Loan Party shall deny that it has
any further liability under the Guarantee Agreement to which it is a party, or shall give notice to such effect; or
(p) any Collateral Document shall for any reason fail to create a valid and perfected first priority security interest in any
Collateral purported to be covered thereby, except as permitted by the terms hereof or of any Collateral Document, or any
Collateral Document shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of any Collateral Document,
then, and in every such event (other than an event with respect to either Borrower described in paragraph (h) or (i) of this Article), and
at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders
shall, by notice to the U.S. Borrower, take either or both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due
and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of each Borrower accrued hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by each Borrower; and in case of any event with respect to
either Borrower described in paragraph (h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and other obligations of each Borrower accrued hereunder,
shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby
waived by each Borrower (it being understood, for purposes of clarity, that the foregoing shall not affect the maturity or other terms of,
or the obligations or rights of any party under, the definitive documentation in respect of any Swap Agreement).
ARTICLE VIII
The Administrative Agent
Each of the Lenders and the Issuing Banks hereby irrevocably appoints the Administrative Agent as its agent and
authorizes the Administrative Agent to take such actions on its behalf, including execution of the other Loan Documents, and to
exercise such powers as are delegated to the Administrative Agent by the terms of the Loan Documents, together with such actions and
powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent, the
Lenders and the Issuing Banks, and neither Borrower shall have rights as a third party beneficiary of any of such provisions.
The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates
may accept deposits from, lend money to and generally engage in any kind of business with the U.S. Borrower or any Subsidiary or
other Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except those expressly set forth in the Loan
Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other
implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to
take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated by
the Loan Documents that the Administrative Agent is required to exercise in writing as directed by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary or believed by the Administrative Agent in good faith to be necessary under
the circumstances as provided in Section 2.05(j) or Section 9.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to
the U.S. Borrower or any Subsidiary that is communicated to or obtained by the

bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action
taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders
as shall be necessary under the circumstances as provided in Section 2.05(j) or Section 9.02 or believed by the Administrative Agent in
good faith to be necessary) or in the absence of its own gross negligence or wilful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by either
Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or
other document delivered thereunder or in connection therewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, (v) the creation,
perfection or priority of Liens on the Collateral or the existence of the Collateral, or (vi) the satisfaction of any condition set forth in
Article IV or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Adobe pdf file,
Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed or sent or otherwise
authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may
consult with legal counsel (who may be counsel for the Loan Parties), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one
or more sub-agents appointed by the Administrative Agent, provided that the Administrative Agent shall remain liable for the
performance of such obligations and duties. The Administrative Agent and any such sub-agent may perform any and all its duties and
exercise its rights and powers by or through their respective Related Parties, provided that the Administrative Agent shall remain liable
for the performance of such obligations and duties. The exculpatory provisions of this Article shall apply to any such sub-agent and to
the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with
the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.
In determining compliance with any condition hereunder to the making of a Loan, or the issuance, amendment, renewal
or extension of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Bank, the
Administrative Agent may presume that such condition is satisfactory to such Lender or an Issuing Bank unless the Administrative
Agent shall have received notice to the contrary from such Lender or such Issuing Bank prior to the making of such Loan or the
issuance, amendment, renewal or extension of such Letter of Credit.
Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the
Administrative Agent may resign at any time upon notice to the Lenders, the Issuing Banks and the U.S. Borrower. Upon any such
resignation, the Required Lenders shall have the right, with the consent of the Borrowers in the absence of a continuing Event of
Default, to appoint a successor. If no successor shall have been so appointed by the U.S. Borrower and the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent that shall be a
commercial bank with an office in New York, New York, or an Affiliate of any such commercial bank, in either case, acceptable to the
U.S. Borrower in the absence of a continuing Event of Default (such acceptance not to be unreasonably withheld or delayed). Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from all its duties and obligations under the Loan Documents. The fees payable by the U.S. Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed in writing between the U.S.
Borrower and such successor. After the Administrative

Agents resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its subagents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of
them while the retiring Administrative Agent was acting as Administrative Agent.
Each Lender and each Issuing Bank acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and each Issuing Bank also
acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own
decisions in taking or not taking action under or based upon any Loan Document or any related agreement or any document furnished
thereunder.
Notwithstanding anything herein to the contrary, none of the Arrangers and the other agents listed on the cover page
hereof shall have any powers, duties or responsibilities under any Loan Document, except in its capacity, as applicable, as the
Administrative Agent, a Lender or an Issuing Bank hereunder.
In furtherance of the foregoing and not in limitation thereof, no Swap Agreement the obligations under which constitute
Secured Obligations will create (or be deemed to create) in favor of any Secured Party that is a party thereto any rights in connection
with the management or release of any Collateral or of the obligations of any Loan Party under this Agreement or any other Loan
Document. By accepting the benefits of the Collateral, each Secured Party that is a party to any such Swap Agreement shall be deemed
to have appointed the Administrative Agent to serve as administrative agent and collateral agent under the Loan Documents and agreed
to be bound by the Loan Documents as a Secured Party thereunder, subject to the limitations set forth in this paragraph.
Each Lender hereby agrees that (a) it has requested a copy of each Report prepared by or on behalf of the
Administrative Agent; (b) the Administrative Agent (i) makes no representation or warranty, express or implied, as to the completeness
or accuracy of any Report or any of the information contained therein or any inaccuracy or omission contained in or relating to a
Report and (ii) shall not be liable for any information contained in any Report; (c) the Reports are not comprehensive audits or
examinations, and that any Person performing any field examination will inspect only specific information regarding the Loan Parties
and will rely significantly upon the Loan Parties books and records, as well as on representations of the Loan Parties personnel and
that the Administrative Agent undertakes no obligation to update, correct or supplement the Reports; (d) it will keep all Reports
confidential and strictly for its internal use, not share the Report with any Loan Party or any other Person except as otherwise permitted
pursuant to this Agreement; and (e) without limiting the generality of any other indemnification provision contained in this
Agreement, it will pay and protect, and indemnify, defend, and hold the Administrative Agent and any such other Person preparing a
Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including reasonable
attorney fees) incurred by such Person as the direct or indirect result of disclosure of any such Report to a third party by such
indemnifying Lender in violation of the terms hereof.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices.
(a) Except in the case of notices and other communications expressly permitted to be given by telephone or Electronic
Systems (and subject in each case to paragraph (b) below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy or
Adobe pdf file, as follows:
(i)
if to the U.S. Borrower or any Loan Party (other than the Canadian Borrower or any Canadian Collateral
Party), to the U.S. Borrower at:

550 West Adams Street

Chicago, IL 60661
Attention: Treasurer
Email: kbanas@usg.com
with copies to:
Corporate Secretary
Telecopy No.: (312) 672-4093
Assistant Treasurer
Email: eganchev@usg.com;
(ii)

if to the Canadian Borrower or any Canadian Collateral Party, to the Canadian Borrower at:
350 Burnhamthorpe Road, 5th Floor
Mississauga, Ontario L5B 3J1
Attention: Financial Accounting Manager
Email: kpotter@usg.com

with copies to:

Corporate Secretary
Telecopy No.: (312) 672-4093
Assistant Treasurer
Email: eganchev@usg.com;
(iii) if to JPMCB in its capacity as the Administrative Agent, an Issuing Bank or the Swingline Lender, to:
JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713
Attention: Siyana Custis
Telecopy No.: (302) 634-1845
email: siyana.c.custis@jpmorgan.com
with a copy to:
JPMorgan Chase Bank, N.A.
383 Madison Avenue
New York, NY 10179
Attention: Peter Predun
Telecopy No.: (212) 270-5100
email: peter.predun@jpmorgan.com; and
(iv) if to JPMCB Toronto in its capacity as the Administrative Agent, to:
JPMorgan Chase Bank, N.A., Toronto Branch
c/o JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713

Attention: Siyana Custis

Telecopy No.: (302) 634-1845
email: siyana.c.custis@jpmorgan.com
with a copy to:
JPMorgan Chase Bank, N.A.
383 Madison Avenue
New York, NY 10179
Attention: Peter Predun
Telecopy No.: (212) 270-5100
email: peter.predun@jpmorgan.com
(v) if to any other Issuing Bank, to it at its address (or telecopy number) most recently specified by it in a notice
to the Administrative Agent and the U.S. Borrower (or, in the absence of any such notice, to the address (or telecopy
number) set forth in the Administrative Questionnaire of the Lender that is serving as such Issuing Bank or is an Affiliate
thereof); and
(vi) if to any other Lender, to it at its address (or telecopy number) set forth in its Administrative Questionnaire;
provided that, in addition to delivery to the applicable recipients set forth above, each Borrowing Base Certificate and any related
notices in respect of either Borrowing Base shall also be delivered, by Adobe pdf file to the following addresses: (A)
ib.cbc@jpmchase.com and (B) covenant.compliance@jpmchase.com.
All such notices and other communications (i) sent by hand or overnight courier service, or mailed by certified or registered mail, shall
be deemed to have been given when received or (ii) sent by telecopy or by Adobe pdf file shall be deemed to have been given when
sent, provided that if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of
business on the next Business Day for the recipient.
(b) Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished
by Electronic Systems pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to
notices pursuant to Article II or to compliance and no Default certificates delivered pursuant to Section 5.01(c) unless otherwise
agreed by the Administrative Agent and the applicable Lender or Issuing Bank. Each of the Administrative Agent and the Borrowers
(on behalf of the Loan Parties) may, in its discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular
notices or communications. Unless the Administrative Agent otherwise proscribes, all such notices and other communications (i) sent
to an e-mail address shall be deemed received upon the senders receipt of an acknowledgement from the intended recipient (such as
by the return receipt requested function, as available, return e-mail or other written acknowledgement); provided that if not given
during the normal business hours of the recipient, shall be deemed to have been given at the opening of business on the next
Business Day for the recipient, and (ii) posted to an Internet or intranet website shall be deemed received upon the deemed receipt by
the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication
is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, e-mail or
other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to
have been sent at the opening of business on the next Business Day of the recipient.
(c) Any party hereto may change its address, telecopy number or e-mail address for notices and other communications
hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date of receipt.
(d) Electronic Systems.

( i ) Each Loan Party agrees that the Administrative Agent may, but shall not be obligated to, make
Communications (as defined below) available to the Issuing Banks and the other Lenders by posting the
Communications (as defined below) on Debt Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic
System.
(ii) Any Electronic System used by the Administrative Agent is provided as is and as available. The Agent
Parties (as defined below) do not warrant the adequacy of such Electronic Systems and expressly disclaim liability for
errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including any
warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from
viruses or other code defects, is made by any Agent Party in connection with the Communications or any Electronic
System. In no event shall the Administrative Agent or any of its Related Parties (collectively, the Agent Parties) have
any liability to the Borrowers or the other Loan Parties, any Lender, any Issuing Bank or any other Person or entity for
damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses
(whether in tort, contract or otherwise) arising out of either Borrowers, any other Loan Partys or the Administrative
Agents transmission of communications through an Electronic System. Communications means, collectively, any
notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party
pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Administrative
Agent, any Lender or any Issuing Bank by means of electronic communications pursuant to this Section, including
through an Electronic System.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative Agent, any Issuing Bank or any
Lender in exercising any right or power under any 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 Banks 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 any Loan Document or consent to any departure by any Loan
Party therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, 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 the issuance, amendment, renewal or extension of a Letter of Credit shall not be construed as a
waiver of any Default, regardless of whether the Administrative Agent, any Lender or any Issuing Bank may have had notice or
knowledge of such Default at the time. No notice to or demand on either Borrower or any other Loan Party in any case shall entitle
either Borrower or any other Loan Party to any other or further notice or demand in similar or other circumstances.
( b ) Except as provided in Section 2.19 with respect to any Revolving Commitment Increase, neither any Loan
Document nor any provision thereof may be waived, amended or modified except, in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by the U.S. Borrower and the Required Lenders or, in the case of any other Loan
Document, pursuant to an agreement or agreements in writing entered into by the Administrative Agent and the applicable Loan
Parties, in each case with the consent of the Required Lenders, provided that no such agreement shall (i) increase the Commitment of
any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or reduce
the rate of interest thereon, or reduce or forgive any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the maturity of any Loan, or the required date of reimbursement of any LC Disbursement, or any date for the
payment of any interest or fees payable hereunder, or reduce or forgive the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.17(b) or (d) or any other provision of this Agreement in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender adversely affected thereby, (v) change any of the provisions
of this Section or the percentage set forth in the definition of Required Lenders or any other provision of any Loan Document
specifying the number or percentage of Lenders

required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the
written consent of each Lender (it being understood that, with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required Lenders on substantially the same basis as the
Revolving Commitments on the Restatement Effective Date), (vi) modify the protections afforded to an SPV pursuant to the
provisions of Section 9.04(e) without the written consent of such SPV, (vii) release any material Loan Party from its Guarantee under
the Guarantee Agreement (except as expressly provided in the Guarantee Agreement), or limit its liability in respect of such
Guarantee, without the written consent of each Lender, (viii) release all or substantially all the Collateral from the Liens of the
Collateral Documents, without the written consent of each Lender, (ix) change any of the provisions of the definitions of Eligible
Accounts, Eligible Inventory, U.S. Borrowing Base or Canadian Borrowing Base (including any defined term used therein
relevant to the determination of either Borrowing Base, but excluding the advance rates referenced therein), without the written
consent of Lenders having Revolving Exposure and unused Revolving Commitments, if any, representing more than 66% of the
sum of the total Revolving Exposure and unused Revolving Commitments at such time or (x) change any of the advance rates
referenced in the definitions of U.S. Borrowing Base or Canadian Borrowing Base or any defined term used therein, without the
written consent of each Lender; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent, any Issuing Bank or the Swingline Lender without the prior written consent of the Administrative Agent,
such Issuing Bank or the Swingline Lender, as the case may be.
( c ) In connection with any proposed amendment, modification, waiver or termination (a Proposed Change)
requiring the consent of all Lenders or all affected Lenders, if the consent of the Required Lenders to such Proposed Change is
obtained, but the consent to such Proposed Change of other Lenders whose consent is required is not obtained (any such Lender
whose consent is not obtained as described in paragraph (b) of this Section being referred to as a Non-Consenting Lender), then, so
long as the Lender that is acting as Administrative Agent is not a Non-Consenting Lender, the U.S. Borrower may, at its sole expense
and effort, upon notice to such Non-Consenting Lender and the Administrative Agent, require such Non-Consenting Lender to assign
and delegate (without its signature or consent), without recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment), provided that (i) the U.S. Borrower shall have received the
prior written consent of the Administrative Agent, each Issuing Bank and the Swingline Lender, which consent shall not unreasonably
be withheld or delayed, (ii) such Non-Consenting Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements, Swingline Loans and Overadvances, accrued interest thereon, accrued
fees and all other amounts payable to it hereunder from the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Loan Parties (in the case of all other amounts) and (iii) the Loan Parties or such assignee shall have paid to the
Administrative Agent the processing and recordation fee specified in Section 9.04(b).
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) Subject to Section 9.19, the Borrowers shall jointly and
severally (in the case of the U.S. Borrower) and severally (in the case of the Canadian Borrower) pay (i) all reasonable outofpocket
expenses (including reasonable expenses incurred in connection with due diligence) incurred by the Administrative Agent and its
Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the
syndication of the credit facilities provided for herein, the preparation and administration of the Loan Documents or any amendments,
modifications or waivers of the provisions thereof (whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by any Issuing Bank in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all reasonable out-of-pocket expenses
incurred by the Administrative Agent, any Issuing Bank or any Lender, including the fees, charges and disbursements of any counsel
for the Administrative Agent, any Issuing Bank or any Lender, in connection with the enforcement or protection of its rights in
connection with the Loan Documents, including its rights under this Section, or in connection with the Loans made or Letters of Credit
issued hereunder, including all such reasonable out-ofpocket expenses incurred during any workout or restructuring (and related
negotiations) in respect of such Loans or Letters of Credit.

(b) Subject to Section 9.19, the Borrowers shall jointly and severally (in the case of the U.S. Borrower) and severally
(in the case of the Canadian Borrower) indemnify the Administrative Agent, each Issuing Bank and each Lender, and each Related
Party of any of the foregoing Persons (each such Person being called an Indemnitee), 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 by any third party or
by the U.S. Borrower or any Subsidiary arising out of, in connection with, or as a result of (i) the execution or delivery of any Loan
Document or any other agreement or instrument contemplated thereby, the performance by the parties to the Loan Documents of their
respective obligations thereunder or the consummation of the Transactions or any other transactions contemplated thereby, (ii) any
Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for
payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of
such Letter of Credit), (iii) any actual or alleged presence or Release of Hazardous Materials on, at, to or from any property currently
or formerly owned or operated by the U.S. Borrower or any Subsidiary, or any other Environmental Liability related in any way to the
U.S. Borrower or any Subsidiary or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the
foregoing (each, a Proceeding), whether based on contract, tort or any other theory, whether brought by a third party or by the U.S.
Borrower or any Subsidiary and regardless of whether 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, non-appealable judgment to have resulted from (A) the gross negligence, bad faith or wilful
misconduct of such Indemnitee, (B) a material breach by such Indemnitee of its obligations under this Agreement or any other Loan
Document or (C) claims of one or more Indemnitees against another Indemnitee (other than claims against the Administrative Agent
or any Arranger in their respective capacities as such) and not involving any act or omission by either Borrower, any of the
Subsidiaries or any of their respective Affiliates (or any of such Persons Related Parties). The Borrowers shall not, without the prior
written consent of any Indemnitee, effect any settlement of any pending or threatened Proceeding in respect of which indemnity
could have been sought under this Section 9.03(b) by such Indemnitee unless such settlement (x) includes an unconditional release of
such Indemnitee in form and substance reasonably satisfactory to such Indemnitee from all liability or claims that are the subject
matter of such Proceeding and (y) does not include any statement as to or any admission of fault, culpability, wrongdoing or a failure
to act by or on behalf of such Indemnitee or any injunctive relief or other non-monetary remedy. The Borrowers shall not be liable for
any settlement of any Proceeding if the amount of such settlement was effected without the Borrowers consent (which consent shall
not be unreasonably withheld, conditioned or delayed), but if settled with the Borrowers written consent or if there is a judgment by
a court of competent jurisdiction for the plaintiff in any such Proceeding, the Borrowers agree to indemnify and hold harmless each
Indemnitee from and against any and all losses, claims, damages, penalties, liabilities and expenses by reason of such settlement or
judgment in accordance with the other provisions of this Section 9.03(b).
(c) To the extent that either Borrower fails to pay any amount required to be paid by it to the Administrative Agent,
any Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this Section and without limiting such Borrowers obligation
to do so, each Lender severally agrees to pay to the Administrative Agent, such Issuing Bank or the Swingline Lender, as the case
may be, such Lenders Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the Administrative Agent, such Issuing Bank or the
Swingline Lender in its capacity as such. The obligations of the Lenders under this paragraph (c) are subject to the last sentence of
Section 2.02(a) (which shall apply mutatis mutandis to the Lenders obligations under this paragraph (c)).
(d) To the fullest extent permitted by applicable law, neither Borrower shall assert, and each Borrower hereby waives,
any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to
direct or actual damages) arising out of, in connection with, or as a result of, any Loan Document or any agreement or instrument
contemplated thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

(e) All amounts due under this Section shall be payable not later than three Business Days after written demand
therefor setting forth the basis for such claim in reasonable detail.
SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank
that issues any Letter of Credit), except that (i) neither Borrower may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by such Borrower without such
consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other
than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank that issues
any Letter of Credit), Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated
hereby, the Related Parties of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy
or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees
all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the
time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of (A) the U.S. Borrower,
provided that no consent of the U.S. Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved
Fund (as defined below) or, if an Event of Default has occurred and is continuing, any other assignee; (B) the Administrative Agent;
and (C) each Issuing Bank.
(ii) Assignments shall be subject to the following additional conditions: (A) except in the case of an assignment
to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lenders
Commitment or Loans, the amount of the Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the trade date specified in the Assignment and Assumption with respect to such
assignment or, if no date is so specified, as of the date the Assignment and Assumption with respect to such assignment
is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the U.S. Borrower and the
Administrative Agent otherwise consent (such consent not to be unreasonably withheld or delayed), provided that no
such consent of the U.S. Borrower shall be required if an Event of Default has occurred and is continuing; (B) each
partial assignment shall be made as an assignment of a proportionate part of all the assigning Lenders rights and
obligations under this Agreement; (C) the parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500, provided that
assignments made pursuant to Section 2.18(b) or Section 9.02(c) shall not require the signature of the assigning Lender
to become effective; (D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent any Tax forms
required by Section 2.16(f) and an Administrative Questionnaire in which the assignee designates one or more credit
contacts to whom all syndicate-level information (which may contain material non-public information about the Loan
Parties and their Related Parties or their respective securities) will be made available and who may receive such
information in accordance with the assignees compliance procedures and applicable laws, including Federal and state
securities laws; (E) any assignment of all or a portion of a Revolving Lenders Revolving Commitment shall be
accompanied by a simultaneous assignment of a pro rata portion of such Lenders Canadian Revolving SubCommitment (it being understood and agreed that a Revolving Lender may not separately assign all or a portion of such
Lenders Canadian Revolving Sub-Commitment other than as contemplated by this clause (E)); and (F) no assignment
shall be made to a Person that is a natural person (or any holding company, investment vehicle or trust for, or owned
and operated for the primary benefit of, a natural person).
For purposes of paragraph (b) of this Section, the term Approved Fund and CLO have the following meanings:

Approved Fund means (a) a CLO and (b) with respect to any Lender that is a fund that invests in bank loans and
similar extensions of credit, any other fund that invests in bank loans and similar extensions of credit and is managed by the same
investment advisor as such Lender or by an Affiliate of such investment advisor.
CLO means an entity (whether a corporation, partnership, trust or otherwise) that is engaged in making, purchasing,
holding or otherwise investing in bank loans and similar extensions of credit in the ordinary course of its business and is administered
or managed by a Lender or an Affiliate of such Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the
effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption
covering all of the assigning Lenders rights and obligations under this Agreement, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.03) and to any fees payable
hereunder that have accrued for such Lenders account but have not yet been paid Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an agent of the Borrowers, shall maintain at one of its
offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitment of, and principal amount of the Loans and LC Disbursements owing to,
each Lender pursuant to the terms hereof from time to time (the Register ) . The entries in the Register shall be
conclusive, and the Borrowers, the Administrative Agent, the Issuing Banks and the Lenders shall treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrowers, any
Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an
assignee, the assignees completed Administrative Questionnaire and any Tax forms required by Section 2.16(f) (unless
the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this
Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Assumption and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in
this paragraph.
(vi) The words execution, signed, signature and words of like import in any Assignment and Assumption
shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of
the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal
Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act
or any other similar state laws based on the Uniform Electronic Transactions Act.
(c)
(i) Any Lender may, without the consent of the Borrowers, the Administrative Agent, any Issuing Bank or the
Swingline Lender, sell participations to one or more banks or other entities (a Participant) in all or a portion of such Lenders rights
and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it), provided that (A) such
Lenders obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other
parties hereto for the performance

of such obligations and (C) the Borrowers, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lenders rights and obligations under this Agreement.
(ii) Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver
of any provision of the Loan Documents, provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso
to Section 9.02(b) that affects such Participant. Subject to paragraph (c)(iii) of this Section, the Borrowers agree that each
Participant shall be entitled to the benefits of Sections 2.14, 2.15 and 2.16 (subject to the requirements and limitations
therein) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section, provided that such Participant shall be subject to Section 2.18 as though it were a Lender. To the extent
permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender,
provided that such Participant shall be subject to Section 2.17(d) as though it were a Lender.
(iii) A Participant shall not be entitled to receive any greater payment under Section 2.14, 2.15 or 2.16 than the
applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the U.S. Borrowers prior written consent. A Participant that
would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.16 unless the U.S.
Borrower is notified of the participation sold to such Participant and such Participant complies with Section 2.16(f) as
though it were a Lender.
(iv) Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the
Borrowers, maintain a register on which it enters the name and address of each Participant and the principal amounts
(and stated interest) of each Participants interest in the Loans or other obligations under the Loan Documents (the
Participant Register); provided that no Lender shall have any obligation to disclose all or any portion of the Participant
Register (including the identity of any Participant or any information relating to a Participant's interest in any
commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the
extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in
registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant
Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in
the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice
to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall
have no responsibility for maintaining a Participant Register.
(d)
Any Lender may at any time, without the consent of the Borrowers or the Administrative Agent, pledge or
assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest, provided that no such pledge or assignment of a security interest shall release a Lender from any of
its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
(e)
Notwithstanding anything to the contrary contained herein, any Lender (a Granting Lender) may grant to a
special purpose funding vehicle (an SPV), identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrowers, the option to provide to the applicable Borrower all or any part of any Loan that such
Granting Lender would otherwise be obligated to make to such Borrower pursuant to this Agreement, provided that (i) nothing herein
shall constitute a commitment by any SPV to make any Loan and (ii) if an SPV elects not to exercise such option or otherwise fails to
provide all or any part of such Loan,

the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof. The making of a Loan by an SPV hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender.
Each party hereto hereby agrees that no SPV shall be liable for any indemnity or similar payment obligation under this Agreement (all
liability for which is hereby assumed by and shall remain with the Granting Lender). In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper or other senior indebtedness of any SPV, such party will not
institute against, or join any other person in instituting against, such SPV any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under the laws of the U.S. or any State thereof. In addition, notwithstanding anything to the contrary
contained in this Section 9.04, any SPV may (i) with notice to, but without the prior written consent of, the Borrowers and the
Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to the
Granting Lender or to any financial institutions (consented to by the U.S. Borrower and Administrative Agent) providing liquidity or
credit support to or for the account of such SPV to support the funding or maintenance of Loans and (ii) disclose on a confidential
basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPV.
SECTION 9.05. Survival. All covenants, agreements, representations and warranties made by the Borrowers and the
other Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this
Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and the issuance of any Letters of Credit, regardless of
any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, any 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
hereunder, 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 Obligation (as distinguished from the Secured Obligations) under this Agreement is outstanding and unpaid or any Letter of Credit
is outstanding and so long as the Revolving Commitments have not expired or terminated. The provisions of Sections 2.14, 2.15, 2.16
and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the
termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement 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 Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent or the syndication of the Loans and Commitments constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject
matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or by Adobe
pdf file shall be effective as delivery of an original executed counterpart of this Agreement.
SECTION 9.07. 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.
SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender, each Issuing
Bank and each of their respective 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, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, such
Issuing Bank or any such Affiliate to or for the credit or the account of the applicable Borrower against any of and all the obligations of
such Borrower now or hereafter existing under this Agreement held by such Lender or such Issuing Bank, irrespective of whether or
not such Lender or such Issuing Bank shall have made any demand under this Agreement and although such obligations may be
unmatured or are owed to a branch or office of such Lender or such Issuing Bank different from the branch or office holding such
deposit or obligated on such Indebtedness; provided that none of the Lenders, the Issuing Banks or any of their respective Affiliates
shall exercise any right of setoff under this Section 9.08 against any Canadian Loan Party or any of its assets or apply any deposits of
any Canadian Loan Party, in each case with respect to any Obligations other than Canadian Secured Obligations. The applicable Lender
and the applicable Issuing Bank shall notify the applicable Borrower and the Administrative Agent of such setoff and application,
provided that any failure to give or any delay in giving such notice shall not affect the validity of any such setoff and application under
this Section. The rights of each Lender, each Issuing Bank and their respective Affiliates under this Section are in addition to other
rights and remedies (including other rights of setoff) that such Lender, such Issuing Bank and their respective Affiliates may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process. (a) Except as expressly provided in Section
9.20, this Agreement and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon,
arising out of or relating to this Agreement and the transactions contemplated hereby shall be construed in accordance with and
governed by the law of the State of New York.
(b ) Each party 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 U.S. 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 any 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 enforced in other jurisdictions by suit on the judgment or in any other manner provided
by law.
( c ) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out
of or relating to any Loan Document in any court referred to in paragraph (b) of this Section. 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 9.01. Nothing in any Loan Document will affect the right of any party to this Agreement to serve process in any other manner
permitted by law. The parties hereto hereby agree that the U.S. Borrower shall be the authorized agent for the Canadian Borrower,
upon whom process may be served in any suit, action or proceeding arising out of or relating to this Agreement and the other Loan
Documents or the performance of services hereunder or thereunder which may be instituted in any court referred to in Section
9.09(b). Service of process upon the U.S. Borrower shall be deemed, in every respect, effective service of process upon the Canadian
Borrower.
SECTION 9.10. 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 ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY (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.
SECTION 9.11. 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 shall not affect the construction of, or be taken into consideration in interpreting, this
Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing Banks and the Lenders agrees to maintain
the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates directors,
officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to any Loan Document or the enforcement of rights thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any Swap Agreement relating to the Loan Parties and their obligations under the Loan Documents, (g)
with the consent of the U.S. Borrower or (h) to the extent such Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis
from a source other than a Loan Party. For the purposes of this Section, Information means all information received from a Loan
Party and/or its Related Parties or representatives relating to any Loan Party, its Subsidiaries or their respective businesses, other than
any such information that is available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis prior to
disclosure by any Loan Party and/or its Related Parties or representatives, provided that, in the case of information received from either
Borrower and/or its Related Parties or any Subsidiary after the Restatement Effective Date, such information is clearly identified at the
time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own confidential information.
(b) Each Lender acknowledges that information as defined in Section 9.12(a) furnished to it pursuant to this Agreement
may include material non-public Information concerning the Loan Parties and their Related Parties or their respective securities, and
confirms that it has developed compliance procedures regarding the use of material non-public Information and that it will handle such
material non-public Information in accordance with those procedures, applicable law, including Federal and state securities laws, and
the terms hereof.
( c ) All information, including waivers and amendments, furnished by the Loan Parties, their Related Parties or
representatives or the Administrative Agent pursuant to, or in the course of administering, this Agreement will be syndicate-level
information, which may contain material non-public Information about the Loan Parties and their Related Parties or their respective
securities and its securities. Accordingly, each Lender represents to the Borrowers (on behalf of the Loan Parties) and the
Administrative Agent that it has identified in its Administrative Questionnaire a credit contact who may receive Information that may
contain material non-public Information in accordance with its compliance procedures, applicable law and the terms hereof.
SECTION 9.13. USA PATRIOT Act. Each Lender, each Issuing Bank and the Administrative Agent (for itself and not
on behalf of any Lender) hereby notifies each Loan Party that, pursuant to the requirements of the USA PATRIOT Act, it is required to
obtain, verify and record information that identifies such Loan Party, which information includes the name and address of such Loan
Party and other information that will allow such Lender, such Issuing Bank or the Administrative Agent, as applicable, to identify such
Loan Party in accordance with the USA PATRIOT Act, and each Loan Party agrees to provide such information from time to time to
such Lender, such Issuing Bank and the Administrative Agent, as applicable. This notice is given in accordance with the requirements
of the USA PATRIOT Act and is effective for each Lender, each Issuing Bank and the Administrative Agent.

SECTION 9.14. Disclosure. The Borrowers and each Lender hereby acknowledges and agrees that the Administrative
Agent and/or its Affiliates from time to time may hold investments in, make other loans to or have other relationships with any of the
Loan Parties and their respective Affiliates.
SECTION 9.15. Appointment for Perfection. Each Lender hereby appoints each other Lender as its agent for the purpose
of perfecting Liens, for the benefit of the Administrative Agent and the Lenders, in assets which, in accordance with Article 9 of the
UCC, the applicable provisions of the PPSA or any other applicable law, can be perfected only by possession. Should any Lender (other
than the Lender serving hereunder as the Administrative Agent) obtain possession of any such Collateral, such Lender shall notify the
Administrative Agent thereof, and, promptly upon the Administrative Agents request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with the Administrative Agents instructions.
SECTION 9.16. Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate
applicable to any Loan or participation in any LC Disbursement, together with all fees, charges and other amounts that are treated as
interest on such Loan or LC Disbursement or participation therein under applicable law (collectively the Charges), shall exceed the
maximum lawful rate (the Maximum Rate) that may be contracted for, charged, taken, received or reserved by the Lender holding
such Loan or LC Disbursement or participation therein in accordance with applicable law, the rate of interest payable in respect of such
Loan or LC Disbursement or participation therein hereunder, together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan or LC
Disbursement or participation therein but were not payable as a result of the operation of this Section shall be cumulated and the interest
and Charges payable to such Lender in respect of other Loans or LC Disbursements or participation therein or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds
Effective Rate to the date of repayment, shall have been received by such Lender.
SECTION 9.17. Existing Credit Agreement; Effectiveness of Amendment and Restatement. Until this Agreement
becomes effective in accordance with the terms of the Amendment and Restatement Agreement, the Existing Credit Agreement shall
remain in full force and effect and shall not be affected hereby. After the Restatement Effective Date, all obligations of the U.S.
Borrower under the Existing Credit Agreement shall become obligations of the U.S. Borrower hereunder and the provisions of the
Existing Credit Agreement shall be superseded by the provisions hereof.
SECTION 9.18. No Fiduciary Relationship. Each Borrower, on behalf of itself and the Subsidiaries, agrees that in
connection with all aspects of the transactions contemplated hereby and any communications in connection therewith, the Borrowers,
the Subsidiaries and their respective Affiliates, on the one hand, and the Administrative Agent, the Lenders and their respective
Affiliates, on the other hand, will have a business relationship that does not create, by implication or otherwise, any fiduciary duty on
the part of the Administrative Agent, the Lenders or their respective Affiliates, and no such duty will be deemed to have arisen in
connection with any such transactions and communications. Each of the Administrative Agent, each Lender, each Issuing Bank and
each of their respective Affiliates may have economic interests that conflict with those of the Loan Parties, their respective stockholders
and/or their respective Affiliates.
SECTION 9.19. Bifurcation. Notwithstanding anything to the contrary contained in this Agreement or any other Loan
Document, except with respect to Secured Obligations for which the Canadian Loan Parties (as distinguished from the Loan Parties
generally) are expressly liable under this Agreement or any other Loan Document, neither the Canadian Borrower nor any other
Canadian Loan Party shall guaranty, pledge assets in support of, be subject to any right of setoff with respect to, or otherwise be liable
for any Obligations that are not Canadian Secured Obligations, including all indemnities and costs and expenses that do not solely relate
to the Canadian Secured Obligations, the Canadian Loan Parties or any Canadian Collateral. In furtherance of the foregoing, each of the
parties acknowledges and agrees that the liability of any Canadian Loan Party for the payment and performance of its covenants,
representations and warranties set forth in this Agreement and the other Loan Documents shall be several from but not joint with the
U.S. Secured Obligations; and the Collateral of the Canadian Loan Parties shall not secure or be applied

in satisfaction, by way of payment, prepayment or otherwise, of all or any portion of the U.S. Secured Obligations. For the avoidance of
doubt, the U.S. Loan Parties shall be jointly and severally liable for all U.S. Secured Obligations and all Canadian Secured Obligations.
SECTION 9.20. Quebec Collateral Matters. (a) Power of Attorney. Without limiting the powers of the Administrative
Agent hereunder or under any other Loan Document to the extent applicable, each of the Lenders hereby acknowledges that the
Administrative Agent (or a collateral agent designated by the Administrative Agent) shall, for the purposes of holding any security
granted by any Loan Party on the property of such Loan Party pursuant to the laws of the Province of Quebec, be the holder of an
irrevocable power of attorney (fond de pouvoir) (within the meaning of Article 2692 of the Civil Code of Quebec) for all present and
future holders of any bond or other title of indebtedness issued by such Loan Party to the Administrative Agent (or such designated
collateral agent) for the benefit of the Lenders and secured by a hypothec granted by such Loan Party pursuant to the laws of the
Province of Quebec. Each of the Lenders hereby irrevocably constitutes, to the extent necessary, the Administrative Agent (or such
designated collateral agent) as the holder of such irrevocable power of attorney (fond de pouvoir) (within the meaning of Article 2692
of the Civil Code of Quebec) in order to hold security granted by the Loan Parties in the Province of Quebec. Each Person that becomes
a Lender pursuant to Section 9.04 (for purposes of this Section 9.20, an Assignee) shall be deemed to have confirmed and ratified the
appointment of the Administrative Agent (or such designated collateral agent) as the holder of such irrevocable power of attorney
(fond de pouvoir) by execution of an Assignment and Assumption. Notwithstanding the provisions of Section 32 of An Act respecting
the Special Powers of Legal Persons (Quebec), the Borrowers and the Lenders irrevocably agree that the Administrative Agent may
acquire and be the holder of any bond or other title of indebtedness issued by a Loan Party and secured by a hypothec granted by such
Loan Party pursuant to the laws of the Province of Quebec at any time and from time to time. The Borrowers hereby acknowledge that
any such bond constitutes a title of indebtedness, as such term is used in Article 2692 of the Civil Code of Quebec.
(b ) Quebec Bond Pledge. Each Borrower hereby expressly acknowledges, declares, agrees and confirms that any
Assignee, through the Administrative Agent, shall have all the benefits of and is hereby acknowledged for all purposes of the Loan
Documents as being a payee under any bond or other title of indebtedness issued by any Loan Party to the Administrative Agent (or
such designated collateral agent) and secured by a hypothec granted by such Loan Party pursuant to the laws of the Province of
Qubec, jointly with the other Lenders, in the same manner and to the same extent as though such Assignee were an original named
payee thereunder and pursuant to any pledge of such bond or other title of indebtedness in favor of the Administrative Agent (or such
designated collateral agent), the Administrative Agent (or such designated collateral agent) shall hold such bond or other title of
indebtedness as pledgee for the benefit of such Assignee, jointly with the other Lenders.
(c) Quebec Law Governing. This Section 9.20 shall be governed by, and construed and interpreted in accordance
with, the law in force in the Province of Quebec.
SECTION 9.21. Judgment Currency. (a) The obligations of any Loan Party under this Agreement and the other Loan
Documents to make payments in U.S. dollars or in Canadian dollars (in any such case, the Obligation Currency) shall not be
discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the
Obligation Currency, except to the extent that such tender or recovery results in the effective receipt by the Administrative Agent, the
respective Issuing Bank or the respective Lender, as the case may be, of the full amount of the Obligation Currency expressed to be
payable to the Administrative Agent, such Issuing Bank or such Lender, as the case may be, under this Agreement or the other Loan
Documents. If, for the purpose of obtaining or enforcing a judgment against any Loan Party in any court or in any jurisdiction, it
becomes necessary to convert into or from any currency other than the Obligation Currency (such other currency, the Judgment
Currency) an amount due in the Obligation Currency, the conversion shall be made at the rate of exchange quoted by the
Administrative Agent, determined, in each case, as of the business day immediately preceding the day on which the judgment is given
(such business day, the Judgment Currency Conversion Date).
(b) If there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the
date of actual payment of the amount due, each Loan Party covenants and agrees to pay, or cause to

be paid, such additional amounts, if any (but in any event not a lesser amount), as may be necessary to ensure that the amount paid in
the Judgment Currency, when converted at the rate of exchange prevailing on the actual date of payment, will produce the amount of
the Obligation Currency that could have been purchased with the amount of the Judgment Currency stipulated in the judgment or
judicial award at the rate of exchange prevailing on the Judgment Currency Conversion Date.
(c) For purposes of determining any rate of exchange for this Section 9.21, such amounts shall include any premium
and costs payable in connection with the purchase of the Obligation Currency.

SCHEDULE 1.01(a)
USG CORPORATION
STATEMENT OF INVESTMENT OBJECTIVE AND GUIDELINES
(see following attached pages)

Exhibit A
Investment Policy
Dated: May 2013
Scope
This policy shall apply to USG Corporation and the corporate cash managed by internal treasury staff of USG Corporation as well as external
managers that are utilized. This policy does not cover cash managed by foreign entities, pension assets or the 401K plan. All investments covered
under this policy will be purchased in U.S. dollars.
USG Corporate cash will be segmented into two categories based in the different characteristics of each and the business needs. As the cash
levels change, the segmentation strategy may be updated.
Tier I: Operating Cash: Cash balances, overnight sweep investments and short-term investments that are held for working capital and daily
operating needs. This segment of cash requires preservation of principal, late-day access and liquidity.
Tier II: Reserve Cash: Excess cash that is not required for operating cash and set aside for specific purposes such as the $300 million maturity of
the Senior Notes on August 1, 2014.

Investment Objectives
The investment objectives of this policy are, in priority order:
Maintain safety and preservation of principal through a well-diversified portfolio of high-grade fixed income securities.
Provide sufficient liquidity of investments to meet projected operating cash requirements.
Deliver yields in excess of selected benchmarks, in relationship to the guidelines and tax considerations. At the time of the inception of
this Investment Policy, USG Corporation is not a taxpaying entity.

Roles and Responsibilities

The CFO and Treasurer are authorized to approve and amend the investment policy.
The Assistant Treasurer and his/her staff are responsible for executing the policy.
Tier I cash is managed by the treasury staff at the Corporate Headquarters and Tier II cash is managed by outside investment managers.
Investment Parameters
Specific eligible securities for U.S. cash Investments- see Appendix 1

ARTICLE ICredit Rating Requirements Excludes Money Market Mutual Funds

Investments must be rated by at least one of the three following credit rating agencies at the time of purchase: if rated by more than one agency
the lowest rating shall prevail.
Moodys Investors Service
Standard & Poors
Fitch Ratings
Average Credit Quality
The minimum average credit quality for each tier of the investment portfolio at the individual portfolio level must maintain a weighted
rating of A or higher. The weighted average quality will be calculated by using mapping tables for each rating agency that assign
numerical values for each credit. Then the weighted average of those numbers (based on % market value) will be applied to get the
average credit rating on the portfolio.In the case of a

security being rated by more than one agency, the lowest rating shall prevail.
Security Downgrade
In the event a security in the portfolio is downgraded below the minimum credit quality allowed for the category, the external investment manager
and/or Treasury personnel responsible for the internal management of the corporate cash will contact the Assistant Treasurer as soon as possible.
A plan of action will be determined in a reasonable time. It is not mandatory that the security must be sold. However, if the decision is made to
hold the investment, the reason for the decision must be documented.
Realized Gains/Losses
USG Corporation will instill no restriction on gains earned from investments managed in house or by an external manager. For each quarter, the
portfolio must adhere to a zero realized net loss policy (excluding realized losses from securities sold due to a credit downgrade).
Duration Limit

Portfolios managed by an external manager must maintain a weighted average duration not to exceed 1 year.
Benchmark
Tier I: The iMoneyNet First Tier Institutional will be used as the benchmark for the operating cash.
Tier II: The ML 3 month Treasury Bill Index will be the benchmark for the reserve cash. Ticker: <GO01>

Reporting and Evaluation and Compliance

The external investment manager(s) must communicate regularly with the Treasurer and Assistant Treasurer, with formal meetings at least
annually. The investment manager(s) must provide detailed monthly reporting on each investment portfolio. Electronic reporting should be provided
in a timely manner consistent with the Company's calendar and cutoff dates provided by the Assistant Treasurer. The portfolio's performance and
risk profile is to be reported on a monthly, quarterly and annual basis. These reports should support accounting classifications such as Available
for Sale, performance of the portfolio and should at least include:
*Total securities held in the portfolio, including maturity date, coupon rate and current yield to maturity
*Mark to market valuations
*Liquidity/cash flow schedule
*Portfolio value
*Investment income
*Performance figures
*Comparisons to the selected benchmark index
*Realized gains/losses
*Portfolio risk profile
Finally, the investment manager(s) should provide a certification of compliance with the stated investment policy and a related report that explains
any exceptions.

(a)

Appendix 1

SECTION 10.02. USG Corporation - Tier I: Operating Cash

SECTION 10.03. INVESTMENT POLICY

SECURITY TYPE

(A) Obligations of: US Treasury,

Government & Agency Securities

MINIMUM
CREDIT
RATING

MAXIMUM
MATURITY

MAXIMUM
PORTFOLIO
EXPOSURE

MAXIMUM
ISSUER EXPOSURE

Aa1/AA+

6 Months

100%

N/A

A-1/P-1

90 days

30%

5%

Includes: US Treasury
Bills, Notes & Bonds, Agency and GSE securities

(B) Commercial Paper

Money Market Mutual Funds**
Includes: Taxable & Tax-exempt

Stable NAV, 2a-7 Daily

compliant

100%

Our exposure cannot be greater

than 5% of total assets of the
money market fund*

Certificates of Deposit
Includes: (Domestic, Eurodollar, and Yankee), Eurodollar Deposits,
Time Deposits

A-1/P-1

6 Months

30%

5%

Obligations of Foreign Governments and Supranational Organizations

AAA/Aaa

6 Months

50%

5%

Note: Securities issued under rule 144A or other private placements are eligible

*At no time may the total investment in any single Money Market Mutual Fund exceed $100MM.
**Due diligence review will be conducted on Money Market Fund providers. See Appendix 2.

SECTION 10.04. USG Corporation -Tier II: Reserve Cash

SECTION 10.05. INVESTMENT POLICY

SECURITY TYPE

(A) US Treasury, Government & Agency

Securities

MINIMUM
CREDIT RATING

MAXIMUM
MATURITY

MAXIMUM
PORTFOLIO
EXPOSURE

MAXIMUM
ISSUER
EXPOSURE

Aa1/AA+

3 Years

100%

N/A

7 Days

50%

25%

Includes: US Treasury Bills,

Notes & Bonds, Agency and GSE securities
Refer to rating
Collateral type: Treasuries, applicable to collateral
type

(B) Repurchase Agreements

Agencies, Corporates
Collateral margin: 102% of the face value

(C) Commercial Paper

A-1/P-1

13 Months

50%

5%

(D) Asset Backed Commercial Paper

A-1/P-1

13 Months

50%

5%

Stable NAV, 2a-7

compliant

Daily

100%

Our exposure
cannot be greater
than 5% of total
assets of the money
market fund.

A-1/P-1/ VMIG1

7 Days

50%

5%

A3/A-

3 Years

50%

5%

A-1/P-1/VMIG1
BBB-/Baa3*

3 Years

50%
* No more than
25% of the
portfolio in BBB/Baa3

5%

Certificates of Deposit
Includes: (Domestic, Eurodollar, and Yankee), Eurodollar Deposits, Time
Deposits

A-1/P-1

2 years

50%

5%

Obligations of Foreign Governments and Supranational Organizations

AAA/Aaa

3 Years

50%

5%

AAA/Aaa

13 Months

15%

5%

Money Market Mutual Funds**

Includes: Taxable & Tax-exempt

(E) Variable Rate Demand Notes

Includes: Taxable & Tax-exempt
Corporate Bonds (US & Foreign)
Includes: US & Foreign corporate notes, bonds & debentures,
Eurodollar/Yankee debt obligations, fixed and floating

(F) Local, City, State Government & Agency

Obligations
Including but not limited
to: General obligation bonds, revenue bonds,non-rated and non-rerated prerefunded bonds and project bonds

(G) Credit Card and Auto Asset Backed

Securities
-Minimum credit criteria is at time of purchase

-Maximum issuer exposure is at time of purchase

-Maximum maturity is defined as from settlement date
Note: Securities issued under rule 144A or other private placements are eligible
* For Asset Backed Securities Weighted Average Life (WAL) will be used as final maturity for the purposes of duration calculation
** Due diligence review will be conducted on Money Market Fund providers. See Appendix 2.

(b) Appendix 2

Money Market Fund Guidelines

Fund must have at least $10B in Assets under Management (AUM). If fund is smaller, then an exception must be approved by the
Treasurer.
Fund must be bank sponsored by a strong financial entity or be part of a large fund provider.
The liquidity business must be a key component of the overall business of the asset management firm.
Our exposure cannot be greater than 5% of total assets of the money market fund .
The portfolio manager and credit team must be accessible and available upon request.
Fund must be willing to provide, holdings, and Weighted Average Maturity (WAM) at request.
Fund must comply with Rule 2a(7) of the Investment Company Act

Approved by:

____________________________________
Brian Misiunas
Assistant Treasurer

Dated: ________________

____________________________________
Kenneth R. Banas
Treasurer

Dated: ________________

____________________________________
Matt F. Hilzinger
EVP and CFO

Dated: ________________

SCHEDULE 1.01(b)
Borrowing Base Supplemental Documentation
(see following attached pages)

USG Corporation
Schedule of Borrowing Base Supplemental Documentation
Documents to be Submitted to the Administrative Agent
The following information is to be submitted, pursuant to Section 5.01 of the Credit Agreement, for USG Corporation as noted below:
Reporting Frequency

Borrowing Base Certificate in the form of Exhibit

Monthly Reporting: Due within

Fifteen (15) Business Days

Weekly Reporting: Due within

Three (3) Business Days

Accounts Receivable Supporting Documents:

1.

Accounts receivable summary aging aged by invoice date or due date, as applicable, by operating
division in an electronic format suitable to the Administrative Agent

Accounts receivable rollforward by operating division in a format suitable to the Administrative

2. Agent

3. Top 10 accounts receivable balances aged per the most recent summary aging by operating division

Reconciliation of A/R aging report to the general ledger and financial statements by operating
4. division

5. Top 10 Sales Concentration for Prior Twelve months by operating division

Supporting documentation (system generated extract report where applicable) for the A/R ineligibles/
6.
reserves reported on the Borrowing Base Certificate by operating division

Inventory Supporting Documents:

An inventory perpetual report and schedules detailing each operating division's inventory, in a form
satisfactory to the Administrative Agent, (i) by summarized locations, (ii) by department, (iii) by
1. volume on hand and (iv) other schedules as reasonably requested

2. Gross margin and turnover by product segment by operating division

Reconciliation of perpetual inventory reports to the general ledger and financial statements by
3. operating division

Schedule of monthly rent or unpaid fees related to leased or unowned locations (eg: outside
processors, third party warehouses or other locations for which landlord waivers or bailee letters have
4. not been received)

5. Inventory value stated at cost by location for each operating division

Supporting documentation (system generated extract report where applicable) for the inventory
6.
ineligibles/ reserves reported on the Borrowing Base Certificate by operating division

Other Supporting Documents:

1.

Accounts payable summary aging by vendor and by operating division in a format suitable to the
Administrative Agent

2.

Top 10 accounts payable vendor balances by aging category and operating division

3.

Year-to-date top 10 purchases concentration by vendor and operating division

4.

Reconciliation of A/P aging to general ledger and financial statements per operating division

5.

Spreadsheet including threshold limits, past highest margin call analysis (if applicable), outstanding
trades and net positions per counterparty (i.e., mark-to-market position for each trade) for each
Designated Swap Obligation, together with associated ISDA agreements

6.

Cash and Cash Equivalents Balance

Submit to:

Copy to:

JPMorgan Chase Bank, N.A.

J.P. Morgan Securities LLC

Schedule 3.06
Disclosed Matters
As has been disclosed in U.S. Borrowers SEC Reports previously delivered or made available to the Agent, the Lenders and the
Issuing Banks prior to the Restatement Effective Date, in late 2012, the U.S. Borrower and United States Gypsum Company, a
wholly-owned Subsidiary of the U.S. Borrower (and together with the U.S. Borrower, the Named Parties), were named as
defendants in putative class action lawsuits alleging that since at least September 2011, wallboard manufacturers in the United
States conspired to fix and raise the price of gypsum wallboard sold in the United States and to effectuate the alleged conspiracy
by ending the practice of providing job quotes on wallboard. One group of plaintiffs purports to represent a class of entities that
purchased gypsum wallboard in the United States directly from any of the defendants or their affiliates from January 1, 2012 to the
present. The second group of plaintiffs purports to bring their claims and seek damages on behalf of indirect purchasers of gypsum
wallboard. While denying any liability or wrongdoing of any type, the Named Parties have entered into a settlement agreement in
principle with the attorneys representing the direct and indirect purchaser plaintiffs in the U.S. wallboard pricing lawsuits and are in
the process of completing a term sheet. Assuming the settlement is resolved pursuant to the agreement in principle (which is
subject to court approval), the Named Parties will pay a total of $48 million to resolve the U.S. direct and indirect purchaser cases.
The settlement described above does not include the Canadian lawsuits. In connection with this agreement in principle, the U.S.
Borrower will record a charge of $48 million in the third quarter of 2014. These settlement amounts and charge are not reflected in
results of operation reported in the financial statements provided to or made available to the Administrative Agent, the Lenders and
the Issuing Banks prior to the Restatement Effective Date.

Schedule 3.10(c)
Canadian Pension Plans

The most recent actuarial valuation of the CGC Inc. Retirement Plan (the Plan) is as at January 1, 2014. At that date the
actuary reported that the Plan had a solvency deficiency of $9.6385 million and a hypothetical wind up deficit of $13.0773
million.

Schedule 6.01
Existing Indebtedness

Obligor(s)
USG Corporation

Description of Indebtedness
Industrial Revenue Bonds
Ohio Air Quality Development Authority
Ohio Air Quality Development Authority
Ohio Air Quality Development Authority
City of East Chicago, Indiana
City of East Chicago, Indiana
Pennsylvania Economic Development Financing Authority
Oregon Economic & Community Development Commission
Senior Notes
5.875% Senior Notes Due 2021
6.3% Senior Notes Due 2016
7.75% Senior Notes Due 2021
7.875% Senior Notes Due 2020
8.375% Senior Notes Due 2018

Amount
$45,000,000
$44,400,000
$9,000,000
$10,000,000
$10,000,000
$110,000,000
$11,000,000
$350,000,000
$500,000,000
$500,000,000
$249,000,000
$350,000,000

Schedule 6.02
Existing Liens

US Liens
Filing Type

Jurisdiction

File Date

File Number

Secured Party

Description

5/8/09

2009 1472072

Les Schwab Tire Centers of

Idaho, Inc.

Contractual Security Agreement in present and future

products, goods and proceeds re tires, wheels, batteries

3/4/10

2010 0723886

Les Schwab Warehouse Center, Contractual Security Agreement in all present and future
Inc.
products, goods and proceeds re tires, wheels, batteries

4/17/09

2009 1232773

The Dow Chemical Company

Products

4/9/10

2010 1238157

Arizona Chemical Company

"UNI-REZ 2635" products

5/10/10

2010 1626476

International Paper Company

Consigned Paper products

5/17/10

2010 1710809

Weavexx, LLC (SP assignment Consigned Fabrics/rolls for machines (restated collateral
to PNC Bank, National
filed 6/23/10, #2010 2192635)
Association, as Collateral Agent
filed 8/20/13, #2013 3268720)
(addt'l SP assignment to:
Jefferies Finance LLC, as
Collateral Agent filed 8/20/13,
#2013 3268738)

1/31/12

2012 0397127

Arch Chemicals, Inc.

Consigned Inventories of Sodium Omadine Fungicide

11/28/12

2012 4567337

Arch Chemicals, Inc.

Consigned Inventories of Sodium Omadine Fungicide,

Zinc Omadine Antimicrobial and Zinc Omadine ZOE
Antimicrobial

4/17/09

2009 1232773

The Dow Chemical

Corporation

Title to products (chemicals)

5/21/09

2009 1611976

Magid Glove

Inventory of work gloves, safety clothing and safety

products.

8/9/10

2010 2881153

Joseph T. Ryerson & Son,

Corp.

Consigned parts

11/28/12

2012 4567337

Arch Chemicals, Inc.

Consigned Sodium Omadine Fungicide, Zinc Omadine

Antimicrobial and Zinc Omadine ZOE Antimicrobial

L&W Supply Corporation

UCC

DE-Secretary of State

United States Gypsum Company

UCC

DE-Secretary of State

USG Corporation
UCC

DE-Secretary of State

USG Interiors LLC

UCC

DE-Secretary of State

Canadian Liens
None.

Schedule 6.04
Existing Investments

1.

Beltship Management Ltd., a joint venture - 50% owned by Gypsum Transportation, Limited

2.

Donn South Africa (PTY) Ltd., a joint venture - 33% owned by USG Foreign Investments, Ltd.

3.

Knauf/USG Systems GmbH & Co. KG, a joint venture - 50% owned by USG Ventures-Europe GmbH.

4.

Knauf-USG Verwaltungs GmbH, a joint venture - 50% owned by USG Ventures-Europe GmbH.

5.

Gas Natural Caxitln, S. de R.L. de C.V. - 50% owned by USG de Mxico, S.A. de C.V.

6.

USG Boral Building Products Pte Limited - 50% owned by USG Netherlands Global Holdings B.V.

7.

USG Boral Building Products Pty Limited - 50% owned by USG Netherlands Global Holdings B.V.

8.

Investments by USG Corporation and its wholly-owned Subsidiaries in the Equity Interests of the wholly-owned Subsidiaries
of USG Corporation.

Schedule 6.09
Existing Restrictions
1. Indenture, dated as of November 1, 2006, by and between USG Corporation and Wells Fargo Bank, National Association,
as trustee, together with the following supplements:
a. Supplemental Indenture No. 1, dated as of November 17, 2006, by and between USG Corporation and Wells Fargo
Bank, National Association, as trustee, including the 6.30% Senior Notes due 2016 of USG Corporation issued
pursuant thereto;
b. Officers Certificate of USG Corporation dated September 27, 2007 Establishing Terms of a Series of Securities
Under Open-End Indenture (7.750% Senior Notes due 2018), including the 7.750% Senior Notes due 2018 of USG
Corporation issued pursuant thereto;
c. Supplemental Indenture No. 2, dated as of August 4, 2009, by and between USG Corporation, each of United States
Gypsum Company, L&W Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, LLC, as
guarantors, and HSBC Bank USA, National Association, as trustee, including the 9.75% Senior Notes due 2014 of
USG Corporation issued pursuant thereto;
d. Supplemental Indenture No. 3, dated as of November 9, 2010, by and between USG Corporation, each of United
States Gypsum Company, L&W Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, Inc., as
guarantors, and HSBC Bank USA, National Association, as trustee, including the 8.375% Senior Notes due 2018 of
USG Corporation issued pursuant thereto;
e. Supplemental Indenture No. 4, dated as of April 12, 2012, by and between USG Corporation, each of United States
Gypsum Company, L&W Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, LLC, as
guarantors, and HSBC Bank USA, National Association, as trustee, including the 7.875% Senior Notes due 2020 of
USG Corporation issued pursuant thereto; and
f. Supplemental Indenture No. 5, dated as of October 31, 2013, by and between USG Corporation, each of United
States Gypsum Company, L&W Supply Corporation, USG Foreign Investments, Ltd. and USG Interiors, LLC, as
guarantors, and HSBC Bank USA, National Association, as trustee, including the 5.875% Senior Notes due 2021 of
USG Corporation issued pursuant thereto.
2. Secured Loan Agreement, dated October 21, 2008, among Gypsum Transportation Limited, the lenders from time to time
party thereto and DVB Bank SE, as agent and security trustee.
3. The equity ownership of the Borrower or a Subsidiary certain of their joint venture entities is subject to provisions which
either (1) provide the other parties to the joint ventures with rights of first refusal or buy/sell rights with respect to such equity
ownership, or (2) prohibit using such equity ownership as security for indebtedness.

Exhibit A

[FORM OF]
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the Assignment and Assumption) is dated as of the Effective Date set forth
below and is entered into by and between [Insert name of Assignor] (the Assignor) and [Insert name of Assignee] (the
Assignee). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified
below (as amended, supplemented or otherwise modified from time to time, the Credit Agreement), receipt of a copy of which is
hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby
agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee
hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of
the Assignors rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or
instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor under the respective facilities identified below (including guarantees and
participations in letters of credit, swingline loans, overadvances and protective advances included in such facilities) and (ii) to the
extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its
capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement,
any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on
or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at
law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold
and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the Assigned Interest). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without
representation or warranty by the Assignor.
1.

Assignor:

______________________________

2. Assignee:

______________________________
[and is an Affiliate/Approved Fund of [identify Lender] Select as applicable.]

3. Borrowers:

USG Corporation, a Delaware corporation, and CGC Inc., a New Brunswick corporation

4. Administrative Agent:

JPMorgan Chase Bank, N.A.

5. Credit Agreement:

The $450,000,000 Fourth Amended and Restated Credit Agreement dated as of October 22, 2014,
among USG Corporation, a Delaware corporation, CGC Inc., a New Brunswick corporation, the
Lenders and Issuing Banks from time to time party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian Administrative
Agent, and Bank of America, N.A. and Wells Fargo Bank, National Association, as co-syndication
agents

6. Assigned Interest:

Aggregate Amount of
Commitment/Loans for all Lenders
$

Percentage Assigned of
Commitment/Loans*

Amount of Commitment/Loans
Assigned
$

Effective Date: _____________ ___, 20___ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE
EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]
The Assignee agrees to deliver to the Administrative Agent a completed Administrative Questionnaire in which the Assignee
designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information
about the Parent Borrower, the Loan Parties and their Related Parties or their respective securities) will be made available and who
may receive such information in accordance with the Assignees compliance procedures and applicable laws, including
U.S. Federal and State securities laws.
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:______________________________
Name:
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:______________________________
Name:
Title:

* Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

Consented to and Accepted:

JPMORGAN CHASE BANK, N.A., as
Administrative Agent
By_________________________________
Name:
Title:
[Consented to:
USG CORPORATION
By________________________________
Name:
Title:]**

**To the extent required pursuant to Section 9.04(b)(i) of the Credit Agreement.

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1
Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the
Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements,
warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the
execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of either Borrower, any of their respective Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or observance by either Borrower, any of their
respective Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified
in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder
and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of
the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01
thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other
Lender, (v) if it is a Foreign Lender, attached to this Assignment and Assumption is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee and (vi) it is
sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or
the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets
of such type; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or
any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.
2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have
accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.
3 . General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the
parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by facsimile or

other electronic transmission shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.
This Assignment and Assumption and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise)
based upon, arising out of or relating to this Assignment and Assumption and the transactions contemplated hereby shall be
construed in accordance with and governed by the law of the State of New York.

EXHIBIT B

[FORM OF]
BORROWING BASE CERTIFICATE
[See following pages]

USG Corporation
Borrowing Base Certificate
For the period ended XX/XX/XXXX (in US$ 000's)

A. US available accounts receivable

B. US available total inventory

Rent reserves

Designated swap reserves

Designated banking services reserves

Other reserves (per terms of Credit Agreement)

Reserve for Canadian Statutory Priority Liens

D. US borrowing base (lines A+B-C)

E. Portion of US borrowing base supporting Canadian revolving exposure

US$ loans (including overadvances and protective advances) outstanding

US$ LC exposure

US$ swingline exposure

I. Canadian available accounts receivable

J. Canadian available total inventory

Rent reserves

Designated swap reserves

Designated banking services reserves

Other reserves (per terms of Credit Agreement)

Reserve for Canadian Statutory Priority Liens

L. Canadian borrowing base (lines I+J-K)

M. Portion of US borrowing base supporting Canadian revolving exposure

C. Less:

F. Lower of:
(i) US borrowing base less portion of US borrowing base supporting Canadian revolving exposure
(lines D-E)
(ii) Revolving Commitment less Canadian revolving exposure
G. US revolving exposure:

H. US excess availability (lines F-G)

K. Less:

N. Lower of:
(i) (US borrowing base + lesser of (x) Canadian sub-commitment and (y) Canadian borrowing base) US revolving exposure

50,000

Canadian Loans (including overadvances and proctective advances) outstanding

Canadian LC exposure

Canadian Swingline exposure

(ii) Canadian sub-commitment

O. Canadian revolving exposure:

P. Canadian excess availability (lines N-O)

Q. Lower of:
(i) Aggregate revolving commitments

450,000,000

(ii) US borrowing base + the lesser of (x) Canadian sub-commitment and (y) Canadian borrowing base $

R. Aggregate revolving exposure (lines G + O)

S. Excess Availability (lines Q - R)

Officer's Certification:
Pursuant to the Fourth Amended and Restated Credit Agreement dated as of October [], 2014, the undersigned Financial Officer of USG Corporation certifies that the information provided in this certificate to JPMorgan Chase Bank, N.A. as Collateral Agent
is true and correct based on the accounting records of USG Corporation.

USG Corporation
Borrowing Base Certificate
For the period ended XX/XX/XXXX (in USD$ 000's)

Gypsum

Interiors

L&W

Cons

Net Aging Balance

Addback: General Accrual Reserves included in Aging

Total Aging Balance (including Accrual Reserves)

(1)

Less ineligibles:
Non-first-priority perfected security interest

Non-Agent Liens

Payment terms greater than 60 days

Credits greater than 30 days past due, 90 days past invoice

Credits written off or uncollectible

Cross-Aged receivables (50%)

Concentration limit 15% (20% if investment rated)

Non-conforming -covenants/reps/warrants

Non-ordinary course, no invoice, progress billing

Needs further performance, bill and hold, consigment

Sale on approval, sale and return, payments of i/r

Non-shipped/delivered

Returned uncollected

Bankrupt, liquidation, reorg, defaulted A/R, etc

Account debtor sold all assets

Foreign obligors (non US or CAN)

A/R not denominated / payable in US$ or C$

Government A/R

Affiliate A/R or officer > $100k or non ordinary course

Contra

Deductions , counterclaim, disputes, offsets, etc

Promissory note, chattel paper, etc

Notice of Business Activities Report

Reductions, adj, for unpaid re-invoiced A/R

Non-compliant with applicable laws

Non-collateral Party payee

Obligors with cash in advance / cash on delivery

Other (per terms of Credit Agreement)

Accrued sales & use taxes

(2)

A/R Reconciliation Items

(2)

Total ineligibles:
Eligible Accounts Receivable before dilution reserve
Calculated Reserves *
Other Reserves
Total Reserves
$

Implied 5% Dilution
Dilution Reserve Required
Adjusted Eligible Accounts Receivable:
Advance rate
Available Accounts Receivable

85%
$

*Interiors Credit Agreement Reference

(1)Eligible

Credit Agreement Reference

in the definition of Eligible Accounts

(2)Referenced

USG Corporation - Canada

Borrowing Base Certificate
For the period ended XX/XX/XXXX (in C$ 000's)
Cons
Net Aging Balance

Addback: General Accrual Reserves included in Aging

Total Aging Balance (including Accrual Reserves)

(1)

Less ineligibles:
Non-first-priority perfected security interest

Non-Agent Liens

Payment terms greater than 60 days

Credits greater than 30 days past due, 90 days past invoice

Credits written off or uncollectible

Cross-Aged receivables (50%)

Concentration limit 15% (20% if investment rated)

Non-conforming -covenants/reps/warrants

Non-ordinary course, no invoice, progress billing

Needs further performance, bill and hold, consigment

Sale on approval, sale and return, payments of i/r

Non-shipped/delivered

Returned uncollected

Bankrupt, liquidation, reorg, defaulted A/R, etc

Account debtor sold all assets

Foreign obligors (non US or CAN)

A/R not denominated / payable in US$ or C$

Government A/R

Affiliate A/R or officer > $100k or non ordinary course

Contra

Deductions , counterclaim, disputes, offsets, etc

Promissory note, chattel paper, etc

Notice of Business Activities Report

Reductions, adj, for unpaid re-invoiced A/R

Non-compliant with applicable laws

Non-collateral Party payee

Obligors with cash in advance / cash on delivery

Other (per terms of Credit Agreement)

Accrued sales & use taxes

(2)

A/R Reconciliation Items

(2)

Total ineligibles:
$

Eligible Accounts Receivable before dilution reserve

Calculated Reserves *
Other Reserves
Total Reserves
Implied 5% Dilution
Dilution Reserve Required
Adjusted Eligible Accounts Receivable:
Advance rate
Available Accounts Receivable

* Interiors reserves are included in Gypsum

85%
$

[XX/XX/XX] Exchange rate date

C$/US$
(1)Eligible

Credit Agreement Reference

in the definition of Eligible Accounts

(2)Referenced

USG Corporation
Borrowing Base Certificate
For the period ended XX/XX/XXXX (in USD$ 000's)
Gypsum

Interiors

L&W

Cons

Raw Materials Per Perpetual

(1)

Less Ineligibles and Inventory Reserves:

Non-first-priority perfected security interest

Non-Agent Liens

Non-conforming -covenants/reps/warrants

Non-ownership, interest, title

Spare parts, packaging, supplies

Consignment (except <$15mm w/ IG customers & Collateral

Access Argts "CAA")

Not located in US/CAN or intransit

Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)

3rd party warehouses/storage facilities w/o docs or Rent Reserves

Processed at offsite or outside processor w/o docs or Rent Reserves

Discontinued product or component

Not in perpetual inventory report

Reclamation rights

Detonators & explosives

Damaged, defective, return to vendor, discontinued, nonsalable

Items without assigned product class

Intercompany profits included in inventory

Re-stocking and delivery fees included in inventory

Testing prototypes display items

Shrink reserve (3)

Slow moving and obsolete reserve

Lower of cost or market reserve

Capitalized favorable variances

Vendor rebate reserve

Other (per terms of the Credit Agreement)

Total ineligibles:

Eligible Raw Materials

Lesser of:
(i) Advance Rate

60%

60%

60%

NOLV %

%
%

%
%

%
%

(ii) 85% of Net Orderly Liquidation Rate

Available Raw Materials

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

USG Corporation
Borrowing Base Certificate
For the period ended XX/XX/XXXX (in USD$ 000's)
Gypsum

Interiors

L&W

Cons

Work in Process Per Perpetual

(1)

Less Ineligibles and Inventory Reserves:

Non-first-priority perfected security interest

Non-Agent Liens

Non-conforming -covenants/reps/warrants

Non-ownership, interest, title

Spare parts, packaging, supplies

Consignment (except <$15mm w/ IG customers & Collateral

Not located in US/CAN or intransit

Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)

3rd party warehouses/storage facilities w/o docs or Rent Reserves

Processed at offsite or outside processor w/o docs or Rent Reserves

Discontinued product or component

Not in perpetual inventory report

Reclamation rights

Detonators & explosives

Deemed to be non-commodity-like in nature (WIP only)

Damaged, defective, return to vendor, discontinued, nonsalable

Items without assigned product class

Intercompany profits included in inventory

Re-stocking and delivery fees included in inventory

Testing prototypes display items

Shrink reserve (3)

Slow moving and obsolete reserve

Lower of cost or market reserve

Capitalized favorable variances

Vendor rebate reserve

Other (per terms of the Credit Agreement)

Total ineligibles:

Eligible Work in Process Inventory

Lesser of:
(i) Advance Rate

60%

60%

60%

NOLV %

%
%

%
%

%
%

(ii) 85% of Net Orderly Liquidation Rate

Available Work In Process Inventory

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

USG Corporation
Borrowing Base Certificate
For the period ended XX/XX/XXXX (in USD$ 000's)
Gypsum

Finished Goods Per Perpetual

Less Ineligibles and Inventory Reserves:

Interiors

L&W

Cons
$

(1)

Non-first-priority perfected security interest

a

Non-Agent Liens
Non-conforming -covenants/reps/warrants
Non-ownership, interest, title
Spare parts, packaging, supplies
Consignment (except <$15mm w/IG customers & Collateral Access Argts CAA
Not located in US/CAN or intransit

Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)

3rd party warehouses/storage facilities w/o docs or Rent Reserves

Processed at offsite or outside processor w/o docs or Rent Reserves

Discontinued product or component

Not in perpetual inventory report

Reclamation rights

Detonators & explosives

Damaged, defective, return to vendor, discontinued, nonsalable

Items without assigned product class

Intercompany profits included in inventory

Re-stocking and delivery fees included in inventory

Testing prototypes display items

Slow moving and obsolete reserve

Lower of cost or market reserve

Capitalized favorable variances

Vendor rebate reserve

Shrink reserve (3)

Other (per terms of the Credit Agreement)

Total ineligibles:
$

Eligible Finished Goods

Lesser of:

(i) Advance Rate

60%

60%

60%

NOLV %

%
%

%
%

%
%

(ii) 85% of Net Orderly Liquidation Rate

Available Finished Goods Inventory

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

USG Corporation - Canada

Borrowing Base Certificate
For the period ended XX/XX/XXXX (in C$ 000's)
CGC

Raw Materials Per Perpetual

(1)

Less Ineligibles and Inventory Reserves:

Non-first-priority perfected security interest

Non-Agent Liens

Non-conforming -covenants/reps/warrants

Non-ownership, interest, title

Spare parts, packaging, supplies

Consignment (except <$15mm w/ IG customers & Collateral

Access Argts "CAA")

Not located in US/CAN or intransit

Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)

3rd party warehouses/storage facilities w/o docs or Rent Reserves

Processed at offsite or outside processor w/o docs or Rent Reserves

Discontinued product or component

Not in perpetual inventory report

Reclamation rights

Detonators & explosives

Damaged, defective, return to vendor, discontinued, nonsalable

Items without assigned product class

Intercompany profits included in inventory

Re-stocking and delivery fees included in inventory

Testing prototypes display items

Shrink reserve (3)

Slow moving and obsolete reserve

Lower of cost or market reserve

Capitalized favorable variances

Vendor rebate reserve

Other (per terms of the Credit Agreement)

Total ineligibles:

Eligible Raw Materials

Lesser of:
(i) Advance Rate

NOLV %

%
%

(ii) 85% of Net Orderly Liquidation Rate

Available Raw Materials
[XX/XX/XX} Exchange rate date
C$/US$

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

USG Corporation - Canada

Borrowing Base Certificate
For the period ended XX/XX/XXXX in C$ 000's)
CGC

Work in Process Per Perpetual

Less Ineligibles and Inventory Reserves:

Non-first-priority perfected security interest

a

m
n

Non-Agent Liens
Non-conforming -covenants/reps/warrants
Non-ownership, interest, title
Spare parts, packaging, supplies
Consignment (except <$15mm w/ IG customers & Collateral
Not located in US/CAN or intransit
Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)
3rd party warehouses/storage facilities w/o docs or Rent Reserves
Processed at offsite or outside processor w/o docs or Rent Reserves
Discontinued product or component
Not in perpetual inventory report
Reclamation rights
Detonators & explosives
Deemed to be non-commodity-like in nature (WIP only)
Damaged, defective, return to vendor, discontinued, nonsalable
Items without assigned product class

Intercompany profits included in inventory

p

Re-stocking and delivery fees included in inventory

Testing prototypes display items

(1)

Shrink reserve (3)

s

Slow moving and obsolete reserve

Lower of cost or market reserve
Capitalized favorable variances
Vendor rebate reserve
Other (per terms of the Credit Agreement)
x
Total ineligibles:
$

Eligible Work in Process Inventory

Lesser of:

(i) Advance Rate

NOLV %

(ii) 85% of Net Orderly Liquidation Rate

Available Work In Process Inventory
[XX/XX/XX} Exchange rate date
C$/US$

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

USG Corporation - Canada

Borrowing Base Certificate
For the period ended XX/XX/XXXX (in C$ 000's)
Gypsum

Finished Goods Per Perpetual

Less Ineligibles and Inventory Reserves:

Non-first-priority perfected security interest

a

Non-Agent Liens
Non-conforming -covenants/reps/warrants
Non-ownership, interest, title
Spare parts, packaging, supplies
Consignment (except <$15mm w/IG customers & Collateral Access Argts CAA
Not located in US/CAN or intransit
Leased locations w/o docs or Rent Reserves Inventory locations <$100,000 (2)
3rd party warehouses/storage facilities w/o docs or Rent Reserves
Processed at offsite or outside processor w/o docs or Rent Reserves
Discontinued product or component
Not in perpetual inventory report
Reclamation rights
Detonators & explosives
Damaged, defective, return to vendor, discontinued, nonsalable
Items without assigned product class

Intercompany profits included in inventory

o

Re-stocking and delivery fees included in inventory

Testing prototypes display items
Shrink reserve (3)

(1)

Slow moving and obsolete reserve

s

Lower of cost or market reserve

Capitalized favorable variances
Vendor rebate reserve
Other (per terms of the Credit Agreement)
Total ineligibles:
$

Eligible Finished Goods

Lesser of:

(i) Advance Rate

NOLV %

%
%

(ii) 85% of Net Orderly Liquidation Rate

Available Finished Goods Inventory

(1) Eligible

Credit Agreement Reference

reserve will represent % of physical inventory discrepancy observed from most recent field exam
(3) Provided that the aggregate value of RM, WIP, and FG stated at cost is less than $100,000 at a location
(2) Shrink

Exhibit C

[FORM OF]
BORROWING REQUEST
[Date]
JPMorgan Chase Bank, N.A.,
as Administrative Agent
c/o Loan and Agency Services Group
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713
Attention: Siyana Custis
Facsimile No.: (302) 634-1845
[JPMorgan Chase Bank, N.A., Toronto Branch,
as Canadian Administrative Agent
c/o JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713
Attention: Siyana Custis
Facsimile No.: (302) 634-1845]
With a copy to:
JPMorgan Chase Bank, N.A.,
383 Madison Avenue
New York, NY 10179
Attention: Peter Predun
Facsimile No.: (212) 270-5100
Ladies and Gentlemen:
The undersigned Borrower refers to the Fourth Amended and Restated Credit Agreement dated as of October 22,
2014 (as amended, supplemented or otherwise modified from time to time, the Credit Agreement), among USG Corporation, a
Delaware corporation, CGC Inc., a New Brunswick corporation, the Lenders and Issuing Banks from time to time party thereto,
JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the Administrative Agent), JPMorgan Chase Bank, N.A.,
as Canadian administrative agent (in such capacity, the Canadian Agent), and Bank of America, N.A. and Wells Fargo Bank,
National Association, as co-syndication agents. Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The undersigned Borrower hereby gives you notice pursuant to Section
2.03 of the Credit Agreement that it requests a Borrowing under the Credit Agreement and in that connection sets forth below the
terms on which such Borrowing is requested to be made:
1.

Aggregate Amount of Borrowing:* _____________________

* [In the case of a Eurodollar Borrowing, not less than $5,000,000 and in an integral multiple of $1,000,000. In the case of an ABR Borrowing, not
less than $1,000,000 and in an integral multiple of $1,000,000.

2.

[Currency of Borrowing:]*

_____________________

3.

Date of Borrowing:**

4.

Type of Borrowing:***

5.

Interest Period:****

6.

Location and number of the

undersigned Borrowers account
to which funds are to be disbursed:_____________________

_____________________
_____________________
_____________________

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

*Include only if the Borrower under this Borrowing Request is CGC Inc. To be either U.S. dollars or Canadian dollars.
**This date must be (a) a Business Day and (b)(i) in the case of a Eurodollar Borrowing, a date not earlier than three Business
Days after telephonic notice of the related Borrowing Request, delivered before 11:00 a.m., New York City time, (ii) in the case of
an ABR Borrowing, a date not earlier than one Business Day after telephonic notice of the related Borrowing Request, delivered
before 11:00 a.m., New York City time, (iii) in the case of a Canadian Prime Borrowing, a date not earlier than one Business Day
after telephonic notice of the related Borrowing Request, delivered before 12:00 p.m., Toronto time and (iv) in the case of a CDOR
Borrowing, a date not earlier than three Business Days after telephonic notice of the related Borrowing Request, delivered before
12:00 p.m., Toronto time*

*** ABR Borrowing, Eurodollar Borrowing, Canadian Prime Borrowing or CDOR Borrowing.:
**** Applicable only to a Eurodollar Borrowing or a CDOR Borrowing, and subject to the definition of Interest Period

The undersigned Borrower hereby represents and warrants to the Administrative Agent[, the Canadian Agent] and
the Lenders that, on the date of this Borrowing Request and on the date of the related Borrowing, the conditions to lending specified
in Section 4.02 of the Credit Agreement are and shall be satisfied.
Very truly yours,
[USG CORPORATION][cgc inc.]
By:

Name:
Title:

Exhibit D

[FORM OF]
INTEREST ELECTION REQUEST
[Date]
JPMorgan Chase Bank, N.A.,
as Administrative Agent
c/o Loan and Agency Services Group
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713
Attention: Siyana Custis
Facsimile No.: (302) 634-1845
[JPMorgan Chase Bank, N.A., Toronto Branch,
as Canadian Administrative Agent
c/o JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road, Ops 2, Floor 3
Newark, DE 19713
Attention: Siyana Custis
Facsimile No.: (302) 634-1845]
With a copy to:
JPMorgan Chase Bank, N.A.,
383 Madison Avenue
New York, NY 10179
Attention: Peter Predun
Facsimile No.: (212) 270-5100
Ladies and Gentlemen:
The undersigned Borrower refers to the Fourth Amended and Restated Credit Agreement dated as of October 22,
2014 (as amended, supplemented or otherwise modified from time to time, the Credit Agreement), among USG Corporation, a
Delaware corporation, CGC Inc., a New Brunswick corporation, the Lenders and Issuing Banks from time to time party thereto,
JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the Administrative Agent), JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian administrative agent (in such capacity, the Canadian Agent), and Bank of America, N.A. and Wells
Fargo Bank, National Association, as co-syndication agents. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement. This notice constitutes a notice of conversion or notice of
continuation, as applicable, under Section 2.07 of the Credit Agreement, and the undersigned Borrower hereby irrevocably notifies
the Administrative Agent of the following information with respect to the conversion or continuation requested hereby:
1.

Borrowing to which this request

applies:* _______________________________________________

* Specify last day of current Interest Period.

2.

Principal amount of Borrowing to be

converted/continued:* ______________________________________________

3.

Effective date of election:** ______________________________________________

4.

Type of resulting Borrowing(s):*** ______________________________________________

5.

Interest Period of resulting

Borrowing(s):**** ______________________________________________

* If different options are being elected with respect to different portions of the Borrowing, indicate the portions thereof to be allocated to each
resulting Borrowing

** This date must be (a) a Business Day and [(b)(i) in the case of a resulting Eurodollar Borrowing, a date not earlier than three Business Days
after telephonic notice of the related Interest Election Request or (ii) in the case of a resulting ABR Borrowing, a date not earlier than one Business
Day after telephonic notice of the related Interest Election Request, in each case delivered before 11:00 a.m., New York City time].

*** ABR Borrowing, Eurodollar Borrowing, Canadian Prime Borrowing or CDOR Borrowing. If different options are being elected with respect to
different portions of the Borrowing, specify type for each resulting Borrowing.

**** Applicable only if the resulting Borrowing is to be a Eurodollar Borrowing or a CDOR Borrowing, and subject to the definition of Interest
Period. Must comply with the definition of Interest Period and end not later than the Maturity Date. If different options are being elected with
respect to different portions of the Borrowing, specify for each resulting Borrowing.

Very truly yours,

[USG CORPORATION][CGC INC.]

By:

Name:
Title:

EXHIBIT E

[FORM OF]
COMPLIANCE CERTIFICATE
[For the fiscal Quarter ending]
[For the fiscal Year ending]

The undersigned, duly authorized, qualified and acting Financial Officer of USG Corporation, a corporation organized
under the laws of Delaware (USG), hereby certifies that:
(a)
This certificate (Certificate) is furnished pursuant to Section 5.01(c) of the Fourth Amended and Restated
Credit Agreement dated as of October 22, 2014 (as amended, supplemented or otherwise modified from time to time, the Credit
Agreement), among USG, CGC Inc., a New Brunswick corporation, the Lenders and Issuing Banks from time to time party
thereto, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
administrative agent, and Bank of America, N.A. and Wells Fargo Bank, National Association, as co-syndication agents.
Capitalized terms used herein have the meanings attributed thereto in the Credit Agreement unless otherwise defined herein.
(b)

As of the date hereof, no Default has occurred [.][except as follows:]

(c) No change in GAAP or in the application of GAAP, in either case, that would be required to be disclosed to the
Securities and Exchange Commission, has occurred that has affected the financial statements accompanying this Certificate since
the later of December 31, 2013, and the date of the prior certificate delivered under Section 5.01(c) of the Credit Agreement, except
for those changes disclosed in the report of USG on Form 10-Q or 10-K, as applicable, for the period ending ___________,
attached hereto as Exhibit A (the Current Report)[.] [except as follows:]
(d)
The financial statements referred to in Section 5.01[(a)][(b)] of the Credit Agreement which are delivered
concurrently with the delivery of this Compliance Certificate, together with the footnotes and supplemental information related
thereto disclosed in the Current Report, fairly present in all material respects the financial condition and results of operations of
USG and the Subsidiaries on a consolidated basis for the fiscal [year][quarter] then ended [(subject to normal year-end audit
adjustments and the absence of footnote disclosure)]. Such financial statements have been prepared in accordance with GAAP
applied consistently throughout the period involved.
(e) The covenant listed and calculated below is based on the financial statements referred to in Section 5.01[(a)]
[(b)] of the Credit Agreement which are delivered concurrently with the delivery of this Certificate, together with the financial
statements previously delivered pursuant to Section 5.01(a) or (b) that are necessary to determine compliance with such covenant
under the Credit Agreement.

Fixed Charge Coverage Ratio (Section 6.12)

The ratio of
(i)

Consolidated EBITDA (plus the aggregate amount of Transaction Costs incurred or accrued, minus the unfinanced portion
of Capital Expenditures) for the period of four consecutive fiscal quarters most recently ended at or prior to the date of this
certificate (the Measurement Period)
$__________

To
(ii)

Fixed Charges for the Measurement Period

$__________

Ratio: ___________
must not exceed:

1.10 to 1.00

Please refer to Schedule 1 for a detailed calculation of the amounts set forth above.
(f)
The financial ratio listed and calculated below is based on the financial statements referred to in Section
5.01[(a)][(b)] of the Credit Agreement which are delivered concurrently with the delivery of this Certificate, together with the financial
statements previously delivered pursuant to Section 5.01(a) or (b) that are necessary to determine such financial ratio.
Total Net Leverage Ratio (Applicable Rate)
The ratio of
(i)

(x) Total Indebtedness as of last day of the Measurement Period minus (y)
of such date
$__________

the aggregate amount of Unrestricted Cash as

To
(ii)

Consolidated EBITDA for the Measurement Period

$__________

Ratio: ___________
Please refer to Schedule 2 for a detailed calculation of the amounts set forth above.
(g) (i) [Schedule 3 sets forth the changes to the information required pursuant to the Perfection Certificate since [*]
[There have been no changes to the information required pursuant to the Perfection Certificate since [**] and (ii) all initial UCC and
PPSA financing statements or other appropriate filings, recordings or registrations, including all refilings, rerecordings,
reregistrations and amendments to the initial UCC and PPSA financing statements, containing a description of the Collateral have
been filed of record in each governmental, municipal or other appropriate office in the jurisdiction identified pursuant to Section 4.06
of each of the U.S. Security Agreement and the Canadian Security Agreement to the extent necessary to protect and perfect the
Security Interest (as defined in each of the U.S. Security Agreement and the Canadian Security Agreement) as of the date hereof.

*Insert the later of (x) the date of the Perfection Certificate and (y) the date of the most recent Compliance Certificate.
**Insert the later of (x) the date of the Perfection Certificate and (y) the date of the most recent Compliance Certificate. ]

IN WITNESS WHEREOF, I have hereto set my name.

Dated:
USG CORPORATION
By
Name:
Title:Financial Officer

EXHIBIT F

[FORM OF]
ADMINISTRATIVE QUESTIONNAIRE
[See following pages]

Administrative Questionnaire

DEAL NAME: USG Corporation

Agent Address:

JPMorgan Chase Bank, N.A

Return form to:

500 Stanton Christiana Road

Telephone:

Ops Building 2, 3rd Floor

Facsimile:

Newark, DE 19713-2107

E-mail:

It is very important that all of the requested information be completed accurately and that this questionnaire be returned promptly. If your institution is sub-allocating its allocation,
please fill out an administrative questionnaire for each legal entity.

Lender Markit Entity Identifier (MEI): _______________________________

Legal Name of Lender to appear in Documentation: ______________________________

Signature Block
Information: ___________________________________

Signing Credit Agreement

Yes

No

Coming in via Assignment

Yes

No

Type of
Lender: ______________________________________________
(Bank, Asset Manager, Broker/Dealer, CLO/CDO; Finance Company, Hedge Fund, Insurance, Mutual Fund, Pension Fund, Other Regulated Investment Fund, Special Purpose
Vehicle, Other-please specify)
Fund Manager:

N/A

Lender Parent:

N/A
Domestic Address

__________

Canadian Address (if applicable)

________________________

Contacts/Notification Methods: Borrowings, Paydowns, Interest, Fees, etc.

Syndicate-level information (which may contain material non-public information about the Borrower and its related parties or their respective securities) will be made available to
the Credit Contact(s). The Credit Contacts identified must be able to receive such information in accordance with his/her institutions compliance procedures and applicable laws,
including Federal and state securities laws.

Primary Credit Contact

Secondary Credit Contact

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Additional IntraLinks Credit Contact

Additional IntraLinks Credit Contact

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

The above listed individuals will be given access to any related IntraLinks site for information distribution.

Should your institution require more than the contacts listed above, please add additional names on the Annex A provided with the above information for ALL individuals who
require IntraLinks access.

Primary Operations Contact

Secondary Operations Contact

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Operations Contact

Operations Contact

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Bid Contact
Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

L/C Contact

Domestic Wire Instructions

Document Wire Instructions:

Bank Name:
ABA/Routing No.:
Account Name:
Account No.:

FFC Account Name:

FFC Account No.:
Attention:
Reference:

Lenders Foreign Wire Instructions

Lender's Foreign Wire Instructions:

Currency:
Bank Name:
Swift/Routing No.:
Account Name:
Account No.:
FFC Account Name:
FFC Account No.:
Attention:
Reference:

Agents USD Wire Instructions

Agents CAD Wire Instructions

Agents DTCC Account Number:

Tax Documents
(a) NON-U.S. LENDER INSTITUTIONS: (i)I.
Corporations:

(ii) If your institution is incorporated outside of the United States for U.S. federal income tax purposes, and is the beneficial
owner of the interest and other income it receives, you must complete one of the following three tax forms, as applicable to your institution: a.) Form W-8BEN
(Certificate of Foreign Status of Beneficial Owner), b.) Form W8ECI (Income Effectively Connected to a U.S. Trade or Business), or c.) Form W-8EXP
(Certificate of Foreign Government or Governmental Agency).
(iii) A U.S. taxpayer identification number is required for any institution submitting Form W-8ECI. It i s also required o n Form W8BEN for certain institutions claiming the benefits of a tax treaty with the U.S. Please refer to the instructions when completing the form applicable to your
institution. In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms. An original tax form must be submitted.
(iv)

II. Flow-Through Entities:

If your institution is organized outside the U.S., and is classified for U.S. federal income tax purposes as either a Partnership, Trust, Qualified or Non-Qualified Intermediary, or
other non-U.S. flow-through entity, an original Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States
Tax Withholding) must be completed by the intermediary together with a withholding statement. Flow-through entities other than Qualified Intermediaries are required to include
tax forms for each of the underlying beneficial owners.

Please refer to the instructions when completing this form. In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms. Original tax form(s)
must be submitted.
(b) U.S. LENDER INSTITUTIONS:
If your institution is incorporated or organized within the United States, you must complete and return Form W-9 (Request for Taxpayer Identification Number
and Certification). Please be advised that we request that you submit an original Form W-9.
Pursuant to the language contained in the tax section of the Credit Agreement, the applicable tax form for your institution must be completed and returned
prior to the first payment of income. Failure to provide the proper tax form when requested may subject your institution to U.S. tax withholding.

ANNEX A

ANNEX A
Additional IntraLinks Credit Contact
Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Additional IntraLinks Credit Contact

Additional IntraLinks Credit Contact

Additional IntraLinks Credit Contact

Additional IntraLinks Credit Contact

Additional IntraLinks Credit Contact

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Name:
Company:
Title
Address:

Telephone:
Facsimile:
E-mail address:

Exhibit G

[FORM OF]
PERFECTION CERTIFICATE
Reference is made to the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014 (as
amended, supplemented or otherwise modified from time to time, the Credit Agreement), among USG Corporation, a Delaware
corporation (the U.S. Borrower), CGC Inc., a New Brunswick corporation (the Canadian Borrower; the U.S. Borrower and the
Canadian Borrower, collectively, the Borrowers, and each, individually, a Borrower), the Lenders and Issuing Banks from time to
time party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent (in such capacity, the Administrative Agent), JPMorgan
Chase Bank, N.A., Toronto Branch, as Canadian Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, National
Association, as co-syndication agents. Capitalized terms used but not defined herein have the meanings assigned in the Credit
Agreement or the Security Agreement referred to therein, as applicable. For purposes of this Perfection Certificate (this
Certificate), (a) Grantors shall mean each Borrower and each other Loan Party that is a wholly-owned Subsidiary of a Borrower,
(b) U.S. Grantors shall mean the U.S. Borrower and each other Loan Party that is organized under the laws of the United States
of America, any State thereof or the District of Columbia and (c) Canadian Grantor shall mean the Canadian Borrower and each
other Loan Party that is organized under the laws of Canada or any province or territory thereof.
The undersigned, a Financial Officer of the U.S. Borrower and a Financial Officer of the Canadian Borrower, each
hereby certifies to the Administrative Agent and each other Secured Party as follows:
1. Names. (a) The exact legal name of each Grantor, as such name appears in its respective certificate of formation, is as
follows:
(a)
Set forth below is each other legal name each Grantor has had in the past two years, together with the date of the
relevant change:
(b)
Except as set forth in Schedule 1 hereto, no Grantor has changed its identity or corporate structure in any way within the
past two years. Changes in identity or corporate structure would include mergers, consolidations and acquisitions, as well as any
change in the form, nature or jurisdiction of organization. If any such change has occurred, include in Schedule 1 the information
required by Sections 1 and 2 of this certificate as to each acquiree or constituent party to a merger or consolidation.
(c)
The following is a list of all other names (including trade names or similar appellations) used by each Grantor or any of its
divisions or other business units in connection with the conduct of its business or the ownership of its properties at any time during
the past two years:
(d)
Set forth below is the Organizational Identification Number, if any, issued by the jurisdiction of formation of each Grantor
that is a registered organization:
(e)

Set forth below is the Federal Taxpayer Identification Number of each Grantor:*

*Necessary only for Grantors organized under the laws of North Dakota or South Dakota.

2.
below:

Current Locations. (a) The chief executive office of each Grantor is located at the address set forth opposite its name
Grantor

Mailing Address

County

State

(a) Set forth below opposite the name of each Grantor are all locations where such Grantor maintains any books or records
relating to any Accounts:
Grantor

Mailing Address

County

State

(b) Set forth below opposite the name of each Grantor are all locations where such Grantor maintains any Collateral other than
that referred to in Section 2(b):
Grantor

Mailing Address

County

State

(c) The jurisdiction of formation of each Grantor that is a registered organization is set forth opposite its name below:
Grantor:

Jurisdiction:

(d) Set forth below opposite the name of each Grantor are all the places of business of such Grantor not identified in paragraph
(a), (b), (c) or (d) above:
Grantor

Mailing Address

County

State

(e) Set forth below opposite the name of each Grantor are the names and addresses of all Persons other than such Grantor
that have possession of any of the Collateral of such Grantor:
Grantor

Mailing Address

County

State

3.

Unusual Transactions. All Accounts have been originated by the Grantors in the ordinary course of business.

4.
File Search Reports. File search reports have been obtained from each Uniform Commercial Code and Personal Property
Security Act filing office identified with respect to such Grantor in Section 2 hereof, and such search reports reflect no liens against
any of the Collateral other than those permitted under the Credit Agreement.
5.
UCC and PPSA Filings. Financing statements in substantially the form of Schedule 5 hereto have been prepared for filing
in the proper Uniform Commercial Code filing office in the jurisdiction in which each U.S. Grantor is located. Personal Property
Security Act filings or other applicable personal property security filings have been prepared for filing in the proper personal property
security filing offices in the proper local jurisdiction for each Canadian Grantor.
6.
Schedule of Filings. Attached hereto as Schedule 6 is a schedule setting forth, with respect to the filings described in
Section 5 above, each filing and the filing office in which such filing is to be made.
7.
Deposit Accounts. Attached hereto as Schedule 7 is a true and correct list of Collateral Deposit Accounts maintained by
each Grantor, including the name and address of the depositary institution, the type of account and the account number.

IN WITNESS WHEREOF, the undersigned have duly executed this Certificate on this [] day of [], 2014.

USG CORPORATION
By
Name:
Title:Financial Officer

CGC INC.
By
Name:
Title:Financial Officer

EXHIBIT H-1

[FORM OF]
U.S. REVOLVING NOTE

$[Amount]

New York, New York

FOR VALUE RECEIVED, the undersigned (the U.S. Borrower) hereby unconditionally promises to pay to the
order of [LENDER NAME] or its registered assigns (the Lender), in immediately available funds, in accordance with Section 2.09
of the Credit Agreement (as defined below) on the Maturity Date (capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement), the principal amount of [ Amount in words ] dollars and
0/100 ($[ Amount ]) or, if less, the then unpaid principal amount of all U.S. Revolving Loans made by the Lender to the U.S.
Borrower pursuant to the Credit Agreement.
The U.S. Borrower further unconditionally promises to pay interest on the unpaid principal amount of each U.S.
Revolving Loan made by the Lender to the U.S. Borrower in like money at said office until paid at the rate or rates per annum, from
the dates and payable on the dates set forth in the Credit Agreement.
This revolving note (this Note) is one of the promissory notes referred to in Section 2.09(f) of the Fourth Amended
and Restated Credit Agreement dated as of October 22, 2014 (as amended, supplemented or otherwise modified from time to time,
the Credit Agreement), among USG Corporation, a Delaware corporation, CGC Inc., a New Brunswick corporation, the Lenders
and Issuing Banks from time to time party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, JPMorgan Chase Bank,
N.A., Toronto Branch, as Canadian Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, National Association,
as co-syndication agents, and is entitled to the benefits thereof and of the other Loan Documents.
In case an Event of Default shall occur and be continuing, the principal of and accrued interest on this Note may be
declared to be due and payable in the manner and with the effect provided in the Credit Agreement.
The U.S. Borrower hereby waives presentment, demand, protest or notice of any kind in connection with this Note.

THIS NOTE AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN
CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS NOTE AND THE
TRANSACTIONS CONTEMPLATED HEREBY SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW OF THE STATE OF NEW YORK.

USG CORPORATION
By
Name:
Title:

[FORM OF]
CANADIAN REVOLVING NOTE

$[Amount]

New York, New York

FOR VALUE RECEIVED, the undersigned (the Canadian Borrower) hereby unconditionally promises to pay to the
order of [LENDER NAME] or its registered assigns (the Lender), in immediately available funds, in accordance with Section 2.09
of the Credit Agreement (as defined below) on the Maturity Date (capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement), the principal amount of [ Amount in words ] dollars and
0/100 ($[ Amount ]) or, if less, the then unpaid principal amount of all Canadian Revolving Loans made by the Lender to the
Canadian Borrower pursuant to the Credit Agreement.
The Canadian Borrower further unconditionally promises to pay interest on the unpaid principal amount of each
Canadian Revolving Loan made by the Lender to the Canadian Borrower in like money at said office until paid at the rate or rates
per annum, from the dates and payable on the dates set forth in the Credit Agreement.
This revolving note (this Note) is one of the promissory notes referred to in Section 2.09(f) of the Fourth Amended
and Restated Credit Agreement dated as of October 22, 2014 (as amended, supplemented or otherwise modified from time to time,
the Credit Agreement), among USG Corporation, a Delaware corporation, CGC Inc., a New Brunswick corporation, the Lenders
and Issuing Banks from time to time party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, JPMorgan Chase Bank,
N.A., Toronto Branch, as Canadian Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, National Association,
as co-syndication agents, and is entitled to the benefits thereof and of the other Loan Documents.
In case an Event of Default shall occur and be continuing, the principal of and accrued interest on this Note may be
declared to be due and payable in the manner and with the effect provided in the Credit Agreement.
The Canadian Borrower hereby waives presentment, demand, protest or notice of any kind in connection with this
Note.

THIS NOTE AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN
CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS NOTE AND THE
TRANSACTIONS CONTEMPLATED HEREBY SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW OF THE STATE OF NEW YORK.

CGC INC.
By
Name:
Title:

EXHIBIT 10.20

AMENDED AND RESTATED

GUARANTEE AGREEMENT
dated as of
October 22, 2014,
among
USG CORPORATION,
CGC Inc.,
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.
SECTION 1.02.

Credit Agreement
Other Defined Terms

1
1
ARTICLE II
Guarantee

SECTION 2.01.
SECTION 2.02.
SECTION 2.03.
SECTION 2.04.
SECTION 2.05.
SECTION 2.06.
SECTION 2.07.

Guarantee
Guarantee of Payment
No Limitations
Reinstatement
Agreement To Pay; Subrogation
Information
Keepwell

3
3
3
4
4
4
4
ARTICLE III

Indemnity, Subrogation and Subordination

SECTION 3.01.
SECTION 3.02.
SECTION 3.03.

Indemnity and Subrogation

Contribution and Subrogation
Subordination

5
5
6
ARTICLE IV
Miscellaneous

SECTION 4.01.
SECTION 4.02.
SECTION 4.03.
SECTION 4.04.
SECTION 4.05.
SECTION 4.06.
SECTION 4.07.
SECTION 4.08.

Notices
Waivers; Amendment
Administrative Agents Fees and Expenses; Indemnification
Successors and Assigns
Survival of Agreement
Counterparts; Effectiveness; Several Agreement
Severability
Right of Set-Off

7
7
7
8
8
8
9
9

SECTION 4.09.
SECTION 4.10.
SECTION 4.11.

Governing Law; Jurisdiction; Consent to Service of Process

WAIVER OF JURY TRIAL
Headings

9
10
10

SECTION 4.12.
SECTION 4.13.
SECTION 4.14.
SECTION 4.15.

Guarantee Absolute
Termination or Release
Additional Subsidiaries
Covenant

Schedules
Schedule I Guarantors

Exhibits
Exhibit I Form of Supplement

10
11
11
11

AMENDED AND RESTATED GUARANTEE AGREEMENT dated as of October 22, 2014 (this
Agreement), among USG CORPORATION, a Delaware corporation (the U.S. Borrower), CGC INC., a
New Brunswick corporation (the Canadian Borrower; the U.S. Borrower and the Canadian Borrower,
collectively, the Borrowers, and each, individually, a Borrower), each Subsidiary of the U.S. Borrower
from time to time party hereto and JPMORGAN CHASE BANK, N.A., as Administrative Agent.
Reference is made to the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014 (as amended,
restated, supplemented or otherwise modified from time to time, the Credit Agreement), among the Borrowers, the Lenders and
Issuing Banks party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, JPMorgan Chase Bank N.A., Toronto Branch, as
Canadian Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents.
The Lenders have agreed to extend credit to the Borrowers 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 Borrowers, will derive substantial benefits from the extension of credit to
the Borrowers 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:
Agreement has the meaning assigned to such term in the preliminary statement of this Agreement.
Borrower and Borrowers has the meaning assigned to such term in the preliminary statement of this Agreement.
Canadian Borrower has the meaning assigned to such term in the preliminary statement of this Agreement.
Canadian Guarantors has the meaning assigned to such term in clause (b) of the definition of Guarantors.
Canadian Obligation Claiming Party has the meaning assigned to such term in Section 3.02.

Canadian Obligation Contributing Party has the meaning assigned to such term in Section 3.02.
Claiming Party means any Canadian Obligation Claiming Party or U.S. Obligation Claiming Party.
Contributing Party means any Canadian Obligation Contributing Party or U.S. Obligation Contributing Party.
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) with respect to the U.S. Secured Obligations, (i) the U.S. Borrower, (ii) the Domestic
Subsidiaries identified on Schedule I hereto and (iii) each other Domestic Subsidiary that becomes a party to this Agreement after the
Restatement Effective Date, in each case except with respect to the U.S. Secured Obligations of such Person (other than the U.S.
Obligations of such Person described in clause (b) of the definition of the term U.S. Obligations) (the Persons specified in this clause
(a), the U.S. Guarantors) (it being understood, for purposes of clarity, that no CFC Holdco or any Subsidiary of a CFC or a CFC
Holdco shall be a U.S. Guarantor), and (b) with respect to the Canadian Secured Obligations, (i) each of the U.S. Guarantors, (ii) the
Canadian Borrower and (iii) each other Canadian Subsidiary that becomes a party to this Agreement after the Restatement Effective
Date (together with the Canadian Borrower, the Canadian Guarantors), in each case except with respect to the Canadian Secured
Obligations of such Person (other than the Canadian Obligations of such Person described in clause (b) of the definition of the term
Canadian Obligations).
U.S. Borrower has the meaning assigned to such term in the preliminary statement of this Agreement.
U.S. Guarantors has the meaning assigned to such term in clause (a) of the definition of Guarantors.
U.S. Obligation Claiming Party has the meaning assigned to such term in Section 3.02.
U.S. Obligation Contributing Party has the meaning assigned to such term in Section 3.02.
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 Canadian Secured
Obligations, and each U.S. Guarantor unconditionally guarantees, jointly with the other U.S. Guarantors and severally, as a primary
obligor and not merely as a surety, the due and punctual payment and performance of the U.S. 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 thereof notwithstanding any extension or renewal of any Secured
Obligation. Each of the Guarantors waives

presentment to, demand of payment from and protest to either 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 either Borrower or any other
Person.
SECTION 2.03. No Limitations. (a) Except for termination of a Guarantors 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; (v) any law, regulation, decree or order of any jurisdiction, or any
other event, affecting any term of the Secured Obligations or any Loan Partys rights with respect thereto; or (vi) 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
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 either 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 either Borrower or any other Loan Party, other than the payment in full in cash
of all the Secured Obligations (or, in the case of the Canadian Guarantors, the Canadian 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
either Borrower or any other Loan Party or exercise any other right or remedy available to it against either 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
(or, in the case of the Canadian Guarantors, the Canadian 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 either Borrower or any other Loan Party, as the case may be, or any security.
SECTION 2.04. Reinstatement. Each of the U.S. Guarantors and the Canadian 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 or the Canadian Secured Obligation, respectively, is rescinded or
must otherwise be restored by the Administrative Agent or any other Guaranteed Party upon the bankruptcy or reorganization of either
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 either 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 (in the case of any such Secured Obligation that is a
Canadian Secured Obligations) and each U.S. Guarantor (in the case of any such Secured Obligation that is a U.S. Secured
Obligation) 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 either 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 each
Borrowers and each other Loan Partys 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.
SECTION 2.07. Keepwell. Subject, in the case of the Canadian Guarantors, to Section 4.17, each Qualified ECP
Guarantor (as defined below) hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Guarantor that would otherwise not be an eligible contract
participant as defined in the Commodity Exchange Act and the regulations thereunder to honor all of its obligations under this
Agreement in respect of Specified Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under
this Section 2.07 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this
Section 2.07 or otherwise under this Agreement voidable under applicable law relating to fraudulent conveyance or fraudulent transfer,
and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 2.07 shall remain in full force
and effect until the indefeasible payment in full in cash of all the Secured Obligations (or, in the case of the Canadian Guarantors, the
Canadian Secured Obligations). Each Qualified ECP Guarantor intends that this Section 2.07 constitute, and this Section 2.07 shall be
deemed to constitute, a keepwell, support, or other agreement for the benefit of each other Loan Party for all purposes of Section
la(18)(A)(v)(II) of the Commodity Exchange Act. For purposes hereof, Qualified ECP Guarantor means, in respect of any Specified
Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Guarantee becomes or would
become effective with respect to such Specified Swap Obligation and each other Loan Party that constitutes an eligible contract
participant under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as
an eligible contract participant at such time by guaranteeing or entering into a keepwell in respect of obligations of such other person
under Section la(18)(A)(v)(II) of the Commodity Exchange Act.

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), (a) each U.S. Guarantor agrees that in the event a payment of
a U.S. Secured Obligation of such Guarantor shall be made by any other U.S. Guarantor under this Agreement, such U.S. Guarantor
shall indemnify such other U.S. Guarantor for the full amount of such payment and such other U.S. Guarantor shall be subrogated to
the rights of the Person to whom such payment shall have been made to the extent of such payment and (b) each Guarantor agrees that
in the event a payment of a Canadian 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 Canadian Obligation 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 Canadian
Secured Obligation and such other Guarantor (the Canadian Obligation Claiming Party) shall not have been fully indemnified by the
applicable Guarantor as provided in Section 3.01, such Canadian Obligation Contributing Party shall indemnify the Canadian
Obligation 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 such Canadian Obligation 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). Each U.S. Guarantor (a U.S.
Obligation Contributing Party) agrees (subject to Section 3.03) that, in the event a payment shall be made by any other U.S.
Guarantor hereunder in respect of any U.S. Secured Obligation and such other U.S. Guarantor (the U.S. Obligation Claiming Party)
shall not have been fully indemnified by the applicable Guarantor as provided in Section 3.01, such U.S. Obligation Contributing Party
shall indemnify the U.S. Obligation 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 such U.S. Obligation Contributing Party on the date hereof (or, in the case of any U.S.
Guarantor becoming a party hereto pursuant to Section 4.14, the date of the supplement hereto executed and delivered by such U.S.
Guarantor) and the denominator shall be the aggregate net worth of all the U.S. Guarantors on the date hereof (or, in the case of any
U.S. Guarantor becoming a party hereto pursuant to Section 4.14, the date of the supplement hereto executed and delivered by such
U.S. 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. Notwithstanding the foregoing, to the extent that
any Claiming Partys right to indemnification hereunder arises from a payment made to satisfy Secured Obligations constituting
Specified Swap Obligations, only those Contributing Parties for whom such Specified Swap Obligations do not constitute Excluded
Swap Obligations shall indemnify such Claiming Party, with the fraction set forth in the second preceding sentence being modified as
appropriate to provide for indemnification of the entire indemnified amount.
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.
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 U.S. 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, any 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 Banks 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 any 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 Agents 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, subject to Section 4.17 with
respect to each Canadian Guarantor, (i) each Canadian 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, the execution, delivery or performance of this Agreement with respect to
the Canadian Secured Obligations or any claim, litigation, investigation or proceeding relating to this Agreement or any instrument
contemplated hereby with respect to the Canadian Secured Obligations, whether or not any Indemnitee is a party thereto, and (ii) each
U.S. 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, 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, in either case, 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, non-appealable judgment to have resulted from (A) the gross negligence, bad faith or wilful misconduct
of such Indemnitee, (B) a material breach by such Indemnitee of its obligations under this Agreement or any other Loan Document or
(C) claims of one or more Indemnitees against another Indemnitee (other than claims against the Administrative Agent or any Arranger
in their respective capacities as such) and not involving any act or omission by either Borrower, any of the Subsidiaries or any of their
respective Affiliates (or any of such Persons Related Parties). None of the Guarantors shall, without the prior written consent of any
Indemnitee, effect any settlement of any pending or threatened Proceeding in respect of which indemnity could have been sought
under this Section 4.03(b) by such Indemnitee unless such settlement (x) includes an unconditional release of such Indemnitee in form
and substance reasonably satisfactory to such Indemnitee from all liability or claims that are the subject matter of such Proceeding and
(y) does not include any statement as to or any admission of fault, culpability, wrongdoing or a failure to act by or on behalf of such
Indemnitee or any injunctive relief or other non-monetary remedy. The Guarantors shall not be liable for any settlement of any
Proceeding if the amount of such settlement was effected without the U.S. Borrowers consent (which consent shall not be
unreasonably withheld, conditioned or delayed), but if settled with the U.S. Borrowers written consent or if there is a judgment by a
court of competent jurisdiction for the plaintiff in any such Proceeding, the Guarantors, subject to Section 4.17 below with respect to
the Canadian Guarantors, agree to indemnify and hold harmless each Indemnitee from and against any and all losses, claims, damages,
penalties, liabilities and expenses by reason of such settlement or judgment in accordance with the other provisions of this Section
4.03(b).
(c) Any such amounts payable as provided hereunder shall be allocated as between the U.S. Guarantors and the
Canadian Guarantors, as applicable, and shall be additional U.S. Secured Obligations or Canadian Secured Obligations, as applicable,
guaranteed hereby. For the avoidance of doubt, and notwithstanding anything to the contrary in this Agreement or any Loan
Document, no Canadian Guarantor shall be liable for the reimbursement and indemnification obligations under this Section 4.03 with
respect to the U.S. Secured Obligations. 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 the Issuing Banks 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 Issuing Bank or on its behalf and notwithstanding that the Administrative
Agent, any 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 an original
executed 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 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 goodfaith 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. Subject to the last sentence of this Section 4.08, 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. Notwithstanding the foregoing or
anything else in this Agreement to the contrary, no Lender shall exercise any right of setoff under this Section 4.08 against any
Canadian Guarantor or any of its properties or assets with respect to any Secured Obligations other than Canadian Secured
Obligations.
SECTION 4.09. Governing Law; Jurisdiction; Consent to Service of Process. (a) This Agreement and any claim,
controversy, dispute or cause of action (WHETHER in contract or tort or otherwise) based upon, arising out of or relating to
this Agreement and the transactions contemplated hereby 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 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. The parties hereto hereby agree that the U.S. Borrower shall be the authorized agent for
the Canadian Borrower, upon whom process may be served in any suit, action or proceeding arising out of or relating to this
Agreement or the performance of services hereunder which may be instituted in any court referred to in Section 4.09(b). Service of
process upon the U.S. Borrower shall be deemed, in every respect, effective service of process upon the Canadian Borrower.
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 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 or, in the case
of the Canadian Guarantors, the Canadian 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 (or cash
collateralized in an amount equal to 103% of the aggregate undrawn amount of all outstanding Letters of Credit (for each Letter of
Credit, denominated in the currency of such Letter of Credit) or otherwise collateralized (i.e., by issuance of backstop letters of credit to
the applicable Issuing Banks in respect thereof), in each case in a manner satisfactory to the applicable Issuing Banks) and the Issuing
Banks have no further obligations to issue Letters of Credit under the Credit Agreement; provided that this Agreement and the
Guarantees made herein shall terminate with respect to the Canadian Guarantors when all the Canadian Obligations (as distinguished
from the Canadian Secured Obligations) have been paid in full, in cash, and the Lenders have no further commitment to lend to the
Canadian Borrower under the Credit Agreement, the LC Exposure in respect of Letters of Credit issued to the Canadian Borrower (or
with respect to which the Canadian Borrower is a co-applicant) has been reduced to zero (or cash collateralized in an amount equal to
103% of the aggregate undrawn amount of all such outstanding Letters of Credit (for each Letter of Credit, denominated in the
currency of such Letter of Credit) or otherwise collateralized (i.e., by issuance of backstop letters of credit to the applicable Issuing
Banks in respect thereof), in each case in a manner satisfactory to the applicable Issuing Banks) and the Issuing Banks have no further
obligations to issue Letters of Credit to the Canadian Borrower (or to any Subsidiary with the Canadian Borrower as a co-applicant)
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 Guarantors

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, and solely to the extent required thereby,
certain Domestic Material Subsidiaries and Canadian Material Subsidiaries that were not in existence or not Domestic Material
Subsidiaries or Canadian Material Subsidiaries on the date of the Credit Agreement (as well as certain other Subsidiaries specified by
the U.S. Borrower) may be required to enter in this Agreement as a Guarantor upon becoming such a Domestic Material Subsidiary or
a Canadian 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. Covenant. Each Guarantor agrees to be bound by the provisions of Section 2.16 of the Credit
Agreement with the same force and effect, and to the same extent, as if such Guarantor were a party to the Credit Agreement.
SECTION 4.16. Amendment and Restatement. From and after the Restatement Effective Date, this Agreement amends
and restates that certain Guaranty Agreement dated as of January 7, 2009 (the Original Guaranty), among the U.S. Borrower, those
of its Subsidiaries then parties thereto (the Original Guarantors) and the Administrative Agent, and from and after such date, all
references in the Credit Agreement and the other Loan Documents to the Guaranty Agreement shall be deemed to refer to this
Agreement. In connection therewith, it is hereby acknowledged and agreed that those Original Guarantors which were parties to the
Original Guaranty but which are not parties to this Agreement (the Released Original Guarantors) are hereby released from all
obligations and liabilities under the Original Guaranty and shall no longer be deemed Guarantors or Loan Parties under and pursuant to
the Loan Documents. Other than as set forth in the immediately preceding sentence, upon the Restatement Effective Date, all
obligations of the Loan Parties under the Original Guarantee shall become obligations of the Loan Parties under this Agreement and
the provisions of the Original Guaranty shall be superseded (but not novated or extinguished) by the provisions of this Agreement.
SECTION 4.17. Bifurcation. Notwithstanding anything to the contrary contained in this Agreement or any other Loan
Document, except with respect to Secured Obligations for which the Canadian Loan Parties (as distinguished from the Loan Parties
generally) are expressly liable under this Agreement or any other Loan Document, neither the Canadian Borrower nor any other
Canadian Loan Party shall guaranty, pledge assets in support of, be subject to any right of setoff with respect to, or otherwise be liable
for any Obligations that are not Canadian Secured Obligations, including all indemnities and costs and expenses that do not solely
relate to the Canadian Secured Obligations, the Canadian Loan Parties or any Canadian Collateral. In furtherance of the foregoing,
each of the parties acknowledges and agrees that the liability of any Canadian Loan Party for the payment and performance of its
covenants, representations and warranties set forth in this Agreement and the other Loan Documents shall be several from but not joint
with the U.S. Secured Obligations; and the Collateral of the Canadian Loan Parties shall not secure or be applied in satisfaction, by
way of payment, prepayment, or otherwise, of all or any portion of the U.S. Secured Obligations. For the avoidance of doubt, the U.S.
Loan Parties shall be jointly and severally liable for all U.S. Secured Obligations and Canadian Secured Obligations.Schedule I to
Guarantee Agreement.

U.S. GUARANTORS
L&W Supply Corporation
United States Gypsum Company
USG Interiors, LLC
California Wholesale Material Supply, LLC
Livonia Building Materials, LLC
Otsego Paper, Inc.

SUPPLEMENT NO. __ dated as of _________, 20__ (this Supplement), to the Amended and
Restated Guarantee Agreement dated as of October 22, 2014 (as amended, supplemented or otherwise modified
from time to time, the Guarantee Agreement), among USG CORPORATION, a Delaware corporation (the
U.S. Borrower), CGC INC., a New Brunswick corporation (the Canadian Borrower; the U.S. Borrower
and the Canadian Borrower, collectively, the Borrowers, and each, individually, a Borrower), the
Subsidiaries of the U.S. Borrower from time to time party thereto (together with the Borrowers, the
Guarantors) and JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the
Administrative Agent).
A. Reference is made to the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014 (as
amended, restated, supplemented or otherwise modified from time to time, the Credit Agreement), among the Borrowers, the
Lenders and Issuing Banks party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, JPMorgan Chase Bank N.A.,
Toronto Branch, as Canadian Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, National Association, as CoSyndication Agents.
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 Banks 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 Banks 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 an original executed 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 and any claim, controversy, dispute or cause of action (WHETHER in contract
or tort or otherwise) based upon, arising out of or relating to this supplement and the transactions contemplated hereby shall
be construed in accordance with and governed by the law 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]

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:

EXHIBIT 10.21

U.S. PLEDGE AND SECURITY AGREEMENT

dated as of January 7, 2009,
among
USG CORPORATION,
as U.S. Borrower,
The Other U.S. Grantors Party Hereto
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent

Table of Contents
ARTICLE I
DEFINITIONS
SECTION 1.01.
SECTION 1.02.
SECTION 1.03.

Terms Defined in Credit Agreement

Terms Defined in UCC
Definitions of Certain Terms Used Herein

1
1
1

ARTICLE II
GRANT OF SECURITY INTEREST
SECTION 2.01.
SECTION 2.02.

Security Interest
Keepwell

4
5
ARTICLE III
REPRESENTATIONS AND WARRANTIES

SECTION 3.01.
SECTION 3.02.
SECTION 3.03.
SECTION 3.04.
SECTION 3.05.
SECTION 3.06.
SECTION 3.07.
SECTION 3.08.
SECTION 3.09.
SECTION 3.10.
SECTION 3.11.
SECTION 3.12.
SECTION 3.13.
SECTION 3.14.

Title, Perfection and Priority

Type and Jurisdiction of Organization, Organizational and Identification Numbers
Principal Location
Collateral Locations
Deposit Accounts
Exact Names
Perfection Certificate
Validity of Security Interest
Security Interest as Security Only
Accounts
Inventory
Intellectual Property
Filing Requirements
No Financing Statements, Security Agreements

5
6
6
6
6
6
6
7
7
7
7
8
8
8

ARTICLE IV
COVENANTS
SECTION 4.01.
SECTION 4.02.

General
Accounts

9
11

SECTION 4.03.
SECTION 4.04.

Inventory
Intellectual Property

11
12

SECTION 4.05.
SECTION 4.06.

Collateral Access Agreements

Change of Name or Location; Change of Fiscal Year

12
13

ARTICLE V
REMEDIES
SECTION 5.01.
SECTION 5.02.
SECTION 5.03.

Remedies
U.S. Grantors Obligations Upon an Event of Default
Grant of Intellectual Property License

13
15
15

ARTICLE VI
ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY
SECTION 6.01.
SECTION 6.02.

Account Verification
Authorization for Secured Party to Take Certain Action

16
16

ARTICLE VII
COLLECTION AND APPLICATION OF COLLATERAL PROCEEDS; DEPOSIT ACCOUNTS
SECTION 7.01.
SECTION 7.02.
SECTION 7.03.

Collection of Accounts
Covenant Regarding New Deposit Accounts
Cash Dominion Periods; Application of Proceeds

18
18
19

ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01.
SECTION 8.02.

Waivers

21

SECTION 8.03.
SECTION 8.04.
SECTION 8.05.
SECTION 8.06.
SECTION 8.07.
SECTION 8.08.
SECTION 8.09.
SECTION 8.10.
SECTION 8.11.

Limitation on Administrative Agents and Lenders Duty with Respect to the Collateral
Compromises and Collection of Collateral
Secured Party Performance of Debtor Obligations
Specific Performance of Certain Covenants
Dispositions Not Authorized
No Waiver; Amendments; Cumulative Remedies
Limitation by Law; Severability of Provisions
Reinstatement
Benefit of Agreement
Survival of Representations

21
22
22
23
23
23
23
23
24
24

SECTION 8.12.
SECTION 8.13.

Headings
Termination

24
24

SECTION 8.14.
SECTION 8.15.
SECTION 8.16.
SECTION 8.17.
SECTION 8.18.
SECTION 8.19.
SECTION 8.20.
SECTION 8.21.
SECTION 8.22.

Additional Subsidiaries
Right of Setoff
Lien Absolute
Release
Entire Agreement
Governing Law; Jurisdiction; Consent to Service of Process
WAIVER OF JURY TRIAL
Taxes and Expenses; Indemnity
Counterparts

25
25
26
26
27
27
27
28
29

ARTICLE IX
NOTICES
SECTION 9.01.

Sending Notices

29

ARTICLE X
THE ADMINISTRATIVE AGENT
Schedule 1

U.S. Subsidiary Grantors

Exhibit A

Information for each U.S. Grantor

Exhibit B

Collateral Deposit Accounts

Exhibit C

Financing Statement Filing Offices

Exhibit D

Form of New Subsidiary Supplement

U.S. PLEDGE AND SECURITY AGREEMENT

THIS U.S. PLEDGE AND SECURITY AGREEMENT (this Agreement) is entered into as of January 7, 2009,
among USG Corporation, a Delaware corporation (the U.S. Borrower), each Domestic Subsidiary identified on Schedule I hereto
and each other Domestic Subsidiary that becomes a party to this Agreement after the Restatement Effective Date pursuant to Section
8.14 hereof (each such Subsidiary and the U.S. Borrower, a U.S. Grantor and, collectively, the U.S. Grantors) and JPMorgan
Chase Bank, N.A., in its capacity as administrative agent (the Administrative Agent) for the lenders party to the Credit Agreement
referred to below.
PRELIMINARY STATEMENT
Reference is made to the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014 (as amended,
restated, supplemented or otherwise modified from time to time, the Credit Agreement), among the U.S. Borrower, CGC Inc., a
New Brunswick corporation (the Canadian Borrower; the U.S. Borrower and the Canadian Borrower, collectively, the Borrowers
and each, individually, a Borrower), the Lenders and Issuing Banks from time to time party thereto, the Administrative Agent,
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian administrative agent, and Bank of America, N.A. and Wells Fargo Bank,
National Association, as co-syndication agents. Each U.S. Grantor is entering into this Agreement in order to induce the Lenders and
Issuing Banks to enter into and extend credit to the Borrowers under the Credit Agreement and to secure the Secured Obligations.
ACCORDINGLY, the U.S. Grantors and the Administrative Agent, on behalf of the Lenders, hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Terms Defined in Credit Agreement. All capitalized terms used herein and not otherwise defined shall
have the meanings assigned to such terms in the Credit Agreement.
SECTION 1.02. Terms Defined in UCC. Terms defined in the UCC which are not otherwise defined in this
Agreement are used herein as defined in the UCC.
SECTION 1.03. Definitions of Certain Terms Used Herein. As used in this Agreement, in addition to the terms defined
in the preamble hereto and in the Preliminary Statement, the following terms shall have the following meanings:
Accounts means all rights to payment, whether or not earned by performance, for the sale or lease of goods or the
rendition of services, in each case in the ordinary course of the U.S. Grantors business, whether such rights constitute or are evidenced
by any Account (as defined in Article 9 of the UCC), Chattel Paper, Instrument or General Intangible.
Article means a numbered article of this Agreement, unless another document is specifically referenced.
Cash Dominion Period means any of (a) a period commencing on the date on which Excess Availability shall have
been less than the Threshold Amount for five (5) consecutive Business

Days and ending on the first date thereafter on which Excess Availability shall have been equal to or greater than the Threshold
Amount for thirty (30) consecutive calendar days and (b) a period during which an Event of Default has occurred and is continuing.
For purposes of clarity, if, during the continuance of a Cash Dominion Period triggered by an event described in either clause (a) or (b)
of this definition, an event described in clause (a) or (b) of this definition shall occur, then such Cash Dominion Period shall be deemed
not to have terminated until such time as a Cash Dominion Period would no longer exist under both clauses (a) and (b) of this
definition.
Cash Dominion Period Notice shall have the meaning set forth in Section 7.03(a).
Cash Dominion Termination Notice shall have the meaning set forth in Section 7.03(a).
Cash Dominion Termination Period shall have the meaning set forth in Section 7.03(a).
Collateral shall have the meaning set forth in Article II.
Collateral Access Agreement means any landlord waiver or other agreement (as such waiver or agreement may be
amended, restated or otherwise modified from time to time), in form and substance reasonably satisfactory to the Administrative Agent,
pursuant to which a mortgagee or lessor of real property on which Collateral is stored or otherwise located, or a bailee, consignee or
similar Person with respect to any warehouse, processor or converter facility or other location where Collateral is stored or located, (a)
acknowledges the Lien of the Administrative Agent, on behalf of the Secured Parties, in respect of such Collateral, (b) waives or, in
the reasonable discretion of the Administrative Agent, subordinates on terms reasonably acceptable to the Administrative Agent any
Lien or other claim that such Person may assert against such Collateral and (c) where applicable, grants to the Administrative Agent
reasonable access to and use of such real property or facility, as the case may be, following the occurrence and during the continuance
of an Event of Default, to assemble, complete and sell such Collateral.
Collateral Deposit Account means, with respect to each U.S. Grantor, any lockbox account maintained by such U.S.
Grantor to which any cash, checks or other similar payments constituting payments made in respect of Accounts and/or proceeds of
Inventory are or are to be remitted and all Deposit Accounts maintained by such U.S. Grantor into which any such payments are
directed to be deposited, as well as any other Deposit Accounts maintained by such U.S. Grantor into which any cash, checks or other
similar payments constituting payments made in respect of Accounts and/or proceeds of Inventory are or are to be deposited.
Collateral Deposit Account Bank means each bank or other financial institution at which any U.S. Grantor maintains
a Collateral Deposit Account.
Collateral Report means any certificate (including any Borrowing Base Certificate), report or other document
delivered by any U.S. Grantor to the Administrative Agent relating to the Collateral pursuant to any Loan Document.
Collection Account shall have the meaning set forth in Section 7.03(a).
Control shall have the meaning set forth in Section 9-104 or Section 9-105, as applicable, of Article 9 of the UCC.
Copyrights means, with respect to any Person, all of such Persons right, title and interest in and to the following: (a)
all copyrights, rights and interests in copyrights, works protectable by copyright, copyright registrations, and copyright applications; (b)
all renewals of any of the foregoing; (c)

all licenses of the foregoing; and (d) the rights corresponding to the use or sublicense of any of the foregoing throughout the world.
Deposit Account Control Agreement means an agreement, in form and substance reasonably satisfactory to the
Administrative Agent, among any U.S. Grantor, a Collateral Deposit Account Bank and the Administrative Agent with respect to
Control of the Collateral Deposit Accounts listed therein and the disposition of funds on deposit in such Collateral Deposit Accounts.
Exhibit refers to a specific exhibit to this Agreement (as amended, deemed amended or supplemented from time to
time in accordance with this Agreement or any Supplement), unless another document is specifically referenced.
Financing Statement means, with respect to any U.S. Grantor, each UCC financing statement naming the
Administrative Agent as secured party and such U.S. Grantor as debtor and describing the Collateral in a manner consistent with the
requirements set forth in Section 4.01(b).
Intellectual Property means the collective reference to all intellectual and similar property of every kind and nature,
including inventions, designs, Patents, Copyrights, Trademarks, trade secrets, domain names, confidential or proprietary technical and
business information, know how or other data or information, software and databases and all embodiments or fixations thereof and
related documentation, registrations and franchises, and all additions, improvements and accessions to, and books and records
describing or used in connection with, any of the foregoing.
Inventory shall have the meaning set forth in Article 9 of the UCC.
Patents means, with respect to any Person, all of such Persons right, title and interest in and to: (a) any and all patents
and patent applications; (b) all inventions and improvements described and claimed therein; (c) all reissues, divisions, continuations,
renewals, extensions and continuations-in-part thereof; (d) all licenses of the foregoing; and (e) all rights corresponding to the use or
sublicense of any of the foregoing throughout the world.
Proceeds shall have the meaning set forth in Article 9 of the UCC.
Section means a numbered section of this Agreement, unless another document is specifically referenced.
Security Interest has the meaning assigned to such term in Section 2.01.
Specified L&W Grantors means, collectively, each of L & W Supply Corporation, a Delaware corporation,
California Wholesale Material Supply, LLC, a Delaware limited liability company, and Livonia Building Materials, LLC, a Michigan
limited liability company, in each case for so long as such entity is required to be a U.S. Grantor hereunder.
Supplement shall have the meaning set forth in Section 8.14.
Trademarks means, with respect to any Person, all of such Persons right, title and interest in and to the following: (a)
all trademarks (including service marks), trade names, trade dress and trade styles and the registrations and applications for registration
thereof; (b) all licenses of the foregoing, whether as licensee or licensor; (c) all renewals of the foregoing; and (d) all rights
corresponding to the use or sublicense of any of the foregoing throughout the world.

The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms.
ARTICLE II
GRANT OF SECURITY INTEREST
SECTION 2.01. Security Interest. As security for the payment or performance, as the case may be, in full of the
Secured Obligations, each U.S. Grantor hereby pledges, assigns and grants to the Administrative Agent, its successors and permitted
assigns, on behalf of and for the benefit of the Secured Parties, a security interest in all of such U.S. Grantors right, title and interest in
(a) Accounts, and Proceeds in respect thereof, whether now owned by or owing to, or hereafter acquired by or arising in favor of, such
U.S. Grantor (including under any trade name or derivations thereof), and regardless of where located, (b) Inventory, and Proceeds in
respect thereof, whether now owned by, or hereafter acquired by, such U.S. Grantor (including under any trade name or derivations
thereof), and regardless of where located, and (c) all Collateral Deposit Accounts of such U.S. Grantor (all of the assets referenced in
the immediately preceding clauses (a), (b) and (c), and all such right, title and interest therein, are collectively referred to as the
Collateral; the security interest in the Collateral granted pursuant to this Section 2.01 is referred to as the Security Interest).
SECTION 2.02. Keepwell. Each Qualified ECP Guarantor (as defined below) hereby jointly and severally absolutely,
unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other
U.S. Grantor that would otherwise not be an eligible contract participant as defined in the Commodity Exchange Act and the
regulations thereunder to honor all of its obligations under this Agreement in respect of Specified Swap Obligations (provided,
however, that each Qualified ECP Guarantor shall only be liable under this Section 2.02 for the maximum amount of such liability that
can be hereby incurred without rendering its obligations under this Section 2.02 or otherwise under this Agreement voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each
Qualified ECP Guarantor under this Section 2.02 shall remain in full force and effect until the indefeasible payment in full in cash of all
the Secured Obligations. Each Qualified ECP Guarantor intends that this Section 2.02 constitute, and this Section 2.02 shall be deemed
to constitute, a keepwell, support, or other agreement for the benefit of each other Loan Party for all purposes of Section la(18)(A)(v)
(II) of the Commodity Exchange Act. For purposes hereof, Qualified ECP Guarantor means, in respect of any Specified Swap
Obligation, each U.S. Grantor that has total assets exceeding $10,000,000 at the time the grant of the relevant security interest becomes
or would become effective with respect to such Specified Swap Obligation and each other U.S. Grantor that constitutes an eligible
contract participant under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to
qualify as an eligible contract participant at such time by guaranteeing or entering into a keepwell in respect of obligations of such
other person under Section la(18)(A)(v)(II) of the Commodity Exchange Act.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each U.S. Grantor represents, warrants and covenants to and with the Secured Parties that:

SECTION 3.01. Title, Perfection and Priority. Such U.S. Grantor has good and valid rights in or the power to transfer
the Collateral and title to the Collateral with respect to which it has purported to grant the Security Interest hereunder, free and clear of
all Liens except for Liens permitted under Section 4.01(g), and has full power and authority to grant to the Administrative Agent, for
the benefit of the Secured Parties, the Security Interest pursuant hereto and to execute, deliver and perform its obligations in accordance
with the terms of this Agreement, without the consent or approval of any other Person other than any consent or approval that has been
obtained, except such consents or approvals the failure of which to have been obtained will not impair the Security Interest. When a
properly completed Financing Statement has been filed in the appropriate office against such U.S. Grantor in the applicable location
listed on Exhibit C (or, in the case of any U.S. Grantor that becomes a party hereto after the Restatement Effective Date, in the
jurisdiction of organization of such U.S. Grantor specified in Schedule I to the Supplement for such U.S. Grantor) and any applicable
filing fees or taxes are paid in connection with such filing, the Administrative Agent will have a fully perfected first priority security
interest in that Collateral of such U.S. Grantor in which a security interest may be perfected by filing a UCC financing statement,
subject only to Liens permitted under Section 4.01(g).
SECTION 3.02. Type and Jurisdiction of Organization, Organizational and Identification Numbers. The type of entity
of such U.S. Grantor, its state of organization, the organizational number issued to it by its state of organization and its federal
employer identification number are set forth on Exhibit A.
SECTION 3.03. Principal Location. The location of such U.S. Grantors place of business (if it has only one) or its
chief executive office (if it has more than one place of business) is disclosed in Exhibit A. In addition, such U.S. Grantor has no other
places of business where books and records with respect to the Collateral are maintained, except those set forth in Exhibit A.
SECTION 3.04. Collateral Locations. All of such U.S. Grantors locations where Collateral having an aggregate book
value of $100,000 or more is located are listed on Exhibit A. All of said locations are owned by such U.S. Grantor except for locations
(a) which are leased by the U.S. Grantor as lessee and designated in Exhibit A and (b) at which Inventory is held in a public
warehouse or is otherwise held by a bailee or on consignment as designated in Exhibit A.
SECTION 3.05. Deposit Accounts. Exhibit B sets forth a complete list of the Collateral Deposit Accounts of such U.S.
Grantor, including, with respect to each such Collateral Deposit Account, each depositary institutions name and location and such
U.S. Grantors account number.
SECTION 3.06. Exact Names. Such U.S. Grantors name, as set forth on Exhibit A, is the exact name as it appears in
such U.S. Grantors organizational documents, as amended, as filed with such U.S. Grantors jurisdiction of organization. Such U.S.
Grantor has not, during the past two years prior to the Restatement Effective Date, been known by or used any other corporate or
fictitious name, or been a party to any merger or consolidation, or been a party to any acquisition, in each case except as otherwise
specified in the Perfection Certificate or any certificate delivered to the Administrative Agent pursuant to Section 4.01(f).
SECTION 3.07. Perfection Certificate. The Perfection Certificate has been duly prepared, completed and executed by
the Borrowers and the information set forth therein with respect to each U.S. Grantor is correct and complete as of the Restatement
Effective Date, and the Financing Statements (including any amendments thereto) prepared by the Administrative Agent based upon
the information provided to the Administrative Agent in the Perfection Certificate for filing in each governmental,

municipal or other office specified in Section 2(d) to the Perfection Certificate (or specified by notice from the U.S. Borrower to the
Administrative Agent after the Restatement Effective Date in the case of filings, recordings or registrations required by Section 5.10 of
the Credit Agreement or Sections 4.01 and 4.06 hereof) are all the filings, recordings and registrations that are necessary to perfect a
security interest in favor of the Administrative Agent (for the benefit of the Secured Parties) in respect of all the Collateral in which the
Security Interest may be perfected by filing, recording or registering in the U.S. (or any political subdivision thereof), and no further or
subsequent filing, refiling, recording, rerecording, registration or reregistration is necessary in any such jurisdiction, except as provided
under applicable law with respect to the filing of continuation statements.
SECTION 3.08. Validity of Security Interest. The Security Interest constitutes a legal and valid security interest in all
the Collateral securing the payment and performance of the Secured Obligations.
SECTION 3.09. Security Interest as Security Only. The Security Interest granted by such U.S. Grantor is granted as
security only and shall not subject the Administrative Agent or any other Secured Party to, or in any way alter or modify, any
obligation or liability of any U.S. Grantor with respect to or arising out of the Collateral.
SECTION 3.10. Accounts. (a) The names of the Account Debtors, amounts owing, due dates and other information
with respect to such U.S. Grantors Accounts are and will be complete, true and correct in all material respects in the records of such
U.S. Grantor relating thereto and in all invoices and Collateral Reports with respect thereto furnished to the Administrative Agent
pursuant to the Loan Documents from time to time. As of the time when each Account arises, such U.S. Grantor shall be deemed to
have represented and warranted that such Account and all records relating thereto are genuine and in all respects what they purport to
be.
(b) In addition, with respect to all of its Accounts, except as disclosed in the most recent Collateral Report, (i) the
amounts shown on all invoices, statements and Collateral Reports with respect thereto are actually and absolutely owing to such U.S.
Grantor as indicated thereon and are not in any way contingent (other than with respect to discounts, rebates, billing errors, setoffs,
counterclaims and other Dilution Factors); (ii) no payments have been or shall be made thereon except payments delivered or to be
delivered to a Collateral Deposit Account as required pursuant to Section 7.01; and (iii) to such U.S. Grantors knowledge, all Account
Debtors relating to such Accounts have the capacity to contract.
SECTION 3.11. Inventory. With respect to any of its Inventory represented as being Eligible Inventory on the most
recent Collateral Report, (a) as of the last day of the period covered by such Collateral Report, such Inventory (other than Inventory in
transit) is located at one of such U.S. Grantors locations set forth on Exhibit A and such Inventory (other than Inventory in transit and
other than Inventory that has subsequently been sold, transferred or otherwise disposed of by such U.S. Grantor (other than to another
U.S. Grantor) in the ordinary course of business) shall not be stored at any other location except as permitted by Section 4.01(j), (b)
other than any Inventory that has subsequently been sold, transferred or otherwise disposed of by such U.S. Grantor (other than to
another U.S. Grantor) in the ordinary course of business, such U.S. Grantor has good and merchantable title to such Inventory and
such Inventory is not subject to any Lien, except for Liens permitted by Section 4.01(g), (c) except as specifically disclosed in such
Collateral Report (or in any notification provided to the Administrative Agent subsequent to the last day of the period covered by such
Collateral Report in accordance with Section 5.01(i) of the Credit Agreement), such Inventory (except for de minimis portions of such
Inventory) is Eligible Inventory of good and merchantable quality, free from any defects, (d) such

Inventory is not subject to any licensing, patent, royalty, trademark, trade name or copyright agreements with any third parties which
would require any consent of any third party upon sale or disposition of that Inventory or the payment of any monies to any third party
upon such sale or other disposition (other than any such consent that has already been obtained or any such payment obligation that has
already been waived), (e) such Inventory has been produced in accordance with the Federal Fair Labor Standards Act of 1938, as
amended, and all rules, regulations and orders thereunder and (f) the preparation for sale, marketing or sale of such Inventory by the
Administrative Agent after the occurrence and during the continuance of an Event of Default shall not require the consent of any
Person (except as required by applicable law) and shall not constitute a breach or default under any contract or agreement to which
such U.S. Grantor is a party or to which such Inventory is subject.
SECTION 3.12. Intellectual Property. Such U.S. Grantor owns, or is licensed to use, all Patents, Trademarks,
Copyrights or other Intellectual Property material to its business, and the use thereof by such U.S. Grantor does not infringe upon the
rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, and no such Intellectual Property is subject to any Lien or other restriction (other than any such
Lien or other restriction with respect to which a waiver or release has been obtained) that would materially interfere with the exercise
of the Administrative Agents rights with respect to such Intellectual Property to prepare for sale, market and sell any Eligible
Inventory under Section 5.03.
SECTION 3.13. Filing Requirements. None of the Collateral owned by it is of a type for which security interests or
liens may be perfected by filing under any Federal statute. Notwithstanding anything in any Loan Document to the contrary, the
Administrative Agent agrees that the U.S. Grantors shall not be required to make filings under the Assignment of Claims Act of 1940,
31 U.S.C. 3727 and 41 U.S.C. 15.
SECTION 3.14. No Financing Statements, Security Agreements. No financing statement or security agreement
describing all or any portion of the Collateral which has not lapsed or been terminated naming such U.S. Grantor as debtor has been
filed or is of record in any jurisdiction except (a) for the Financing Statements and (b) as permitted under Section 4.01(g).
ARTICLE IV
COVENANTS
From the date of this Agreement, and thereafter until this Agreement is terminated, each U.S. Grantor agrees that:
SECTION 4.01. General. (a) Collateral Records. Such U.S. Grantor will maintain books and records with respect to
the Collateral owned by it in accordance Section 5.07 of the Credit Agreement, and furnish to the Administrative Agent, with sufficient
copies for each of the Lenders, such reports relating to such Collateral as the Administrative Agent may from time to time reasonably
request.
(b) Authorization to File Financing Statements; Ratification. Such U.S. Grantor hereby authorizes the Administrative
Agent to file, and if requested will deliver to the Administrative Agent, all Financing Statements and other documents and take such
other actions as may from time to time be reasonably requested by the Administrative Agent in order to maintain, subject to any Liens
permitted under Section 4.01(g), a first priority perfected security interest in and, if applicable and contemplated by the terms hereof,
Control of, the Collateral owned by such U.S. Grantor. Any Financing Statement (or

amendment thereto) filed by the Administrative Agent shall (i) indicate such U.S. Grantors Collateral by any description that
reasonably approximates the description of such Collateral contained in this Agreement and (ii) contain any other information required
by part 5 of Article 9 of the UCC for the sufficiency or filing office acceptance of such Financing Statement (or amendment thereto).
Such U.S. Grantor agrees to furnish any such information to the Administrative Agent promptly upon request. Such U.S. Grantor also
ratifies its authorization for the Administrative Agent to have filed any initial Financing Statements if filed prior to the Restatement
Effective Date.
(c) Further Assurances. Such U.S. Grantor agrees to take any and all actions that it shall reasonably deem necessary to
defend title to the Collateral against all persons and to defend the Security Interest of the Administrative Agent in its Collateral and the
priority thereof against any Lien not expressly permitted under Section 4.01(g).
(d) Disposition of Collateral. Such U.S. Grantor will not sell, lease or otherwise dispose of the Collateral owned by it
except for dispositions not otherwise prohibited by Section 6.03 of the Credit Agreement.
(e) Maintaining Perfection of Security Interest. Each U.S. Grantor agrees, at its own expense, to execute, acknowledge,
deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Administrative Agent may
from time to time reasonably request to preserve, protect and perfect the Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of
the Security Interest and the filing of any Financing Statements or other documents in connection herewith or therewith. If any amount
payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note or other instrument
(other than any promissory note or other instrument in an aggregate principal amount of less than $500,000 owed to the applicable
U.S. Grantor by any Person that is not a Borrower or any Subsidiary, provided that the aggregate principal amount of promissory notes
that may be excluded from the delivery requirements of this paragraph (e) may not exceed $2,000,000 at any one time), such note or
instrument shall be immediately pledged and delivered to the Administrative Agent, duly endorsed in a manner satisfactory to the
Administrative Agent.
(f) Annual Confirmation of Perfection Certificate. Each year, at the time of delivery of annual financial statements with
respect to the preceding fiscal year pursuant to Section 5.01(a) of the Credit Agreement, the U.S. Borrower shall deliver to the
Administrative Agent a certificate executed by a Financial Officer of the U.S. Borrower (i) setting forth any changes to the information
required pursuant to the Perfection Certificate, or confirming that there has been no change in such information, in each case since the
date of the Perfection Certificate or the date of the most recent certificate delivered pursuant to this Section 4.01(f) and (ii) certifying
that all initial UCC financing statements or other appropriate filings, recordings or registrations, including all refilings, rerecordings,
reregistrations and amendments to the initial UCC financing statements, containing a description of the Collateral have been filed of
record in each governmental, municipal or other appropriate office in the jurisdiction identified pursuant to Section 4.06 to the extent
necessary to protect and perfect the Security Interest as of the date of such certificate. In connection with the delivery of any updates to
the Perfection Certificate in accordance with this Section 4.01(f) (but without limiting the express requirements of this Agreement,
including those under Sections 4.05, 4.06 and 7.02(b)), Exhibit A and Exhibit B hereto shall be deemed amended to include such
updated information.

(g) Liens. Such U.S. Grantor will not create, incur, or suffer to exist any Lien on the Collateral owned by it except
Liens permitted under clauses (a) through (d), (f) and (k) of Section 6.02 of the Credit Agreement.
(h) Other Financing Statements. Such U.S. Grantor will not authorize the filing of any financing statement naming it as
debtor covering all or any portion of the Collateral owned by it, except with respect to any Lien permitted under Section 4.01(g). Such
U.S. Grantor acknowledges that it is not authorized to file (i) any financing statement with respect to the Collateral, except with respect
to any Lien permitted under Section 4.01(g), without providing prior written notice to the Administrative Agent or (ii) any amendment
or termination statement with respect to any Financing Statement filed in accordance with the terms hereof without the prior written
consent of the Administrative Agent, subject to such U.S. Grantors rights under Section 9-509(d)(2) of the UCC.
(i) Compliance with Terms. Such U.S. Grantor shall observe, perform and comply with all obligations in respect of the
Collateral owned by it (in each case, in a manner consistent with past business practices of such U.S. Grantor), unless the failure to
observe, perform or comply with such obligations would not adversely affect the validity, perfection and priority of the Security
Interest.
(j) Locations. Such U.S. Grantor will not maintain any Collateral owned by it at any location other than those locations
listed on Exhibit A (or any other location with respect to which advance written notice has been provided as contemplated by Section
4.05), other than (i) Inventory that is in transit from or to such a location and (ii) Inventory with a book value in the aggregate at any
location not listed on Exhibit A of less than $100,000; provided that the aggregate value of Inventory at all locations not listed on
Exhibit A shall not exceed $2,000,000.
SECTION 4.02. Accounts. (a) Certain Agreements on Accounts. No U.S. Grantor will make or agree to make any
discount, credit, rebate or other reduction in the original amount owing on an Account or accept in satisfaction of an Account less than
the original amount thereof, except that such U.S. Grantor may reduce the amount owing on Accounts arising from the sale of
Inventory in accordance with its past business practices unless and until a notice from the Administrative Agent has been received
revoking such right during an Event of Default, but only for so long as an Event of Default is continuing.
(b) Collection of Accounts. Except as otherwise provided in this Agreement, each U.S. Grantor will, consistent with its
past business practices, collect and enforce, at no expense to any Secured Party, all amounts due or hereafter due to such U.S. Grantor
under the Accounts owned by it.
(c) Security Interest in Property to Satisfy Account Debt. If at any time any U.S. Grantor shall take a security interest in
any property of an Account Debtor or any other Person to secure payment and performance of an Account, such U.S. Grantor shall
promptly assign such security interest to the Administrative Agent. Such assignment need not be filed of public record unless necessary
to continue the perfected status of the security interest against creditors of and transferees from the Account Debtor or other Person
granting the security interest.
(d) Delivery of Invoices. Such U.S. Grantor will deliver to the Administrative Agent, immediately upon its request after
the occurrence and during the continuation of an Event of Default and in connection with the Administrative Agents exercise of
remedies hereunder, duplicate invoices with respect to each Account owned by it bearing such language of assignment as the
Administrative Agent shall specify.

(e) Disclosure of Material Reductions in Accounts. Such U.S. Grantor, promptly upon obtaining knowledge of any
event, circumstance or change that has occurred since the most recent date on which a Borrowing Base Certificate was required to be
delivered pursuant to Section 5.01(e) of the Credit Agreement that would materially reduce the aggregate amount of Eligible Accounts
or result in a material portion of the Eligible Accounts ceasing to be Eligible Accounts, shall cause the U.S. Borrower to promptly
disclose such fact to the Administrative Agent in writing.
SECTION 4.03. Inventory. (a) Maintenance of Goods. Such U.S. Grantor will maintain, preserve, protect and keep its
Inventory in a manner consistent with its past business practices.
(b) Returned Inventory. If an Account Debtor returns any Inventory to such U.S. Grantor when no Event of Default
exists, then such U.S. Grantor shall promptly determine the reason for such return and, if reasonably deemed appropriate by such U.S.
Grantor, shall issue a credit memorandum to the Account Debtor in the appropriate amount and in a manner consistent with its past
business practices. Such U.S. Grantor shall promptly report to the Administrative Agent any return of Inventory involving an amount
in excess of $2,000,000. Each such report shall indicate each applicable Account Debtors stated reasons for the returns and the
locations and condition of the returned Inventory. All returned Inventory shall be subject to the Administrative Agents Liens thereon.
Whenever any Inventory is returned, the related Account shall be deemed not to be an Eligible Account to the extent of the amount
owing by the Account Debtor with respect to such returned Inventory.
(c) Inventory Count; Perpetual Inventory System. Such U.S. Grantor will conduct cycle counts of its Inventory in a
manner consistent with past business practices and reasonably acceptable to such U.S. Grantors auditors. Upon the request of the
Administrative Agent in connection with any field examination conducted in accordance with Section 5.07(b) of the Credit
Agreement, such U.S. Grantor, at its own expense, shall deliver to the Administrative Agent the results of each physical verification
which such U.S. Grantor has made, or has caused any other Person to make on its behalf, of all or any portion of its Inventory. Such
U.S. Grantor will maintain a perpetual inventory reporting system at all times.
SECTION 4.04. Intellectual Property. Such U.S. Grantor will use commercially reasonable efforts to secure all
consents, waivers and approvals necessary or appropriate to ensure the ability of the Administrative Agent to fully exercise the rights
granted to it in Section 5.03.
SECTION 4.05. Collateral Access Agreements. Such U.S. Grantor shall use commercially reasonable efforts to obtain
a Collateral Access Agreement from the lessor of each leased property, mortgagee of each owned property and bailee, consignee or
similar Person with respect to any warehouse, processor or converter facility or other location, in each case where Collateral is or is to
be stored or located as of the Restatement Effective Date or at any time thereafter, provided that no U.S. Grantor shall be required to
obtain a Collateral Access Agreement with respect to any location at which the Inventory on-hand has a book value of less than
$100,000. For purposes of clarity, it is understood and agreed that any U.S. Grantors failure, after having used commercially
reasonable efforts, to obtain a Collateral Access Agreement with respect to any such location where Collateral is stored or located shall
not constitute an Event of Default. With respect to any such location where Inventory is stored or located as of the Restatement
Effective Date or at any time thereafter, if the Administrative Agent has not received a Collateral Access Agreement with respect to
such location, the Eligible Inventory at such location shall be subject to such Reserves as may be established by the Administrative
Agent in accordance with the terms of the Credit Agreement. Such U.S. Grantor shall provide to the Administrative Agent reasonable
(but in no event less than three Business Days) advance written notice of (i) any arrangement or agreement entered into by such U.S.
Grantor to lease or mortgage real property or any warehouse or similar location

at which Collateral is to be stored or located, unless a Collateral Access Agreement that would cover such Collateral is in effect with
respect to such location and (ii) any arrangement or agreement to ship or otherwise transfer any Collateral to any mortgaged or leased
real property, or to any warehouse, processor or converter facility or other location, in each case unless a Collateral Access Agreement
that would cover such Collateral is in effect with respect to such location, and such U.S. Grantor shall provide to the Administrative
Agent prompt written notice of the termination of any such existing arrangement or agreement with respect to any location at which
Collateral is stored or located at the time of such termination. Not later than the last day of the calendar quarter during which any
arrangement, agreement or termination referenced in the immediately preceding sentence is established or occurs, the U.S. Borrower
shall deliver to the Administrative Agent a supplement to Exhibit A, setting forth the information with respect to the locations
applicable to any such new arrangement or agreement required therein or indicating the termination of any such arrangement or
agreement, as the case may be. Such U.S. Grantor shall timely and fully pay and perform its obligations under all leases and other
agreements with respect to each location where any Collateral is or may be stored or located.
SECTION 4.06. Change of Name or Location; Change of Fiscal Year. Such U.S. Grantor shall not (a) change its name
as it appears in official filings in the state of its incorporation or organization, (b) change its chief executive office, principal place of
business or corporate offices, or the location of its records concerning the Collateral as set forth in the Security Agreement, (c) change
the type of entity that it is, (d) change its organization identification number, if any, issued by its state of incorporation or other
organization or (e) change its state of incorporation or organization, in each case, unless the Administrative Agent shall have received
at least ten days prior written notice of such change and such U.S. Grantor (or the Administrative Agent on behalf of such U.S.
Grantor) shall have taken all action reasonably requested by the Administrative Agent to continue the validity, perfection and priority
of any Liens in favor of the Administrative Agent, on behalf of the Secured Parties, in any Collateral, provided that any new
jurisdiction of organization shall be in the U.S., any State thereof or the District of Columbia. In connection with any such change
permitted under this Section 4.06, Exhibits A and C hereto shall be deemed to be amended to reflect such change(s) (effective as of the
date of such change(s)).
ARTICLE V
REMEDIES
SECTION 5.01. Remedies. (a) Upon the occurrence, and during the continuance, of an Event of Default, the
Administrative Agent may exercise any or all of the following rights and remedies:
(i) those rights and remedies provided in this Agreement, the Credit Agreement or any other Loan Document, provided
that this Section 5.01(a) shall not be understood to limit any rights or remedies available to the Secured Parties prior to an Event
of Default;
(ii) those rights and remedies available to a secured party under the UCC (whether or not the UCC applies to the
affected Collateral) or under any other applicable law (including, without limitation, any law governing the exercise of a banks
right of setoff or bankers lien) when a debtor is in default under a security agreement;
(iii) institute a Cash Dominion Period as per the terms of Section 7.03; and
(iv) without notice (except as specifically provided in Section 8.01 or elsewhere herein), demand or advertisement of
any kind to any U.S. Grantor or any other Person, enter the premises

of any U.S. Grantor where any Collateral is located (through self-help and without judicial process) to collect, receive,
assemble, process, appropriate, sell, lease, assign, grant an option or options to purchase or otherwise dispose of, deliver or
realize upon, the Collateral or any part thereof in one or more parcels at public or private sale or sales (which sales may be
adjourned or continued from time to time with or without notice and may take place at any U.S. Grantors premises or
elsewhere), for cash, on credit or for future delivery without assumption of any credit risk, and upon such other terms as the
Administrative Agent may deem commercially reasonable.
(b) The Administrative Agent, on behalf of the Secured Parties, may comply with any applicable state or federal law
requirements in connection with a disposition of the Collateral and such compliance will not be considered to adversely affect the
commercial reasonableness of any sale of the Collateral.
(c) The Administrative Agent shall have the right upon any such public sale or sales and, to the extent permitted by law,
upon any such private sale or sales, to purchase for the benefit of the Secured Parties, the whole or any part of the Collateral so sold,
free of any right of equity redemption, which equity redemption the U.S. Grantor hereby expressly releases.
(d) Until the Administrative Agent is able to effect a sale, lease, or other disposition of Collateral, the Administrative
Agent shall have the right to hold or use Collateral, or any part thereof, to the extent that it deems appropriate for the purpose of
preserving Collateral or its value or for any other purpose deemed appropriate by the Administrative Agent. The Administrative Agent
may, if it so elects, seek the appointment of a receiver or keeper to enforce any of the Administrative Agents remedies (for the benefit
of the Secured Parties) with respect to such appointment without prior notice or hearing as to such appointment.
(e) Notwithstanding the foregoing, no Secured Party shall be required to (i) make any demand upon, or pursue or
exhaust any of their rights or remedies against, any U.S. Grantor, any other obligor, guarantor, pledgor or any other Person with
respect to the payment of the Secured Obligations or to pursue or exhaust any of their rights or remedies with respect to any Collateral
therefor or any direct or indirect guarantee thereof, (ii) marshal the Collateral or any guarantee of the Secured Obligations or resort to
the Collateral or any such guarantee in any particular order or (iii) effect a public sale of any Collateral.
SECTION 5.02. U.S. Grantors Obligations Upon an Event of Default. Without limiting the foregoing or any other
inspection rights the Administrative Agent may have under the Loan Documents, upon the request of the Administrative Agent after
the occurrence and during the continuance of an Event of Default, each U.S. Grantor will:
(a) at any time the Secured Obligations have been accelerated in accordance with the Credit Agreement, assemble and
make available to the Administrative Agent all books and records relating to the Collateral at any place or places specified by the
Administrative Agent, whether at a U.S. Grantors premises or elsewhere;
(b) at any time the Secured Obligations have been accelerated in accordance with the Credit Agreement, permit the
Administrative Agent, by the Administrative Agents representatives and agents, to enter, occupy and use any premises where all or
any part of the Collateral, or the books and records relating thereto, or both, are located, to take possession of and/or remove all or any
part of the Collateral or make copies of the books and records relating thereto, or both, and to conduct sales of the

Collateral in accordance with the terms hereof, any applicable Collateral Access Agreements and applicable law, without any
obligation to pay the applicable U.S. Grantor for such use and occupancy; and
(c) at its own expense, cause the independent certified public accountants then engaged by each U.S. Grantor to prepare
and deliver to the Administrative Agent, promptly upon the Administrative Agents request, the following reports with respect to the
Accounts of such U.S. Grantor: (i) a reconciliation of all such Accounts; (ii) an aging of all such Accounts; (iii) trial balances; and (iv)
a test verification of all such Accounts.
SECTION 5.03. Grant of Intellectual Property License. Solely for the purpose of enabling, and solely to the extent
necessary to enable, the Administrative Agent to exercise the rights and remedies to prepare for sale, market and sell Inventory under
this Article V at such time as the Administrative Agent shall be lawfully entitled to exercise such rights and remedies, each U.S.
Grantor hereby (a) grants to the Administrative Agent, for the benefit of the Secured Parties, an irrevocable, nonexclusive license
(exercisable without payment of royalty or other compensation to any U.S. Grantor) to use, license or sublicense any Intellectual
Property now owned or hereafter acquired by such U.S. Grantor, and wherever the same may be located, and including in such license
access to all media in which any of the licensed items may be recorded or stored and to all computer software and programs used for
the compilation or printout thereof and (b) irrevocably agrees that the Administrative Agent may sell any of such U.S. Grantors
Inventory directly to any person, and, in connection with any such sale or other enforcement of the Administrative Agents rights under
this Agreement, may sell Inventory which bears any Trademark owned by or licensed to such U.S. Grantor and any Inventory that is
covered by any Copyright owned by or licensed to such U.S. Grantor, and the Administrative Agent may finish any work in process
using any Patent (or other Intellectual Property) owned by or licensed to such U.S. Grantor and affix any appropriate Trademark
owned by or licensed to such U.S. Grantor and sell such Inventory as provided herein. The use of such license by the Administrative
Agent may be exercised, at the option of the Administrative Agent, only upon the occurrence and during the continuance of an Event
of Default, provided that any license, sublicense or other transaction entered into by the Administrative Agent in accordance herewith
and in connection with the exercise of the Administrative Agents remedies hereunder shall be binding upon the U.S. Grantors
notwithstanding any subsequent cure of such Event of Default. All actions taken by the Administrative Agent pursuant to this Article
V, as well as the Administrative Agents use of any trade secrets or other Intellectual Property pursuant to this Agreement, shall be
subject to the confidentiality restrictions set forth in Section 9.12 of the Credit Agreement.
ARTICLE VI
ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY
SECTION 6.01. Account Verification. The Administrative Agent may at any time, in the name of the applicable U.S.
Grantor or, after the occurrence, and during the continuance, of an Event of Default, in the Administrative Agents own name or in the
name of a nominee of the Administrative Agent, communicate (by mail, telephone, facsimile or otherwise) with the Account Debtors
of any such U.S. Grantor to verify with such Account Debtors, to the Administrative Agents reasonable satisfaction, any information
relating to the existence, amount, terms of, and any other material matter relating to, the Accounts of such Account Debtors.
SECTION 6.02. Authorization for Secured Party to Take Certain Action. (a) Subject to Section 6.02(b), each U.S.
Grantor hereby appoints the Administrative Agent the attorney-in-fact of such U.S. Grantor for the purpose of carrying out the
provisions of this Agreement and taking any action and

executing any instrument that the Administrative Agent may reasonably deem necessary or advisable to accomplish the purposes
hereof, which appointment is irrevocable and coupled with an interest. Without limiting the generality of the foregoing, the
Administrative Agent shall have the right with full power of substitution either in the name of such U.S. Grantor or, after the
occurrence, and during the continuance, of an Event of Default, in the Administrative Agents name, to (i) file Financing Statements
necessary or desirable in the Administrative Agents sole discretion to perfect and to maintain the perfection and priority of the
Administrative Agents security interest in the Collateral, (ii) endorse and collect any cash proceeds of the Collateral of such U.S.
Grantor, (iii) file a carbon, photographic or other reproduction of this Agreement or any Financing Statement as a financing statement
and to file any other financing statement or amendment of a financing statement (which does not add new collateral or add a debtor) in
such offices as the Administrative Agent in its sole discretion deems necessary or desirable to perfect and to maintain the perfection and
priority of the Security Interest, (iv) apply the proceeds of any Collateral of such U.S. Grantor received by the Administrative Agent to
the Secured Obligations as provided in Section 2.09(b) or Section 2.17(b) of the Credit Agreement, as applicable, (v) discharge past
due taxes, assessments, charges, fees or Liens on the Collateral (except for such Liens as are specifically permitted under Section
4.01(g)), (vi) contact the Account Debtors of such U.S. Grantor for any reason, (vii) demand payment or enforce payment of the
Accounts in the name of the Administrative Agent or such U.S. Grantor, (viii) endorse any and all checks, drafts and other instruments
for the payment of money relating to the Accounts, (ix) sign such U.S. Grantors name on any invoice or bill of lading relating to the
Accounts, drafts against any Account Debtor or assignments and verifications of Accounts, (x) exercise all of such U.S. Grantors
rights and remedies with respect to the collection of the Accounts and any other Collateral, (xi) settle, adjust, compromise, extend or
renew the Accounts or any legal proceedings brought to collect Accounts, (xii) prepare, file and sign such U.S. Grantors name on a
proof of claim in bankruptcy or similar document against any Account Debtor of such U.S. Grantor, (xiii) prepare, file and sign such
U.S. Grantors name on any notice of Lien, assignment or satisfaction of Lien or similar document in connection with the Accounts,
(xiv) change the address for delivery of mail relating to the Accounts of such U.S. Grantor to such address as the Administrative Agent
may designate and to receive, open and dispose of all such mail addressed to such U.S. Grantor, (xv) use, sell, assign, transfer, pledge,
make any agreement with respect to or otherwise deal with all or any of the Collateral and (xvi) do all other acts and things necessary
to carry out the purposes of this Agreement, as fully and completely as though the Administrative Agent were the absolute owner of
the Collateral for all purposes, provided that (A) nothing herein contained shall be construed as requiring or obligating the
Administrative Agent to make any commitment or to make any inquiry as to the nature or sufficiency of any payment received by the
Administrative Agent, or to present or file any claim or notice, or to take any action with respect to the Collateral or any part thereof or
the moneys due or to become due in respect thereof or any property covered thereby and such U.S. Grantor agrees to reimburse the
Administrative Agent on demand for any payment made or any expense incurred by the Administrative Agent in connection with any
of the foregoing and (B) this authorization shall not relieve such U.S. Grantor of any of its obligations under this Agreement or under
the Credit Agreement. The Administrative Agent and the other Secured Parties shall be accountable only for amounts actually received
as a result of the exercise of the powers granted to them herein, and neither they nor their officers, directors, employees or agents shall
be responsible to any U.S. Grantor for any act or failure to act hereunder, except for their own gross negligence, bad faith or wilful
misconduct. Notwithstanding the foregoing, if the Administrative Agent or a Secured Party determines (after being given notice of
such) that any portion of a payment from an Account Debtor received by it constitutes the excess portion of a joint remittance from
such Account Debtor (which such portion was not owed to a U.S. Grantor but paid to the joint order of a U.S. Grantor and a nonAffiliated contractor or sub-contractor in respect of an Account), the Administrative Agent or other Secured Party, as applicable, shall
promptly remit such excess portion of the payment to the U.S. Grantors.

(b) All acts of said attorney or designee are hereby ratified and approved. The powers conferred on the Administrative
Agent, for the benefit of the Secured Parties, under this Section 6.02 are solely to protect the Administrative Agents interests in the
Collateral and shall not impose any duty upon the Administrative Agent or any other Secured Party to exercise any such powers. The
Administrative Agent agrees that, except for the powers granted in Sections 6.02(a)(i), (a)(iii) or (a)(v), it shall not exercise any power
or authority granted to it unless an Event of Default has occurred and is continuing, provided, however, that the Administrative Agent
may exercise the powers granted in Sections 6.02(a)(ii), (a)(iv) and (a)(viii) at any time during the continuance of a Cash Dominion
Period. The Administrative Agent further agrees that it will not exercise any power or authority granted to it in Sections 6.02(a)(x), (a)
(xi), (a)(xii) and (a)(xiii) unless an Event of Default has occurred and is continuing and the Secured Obligations have been accelerated
in accordance with the Credit Agreement.
ARTICLE VII
COLLECTION AND APPLICATION OF COLLATERAL PROCEEDS; DEPOSIT ACCOUNTS
SECTION 7.01. Collection of Accounts. (a) [Reserved.]
(b) Each U.S. Grantor shall direct all of its Account Debtors to forward payments directly to one or more of the
Collateral Deposit Accounts of such U.S. Grantor; provided, however, that with respect to the Account Debtors of the Specified L&W
Grantors, the Specified L&W Grantors shall not be required to so direct such Account Debtors (and, accordingly, shall not be deemed
to have breached this Section 7.01(b)) so long as the Specified L&W Grantors each deposit any cash, checks or other similar payments
constituting payments made with respect to any Account of such Account Debtors into a Collateral Deposit Account in accordance
with the last sentence of this Section 7.01(b). If any U.S. Grantor (other than a Specified L&W Grantor) should refuse or neglect to
notify any Account Debtor to forward payments with respect to such Account Debtors Accounts directly to a Collateral Deposit
Account following its receipt of a written request to do so from the Administrative Agent, the Administrative Agent shall,
notwithstanding the language set forth in Section 6.02(b), be entitled to make such notification directly to Account Debtor. If
notwithstanding the foregoing instructions, any U.S. Grantor receives any cash, checks or other similar payments constituting
payments made with respect to any Account, such U.S. Grantor shall receive such cash, checks or other similar payments as the
Administrative Agents trustee and shall promptly (but in no event later than two Business Days after receipt thereof) deposit all such
cash, checks or other similar payments into a Collateral Deposit Account.
SECTION 7.02. Covenant Regarding New Deposit Accounts. (a) No U.S. Grantor may open a Collateral Deposit
Account unless the bank or financial institution at which such U.S. Grantor seeks to open such Collateral Deposit Account has entered
into a Deposit Account Control Agreement in order to give the Administrative Agent Control of such Collateral Deposit Account,
provided that the Administrative Agent may, in its discretion, with respect to the Collateral Deposit Accounts of any Collateral Deposit
Account Bank that is not subject to a Deposit Account Control Agreement, (i) defer delivery of a Deposit Account Control Agreement
with respect to such Collateral Deposit Accounts or (ii) require such U.S. Grantor to replace such Collateral Deposit Accounts with
one or more new Collateral Deposit Accounts opened and maintained with a bank or financial institution that is subject to an existing
Deposit Account Control Agreement (it being understood and agreed that, prior to the opening of such new Collateral Deposit
Accounts referenced in the immediately preceding clause (ii), the Administrative Agent shall be entitled to establish a Reserve with
respect to those Collateral Deposit Account referenced in the immediately preceding clause (i) for which a Deposit Account Control
Agreement has not yet been executed and delivered).

(b) Promptly following a U.S. Grantors opening of any new Collateral Deposit Account in accordance with this
Section 7.02 or such U.S. Grantors closing of a Collateral Deposit Account, but in each case no later than the end of the calendar
quarter during which such Collateral Deposit Account is opened or closed, as the case may be, the U.S. Borrower shall deliver to the
Administrative Agent a supplement to Exhibit B, setting forth the applicable information with respect to such new Collateral Deposit
Account required therein or indicating the closing of such Collateral Deposit Account, as the case may be.
(c) In the case that any U.S. Grantor opens an additional Collateral Deposit Account with a Collateral Deposit Account
Bank that is already party to a Deposit Account Control Agreement or such U.S. Grantor transfers or otherwise assigns any Collateral
Deposit Account subject to an existing Deposit Account Control Agreement to a different U.S. Grantor party to such Deposit Account
Control Agreement, the U.S. Borrower shall promptly notify the Administrative Agent thereof and, if the applicable U.S. Grantor or
U.S. Grantors fail, within ten Business Days after request from the Administrative Agent, to enter into an amendment, supplement or
other modification to such Deposit Account Control Agreement to reflect the addition or change in ownership, as the case may be, of
such Collateral Deposit Account for the purpose of ensuring that such Collateral Deposit Account is subject to the control arrangement
evidenced thereby, the Administrative Agent shall have the authority to enter into, on behalf of itself and the applicable U.S. Grantor or
U.S. Grantors, such an amendment, supplement or other modification to such Deposit Account Control Agreement.
(d) In the case of Collateral Deposit Accounts maintained with any Lender, the terms of each Deposit Account Control
Agreement entered into with such Lender shall be subject to the provisions of the Credit Agreement regarding setoff.
SECTION 7.03. Cash Dominion Periods; Application of Proceeds. (a) Pursuant to each Deposit Account Control
Agreement entered into pursuant to Section 7.01 or 7.02, the Administrative Agent shall have Control of the relevant Collateral
Deposit Account. The applicable U.S. Grantor may operate and transact business through its Collateral Deposit Accounts in its normal
fashion at all times (except as provided below), including making withdrawals (whether via wire transfer, ACH transfer, check or
otherwise), provided that (i) upon the commencement and during the continuation of any Cash Dominion Period, the Administrative
Agent may (A) send a notice (a Cash Dominion Period Notice) to each Collateral Deposit Account Bank instructing such Collateral
Deposit Bank to cease complying with any instructions originated by the applicable U.S. Grantor regarding the disposition of funds in
the related Collateral Deposit Account and to begin complying with instructions originated by the Administrative Agent directing the
sweep of available funds from the applicable Collateral Deposit Account on a daily basis into a collection account maintained by the
U.S. Borrower with the Administrative Agent (such account, the Collection Account), without further consent of the applicable U.S.
Grantor and subject to the terms of the applicable Deposit Account Control Agreement and (B) apply (and allocate) the funds in the
Collection Account in accordance with Section 2.09(b) or Section 2.17(b) of the Credit Agreement, as applicable, and (ii) except as
otherwise provided below, upon the termination of each Cash Dominion Period (the timing of such termination to be determined by
reference to the definition of the term Cash Dominion Period set forth in Section 1.03), the Administrative Agent shall send a notice
to each Collateral Deposit Account Bank (a Cash Dominion Termination Notice) terminating such Cash Dominion Period and
commencing a period (each such period, a Cash Dominion Termination Period) in which each U.S. Grantor may again transact
business through each Collateral Deposit Account in its normal fashion, including making withdrawals from each Collateral Deposit
Account (whether via wire transfer, ACH transfer, check or otherwise); provided, however, that following (x) the termination of the

Revolving Commitments as contemplated by Article VII of the Credit Agreement or (y) a declaration, as contemplated by Article VII
of the Credit Agreement, that the outstanding Loans have become due and payable, the Administrative Agent shall not be required to
give any further Cash Dominion Termination Notices and shall be entitled to permanently maintain such Cash Dominion Period and
exercise the rights attendant thereto as set forth above.
(b) All amounts deposited in the Collection Account pursuant to this Section 7.03 shall be deemed received by the
Administrative Agent for purposes of Sections 2.09(b) and 2.17(b) of the Credit Agreement, provided that, notwithstanding the
foregoing, if the Administrative Agent or a Secured Party determines (after being given notice of such) that any portion of a payment
from an Account Debtor received by it constitutes the excess portion of a joint remittance from such Account Debtor (which such
portion was not owed to a U.S. Grantor but paid to the joint order of a U.S. Grantor and a non-Affiliated contractor or sub-contractor
in respect of an Account), the Administrative Agent or other Secured Party, as applicable, shall promptly remit such excess portion of
the payment to the U.S. Grantors. The balance, if any, in the Collection Account after all the Secured Obligations on any day during a
Cash Dominion Period have been satisfied shall be deposited by the Administrative Agent into the U.S. Borrowers general operating
account as instructed by the U.S. Borrower. If, at the time any Cash Dominion Termination Period commences, the Collection
Account has a balance, such balance shall be deposited by the Administrative Agent into the U.S. Borrowers general operating
account as instructed by the U.S. Borrower.
(c) To the extent that the terms of any Deposit Account Control Agreement are inconsistent with the terms of this
Section 7.03 with respect to the rights of the Administrative Agent and the U.S. Grantors, the terms of this Section 7.03 shall control.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waivers. Each U.S. Grantor hereby waives notice of the time and place of any public sale or the time
after which any private sale or other disposition of all or any part of the Collateral may be made. To the extent such notice may not be
waived under applicable law, any notice made shall be deemed reasonable if sent to the U.S. Grantors, addressed as set forth in Article
IX, at least ten (10) days prior to (a) the date of any such public sale or (b) the time after which any such private sale or other
disposition may be made. To the maximum extent permitted by applicable law, each U.S. Grantor waives all claims, damages and
demands against any Secured Party arising out of the repossession, retention or sale of the Collateral, except as may arise solely out of
the gross negligence, bad faith or wilful misconduct of such Secured Party as finally determined by a court of competent jurisdiction.
To the extent it may lawfully do so, each U.S. Grantor absolutely and irrevocably waives and relinquishes the benefit and advantage
of, and covenants not to assert against any Secured Party, any valuation, stay, appraisal, extension, moratorium, redemption or similar
laws and any and all rights or defenses it may have as a surety now or hereafter existing which, but for this provision, might be
applicable to the sale of any Collateral made under the judgment, order or decree of any court, or privately under the power of sale
conferred by this Agreement, or otherwise. Except as otherwise specifically provided herein, each U.S. Grantor hereby waives
presentment, demand, protest or any notice (to the maximum extent permitted by applicable law) of any kind in connection with this
Agreement or any Collateral.
SECTION 8.02. Limitation on Administrative Agents and Lenders Duty with Respect to the Collateral. Except as
imposed under applicable law, no Secured Party shall have any other duty as to

any Collateral in its possession or control or in the possession or control of any agent or nominee of such Secured Party, or any income
thereon or as to the preservation of rights against prior parties or any other rights pertaining thereto. To the extent that applicable law
imposes duties on the Administrative Agent to exercise remedies in a commercially reasonable manner, each U.S. Grantor
acknowledges and agrees that it is commercially reasonable for the Administrative Agent (a) to fail to incur expenses deemed
significant by the Administrative Agent to prepare Collateral for disposition or otherwise to transform raw material or work in process
into finished goods or other finished products for disposition, (b) to obtain or, if not required by other law, to fail to obtain
governmental or third party consents for the collection or disposition of Collateral to be collected or disposed of, (c) to fail to exercise
collection remedies against Account Debtors or other Persons obligated on Collateral or to remove Liens on or any adverse claims
against Collateral, (d) to exercise collection remedies against Account Debtors and other Persons obligated on Collateral directly or
through the use of collection agencies and other collection specialists, (e) to advertise dispositions of Collateral through publications or
media of general circulation, whether or not the Collateral is of a specialized nature, (f) to contact other Persons, whether or not in the
same business as such U.S. Grantor, for expressions of interest in acquiring all or any portion of such Collateral, (g) to hire one or more
professional auctioneers to assist in the disposition of Collateral, whether or not the Collateral is of a specialized nature, (h) to dispose
of Collateral by utilizing internet sites that provide for the auction of assets of the types included in the Collateral or that have the
reasonable capacity of doing so, or that match buyers and sellers of assets, (i) to dispose of assets in wholesale rather than retail
markets, (j) to disclaim disposition warranties, such as title, possession or quiet enjoyment, (k) to purchase insurance or credit
enhancements to insure the Administrative Agent against risks of loss, collection or disposition of Collateral or to provide to the
Administrative Agent a guaranteed return from the collection or disposition of Collateral, or (l) to the extent deemed appropriate by the
Administrative Agent, to obtain the services of other brokers, investment bankers, consultants and other professionals to assist the
Administrative Agent in the collection or disposition of any of the Collateral. Each U.S. Grantor acknowledges that the purpose of this
Section 8.02 is to provide non-exhaustive indications of what actions or omissions by the Administrative Agent would be
commercially reasonable in the Administrative Agents exercise of remedies against the Collateral and that other actions or omissions
by the Administrative Agent shall not be deemed commercially unreasonable solely on account of not being indicated in this
Section 8.02. Without limitation upon the foregoing, nothing contained in this Section 8.02 shall be construed to grant any rights to any
U.S. Grantor or to impose any duties on the Administrative Agent that would not have been granted or imposed by this Agreement or
by applicable law in the absence of this Section 8.02.
SECTION 8.03. Compromises and Collection of Collateral. The U.S. Grantors and the Administrative Agent recognize
that setoffs, counterclaims, defenses and other claims may be asserted by obligors with respect to certain of the Accounts, that certain
of the Accounts may be or become uncollectible in whole or in part and that the expense and probability of success in litigating a
disputed Account may exceed the amount that reasonably may be expected to be recovered with respect to an Account. In view of the
foregoing, each U.S. Grantor agrees that the Administrative Agent may at any time and from time to time, if an Event of Default has
occurred and is continuing and the Secured Obligations have been accelerated in accordance with the Credit Agreement, and subject to
applicable law, compromise with the obligor on any Account, accept in full payment of any Account such amount as the
Administrative Agent in its sole discretion shall determine or abandon any Account, and any such action by the Administrative Agent
shall be commercially reasonable so long as the Administrative Agent acts in good faith based on information known to it at the time it
takes any such action.
SECTION 8.04. Secured Party Performance of Debtor Obligations. Without having any obligation to do so, and,
except after the occurrence and during the continuance of an Event of Default,

after having made a request of a U.S. Grantor to do so and such U.S. Grantor having not complied with such request to do so as
promptly as practicable after receipt of such request, the Administrative Agent may perform or pay any obligation which any U.S.
Grantor has agreed to perform or pay in this Agreement and the U.S. Grantors shall reimburse the Administrative Agent for any
amounts paid by the Administrative Agent pursuant to this Section 8.04. The U.S. Grantors obligation to reimburse the Administrative
Agent pursuant to the preceding sentence shall be a Secured Obligation payable on demand.
SECTION 8.05. Specific Performance of Certain Covenants. Each U.S. Grantor acknowledges and agrees that a
breach of any of the covenants contained in Sections 4.01(d), 4.01(e), 4.01(g), 4.06 or 5.02 or in Article VII will cause irreparable
injury to the Secured Parties, that the Secured Parties have no adequate remedy at law in respect of such breaches and therefore agrees,
without limiting the right of the Secured Parties to seek and obtain specific performance of other obligations of the U.S. Grantors
contained in this Agreement, that the covenants of the U.S. Grantors contained in the Sections referred to in this Section 8.05 shall be
specifically enforceable against the U.S. Grantors.
SECTION 8.06. Dispositions Not Authorized. No U.S. Grantor is authorized to sell or otherwise dispose of the
Collateral except as set forth in Section 4.01(d) and notwithstanding any course of dealing between any U.S. Grantor and the
Administrative Agent or other conduct of the Administrative Agent, no authorization to sell or otherwise dispose of the Collateral
(except as set forth in Section 4.01(d)) shall be binding upon the Secured Parties unless such authorization is in writing signed by the
Administrative Agent.
SECTION 8.07. No Waiver; Amendments; Cumulative Remedies. No failure, delay or omission of any Secured Party
to exercise any right or remedy granted under this Agreement shall impair such right or remedy or be construed to be a waiver of any
Default or an acquiescence therein, and any single or partial exercise of any such right or remedy shall not preclude any other or further
exercise thereof or the exercise of any other right or remedy. No waiver, amendment or other variation of the terms, conditions or
provisions of this Agreement whatsoever shall be valid unless in writing signed by the Administrative Agent with the concurrence or at
the direction of the Lenders required under Section 9.02 of the Credit Agreement and then only to the extent in such writing
specifically set forth. All rights and remedies contained in this Agreement or by law afforded shall be cumulative and all shall be
available to the Secured Parties until the Secured Obligations have been paid and performed in full.
SECTION 8.08. Limitation by Law; Severability of Provisions. All rights, remedies and powers provided in this
Agreement may be exercised only to the extent that the exercise thereof does not violate any applicable provision of law, and all the
provisions of this Agreement are intended to be subject to all applicable mandatory provisions of law that may be controlling and to be
limited to the extent necessary so that they shall not render this Agreement invalid, unenforceable, illegal or not entitled to be recorded
or registered, in whole or in part. 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.
SECTION 8.09. Reinstatement. This Agreement shall remain in full force and effect and continue to be effective
should any petition be filed by or against any U.S. Grantor for liquidation or reorganization, should any U.S. Grantor become insolvent
or make an assignment for the benefit of any creditor or creditors or should a receiver or trustee be appointed for all or any significant
part of any U.S.

Grantors assets, and shall continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the
Secured Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored
or returned by any obligee of the Secured Obligations, whether as a voidable preference, fraudulent conveyance or otherwise, all
as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned, the Secured Obligations shall be reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
SECTION 8.10. Benefit of Agreement. The terms and provisions of this Agreement shall be binding upon and inure to
the benefit of the U.S. Grantors, the Secured Parties and their respective successors and assigns (including all persons who become
bound as a debtor to this Agreement), except that no U.S. Grantor shall have the right to assign its rights or delegate its obligations
under this Agreement or any interest herein, without the prior written consent of the Administrative Agent. No sales of participations,
assignments, transfers or other dispositions of any agreement governing the Secured Obligations or any portion thereof or interest
therein shall in any manner impair the Lien granted to the Administrative Agent, for the benefit of the Secured Parties.
SECTION 8.11. Survival of Representations. All representations and warranties of the U.S. Grantors contained in this
Agreement shall survive the execution and delivery of this Agreement.
SECTION 8.12. Headings. The title of and section headings in this Agreement are for convenience of reference only,
and shall not govern the interpretation of any of the terms and provisions of this Agreement.
SECTION 8.13. Termination. (a) Subject to Section 8.09, this Agreement and the Security Interest in the Collateral
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 (or cash
collateralized in an amount equal to 103% of the aggregate undrawn amount of all outstanding Letters of Credit (for each Letter of
Credit, denominated in the currency of such Letter of Credit) or otherwise collateralized (i.e., by issuance of backstop letters of credit to
the applicable Issuing Banks in respect thereof), in each case in a manner satisfactory to the applicable Issuing Banks) and the Issuing
Banks have no further obligations to issue Letters of Credit under the Credit Agreement.
(b) A U.S. Grantor shall automatically be released from its obligations hereunder and the Security Interest in the
Collateral of such U.S. Grantor shall be automatically released 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 U.S. Grantor ceases to be a wholly-owned
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) Upon any sale or other transfer by any U.S. Grantor of any Collateral that is permitted under the Credit Agreement
(other than a sale or other transfer to a U.S. Grantor), or upon the effectiveness of any written consent to the release of the Security
Interest granted hereby in any Collateral pursuant to Section 9.02 of the Credit Agreement, the Security Interest in such Collateral shall
be automatically released.
(d) In connection with any termination or release pursuant to paragraph (a), (b) or (c) of this Section 8.13, the
Administrative Agent shall (i) execute and deliver to any U.S. Grantor, at such U.S.

Grantors expense, all documents that such U.S. Grantor shall reasonably request to evidence such termination or release and (ii) with
respect to any Collateral Deposit Account of any U.S. Grantor that is so released from its obligations hereunder, deliver to each
Collateral Deposit Account Bank that has entered into a Deposit Account Control Agreement with respect to the Collateral Deposit
Accounts of such U.S. Grantor a written notice of termination of each such Deposit Account Control Agreement in accordance with
the terms of such Deposit Account Control Agreement. The Administrative Agent hereby consents to the applicable U.S. Grantor
filing all UCC termination statements corresponding to any Collateral that is so released if the Administrative Agent has failed to file
such UCC termination statements within 5 Business Days of notice of such release delivered by such U.S. Grantor to the
Administrative Agent. Any execution and delivery of documents pursuant to this Section 8.13 shall be without recourse to or warranty
by the Administrative Agent.
SECTION 8.14. Additional Subsidiaries. Pursuant to the Credit Agreement, and solely to the extent required thereby,
certain Domestic Material Subsidiaries that were not in existence or not Domestic Material Subsidiaries as of the Restatement Effective
Date (as well as certain other Domestic Subsidiaries specified by the U.S. Borrower) are required to enter into this Agreement as a
U.S. Grantor 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 D hereto (each such instrument, a Supplement), such
Subsidiary shall become a U.S. Grantor hereunder with the same force and effect as if originally named as a U.S. Grantor herein. The
execution and delivery of any such Supplement shall not require the consent of any other U.S. Grantor hereunder. The rights and
obligations of each U.S. Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new U.S. Grantor
as a party to this Agreement.
SECTION 8.15. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each
of their respective 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, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or any such Affiliate to or for the credit or the account of any
U.S. Grantor against any of and all obligations of such U.S. Grantor now or hereafter existing under this Agreement held by such
Lender, irrespective of whether or not such Lender shall have made any demand hereunder and although such obligations may be
unmatured or are owed to a branch or office of such Lender different from the branch or office holding such deposit or obligation. The
applicable Lender shall notify the U.S. Borrower and the Administrative Agent of such set-off or application, provided that any failure
to give or any delay in giving such notice shall not affect the validity of any such set-off or application under this Section 8.15. The
rights of each Lender under this Section 8.15 are in addition to other rights and remedies (including other rights of setoff) which such
Lender may have.
SECTION 8.16. Lien Absolute. All rights of the Administrative Agent hereunder, and all obligations of each U.S.
Grantor hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any other term of, all or any part 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 exchange, release or non-perfection of any other Collateral, or any release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the Secured Obligations;
(d) the insolvency of any Person; or
(e) any other circumstance which might otherwise constitute a defense available to, or a discharge of, any U.S. Grantor.
SECTION 8.17. Release. Each U.S. Grantor consents and agrees that the Administrative Agent may at any time, or
from time to time, in its discretion:
(a) as contemplated by the Credit Agreement and in conformance therewith, renew, extend or change the time of
payment, and/or the manner, place or terms of payment, of all or any part of the Secured Obligations; and
(b) exchange, release and/or surrender all or any of the Collateral or any part thereof, by whomsoever deposited, which
is now or may hereafter be held by the Administrative Agent in connection with all or any of the Secured Obligations; all in such
manner and upon such terms as the Administrative Agent may deem proper, and without notice to or further assent from any U.S.
Grantor, it being hereby agreed that each U.S. Grantor shall be and remain bound upon this Agreement, irrespective of the value or
condition of any of the Collateral, and notwithstanding any such change, exchange, settlement, compromise, surrender, release,
renewal or extension, and notwithstanding also that the Secured Obligations may, at any time, exceed the aggregate principal amount
thereof set forth in the Credit Agreement, or any other agreement governing any Secured Obligations.
SECTION 8.18. Entire Agreement. This Agreement and the other Loan Documents embody the entire agreement and
understanding between the U.S. Grantors and the Administrative Agent relating to the Collateral and supersede all prior agreements
and understandings between the U.S. Grantors and the Administrative Agent relating to the Collateral.
SECTION 8.19. 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 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 8.19. 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 9.01. 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 8.20. 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
8.20.
SECTION 8.21. Taxes and Expenses; Indemnity. (a) Any taxes (including income taxes but excluding any Excluded
Taxes) payable or ruled payable by Federal or State authority in respect of this Agreement shall be paid by the U.S. Grantors, together
with interest and penalties, if any. The parties hereto agree that the Administrative Agent and each of the other Secured Parties shall be
entitled to reimbursement of its reasonable expenses incurred hereunder as provided in and subject to the limitations set forth in Section
9.03(a) of the Credit Agreement.
(b) Without limitation of any of its indemnification obligations under the other Loan Documents, each U.S. Grantor
shall, jointly and severally with each other U.S. Grantor, indemnify each Indemnitee 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 by any third party or by any U.S.
Grantor arising out of, in connection with, or as a result of (i) the execution and delivery of this Agreement or any other agreement or
instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation
of any transactions contemplated hereby or (ii) any actual or prospective claim, litigation, investigation or proceeding relating to any of
the foregoing or to the Collateral (each, a Proceeding), whether based on contract, tort or any other theory, whether brought by a
third party or by any U.S. Grantor and regardless of whether 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, non-appealable judgment to have resulted from (A) the gross negligence, bad faith or wilful
misconduct of such Indemnitee, (B) a material breach by such Indemnitee of its obligations under this Agreement or any other Loan
Document or (C) claims of one or more Indemnitees against another Indemnitee (other than claims against the Administrative Agent or
any Arranger in their respective capacities as such) and not involving any act or omission by either Borrower, any of the

Subsidiaries or any of their respective Affiliates (or any of such Persons Related Parties). None of the U.S. Grantors shall, without the
prior written consent of any Indemnitee, effect any settlement of any pending or threatened Proceeding in respect of which indemnity
could have been sought under this Section 8.21(b) by such Indemnitee unless such settlement (x) includes an unconditional release of
such Indemnitee in form and substance reasonably satisfactory to such Indemnitee from all liability or claims that are the subject matter
of such Proceeding and (y) does not include any statement as to or any admission of fault, culpability, wrongdoing or a failure to act by
or on behalf of such Indemnitee or any injunctive relief or other non-monetary remedy. The U.S. Grantors shall not be liable for any
settlement of any Proceeding if the amount of such settlement was effected without the U.S. Borrowers consent (which consent shall
not be unreasonably withheld, conditioned or delayed), but if settled with the U.S. Borrowers written consent or if there is a judgment
by a court of competent jurisdiction for the plaintiff in any such Proceeding, the U.S. Grantors agree to indemnify and hold harmless
each Indemnitee from and against any and all losses, claims, damages, penalties, liabilities and expenses by reason of such settlement
or judgment in accordance with the other provisions of this Section 8.21(b).
(c) Any amounts payable pursuant to this Section 8.21 shall be additional Secured Obligations secured hereby and by
the other Collateral Documents. The provisions of this Section 8.21 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 Secured Party. All amounts due under
this Section 8.21 shall be payable not later than three Business Days after written demand therefor setting forth the basis for such claim
in reasonable detail.
SECTION 8.22. Counterparts. This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart.
Delivery of an executed signature page to this Agreement by facsimile or other electronic transmission (including Adobe PDF file)
shall be as effective as delivery of an original executed counterpart of this Agreement.
ARTICLE IX
NOTICES
SECTION 9.01. Sending Notices. Any notice required or permitted to be given under this Agreement shall be made in
accordance with, and deemed to be received pursuant to the terms of, Section 9.01 of the Credit Agreement, in each case addressed to
the U.S. Borrower (with respect to notices to any U.S. Grantor) and to the Administrative Agent and the Lenders at the addresses set
forth in accordance with Section 9.01 of the Credit Agreement.
ARTICLE X
THE ADMINISTRATIVE AGENT
JPMorgan Chase Bank, N.A. has been appointed Administrative Agent for the Lenders hereunder pursuant to Article
VIII of the Credit Agreement. It is expressly understood and agreed by the parties to this Agreement that any authority conferred upon
the Administrative Agent hereunder is subject to the terms of the delegation of authority made by the Lenders to the Administrative
Agent pursuant to the Credit Agreement, and that the Administrative Agent has agreed to act (and any successor

Administrative Agent shall act) as such hereunder only on the express conditions contained in such Article VIII. Any successor
Administrative Agent appointed pursuant to Article VIII of the Credit Agreement shall be entitled to all the rights, interests and benefits
of the Administrative Agent hereunder.

U.S. SUBSIDIARY GRANTORS

Company
California Wholesale Material Supply, LLC
L & W Supply Corporation
Livonia Building Materials, LLC
Otsego Paper, Inc.
United States Gypsum Company
USG Interiors, LLC

Title of Kenneth R. Banas with respect to such Company

Treasurer of L & W Supply Corporation, the Sole Member of
California Wholesale Material Supply, LLC
Treasurer
Treasurer of L & W Supply Corporation, the Sole Member of
Livonia Building Materials, LLC
Treasurer
Treasurer
Treasurer of United States Gypsum Company, the Sole
Member of USG Interiors, LLC

EXHIBIT 10.22

CANADIAN PLEDGE AND SECURITY AGREEMENT

dated as of October 22, 2014

among
CGC INC.,

as Canadian Borrower,

The Other Grantors Party Hereto

and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent

Table of Contents
ARTICLE I
DEFINITIONS
SECTION 1.01.
SECTION 1.02.
SECTION 1.03.

Terms Defined in Credit Agreement

Terms Defined in PPSA
Definitions of Certain Terms Used Herein

1
1
1

ARTICLE II
GRANT OF SECURITY INTEREST
SECTION 2.01.

Security Interest

5
ARTICLE III
REPRESENTATIONS AND WARRANTIES

SECTION 3.01.
SECTION 3.02.
SECTION 3.03.
SECTION 3.04.
SECTION 3.05.
SECTION 3.06.
SECTION 3.07.
SECTION 3.08.
SECTION 3.09.
SECTION 3.10.
SECTION 3.11.
SECTION 3.12.
SECTION 3.13.
SECTION 3.14.

Title, Perfection and Priority

Type and Jurisdiction of Organization, Organizational and Identification Numbers

Principal Location
Collateral Locations
Deposit Accounts
Exact Names
Perfection Certificate
Validity of Security Interest
Security Interest as Security Only
Accounts
Inventory
Intellectual Property
Filing Requirements
No Financing Statements, Security Agreements

6
6
6
7
7
7
7
7
7
8
9
8
9

ARTICLE IV
COVENANTS
SECTION 4.01.
SECTION 4.02.
SECTION 4.03.
SECTION 4.04.
SECTION 4.05.

General
Accounts
Inventory
Intellectual Property
Collateral Access Agreements

9
11
12
13
13

SECTION 4.06.

Change of Name or Location; Change of Fiscal Year

14

ARTICLE V
REMEDIES
SECTION 5.01.
SECTION 5.02.
SECTION 5.03.

Remedies
Grantors Obligations Upon an Event of Default
Grant of Intellectual Property License

14
16
16

ARTICLE VI
ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY
SECTION 6.01.
SECTION 6.02.

Account Verification
Authorization for Secured Party to Take Certain Action

17
17

ARTICLE VII
COLLECTION AND APPLICATION OF COLLATERAL PROCEEDS; DEPOSIT ACCOUNTS
SECTION 7.01.
SECTION 7.02.
SECTION 7.03.

Collection of Accounts
Covenant Regarding New Deposit Accounts
Cash Dominion Periods; Application of Proceeds

19
19
21

ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01.
SECTION 8.02.
SECTION 8.03.
SECTION 8.04.
SECTION 8.05.
SECTION 8.06.
SECTION 8.07.
SECTION 8.08.
SECTION 8.09.
SECTION 8.10.
SECTION 8.11.
SECTION 8.12.
SECTION 8.13.
SECTION 8.14.

Waivers
Limitation on Administrative Agents and Lenders Duty with Respect to the Collateral
Compromises and Collection of Collateral
Secured Party Performance of Debtor Obligations
Specific Performance of Certain Covenants
Dispositions Not Authorized
No Waiver; Amendments; Cumulative Remedies
Limitation by Law; Severability of Provisions
Reinstatement
Benefit of Agreement
Survival of Representations
Headings
Termination
Additional Subsidiaries

22
22
23
24
24
24
24
25
25
25
25
25
26
27

SECTION 8.15.
SECTION 8.16.

Right of Setoff
Lien Absolute

27
27

SECTION 8.17.
SECTION 8.18.
SECTION 8.19.
SECTION 8.20.
SECTION 8.21.
SECTION 8.22.

Release
Entire Agreement
Governing Law; Jurisdiction; Consent to Service of Process
WAIVER OF JURY TRIAL
Taxes and Expenses; Indemnity
Counterparts

28
28
28
29
29
31

ARTICLE IX
NOTICES
SECTION 9.01.

Sending Notices

31
ARTICLE
THE ADMINISTRATIVE AGENT

Schedule 1 Subsidiary Grantors

Exhibit A Information for each Grantor
Exhibit B Collateral Deposit Accounts
Exhibit C Financing Statement Filing Offices
Exhibit D Form of New Subsidiary Supplement

CANADIAN PLEDGE AND SECURITY AGREEMENT

THIS CANADIAN PLEDGE AND SECURITY AGREEMENT (this Agreement) is entered into as of October 22,
2014, among CGC Inc., a New Brunswick corporation (the Canadian Borrower), each Subsidiary identified on Schedule I hereto
and each other Subsidiary that becomes a party to this Agreement after the Restatement Effective Date pursuant to Section 8.14 hereof
(each such Subsidiary and the Canadian Borrower, a Grantor and, collectively, the Grantors) and JPMorgan Chase Bank, N.A., in
its capacity as administrative agent (the Administrative Agent) for the lenders party to the Credit Agreement referred to below.
PRELIMINARY STATEMENT
Reference is made to the Fourth Amended and Restated Credit Agreement dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the Credit Agreement), among USG Corporation, a Delaware
corporation (the Borrower), the Canadian Borrower, the Lenders and Issuing Banks from time to time party thereto, the
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian administrative agent, and Bank of America, N.A.
and Wells Fargo Bank, National Association, as co-syndication agents. Each Grantor is entering into this Agreement in order to induce
the Lenders and the Issuing Banks to enter into and extend credit to the Canadian Borrower under the Credit Agreement and to secure
the Secured Obligations.
ACCORDINGLY, the Grantors and the Administrative Agent, on behalf of the Lenders, hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Terms Defined in Credit Agreement. All capitalized terms used herein and not otherwise defined shall
have the meanings assigned to such terms in the Credit Agreement.
SECTION 1.02. Terms Defined in PPSA. Terms defined in the PPSA in uncapitalized form which are not otherwise
defined in this Agreement in capitalized form are used herein in capitalized form as defined in uncapitalized form in the PPSA.
SECTION 1.03. Definitions of Certain Terms Used Herein. As used in this Agreement, in addition to the terms defined
in the preamble hereto and in the Preliminary Statement, the following terms shall have the following meanings:
Accounts means all rights to payment, whether or not earned by performance, for the sale or lease of goods or the
rendition of services, in each case in the ordinary course of the Grantors business, whether such rights constitute or are evidenced by
any Account (as defined in the PPSA), Chattel Paper, Instrument, Document of Title or Intangible.

Article means a numbered article of this Agreement, unless another document is specifically referenced.
Cash Dominion Period means any of (a) a period commencing on the date on which Excess Availability shall have
been less than the Threshold Amount for five (5) consecutive Business Days and ending on the first date thereafter on which Excess
Availability shall have been equal to or greater than the Threshold Amount for thirty (30) consecutive calendar days and (b) a period
during which an Event of Default has occurred and is continuing. For purposes of clarity, if, during the continuance of a Cash
Dominion Period triggered by an event described in either clause (a) or (b) of this definition, an event described in clause (a) or (b) of
this definition shall occur, then such Cash Dominion Period shall be deemed not to have terminated until such time as a Cash
Dominion Period would no longer exist under both clauses (a) and (b) of this definition.
Cash Dominion Period Notice shall have the meaning set forth in Section 7.03(a).
Cash Dominion Termination Notice shall have the meaning set forth in Section 7.03(a).
Cash Dominion Termination Period shall have the meaning set forth in Section 7.03(a).
Collateral shall have the meaning set forth in Article II.
Collateral Access Agreement means any landlord waiver or other agreement (as such waiver or agreement may be
amended, restated or otherwise modified from time to time), in form and substance reasonably satisfactory to the Administrative Agent,
pursuant to which a mortgagee or lessor of real property on which Collateral is stored or otherwise located, or a bailee, consignee or
similar Person with respect to any warehouse, processor or converter facility or other location where Collateral is stored or located, (a)
acknowledges the Lien of the Administrative Agent, on behalf of the Secured Parties, in respect of such Collateral, (b) waives or, in
the reasonable discretion of the Administrative Agent, subordinates on terms reasonably acceptable to the Administrative Agent any
Lien or other claim that such Person may assert against such Collateral and (c) where applicable, grants to the Administrative Agent
reasonable access to and use of such real property or facility, as the case may be, following the occurrence and during the continuance
of an Event of Default, to assemble, complete and sell such Collateral.
Collateral Access Agreement Deadline means the date that is 90 days (or such longer period as the Administrative
Agent, in its sole discretion, may agree) after the Restatement Effective Date.
Collateral Deposit Account means, with respect to each Grantor, any lockbox account maintained by such Grantor to
which any cash, checks or other similar payments constituting payments made in respect of Accounts and/or proceeds of Inventory are
or are to be remitted and all Deposit Accounts maintained by such Grantor into which any such payments are directed to be deposited,
as well as any other Deposit Accounts maintained by such Grantor into which any cash, checks or other similar payments constituting
payments made in respect of Accounts and/or proceeds of Inventory are or are to be deposited.
Collateral Deposit Account Bank means each bank or other financial institution at which any Grantor maintains a
Collateral Deposit Account.
Collateral Report means any certificate (including any Borrowing Base Certificate), report or other document
delivered by any Grantor to the Administrative Agent relating to the Collateral pursuant to any Loan Document.

Collection Account shall have the meaning set forth in Section 7.03(a).
Control shall have the meaning set forth in the PPSA.
Control Agreement Deadline shall have the meaning set forth in Section 7.01(a).
Copyrights means, with respect to any Person, all of such Persons right, title and interest in and to the following: (a)
all copyrights, rights and interests in copyrights, works protectable by copyright, copyright registrations, and copyright applications; (b)
all renewals of any of the foregoing; (c) all licenses of the foregoing; and (d) the rights corresponding to the use or sublicense of any of
the foregoing throughout the world.
Deposit Account means a demand, time, savings, passbook or similar account maintained with an organization that is
engaged in the business of banking.
Deposit Account Control Agreement means an agreement, in form and substance reasonably satisfactory to the
Administrative Agent, among any Grantor, a Collateral Deposit Account Bank and the Administrative Agent with respect to Control
of the Collateral Deposit Accounts listed therein and the disposition of funds on deposit in such Collateral Deposit Accounts.
Exhibit refers to a specific exhibit to this Agreement (as amended, deemed amended or supplemented from time to
time in accordance with this Agreement or any Supplement), unless another document is specifically referenced.
Financing Statement means, with respect to any Grantor, each PPSA financing statement naming the Administrative
Agent as secured party and such Grantor as debtor and describing the Collateral in a manner consistent with the requirements set forth
in Section 4.01(b).
Intellectual Property means the collective reference to all intellectual and similar property of every kind and nature,
including inventions, designs, Patents, Copyrights, Trademarks, trade secrets, domain names, confidential or proprietary technical and
business information, know how or other data or information, software and databases and all embodiments or fixations thereof and
related documentation, registrations and franchises, and all additions, improvements and accessions to, and books and records
describing or used in connection with, any of the foregoing.
Inventory shall have the meaning set forth in the PPSA.
Patents means, with respect to any Person, all of such Persons right, title and interest in and to: (a) any and all patents
and patent applications; (b) all inventions and improvements described and claimed therein; (c) all reissues, divisions, continuations,
renewals, extensions and continuations-in-part thereof; (d) all licenses of the foregoing; and (e) all rights corresponding to the use or
sublicense of any of the foregoing throughout the world.
PPSA means the Personal Property Security Act of the province referred to in Section 8.19(a) of this Agreement, as such
legislation may be amended, renamed or replaced from time to time, and includes all regulations from time to time made under such
legislation.
Proceeds shall have the meaning set forth in the PPSA.
Receiver means a receiver, a manager or a receiver and manager.

Section means a numbered section of this Agreement, unless another document is specifically referenced.
Secured Obligations has the meaning assigned to the term Canadian Secured Obligations in the Credit Agreement.
Security Interest has the meaning assigned to such term in Section 2.01.
Supplement shall have the meaning set forth in Section 8.14.
Trademarks means, with respect to any Person, all of such Persons right, title and interest in and to the following: (a)
all trademarks (including service marks), trade names, trade dress and trade styles and the registrations and applications for registration
thereof; (b) all licenses of the foregoing, whether as licensee or licensor; (c) all renewals of the foregoing; and (d) all rights
corresponding to the use or sublicense of any of the foregoing throughout the world.
The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms.
ARTICLE II
GRANT OF SECURITY INTEREST
SECTION 2.01. Security Interest. As security for the payment or performance, as the case may be, in full of the
Secured Obligations, each Grantor hereby pledges, assigns and grants to the Administrative Agent, its successors and permitted
assigns, on behalf of and for the benefit of the Secured Parties, a security interest in all of such Grantors right, title and interest in (a)
Accounts, and Proceeds in respect thereof, whether now owned by or owing to, or hereafter acquired by or arising in favor of, such
Grantor (including under any trade name or derivations thereof), and regardless of where located, (b) Inventory, and Proceeds in
respect thereof, whether now owned by, or hereafter acquired by, such Grantor (including under any trade name or derivations
thereof), and regardless of where located, and (c) all Collateral Deposit Accounts of such Grantor (all of the assets referenced in the
immediately preceding clauses (a), (b) and (c), and all such right, title and interest therein, are collectively referred to as the
Collateral; the security interest in the Collateral granted pursuant to this Section 2.01 is referred to as the Security Interest).
SECTION 2.02. Keepwell. Each Grantor which is a Qualified ECP Guarantor (as defined below) hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to
time by each other Grantor that would otherwise not be an eligible contract participant as defined in the Commodity Exchange Act
and the regulations thereunder to honor all of its obligations under this Agreement in respect of Specified Swap Obligations (provided,
however, that each Qualified ECP Guarantor shall only be liable under this Section 2.02 for the maximum amount of such liability that
can be hereby incurred without rendering its obligations under this Section 2.02 or otherwise under this Agreement voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each
Qualified ECP Guarantor under this Section 2.02 shall remain in full force and effect until the indefeasible payment in full in cash of all
the Secured Obligations. Each Qualified ECP Guarantor intends that this Section 2.02 constitute, and this Section 2.02 shall be deemed
to constitute, a keepwell, support, or other agreement for the benefit of each other Grantor for all purposes of Section la(18)(A)(v)(II)
of the Commodity Exchange Act. For purposes hereof, Qualified ECP Guarantor means, in respect

of any Specified Swap Obligation, each Grantor that has total assets exceeding $10,000,000 at the time the grant of the relevant
security interest becomes or would become effective with respect to such Specified Swap Obligation and each other Grantor that
constitutes an eligible contract participant under the Commodity Exchange Act or any regulations promulgated thereunder and can
cause another person to qualify as an eligible contract participant at such time by guaranteeing or entering into a keepwell in respect
of obligations of such other person under Section la(18)(A)(v)(II) of the Commodity Exchange Act.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Grantor represents, warrants and covenants to and with the Secured Parties that:
SECTION 3.01. Title, Perfection and Priority. Such Grantor has good and valid rights in or the power to transfer the
Collateral and title to the Collateral with respect to which it has purported to grant the Security Interest hereunder, free and clear of all
Liens except for Liens permitted under Section 4.01(g), and has full power and authority to grant to the Administrative Agent, for the
benefit of the Secured Parties, the Security Interest pursuant hereto and to execute, deliver and perform its obligations in accordance
with the terms of this Agreement, without the consent or approval of any other Person other than any consent or approval that has been
obtained, except such consents or approvals the failure of which to have been obtained will not impair the Security Interest. When a
properly completed Financing Statement has been filed in the appropriate office against such Grantor in the applicable location listed
on Exhibit C (or, in the case of any Grantor that becomes a party hereto after the Restatement Effective Date, in the jurisdiction of
organization of such Grantor and each other jurisdiction in which it is located (within the meaning of the PPSA) or any tangible
Collateral in which it has rights is located specified in Schedule I to the Supplement for such Grantor) and any applicable filing fees or
taxes are paid in connection with such filing, the Administrative Agent will have a fully perfected first priority security interest in that
Collateral of such Grantor in which a security interest may be perfected by filing a PPSA financing statement, subject only to Liens
permitted under Section 4.01(g).
SECTION 3.02. Type and Jurisdiction of Organization, Organizational and Identification Numbers. The type of entity
of such Grantor, its jurisdiction of organization and the organizational number issued to it by its jurisdiction of organization are set forth
on Exhibit A.
SECTION 3.03. Principal Location. The location of such Grantors place of business (if it has only one) or its chief
executive office (if it has more than one place of business) is disclosed in Exhibit A. In addition, such Grantor has no other places of
business where books and records with respect to the Collateral are maintained, except those set forth in Exhibit A.
SECTION 3.04. Collateral Locations. All of such Grantors locations where Collateral having an aggregate book value
of $100,000 or more is located are listed on Exhibit A. All of said locations are owned by such Grantor except for locations (a) which
are leased by the Grantor as lessee and designated in Exhibit A and (b) at which Inventory is held in a public warehouse or is
otherwise held by a bailee or on consignment as designated in Exhibit A.

SECTION 3.05. Deposit Accounts. Exhibit B sets forth a complete list of the Collateral Deposit Accounts of such
Grantor, including, with respect to each such Collateral Deposit Account, each depositary institutions name and location and such
Grantors account number.
SECTION 3.06. Exact Names. Such Grantors name, as set forth on Exhibit A, is the exact name as it appears in such
Grantors organizational documents, as amended, as filed with such Grantors jurisdiction of organization. Such Grantor has not,
during the past two years prior to the Restatement Effective Date, been known by or used any other corporate or fictitious name, or
been a party to any merger or consolidation, or been a party to any acquisition, in each case except as otherwise specified in the
Perfection Certificate or any certificate delivered to the Administrative Agent pursuant to Section 4.01(f).
SECTION 3.07. Perfection Certificate. The Perfection Certificate has been duly prepared, completed and executed by
the Borrowers and the information set forth therein with respect to each Grantor is correct and complete as of the Restatement Effective
Date, and the Financing Statements (including any amendments thereto) prepared by the Administrative Agent based upon the
information provided to the Administrative Agent in the Perfection Certificate for filing in each governmental, municipal or other office
specified in Section 2(d) to the Perfection Certificate (or specified by notice from the Canadian Borrower to the Administrative Agent
after the Restatement Effective Date in the case of filings, recordings or registrations required by Section 5.10 of the Credit Agreement
or Sections 4.01 and 4.06 hereof) are all the filings, recordings and registrations that are necessary to perfect a security interest in favor
of the Administrative Agent (for the benefit of the Secured Parties) in respect of all the Collateral in which the Security Interest may be
perfected by filing, recording or registering in the applicable jurisdiction in Canada, and no further or subsequent filing, refiling,
recording, rerecording, registration or reregistration is necessary in any such jurisdiction, except as provided under applicable law with
respect to the filing of continuation statements.
SECTION 3.08. Validity of Security Interest. The Security Interest granted by such Grantor constitutes a legal and
valid security interest in all the Collateral securing the payment and performance of the Secured Obligations.
SECTION 3.09. Security Interest as Security Only. The Security Interest granted by such Grantor is granted as security
only and shall not subject the Administrative Agent or any other Secured Party to, or in any way alter or modify, any obligation or
liability of any Grantor with respect to or arising out of the Collateral.
SECTION 3.10. Accounts. (a) The names of the Account Debtors, amounts owing, due dates and other information
with respect to such Grantors Accounts are and will be complete, true and correct in all material respects in the records of such
Grantor relating thereto and in all invoices and Collateral Reports with respect thereto furnished to the Administrative Agent pursuant
to the Loan Documents from time to time. As of the time when each Account arises, such Grantor shall be deemed to have represented
and warranted that such Account and all records relating thereto are genuine and in all respects what they purport to be.
(b) In addition, with respect to all of its Accounts, except as disclosed in the most recent Collateral Report, (i) the
amounts shown on all invoices, statements and Collateral Reports with respect thereto are actually and absolutely owing to such
Grantor as indicated thereon and are not in any way contingent (other than with respect to discounts, rebates, billing errors, setoffs,
counterclaims and other Dilution Factors); (ii) no payments have been or shall be made thereon except payments delivered or to be

delivered to a Collateral Deposit Account as required pursuant to Section 7.01; and (iii) to such Grantors knowledge, all Account
Debtors relating to such Accounts have the capacity to contract.
SECTION 3.11. Inventory. With respect to any of its Inventory represented as being Eligible Inventory on the most
recent Collateral Report, (a) as of the last day of the period covered by such Collateral Report, such Inventory (other than Inventory in
transit) is located at one of such Grantors locations set forth on Exhibit A and such Inventory (other than Inventory in transit and other
than Inventory that has subsequently been sold, transferred or otherwise disposed of by such Grantor (other than to another Grantor) in
the ordinary course of business) shall not be stored at any other location except as permitted by Section 4.01(j), (b) other than any
Inventory that has subsequently been sold, transferred or otherwise disposed of by such Grantor (other than to another Grantor) in the
ordinary course of business, such Grantor has good and merchantable title to such Inventory and such Inventory is not subject to any
Lien, except for Liens permitted by Section 4.01(g), (c) except as specifically disclosed in such Collateral Report (or in any notification
provided to the Administrative Agent subsequent to the last day of the period covered by such Collateral Report in accordance with
Section 5.01(i) of the Credit Agreement), such Inventory (except for de minimis portions of such Inventory) is Eligible Inventory of
good and merchantable quality, free from any defects, (d) such Inventory is not subject to any licensing, patent, royalty, trademark,
trade name or copyright agreements with any third parties which would require any consent of any third party upon sale or disposition
of that Inventory or the payment of any monies to any third party upon such sale or other disposition (other than any such consent that
has already been obtained or any such payment obligation that has already been waived), and (e) the preparation for sale, marketing or
sale of such Inventory by the Administrative Agent after the occurrence and during the continuance of an Event of Default shall not
require the consent of any Person (except as required by applicable law) and shall not constitute a breach or default under any contract
or agreement to which such Grantor is a party or to which such Inventory is subject.
SECTION 3.12. Intellectual Property. Such Grantor owns, or is licensed to use, all Patents, Trademarks, Copyrights or
other Intellectual Property material to its business, and the use thereof by such Grantor does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, and no such Intellectual Property is subject to any Lien or other restriction (other than any such Lien or other
restriction with respect to which a waiver or release has been obtained) that would materially interfere with the exercise of the
Administrative Agents rights with respect to such Intellectual Property to prepare for sale, market and sell any Eligible Inventory
under Section 5.03.
SECTION 3.13. Filing Requirements. None of the Collateral owned by it is of a type for which security interests or
liens may be perfected by filing under any Canadian Federal statute. Notwithstanding anything in any Loan Document to the contrary,
the Administrative Agent agrees that the Grantors shall not be required to seek Crown consent to the assignment of Crown debts as
provided in the Financial Administration Act (Canada) or any provincial or territorial equivalent legislation.
SECTION 3.14. No Financing Statements, Security Agreements. No financing statement or security agreement
describing all or any portion of the Collateral which has not lapsed or been terminated naming such Grantor as debtor has been filed or
is of record in any jurisdiction except (a) for the Financing Statements and (b) as permitted under Section 4.01(g).

ARTICLE IV
COVENANTS
From the date of this Agreement, and thereafter until this Agreement is terminated, each Grantor agrees that:
SECTION 4.01. General. (a) Collateral Records. Such Grantor will maintain books and records with respect to the
Collateral owned by it in accordance Section 5.07 of the Credit Agreement, and furnish to the Administrative Agent, with sufficient
copies for each of the Lenders, such reports relating to such Collateral as the Administrative Agent may from time to time reasonably
request.
(b) Authorization to File Financing Statements; Ratification. Such Grantor hereby authorizes the Administrative Agent
to file, and if requested will deliver to the Administrative Agent, all Financing Statements and other documents and take such other
actions as may from time to time be reasonably requested by the Administrative Agent in order to maintain, subject to any Liens
permitted under Section 4.01(g), a first priority perfected security interest in and, if applicable and contemplated by the terms hereof,
Control of, the Collateral owned by such Grantor. Any Financing Statement (or amendment thereto) filed by the Administrative Agent
shall (i) indicate such Grantors Collateral by any description that reasonably approximates the description of such Collateral contained
in this Agreement, if applicable, and (ii) contain any other information required by the PPSA for the sufficiency or filing office
acceptance of such Financing Statement (or amendment thereto). Such Grantor agrees to furnish any such information to the
Administrative Agent promptly upon request. Such Grantor also ratifies its authorization for the Administrative Agent to have filed any
initial Financing Statements if filed prior to the Restatement Effective Date.
(c) Further Assurances. Such Grantor agrees to take any and all actions that it shall reasonably deem necessary to
defend title to the Collateral against all persons and to defend the Security Interest of the Administrative Agent in its Collateral and the
priority thereof against any Lien not expressly permitted under Section 4.01(g).
(d) Disposition of Collateral. Such Grantor will not sell, lease or otherwise dispose of the Collateral owned by it except
for dispositions not otherwise prohibited by Section 6.03 of the Credit Agreement.
(e) Maintaining Perfection of Security Interest. Each Grantor agrees, at its own expense, to execute, acknowledge,
deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Administrative Agent may
from time to time reasonably request to preserve, protect and perfect the Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of
the Security Interest and the filing of any Financing Statements or other documents in connection herewith or therewith. If any amount
payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note or other instrument
(other than any promissory note or other instrument in an aggregate principal amount of less than $500,000 owed to the applicable
Grantor by any Person that is not a Borrower or any Subsidiary, provided that the aggregate principal amount of promissory notes that
may be excluded from the delivery requirements of this paragraph (e) may not exceed $2,000,000 at any one time), such note or
instrument shall be immediately

pledged and delivered to the Administrative Agent, duly endorsed in a manner satisfactory to the Administrative Agent.
(f) Annual Confirmation of Perfection Certificate. Each year, at the time of delivery of annual financial statements with
respect to the preceding fiscal year pursuant to Section 5.01(a) of the Credit Agreement, the Canadian Borrower shall deliver to the
Administrative Agent a certificate executed by a Financial Officer of the Canadian Borrower (i) setting forth any changes to the
information required pursuant to the Perfection Certificate, or confirming that there has been no change in such information, in each
case since the date of the Perfection Certificate or the date of the most recent certificate delivered pursuant to this Section 4.01(f) and
(ii) certifying that all initial PPSA financing statements or other appropriate filings, recordings or registrations, including all refilings,
rerecordings, reregistrations and amendments to the initial PPSA financing statements, containing a description of the Collateral have
been filed of record in each governmental, municipal or other appropriate office in the jurisdiction identified pursuant to Section 4.06 to
the extent necessary to protect and perfect the Security Interest as of the date of such certificate. In connection with the delivery of any
updates to the Perfection Certificate in accordance with this Section 4.01(f) (but without limiting the express requirements of this
Agreement, including those under Sections 4.05, 4.06 and 7.02(b)), Exhibit A and Exhibit B hereto shall be deemed amended to
include such updated information.
(g) Liens. Such Grantor will not create, incur, or suffer to exist any Lien on the Collateral owned by it except Liens
permitted under clauses (a) through (d), (f) and (k) of Section 6.02 of the Credit Agreement.
(h) Other Financing Statements. Such Grantor will not authorize the filing of any financing statement naming it as
debtor covering all or any portion of the Collateral owned by it, except with respect to any Lien permitted under Section 4.01(g). Such
Grantor acknowledges that it is not authorized to file (i) any financing statement with respect to the Collateral, except with respect to
any Lien permitted under Section 4.01(g), without providing prior written notice to the Administrative Agent or (ii) any amendment or
termination statement with respect to any Financing Statement filed in accordance with the terms hereof without the prior written
consent of the Administrative Agent, subject to such Grantors rights under the PPSA.
(i) Compliance with Terms. Such Grantor shall observe, perform and comply with all obligations in respect of the
Collateral owned by it (in each case, in a manner consistent with past business practices of such Grantor), unless the failure to observe,
perform or comply with such obligations would not adversely affect the validity, perfection and priority of the Security Interest.
(j) Locations. Such Grantor will not maintain any Collateral owned by it at any location other than those locations listed
on Exhibit A (or any other location with respect to which advance written notice has been provided as contemplated by Section 4.05),
other than (i) Inventory that is in transit from or to such location and (ii) Inventory with a book value, in the aggregate, at any location
not listed in Exhibit A of less than $100,000; provided that the aggregate book value of Inventory at all locations not listed in Exhibit A
shall not exceed $2,000,000.
SECTION 4.02. Accounts. (a) Certain Agreements on Accounts. No Grantor will make or agree to make any discount,
credit, rebate or other reduction in the original amount owing on an Account or accept in satisfaction of an Account less than the
original amount thereof, except that such Grantor may reduce the amount owing on Accounts arising from the sale of Inventory in
accordance with its past

business practices unless and until a notice from the Administrative Agent has been received revoking such right during an Event of
Default, but only for so long as an Event of Default is continuing.
(b) Collection of Accounts. Except as otherwise provided in this Agreement, each Grantor will, consistent with its past
business practices, collect and enforce, at no expense to any Secured Party, all amounts due or hereafter due to such Grantor under the
Accounts owned by it.
(c) Security Interest in Property to Satisfy Account Debt. If at any time any Grantor shall take a security interest in any
property of an Account Debtor or any other Person to secure payment and performance of an Account, such Grantor shall promptly
assign such security interest to the Administrative Agent. Such assignment need not be filed of public record unless necessary to
continue the perfected status of the security interest against creditors of and transferees from the Account Debtor or other Person
granting the security interest.
(d) Delivery of Invoices. Such Grantor will deliver to the Administrative Agent, immediately upon its request after the
occurrence and during the continuation of an Event of Default and in connection with the Administrative Agents exercise of remedies
hereunder, duplicate invoices with respect to each Account owned by it bearing such language of assignment as the Administrative
Agent shall specify.
(e) Disclosure of Material Reductions in Accounts. Such Grantor, promptly upon obtaining knowledge of any event,
circumstance or change that has occurred since the most recent date on which a Borrowing Base Certificate was required to be
delivered pursuant to Section 5.01(e) of the Credit Agreement that would materially reduce the aggregate amount of Eligible Accounts
or result in a material portion of the Eligible Accounts ceasing to be Eligible Accounts, shall cause the Canadian Borrower to promptly
disclose such fact to the Administrative Agent in writing.
SECTION 4.03. Inventory. (a) Maintenance of Goods. Such Grantor will maintain, preserve, protect and keep its
Inventory in a manner consistent with its past business practices.
(b) Returned Inventory. If an Account Debtor returns any Inventory to such Grantor when no Event of Default exists,
then such Grantor shall promptly determine the reason for such return and, if reasonably deemed appropriate by such Grantor, shall
issue a credit memorandum to the Account Debtor in the appropriate amount and in a manner consistent with its past business
practices. Such Grantor shall promptly report to the Administrative Agent any return of Inventory involving an amount in excess of
$2,000,000. Each such report shall indicate each applicable Account Debtors stated reasons for the returns and the locations and
condition of the returned Inventory. All returned Inventory shall be subject to the Administrative Agents Liens thereon. Whenever any
Inventory is returned, the related Account shall be deemed not to be an Eligible Account to the extent of the amount owing by the
Account Debtor with respect to such returned Inventory.
(c) Inventory Count; Perpetual Inventory System. Such Grantor will conduct cycle counts of its Inventory in a manner
consistent with past business practices and reasonably acceptable to such Grantors auditors. Upon the request of the Administrative
Agent in connection with any field examination conducted in accordance with Section 5.07(b) of the Credit Agreement, such Grantor,
at its own expense, shall deliver to the Administrative Agent the results of each physical verification which such Grantor has made, or
has caused any other Person to make on its behalf, of all or any portion of its Inventory. Such Grantor will maintain a perpetual
inventory reporting system at all times.

SECTION 4.04. Intellectual Property. Such Grantor will use commercially reasonable efforts to secure all consents,
waivers and approvals necessary or appropriate to ensure the ability of the Administrative Agent to fully exercise the rights granted to it
in Section 5.03.
SECTION 4.05. Collateral Access Agreements. Such Grantor shall use commercially reasonable efforts to obtain a
Collateral Access Agreement from the lessor of each leased property, mortgagee of each owned property and bailee, consignee or
similar Person with respect to any warehouse, processor or converter facility or other location, in each case where Collateral is or is to
be stored or located as of the Restatement Effective Date or at any time thereafter, provided that (a) no Grantor shall be required to
obtain a Collateral Access Agreement with respect to any location at which the Inventory on-hand has a book value of less than
$100,000 and (b) no Collateral Access Agreement shall be required to be in effect prior to the Collateral Access Agreement Deadline.
For purposes of clarity, it is understood and agreed that any Grantors failure, after having used commercially reasonable efforts, to
obtain a Collateral Access Agreement with respect to any such location where Collateral is stored or located shall not constitute an
Event of Default. With respect to any such location where Inventory is stored or located as of the Restatement Effective Date or at any
time thereafter, if the Administrative Agent has not received a Collateral Access Agreement with respect to such location, the Eligible
Inventory at such location shall be subject to such Reserves as may be established by the Administrative Agent in accordance with the
terms of the Credit Agreement. Such Grantor shall provide to the Administrative Agent reasonable (but in no event less than three
Business Days) advance written notice of (i) any arrangement or agreement entered into by such Grantor to lease or mortgage real
property or any warehouse or similar location at which Collateral is to be stored or located, unless a Collateral Access Agreement that
would cover such Collateral is in effect with respect to such location and (ii) any arrangement or agreement to ship or otherwise
transfer any Collateral to any mortgaged or leased real property, or to any warehouse, processor or converter facility or other location,
in each case unless a Collateral Access Agreement that would cover such Collateral is in effect with respect to such location, and such
Grantor shall provide to the Administrative Agent prompt written notice of the termination of any such existing arrangement or
agreement with respect to any location at which Collateral is stored or located at the time of such termination. Not later than the last day
of the calendar quarter during which any arrangement, agreement or termination referenced in the immediately preceding sentence is
established or occurs, the Canadian Borrower shall deliver to the Administrative Agent a supplement to Exhibit A, setting forth the
information with respect to the locations applicable to any such new arrangement or agreement required therein or indicating the
termination of any such arrangement or agreement, as the case may be. Such Grantor shall timely and fully pay and perform its
obligations under all leases and other agreements with respect to each location where any Collateral is or may be stored or located.
SECTION 4.06. Change of Name or Location; Change of Fiscal Year. Such Grantor shall not (a) change its name as it
appears in official filings in the jurisdiction of its incorporation or organization, (b) change its chief executive office, principal place of
business or corporate offices, or the location of its records concerning the Collateral as set forth in the Security Agreement, (c) change
the type of entity that it is, (d) change its organization identification number, if any, issued by its jurisdiction of incorporation or other
organization or (e) change its jurisdiction of incorporation or organization, in each case, unless the Administrative Agent shall have
received at least ten days prior written notice of such change and such Grantor (or the Administrative Agent on behalf of such Grantor)
shall have taken all action reasonably requested by the Administrative Agent to continue the validity, perfection and priority of any
Liens in favor of the Administrative Agent, on behalf of the Secured Parties, in any Collateral, provided that any new jurisdiction of
organization shall be in Canada or any province or territory thereof. In connection with any such change permitted under this Section
4.06, Exhibit A and Exhibit C hereto shall be deemed to be amended to reflect such change (effective as of the date of such change).

ARTICLE V
REMEDIES
SECTION 5.01. Remedies. (a) Upon the occurrence, and during the continuance, of an Event of Default, the
Administrative Agent may exercise any or all of the following rights and remedies:
(i) those rights and remedies provided in this Agreement, the Credit Agreement or any other Loan Document,
provided that this Section 5.01(a) shall not be understood to limit any rights or remedies available to the Secured Parties prior to
an Event of Default;
(ii) those rights and remedies available to a secured party under the PPSA (whether or not the PPSA applies to
the affected Collateral) and under any other applicable law (including, without limitation, any law governing the exercise of a
banks right of setoff or bankers lien), when a debtor is in default under a security agreement;
(iii) institute a Cash Dominion Period as per the terms of Section 7.03;
(iv) without notice (except as specifically provided in Section 8.01 or elsewhere herein), demand or
advertisement of any kind to any Grantor or any other Person, enter the premises of any Grantor where any Collateral is located
(through self-help and without judicial process) to collect, receive, assemble, process, appropriate, sell, lease, assign, grant an
option or options to purchase or otherwise dispose of, deliver or realize upon, the Collateral or any part thereof in one or more
parcels at public or private sale or sales (which sales may be adjourned or continued from time to time with or without notice
and may take place at any Grantors premises or elsewhere), for cash, on credit or for future delivery without assumption of any
credit risk, and upon such other terms as the Administrative Agent may deem commercially reasonable;
(v) appoint by instrument in writing one or more Receivers of any or all Grantors or any or all of the Collateral
of any or all Grantors with such rights, powers and authority (including any or all of the rights, powers and authority of the
Administrative Agent under this Agreement) as may be provided for in the instrument of appointment or any supplemental
instrument, and remove and replace any such Receiver from time to time. To the extent permitted by applicable law, any
Receiver appointed by the Administrative Agent shall (for purposes relating to responsibility for the Receivers acts or
omissions) be considered to be the agent of any such Grantor and not of the Administrative Agent or any of the other Secured
Parties; and
(vi) obtain from any court of competent jurisdiction an order for the appointment of a Receiver of any or all
Grantors or of any or all of the Collateral of any or all Grantors.
(b) The Administrative Agent, on behalf of the Secured Parties, may comply with any applicable provincial or federal
law requirements in connection with a disposition of the Collateral and such compliance will not be considered to adversely affect the
commercial reasonableness of any sale of the Collateral.
(c) The Administrative Agent shall have the right upon any such public sale or sales and, to the extent permitted by law,
upon any such private sale or sales, to purchase for the benefit of the

Secured Parties, the whole or any part of the Collateral so sold, free of any right of equity redemption, which equity redemption the
Grantor hereby expressly releases.
(d) Until the Administrative Agent is able to effect a sale, lease, or other disposition of Collateral, the Administrative
Agent shall have the right to hold or use Collateral, or any part thereof, to the extent that it deems appropriate for the purpose of
preserving Collateral or its value or for any other purpose deemed appropriate by the Administrative Agent. The Administrative Agent
may, if it so elects, seek the appointment of a receiver or keeper to enforce any of the Administrative Agents remedies (for the benefit
of the Secured Parties) with respect to such appointment without prior notice or hearing as to such appointment.
(e) Notwithstanding the foregoing, no Secured Party shall be required to (i) make any demand upon, or pursue or
exhaust any of their rights or remedies against, any Grantor, any other obligor, guarantor, pledgor or any other Person with respect to
the payment of the Secured Obligations or to pursue or exhaust any of their rights or remedies with respect to any Collateral therefor or
any direct or indirect guarantee thereof, (ii) marshal the Collateral or any guarantee of the Secured Obligations or resort to the
Collateral or any such guarantee in any particular order or (iii) effect a public sale of any Collateral.
SECTION 5.02. Grantors Obligations Upon an Event of Default. Without limiting the foregoing or any other
inspection rights the Administrative Agent may have under the Loan Documents, upon the request of the Administrative Agent after
the occurrence and during the continuance of an Event of Default, each Grantor will:
(a) at any time the Secured Obligations have been accelerated in accordance with the Credit Agreement, assemble and
make available to the Administrative Agent all books and records relating to the Collateral at any place or places specified by the
Administrative Agent, whether at a Grantors premises or elsewhere;
(b) at any time the Secured Obligations have been accelerated in accordance with the Credit Agreement, permit the
Administrative Agent, by the Administrative Agents representatives and agents, to enter, occupy and use any premises where all or
any part of the Collateral, or the books and records relating thereto, or both, are located, to take possession of and/or remove all or any
part of the Collateral or make copies of the books and records relating thereto, or both, and to conduct sales of the Collateral in
accordance with the terms hereof, any applicable Collateral Access Agreements and applicable law, without any obligation to pay the
applicable Grantor for such use and occupancy; and
(c) at its own expense, cause the independent certified public accountants then engaged by each Grantor to prepare and
deliver to the Administrative Agent, promptly upon the Administrative Agents request, the following reports with respect to the
Accounts of such Grantor: (i) a reconciliation of all such Accounts; (ii) an aging of all such Accounts; (iii) trial balances; and (iv) a test
verification of all such Accounts.
SECTION 5.03. Grant of Intellectual Property License. Solely for the purpose of enabling, and solely to the extent
necessary to enable, the Administrative Agent to exercise the rights and remedies to prepare for sale, market and sell Inventory under
this Article V at such time as the Administrative Agent shall be lawfully entitled to exercise such rights and remedies, each Grantor
hereby (a) grants to the Administrative Agent, for the benefit of the Secured Parties, an irrevocable, nonexclusive license (exercisable
without payment of royalty or other compensation to any Grantor) to use, license or sublicense any Intellectual Property now owned or
hereafter acquired by such Grantor, and wherever the

same may be located, and including in such license access to all media in which any of the licensed items may be recorded or stored
and to all computer software and programs used for the compilation or printout thereof and (b) irrevocably agrees that the
Administrative Agent may sell any of such Grantors Inventory directly to any person, and, in connection with any such sale or other
enforcement of the Administrative Agents rights under this Agreement, may sell Inventory which bears any Trademark owned by or
licensed to such Grantor and any Inventory that is covered by any Copyright owned by or licensed to such Grantor, and the
Administrative Agent may finish any work in process using any Patent (or other Intellectual Property) owned by or licensed to such
Grantor and affix any appropriate Trademark owned by or licensed to such Grantor and sell such Inventory as provided herein. The
use of such license by the Administrative Agent may be exercised, at the option of the Administrative Agent, only upon the occurrence
and during the continuance of an Event of Default, provided that any license, sublicense or other transaction entered into by the
Administrative Agent in accordance herewith and in connection with the exercise of the Administrative Agents remedies hereunder
shall be binding upon the Grantors notwithstanding any subsequent cure of such Event of Default. All actions taken by the
Administrative Agent pursuant to this Article V, as well as the Administrative Agents use of any trade secrets or other Intellectual
Property pursuant to this Agreement, shall be subject to the confidentiality restrictions set forth in Section 9.12 of the Credit
Agreement.
ARTICLE VI
ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY
SECTION 6.01. Account Verification. The Administrative Agent may at any time, in the name of the applicable
Grantor or, after the occurrence, and during the continuance, of an Event of Default, in the Administrative Agents own name or in the
name of a nominee of the Administrative Agent, communicate (by mail, telephone, facsimile or otherwise) with the Account Debtors
of any such Grantor to verify with such Account Debtors, to the Administrative Agents reasonable satisfaction, any information
relating to the existence, amount, terms of, and any other material matter relating to, the Accounts of such Account Debtors.
SECTION 6.02. Authorization for Secured Party to Take Certain Action. (a) Subject to Section 6.02(b), each Grantor
hereby appoints the Administrative Agent the attorney-in-fact of such Grantor for the purpose of carrying out the provisions of this
Agreement and taking any action and executing any instrument that the Administrative Agent may reasonably deem necessary or
advisable to accomplish the purposes hereof, which appointment is irrevocable and coupled with an interest. Without limiting the
generality of the foregoing, the Administrative Agent shall have the right with full power of substitution either in the name of such
Grantor or, after the occurrence, and during the continuance, of an Event of Default, in the Administrative Agents name, to (i) file
Financing Statements necessary or desirable in the Administrative Agents sole discretion to perfect and to maintain the perfection and
priority of the Administrative Agents security interest in the Collateral, (ii) endorse and collect any cash proceeds of the Collateral of
such Grantor, (iii) file a carbon, photographic or other reproduction of this Agreement or any Financing Statement as a financing
statement and to file any other financing statement or amendment of a financing statement (which does not add new collateral or add a
debtor) in such offices as the Administrative Agent in its sole discretion deems necessary or desirable to perfect and to maintain the
perfection and priority of the Security Interest, (iv) apply the proceeds of any Collateral of such Grantor received by the Administrative
Agent or a Receiver to the Secured Obligations as provided in Section 2.09(b) or Section 2.17(b) of the Credit Agreement, as
applicable, (v) discharge past due taxes, assessments, charges, fees or Liens on the Collateral (except for such Liens as are specifically
permitted under Section 4.01(g)), (vi) contact the Account Debtors of such Grantor for any reason, (vii) demand

payment or enforce payment of the Accounts in the name of the Administrative Agent or such Grantor, (viii) endorse any and all
checks, drafts and other instruments for the payment of money relating to the Accounts, (ix) sign such Grantors name on any invoice
or bill of lading relating to the Accounts, drafts against any Account Debtor or assignments and verifications of Accounts, (x) exercise
all of such Grantors rights and remedies with respect to the collection of the Accounts and any other Collateral, (xi) settle, adjust,
compromise, extend or renew the Accounts or any legal proceedings brought to collect Accounts, (xii) prepare, file and sign such
Grantors name on a proof of claim in bankruptcy or similar document against any Account Debtor of such Grantor, (xiii) prepare, file
and sign such Grantors name on any notice of Lien, assignment or satisfaction of Lien or similar document in connection with the
Accounts, (xiv) change the address for delivery of mail relating to the Accounts of such Grantor to such address as the Administrative
Agent may designate and to receive, open and dispose of all such mail addressed to such Grantor, (xv) use, sell, assign, transfer,
pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral and (xvi) do all other acts and things
necessary to carry out the purposes of this Agreement, as fully and completely as though the Administrative Agent were the absolute
owner of the Collateral for all purposes, provided that (A) nothing herein contained shall be construed as requiring or obligating the
Administrative Agent to make any commitment or to make any inquiry as to the nature or sufficiency of any payment received by the
Administrative Agent, or to present or file any claim or notice, or to take any action with respect to the Collateral or any part thereof or
the moneys due or to become due in respect thereof or any property covered thereby and such Grantor agrees to reimburse the
Administrative Agent on demand for any payment made or any expense incurred by the Administrative Agent in connection with any
of the foregoing and (B) this authorization shall not relieve such Grantor of any of its obligations under this Agreement or under the
Credit Agreement. The Administrative Agent and the other Secured Parties shall be accountable only for amounts actually received as
a result of the exercise of the powers granted to them herein, and neither they nor their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence, bad faith or wilful misconduct.
Notwithstanding the foregoing, if the Administrative Agent or a Secured Party determines (after being given notice of such) that any
portion of a payment from an Account Debtor received by it constitutes the excess portion of a joint remittance from such Account
Debtor (which such portion was not owed to a Grantor but paid to the joint order of a Grantor and a non-Affiliated contractor or subcontractor in respect of an Account), the Administrative Agent or other Secured Party, as applicable, shall promptly remit such excess
portion of the payment to the Grantors.
(b) All acts of said attorney or designee are hereby ratified and approved. The powers conferred on the Administrative
Agent, for the benefit of the Secured Parties, under this Section 6.02 are solely to protect the Administrative Agents interests in the
Collateral and shall not impose any duty upon the Administrative Agent or any other Secured Party to exercise any such powers. The
Administrative Agent agrees that, except for the powers granted in Sections 6.02(a)(i), (a)(iii) or (a)(v), it shall not exercise any power
or authority granted to it unless an Event of Default has occurred and is continuing, provided, however, that the Administrative Agent
may exercise the powers granted in Sections 6.02(a)(ii), (a)(iv) and (a)(viii) at any time during the continuance of a Cash Dominion
Period. The Administrative Agent further agrees that it will not exercise any power or authority granted to it in Sections 6.02(a)(x), (a)
(xi), (a)(xii) and (a)(xiii) unless an Event of Default has occurred and is continuing and the Secured Obligations have been accelerated
in accordance with the Credit Agreement.

ARTICLE VII
COLLECTION AND APPLICATION OF COLLATERAL PROCEEDS; DEPOSIT ACCOUNTS
SECTION 7.01. Collection of Accounts. (a) Each Grantor shall execute and deliver to the Administrative Agent (no
later than the date (the Control Agreement Deadline) which falls 90 Business Days after the Restatement Effective Date (or such
later date as agreed by the Administrative Agent, in its sole discretion)) Deposit Account Control Agreements for each Collateral
Deposit Account maintained by such Grantor as of the Restatement Effective Date. After the Restatement Effective Date, each Grantor
will comply with the terms of Section 7.02.
(b) Not later than the Control Agreement Deadline, each Grantor shall direct all of its Account Debtors to forward
payments directly to one or more of the Collateral Deposit Accounts of such Grantor. If any Grantor should refuse or neglect to notify
any Account Debtor to forward payments with respect to such Account Debtors Accounts directly to a Collateral Deposit Account
following its receipt of a written request to do so from the Administrative Agent, the Administrative Agent shall, notwithstanding the
language set forth in Section 6.02(b), be entitled to make such notification directly to Account Debtor. If notwithstanding the foregoing
instructions, any Grantor receives any cash, checks or other similar payments constituting payments made with respect to any Account,
such Grantor shall receive such cash, checks or other similar payments as the Administrative Agents trustee and shall promptly (but in
no event later than two Business Days after receipt thereof) deposit all such cash, checks or other similar payments into a Collateral
Deposit Account.
SECTION 7.02. Covenant Regarding New Deposit Accounts. (a) No Grantor may open a Collateral Deposit Account
unless the bank or financial institution at which such Grantor seeks to open such Collateral Deposit Account has entered into a Deposit
Account Control Agreement in order to give the Administrative Agent Control of such Collateral Deposit Account, provided that (a)
no such Deposit Account Control Agreement will be required to be effective prior to the Control Agreement Deadline and (b) after the
Control Agreement Deadline, the Administrative Agent may, in its discretion, with respect to the Collateral Deposit Accounts of any
Collateral Deposit Account Bank that is not subject to a Deposit Account Control Agreement, (i) defer delivery of a Deposit Account
Control Agreement with respect to such Collateral Deposit Accounts and (ii) require such Grantor to replace such Collateral Deposit
Accounts with one or more new Collateral Deposit Accounts opened and maintained with a bank or financial institution that is subject
to an existing Deposit Account Control Agreement (it being understood and agreed that, prior to the opening of such new Collateral
Deposit Accounts referenced in the immediately preceding clause (ii) (but only after the Control Agreement Deadline), the
Administrative Agent shall be entitled to establish a Reserve with respect to those Collateral Deposit Account referenced in the
immediately preceding clause (i) for which a Deposit Account Control Agreement has not yet been executed and delivered).
(b) Promptly following a Grantors opening of any new Collateral Deposit Account in accordance with this Section
7.02 or such Grantors closing of a Collateral Deposit Account, but in each case no later than the end of the calendar quarter during
which such Collateral Deposit Account is opened or closed, as the case may be, the Canadian Borrower shall deliver to the
Administrative Agent a supplement to Exhibit B, setting forth the applicable information with respect to such new Collateral Deposit
Account required therein or indicating the closing of such Collateral Deposit Account, as the case may be.

(c) In the case that any Grantor opens an additional Collateral Deposit Account with a Collateral Deposit Account Bank
that is already party to a Deposit Account Control Agreement or such Grantor transfers or otherwise assigns any Collateral Deposit
Account subject to an existing Deposit Account Control Agreement to a different Grantor party to such Deposit Account Control
Agreement, the Canadian. Borrower shall promptly notify the Administrative Agent thereof and, if the applicable Grantor or Grantors
fail, within ten Business Days after request from the Administrative Agent, to enter into an amendment, supplement or other
modification to such Deposit Account Control Agreement to reflect the addition or change in ownership, as the case may be, of such
Collateral Deposit Account for the purpose of ensuring that such Collateral Deposit Account is subject to the control arrangement
evidenced thereby, the Administrative Agent shall have the authority to enter into, on behalf of itself and the applicable Grantor or.
Grantors, such an amendment, supplement or other modification to such Deposit Account Control Agreement.
(d) In the case of Collateral Deposit Accounts maintained with any Lender, the terms of each Deposit Account Control
Agreement entered into with such Lender shall be subject to the provisions of the Credit Agreement regarding setoff.
SECTION 7.03. Cash Dominion Periods; Application of Proceeds. (a) Pursuant to each Deposit Account Control
Agreement entered into pursuant to Sections 7.01 or 7.02, the Administrative Agent shall have Control of the relevant Collateral
Deposit Account. The applicable Grantor may operate and transact business through its Collateral Deposit Accounts in its normal
fashion at all times (except as provided below), including making withdrawals (whether via wire transfer, ACH transfer, check or
otherwise), provided that (i) upon the commencement and during the continuation of any Cash Dominion Period, the Administrative
Agent may (A) send a notice (a Cash Dominion Period Notice) to each Collateral Deposit Account Bank instructing such Collateral
Deposit Bank to cease complying with any instructions originated by the applicable Grantor regarding the disposition of funds in the
related Collateral Deposit Account and to begin complying with instructions originated by the Administrative Agent directing the
sweep of available funds from the applicable Collateral Deposit Account on a daily basis into a collection account maintained by the
Canadian Borrower with the Administrative Agent (such account, the Collection Account), without further consent of the applicable
Grantor and subject to the terms of the applicable Deposit Account Control Agreement and (B) apply (and allocate) the funds in the
Collection Account in accordance with Section 2.09(b) or Section 2.17(b) of the Credit Agreement, as applicable, and (ii) except as
otherwise provided below, upon the termination of each Cash Dominion Period (the timing of such termination to be determined by
reference to the definition of the term Cash Dominion Period set forth in Section 1.03), the Administrative Agent shall send a notice
to each Collateral Deposit Account Bank (a Cash Dominion Termination Notice) terminating such Cash Dominion Period and
commencing a period (each such period, a Cash Dominion Termination Period) in which each Grantor may again transact business
through each Collateral Deposit Account in its normal fashion, including making withdrawals from each Collateral Deposit Account
(whether via wire transfer, ACH transfer, check or otherwise); provided, however, that following (x) the termination of the Revolving
Commitments as contemplated by Article VII of the Credit Agreement or (y) a declaration, as contemplated by Article VII of the
Credit Agreement, that the outstanding Loans have become due and payable, the Administrative Agent shall not be required to give
any further Cash Dominion Termination Notices and shall be entitled to permanently maintain such Cash Dominion Period and
exercise the rights attendant thereto as set forth above.
(b) All amounts deposited in the Collection Account pursuant to this Section 7.03 shall be deemed received by the
Administrative Agent for purposes of Sections 2.09(b) and 2.17(b) of the Credit Agreement, provided that, notwithstanding the
foregoing, if the Administrative Agent or a Secured Party

determines (after being given notice of such) that any portion of a payment from an Account Debtor received by it constitutes the
excess portion of a joint remittance from such Account Debtor (which such portion was not owed to a Grantor but paid to the joint
order of a Grantor and a non-Affiliated contractor or sub-contractor in respect of an Account), the Administrative Agent or other
Secured Party, as applicable, shall promptly remit such excess portion of the payment to the Grantors. The balance, if any, in the
Collection Account after all the Secured Obligations on any day during a Cash Dominion Period have been satisfied shall be deposited
by the Administrative Agent into the Canadian Borrowers general operating account as instructed by the Canadian Borrower. If, at the
time any Cash Dominion Termination Period commences, the Collection Account has a balance, such balance shall be deposited by
the Administrative Agent into the Canadian Borrowers general operating account as instructed by the Canadian Borrower.
(c) To the extent that the terms of any Deposit Account Control Agreement are inconsistent with the terms of this
Section 7.03 with respect to the rights of the Administrative Agent and the Grantors, the terms of this Section 7.03 shall control.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waivers. Each Grantor hereby waives notice of the time and place of any public sale or the time after
which any private sale or other disposition of all or any part of the Collateral may be made. To the extent such notice may not be
waived under applicable law, any notice made shall be deemed reasonable if sent to the Grantors, addressed as set forth in Article IX,
at least fifteen (15) days prior to (a) the date of any such public sale or (b) the time after which any such private sale or other disposition
may be made. To the maximum extent permitted by applicable law, each Grantor waives all claims, damages and demands against any
Secured Party or Receiver arising out of the repossession, retention or sale of the Collateral, except as may arise solely out of the gross
negligence, bad faith or wilful misconduct of such Secured Party or Receiver as finally determined by a court of competent jurisdiction.
To the extent it may lawfully do so, each Grantor absolutely and irrevocably waives and relinquishes the benefit and advantage of, and
covenants not to assert against any Secured Party or Receiver, any valuation, stay, appraisal, extension, moratorium, redemption or
similar laws and any and all rights or defenses it may have as a surety now or hereafter existing which, but for this provision, might be
applicable to the sale of any Collateral made under the judgment, order or decree of any court, or privately under the power of sale
conferred by this Agreement, or otherwise. Except as otherwise specifically provided herein, each Grantor hereby waives presentment,
demand, protest or any notice (to the maximum extent permitted by applicable law) of any kind in connection with this Agreement or
any Collateral.
SECTION 8.02. Limitation on Administrative Agents and Lenders Duty with Respect to the Collateral. Except as
imposed under applicable law, no Secured Party shall have any other duty as to any Collateral in its possession or control or in the
possession or control of any agent or nominee of such Secured Party, or any income thereon or as to the preservation of rights against
prior parties or any other rights pertaining thereto. To the extent that applicable law imposes duties on the Administrative Agent to
exercise remedies in a commercially reasonable manner, each Grantor acknowledges and agrees that it is commercially reasonable for
the Administrative Agent (a) to fail to incur expenses deemed significant by the Administrative Agent to prepare Collateral for
disposition or otherwise to transform raw material or work in process into finished goods or other finished products for disposition, (b)
to obtain or, if not required by other law, to fail to obtain governmental or third party consents for the collection or disposition of
Collateral to be collected or disposed of, (c) to fail to exercise collection remedies against

Account Debtors or other Persons obligated on Collateral or to remove Liens on or any adverse claims against Collateral, (d) to
exercise collection remedies against Account Debtors and other Persons obligated on Collateral directly or through the use of collection
agencies and other collection specialists, (e) to advertise dispositions of Collateral through publications or media of general circulation,
whether or not the Collateral is of a specialized nature, (f) to contact other Persons, whether or not in the same business as such
Grantor, for expressions of interest in acquiring all or any portion of such Collateral, (g) to hire one or more professional auctioneers to
assist in the disposition of Collateral, whether or not the Collateral is of a specialized nature, (h) to dispose of Collateral by utilizing
internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capacity of doing
so, or that match buyers and sellers of assets, (i) to dispose of assets in wholesale rather than retail markets, (j) to disclaim disposition
warranties, such as title, possession or quiet enjoyment, (k) to purchase insurance or credit enhancements to insure the Administrative
Agent against risks of loss, collection or disposition of Collateral or to provide to the Administrative Agent a guaranteed return from
the collection or disposition of Collateral, or (l) to the extent deemed appropriate by the Administrative Agent, to obtain the services of
other brokers, investment bankers, consultants and other professionals to assist the Administrative Agent in the collection or disposition
of any of the Collateral. Each Grantor acknowledges that the purpose of this Section 8.02 is to provide non-exhaustive indications of
what actions or omissions by the Administrative Agent would be commercially reasonable in the Administrative Agents exercise of
remedies against the Collateral and that other actions or omissions by the Administrative Agent shall not be deemed commercially
unreasonable solely on account of not being indicated in this Section 8.02. Without limitation upon the foregoing, nothing contained in
this Section 8.02 shall be construed to grant any rights to any Grantor or to impose any duties on the Administrative Agent that would
not have been granted or imposed by this Agreement or by applicable law in the absence of this Section 8.02.
SECTION 8.03. Compromises and Collection of Collateral. The Grantors and the Administrative Agent recognize that
setoffs, counterclaims, defenses and other claims may be asserted by obligors with respect to certain of the Accounts, that certain of the
Accounts may be or become uncollectible in whole or in part and that the expense and probability of success in litigating a disputed
Account may exceed the amount that reasonably may be expected to be recovered with respect to an Account. In view of the
foregoing, each Grantor agrees that the Administrative Agent may at any time and from time to time, if an Event of Default has
occurred and is continuing and the Secured Obligations have been accelerated in accordance with the Credit Agreement, and subject to
applicable law, compromise with the obligor on any Account, accept in full payment of any Account such amount as the
Administrative Agent in its sole discretion shall determine or abandon any Account, and any such action by the Administrative Agent
shall be commercially reasonable so long as the Administrative Agent acts in good faith based on information known to it at the time it
takes any such action.
SECTION 8.04. Secured Party Performance of Debtor Obligations. Without having any obligation to do so, and,
except after the occurrence and during the continuance of an Event of Default, after having made a request of a Grantor to do so and
the Grantor having not complied with such request to do so as promptly as practicable after receipt of such request, the Administrative
Agent may perform or pay any obligation which any Grantor has agreed to perform or pay in this Agreement and the Grantors shall
reimburse the Administrative Agent for any amounts paid by the Administrative Agent pursuant to this Section 8.04. The Grantors
obligation to reimburse the Administrative Agent pursuant to the preceding sentence shall be a Secured Obligation payable on demand.
SECTION 8.05. Specific Performance of Certain Covenants. Each Grantor acknowledges and agrees that a breach of
any of the covenants contained in Sections 4.01(d), 4.01(e), 4.01(g), 4.06 or 5.02, or in Article VII will cause irreparable injury to the
Secured Parties, that the Secured Parties have no

adequate remedy at law in respect of such breaches and therefore agrees, without limiting the right of the Secured Parties to seek and
obtain specific performance of other obligations of the Grantors contained in this Agreement, that the covenants of the Grantors
contained in the Sections referred to in this Section 8.05 shall be specifically enforceable against the Grantors.
SECTION 8.06. Dispositions Not Authorized. No Grantor is authorized to sell or otherwise dispose of the Collateral
except as set forth in Section 4.01(d) and notwithstanding any course of dealing between any Grantor and the Administrative Agent or
other conduct of the Administrative Agent, no authorization to sell or otherwise dispose of the Collateral (except as set forth in
Section 4.01(d)) shall be binding upon the Secured Parties unless such authorization is in writing signed by the Administrative Agent.
SECTION 8.07. No Waiver; Amendments; Cumulative Remedies. No failure, delay or omission of any Secured Party
to exercise any right or remedy granted under this Agreement shall impair such right or remedy or be construed to be a waiver of any
Default or an acquiescence therein, and any single or partial exercise of any such right or remedy shall not preclude any other or further
exercise thereof or the exercise of any other right or remedy. No waiver, amendment or other variation of the terms, conditions or
provisions of this Agreement whatsoever shall be valid unless in writing signed by the Administrative Agent with the concurrence or at
the direction of the Lenders required under Section 9.02 of the Credit Agreement and then only to the extent in such writing
specifically set forth. All rights and remedies contained in this Agreement or by law afforded shall be cumulative and all shall be
available to the Secured Parties until the Secured Obligations have been paid and performed in full.
SECTION 8.08. Limitation by Law; Severability of Provisions. All rights, remedies and powers provided in this
Agreement may be exercised only to the extent that the exercise thereof does not violate any applicable provision of law, and all the
provisions of this Agreement are intended to be subject to all applicable mandatory provisions of law that may be controlling and to be
limited to the extent necessary so that they shall not render this Agreement invalid, unenforceable, illegal or not entitled to be recorded
or registered, in whole or in part. 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.
SECTION 8.09. Reinstatement. This Agreement shall remain in full force and effect and continue to be effective
should any petition be filed by or against any Grantor for liquidation or reorganization, should any Grantor become insolvent or make
an assignment for the benefit of any creditor or creditors or should a Receiver or trustee be appointed for all or any significant part of
any Grantors assets, and shall continue to be effective or be reinstated, as the case may be, if at any time payment and performance of
the Secured Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by any obligee of the Secured Obligations, whether as a voidable preference, fraudulent conveyance or
otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Secured Obligations shall be reinstated and deemed reduced only by such amount paid
and not so rescinded, reduced, restored or returned.
SECTION 8.10. Benefit of Agreement. The terms and provisions of this Agreement shall be binding upon and inure to
the benefit of the Grantors, the Secured Parties and their respective successors and assigns (including all persons who become bound as
a debtor to this Agreement), except

that no Grantor shall have the right to assign its rights or delegate its obligations under this Agreement or any interest herein, without
the prior written consent of the Administrative Agent. No sales of participations, assignments, transfers or other dispositions of any
agreement governing the Secured Obligations or any portion thereof or interest therein shall in any manner impair the Lien granted to
the Administrative Agent, for the benefit of the Secured Parties.
SECTION 8.11. Survival of Representations. All representations and warranties of the Grantors contained in this
Agreement shall survive the execution and delivery of this Agreement.
SECTION 8.12. Headings. The title of and section headings in this Agreement are for convenience of reference only,
and shall not govern the interpretation of any of the terms and provisions of this Agreement.
SECTION 8.13. Termination. (a) Subject to Section 8.09, this Agreement and the Security Interest in the Collateral
shall terminate when all the Secured Obligations have been paid in full, in cash, and the Lenders have no further commitment to lend to
the Canadian Borrower under the Credit Agreement, the LC Exposure in respect of Letters of Credit issued to the Canadian Borrower
(or with respect to which the Canadian Borrower is a co-applicant) has been reduced to zero (or cash collateralized in an amount equal
to 103% of the aggregate undrawn amount of all such outstanding Letters of Credit (for each Letter of Credit, denominated in the
currency of such Letter of Credit) or otherwise collateralized (i.e., by issuance of backstop letters of credit to the applicable Issuing
Banks in respect thereof), in each case in a manner satisfactory to the applicable Issuing Banks) and the Issuing Banks have no further
obligations to issue Letters of Credit to the Canadian Borrower (or to any Subsidiary with the Canadian Borrower as a co-applicant)
under the Credit Agreement.
(b) A Grantor shall automatically be released from its obligations hereunder and the Security Interest in the Collateral of
such Grantor shall be automatically released 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 Grantor ceases to be a wholly-owned 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) Upon any sale or other transfer by any Grantor of any Collateral that is permitted under the Credit Agreement (other
than a sale or other transfer to a Grantor), or upon the effectiveness of any written consent to the release of the Security Interest
granted hereby in any Collateral pursuant to Section 9.02 of the Credit Agreement, the Security Interest in such Collateral shall be
automatically released.
(d) In connection with any termination or release pursuant to paragraph (a), (b) or (c) of this Section 8.13, the
Administrative Agent shall (i) execute and deliver to any Grantor, at such Grantors expense, all documents that such Grantor shall
reasonably request to evidence such termination or release and (ii) with respect to any Collateral Deposit Account of any Grantor that
is so released from its obligations hereunder, deliver to each Collateral Deposit Account Bank that has entered into a Deposit Account
Control Agreement with respect to the Collateral Deposit Accounts of such Grantor a written notice of termination of each such
Deposit Account Control Agreement in accordance with the terms of such Deposit Account Control Agreement. The Administrative
Agent hereby consents to the applicable Grantor filing all PPSA discharge statements corresponding to any Collateral that is so
released if the Administrative Agent has failed to file such PPSA discharge statements within 5 Business Days of notice of such release
delivered by such Grantor to the Administrative Agent. Any execution and delivery of

documents pursuant to this Section 8.13 shall be without recourse to or warranty by the Administrative Agent.
SECTION 8.14. Additional Subsidiaries. Pursuant to the Credit Agreement, and solely to the extent required thereby,,
certain Canadian Material Subsidiaries that were not in existence or not Canadian Material Subsidiaries as of the Restatement Effective
Date (as well as certain other Canadian Subsidiaries specified by the Canadian Borrower) are required to enter into this Agreement as a
Grantor upon becoming such a Canadian Material Subsidiary (or upon such designation). Upon execution and delivery by the
Administrative Agent and a Canadian Subsidiary of an instrument in the form of Exhibit D hereto (each such instrument, a
Supplement), such Canadian Subsidiary shall become a Grantor hereunder with the same force and effect as if originally named as a
Grantor herein. The execution and delivery of any such Supplement shall not require the consent of any other Grantor hereunder. The
rights and obligations of each Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new Grantor
as a party to this Agreement
SECTION 8.15. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each
of their respective 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, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or any such Affiliate to or for the credit or the account of any
Grantor against any of and all obligations of such Grantor now or hereafter existing under this Agreement held by such Lender,
irrespective of whether or not such Lender shall have made any demand hereunder and although such obligations may be unmatured or
are owed to a branch or office of such Lender different from the branch or office holding such deposit or obligation. The applicable
Lender shall notify the Canadian Borrower and the Administrative Agent of such set-off or application, provided that any failure to
give or any delay in giving such notice shall not affect the validity of any such set-off or application under this Section 8.15. The rights
of each Lender under this Section 8.15 are in addition to other rights and remedies (including other rights of setoff) which such Lender
may have.
SECTION 8.16. Lien Absolute. All rights of the Administrative Agent hereunder, and all obligations of each Grantor
hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any other term of, all or any part 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 exchange, release or non-perfection of any other Collateral, or any release or amendment or waiver of or
consent to departure from any guarantee, for all or any of the Secured Obligations;
(d) the insolvency of any Person; or
(e) any other circumstance which might otherwise constitute a defense available to, or a discharge of, any Grantor.

SECTION 8.17. Release. Each Grantor consents and agrees that the Administrative Agent may at any time, or from
time to time, in its discretion:
(a) as contemplated by the Credit Agreement and in conformance therewith, renew, extend or change the time of
payment, and/or the manner, place or terms of payment, of all or any part of the Secured Obligations; and
(b) exchange, release and/or surrender all or any of the Collateral or any part thereof, by whomsoever deposited, which
is now or may hereafter be held by the Administrative Agent in connection with all or any of the Secured Obligations; all in such
manner and upon such terms as the Administrative Agent may deem proper, and without notice to or further assent from any Grantor,
it being hereby agreed that each Grantor shall be and remain bound upon this Agreement, irrespective of the value or condition of any
of the Collateral, and notwithstanding any such change, exchange, settlement, compromise, surrender, release, renewal or extension,
and notwithstanding also that the Secured Obligations may, at any time, exceed the aggregate principal amount thereof set forth in the
Credit Agreement, or any other agreement governing any Secured Obligations.
SECTION 8.18. Entire Agreement. This Agreement and the other Loan Documents embody the entire agreement and
understanding between the Grantors and the Administrative Agent relating to the Collateral and supersede all prior agreements and
understandings between the Grantors and the Administrative Agent relating to the Collateral.
SECTION 8.19. Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the law of the Province of Ontario and the
federal laws of Canada applicable therein.
(b) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the courts of the province of Ontario, 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 court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be 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 8.19. 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 9.01. 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 8.20. 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 8.20.
SECTION 8.21. Taxes and Expenses; Indemnity. (a) Any taxes (including income taxes but excluding any Excluded
Taxes) payable or ruled payable by Federal or Provincial authority in respect of this Agreement shall be paid by the Grantors, together
with interest and penalties, if any. The parties hereto agree that the Administrative Agent and each of the other Secured Parties shall be
entitled to reimbursement of its reasonable expenses incurred hereunder as provided in and subject to the limitations set forth in Section
9.03(a) of the Credit Agreement.
(b) Without limitation of any of its indemnification obligations under the other Loan Documents, each Grantor shall,
jointly and severally with each other Grantor, indemnify each Indemnitee 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 by any third party or by any Grantor
arising out of, in connection with, or as a result of (i) the execution and delivery of this Agreement or any other agreement or
instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation
of any transactions contemplated hereby or (ii) any actual or prospective claim, litigation, investigation or proceeding relating to any of
the foregoing or to the Collateral (each, a Proceeding), whether based on contract, tort or any other theory, whether brought by a
third party or by any Grantor and regardless of whether 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, non-appealable judgment to have resulted from (A) the gross negligence, bad faith or wilful misconduct
of such Indemnitee, (B) a material breach by such Indemnitee of its obligations under this Agreement or any other Loan Document or
(C) claims of one or more Indemnitees against another Indemnitee (other than claims against the Administrative Agent or any Arranger
in their respective capacities as such) and not involving any act or omission by either Borrower, any of the Subsidiaries or any of their
respective Affiliates (or any of such Persons Related Parties). None of the Grantors shall, without the prior written consent of any
Indemnitee, effect any settlement of any pending or threatened Proceeding in respect of which indemnity could have been sought
under this Section 8.21(b) by such Indemnitee unless such settlement (x) includes an unconditional release of such Indemnitee in form
and substance reasonably satisfactory to such Indemnitee from all liability or claims that are the subject matter of such Proceeding and
(y) does not include any statement as to or any admission of fault, culpability, wrongdoing or a failure to act by or on behalf of such
Indemnitee or any injunctive relief or other non-monetary remedy. The Grantors shall not be liable for any settlement of any
Proceeding if the amount of such settlement was effected without the Canadian Borrowers consent (which consent shall not be
unreasonably withheld, conditioned or delayed), but if settled with the Canadian Borrowers written consent or if there is a judgment
by a court of competent jurisdiction for the plaintiff in any such Proceeding, the Grantors agree to indemnify and hold harmless each
Indemnitee from and against any and

all losses, claims, damages, penalties, liabilities and expenses by reason of such settlement or judgment in accordance with the other
provisions of this Section 8.21(b).
(c) Any amounts payable pursuant to this Section 8.21 shall be additional Secured Obligations secured hereby and by
the other Collateral Documents. The provisions of this Section 8.21 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 Secured Party. All amounts due under
this Section 8.21 shall be payable not later than three Business Days after written demand therefor setting forth the basis for such claim
in reasonable detail.
SECTION 8.22. Counterparts. This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart.
Delivery of an executed signature page to this Agreement by facsimile or other electronic transmission (including Adobe PDF file)
shall be as effective as delivery of an original executed counterpart of this Agreement.
ARTICLE IX
NOTICES
SECTION 9.01. Sending Notices. Any notice required or permitted to be given under this Agreement shall be made in
accordance with, and deemed to be received pursuant to the terms of, Section 9.01 of the Credit Agreement, in each case addressed to
the Canadian Borrower (with respect to notices to any Grantor) and to the Administrative Agent and the Lenders at the addresses set
forth in accordance with Section 9.01 of the Credit Agreement.
ARTICLE X
THE ADMINISTRATIVE AGENT
JPMorgan Chase Bank, N.A. has been appointed Administrative Agent for the Lenders hereunder pursuant to Article
VIII of the Credit Agreement. It is expressly understood and agreed by the parties to this Agreement that any authority conferred upon
the Administrative Agent hereunder is subject to the terms of the delegation of authority made by the Lenders to the Administrative
Agent pursuant to the Credit Agreement, and that the Administrative Agent has agreed to act (and any successor Administrative Agent
shall act) as such hereunder only on the express conditions contained in such Article VIII. Any successor Administrative Agent
appointed pursuant to Article VIII of the Credit Agreement shall be entitled to all the rights, interests and benefits of the Administrative
Agent hereunder.
[Signature Page Follows]

IN WITNESS WHEREOF, the Grantors and the Administrative Agent have executed this Agreement as of the date
first above written.

CGC INC.
by

/s/ Kenneth R. Banas

Name: Keneth R. Banas
Title: Vice President, Finance

JPMORGAN CHASE BANK, N.A., as Administrative Agent

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

EXHIBIT A
(See Sections 3.02, 3.03, 3.04, 3.06, 3.11, 4.01(j), 4.06 and 9.01 of Security Agreement)
NOTICE ADDRESS FOR GRANTOR
550 West Adams Street
Chicago, IL 60661
Attention: Vice President and Treasurer
Telecopy No.: (312) 672-3883
with a copy to: Corporate Secretary
Telecopy No.: (312) 672-7748
INFORMATION OF CGC INC.
I. Name of Grantor: CGC Inc.
II.

Jurisdiction of Incorporation or Organization: New Brunswick, Canada

III. Type of Entity: Corporation

IV.

Organizational Number assigned by Jurisdiction of Incorporation or Organization: 635754

V.

Place of Business (if it has only one) or Chief Executive Office (if more than one place of business):
350 Burnhamthorpe Road West
5th Floor
Mississauga, Ontario
L5B 3J1

VI.

Other Places of Business: See below.

VII. Locations of Collateral:

(a) Properties Owned by the Grantor:
55 Third Line Road
Hagersville, ON
N0A 1H0
735 Fourth Line Road
Oakville, ON
L6L 5B7
450 De Baets Street
Winnipeg, MB
R2J 4K3
79 Little Narrows Road
Little Narrows, NS
B0E 1T0

669 Wentworth Road

Windsor, NS
B0N 2T0
(b) Properties Leased by the Grantor (Include Landlords Name):
5025- 52nd Avenue S.E.
Calgary, AB
T2C 4N7
350 Burnhamthorpe Road West,
5th Floor
Mississauga, ON
L5B 3J1
7200 Notre Dame Est
Montreal, PQ
H1N 3L6
11105 Bridge Road
Surrey, BC
V3V 3V2
19575 96 Avenue
Surrey, BC
V4N 4C5
(c)

BK Prime Foothills LP

350 Burnhamthorpe Road

Investments Inc.

Simsue Investments Inc.

11105 Bridge Road Limited

Transpacific Realty Advisors

Public Warehouses or other Locations pursuant to Bailment or Consignment Arrangements (include name of
Warehouse Operator or other Bailee or Consignee): None.

EXHIBIT B
(See Sections 3.05 and 7.01(a) of Security Agreement)
COLLATERAL DEPOSIT ACCOUNTS

Name of Grantor

CGC Inc.

Name and Address of Depositary

Institution

TD Bank, N.A.
100 Wellington St. West,
26th Floor
Toronto, ON
MSK 1A2I

Account Number

Related Lockbox number, if

any

EXHIBIT C
(See Section 3.01 of Security Agreement)
JURISDICTIONS IN WHICH FINANCING STATEMENTS HAVE BEEN FILED

Company
CGC Inc.

Jurisdiction
ON, BC, AB, MB, NB and NS

EXHIBIT D
SUPPLEMENT NO. __ dated as of _________________________ (this Supplement), to the Canadian Pledge and
Security Agreement dated as of October 22, 2014 (as amended, supplemented or otherwise modified from time to time, the Security
Agreement), among CGC Inc., a New Brunswick corporation (the Canadian Borrower), the Subsidiaries of CGC Inc. from time to
time party thereto (each such Subsidiary and the Canadian Borrower, a Grantor and, collectively, the Grantors) and JPMorgan
Chase Bank, N.A., in its capacity as administrative agent (the Administrative Agent) for the lenders party to the Credit Agreement
referred to below.
A. Reference is made to the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014 (as
amended, supplemented or otherwise modified from time to time, the Credit Agreement), among USG Corporation, a
Delaware corporation (the Borrower), the Canadian Borrower, the Lenders and Issuing Banks from time to time party
thereto, the Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian administrative agent, and Bank
of America, N.A. and Wells Fargo Bank, National Association, as co-syndication agents.
B. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in
the Credit Agreement or the Security Agreement, as applicable.
C. The Grantors have entered into the Security Agreement in order to induce the Lenders to make Loans. Section
8.14 of Security Agreement provides that certain Subsidiaries must become Grantors under the Security Agreement by
execution and delivery of an instrument in the form of this Supplement. The undersigned such Subsidiary (the New
Subsidiary) is executing this Supplement in accordance with the requirements of the Credit Agreement to become a Grantor
under the Security Agreement in order to induce the Lenders to make additional Loans and as consideration for Loans
previously made.
Accordingly, the Administrative Agent and the New Subsidiary agree as follows:
SECTION 1. In accordance with Section 8.14 of the Security Agreement, the New Subsidiary by its signature below
becomes a Grantor under the Security Agreement with the same force and effect as if originally named therein as a Grantor and the
New Subsidiary hereby (a) agrees to all the terms and provisions of the Security Agreement applicable to it as a Grantor thereunder
and (b) represents and warrants that the representations and warranties made by it as a Grantor thereunder are true and correct on and
as of the date hereof. In furtherance of the foregoing, the New Subsidiary, as security for the payment and performance in full of the
Secured Obligations, does hereby create and grant to the Administrative Agent, its successors and assigns, for the benefit of the
Secured Parties, their successors and assigns, a security interest in and Lien on all of the New Subsidiarys right, title and interest in
and to the Collateral of the New Subsidiary. Each reference to a Grantor in the Security Agreement shall be deemed to include the
New Subsidiary. The Security Agreement is hereby incorporated herein by reference.
SECTION 2. The New Subsidiary represents and warrants to the Administrative Agent and the other Secured 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 electronic transmission (including Adobe PDF file) shall be as effective as delivery of an
original executed counterpart of this Supplement.
SECTION 4. The New Subsidiary hereby represents and warrants that (a) set forth on Schedule I attached hereto is the
true and correct legal name of the New Subsidiary, its jurisdiction of organization, the organizational number issued to it by its
jurisdiction of organization and the location of its place of business (if it has only one) or its chief executive office (if it has more than
one place of business), the location of any other place of business of such New Subsidiary and the location of any and all Collateral of
the New Subsidiary having an aggregate book value of $100,000 or more and (b) set forth on Schedule II attached hereto is a complete
list of all Collateral Deposit Accounts maintained by such New Subsidiary, together with applicable identifying information for such
Collateral Deposit Accounts . The information set forth on such Schedule I shall be deemed to supplement Exhibit A to the Security
Agreement, effective as of the date hereof. The information set forth on such Schedule II in respect of Collateral Deposit Accounts
shall be deemed to supplement Exhibit B to the Security Agreement, effective as of the date hereof.
SECTION 5. Except as expressly supplemented hereby, the Security Agreement shall remain in full force and effect.
SECTION 6. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE PROVINCE OF ONTARIO AND THE FEDERAL LAW OF CANADA APPLICABLE
THEREIN.
SECTION 7. 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 7.
SECTION 8. 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 Security
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 9. All communications and notices hereunder shall be in writing and given as provided in Section 9.01 of
the Security Agreement.
SECTION 10. 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.

IN WITNESS WHEREOF, the New Subsidiary and the Administrative Agent have duly executed this Supplement to
the Security 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:

INFORMATION OF {Insert name of New Subsidiary}

I. Name of Grantor: _____________________________________
II.

Jurisdiction of Incorporation or Organization: __________________________

III. Type of Entity: _______________________________________

IV.

Organizational Number assigned by Jurisdiction of Incorporation or Organization:

_________________________________________

V. Federal Identification Number: ________________________________

VI.

Place of Business (if it has only one) or Chief Executive Office (if more than one place of business):

Attention:

VII.

Other Places of Business:

VIII. Locations of Collateral:

(a) Properties Owned by the Grantor:
(b) Properties Leased by the Grantor (Include Landlords Name):
(c)

Public Warehouses or other Locations pursuant to Bailment or Consignment Arrangements (include name of
Warehouse Operator or other Bailee or Consignee):

COLLATERAL DEPOSIT ACCOUNTS

Name of Grantor

Name of Institution

Location of Institution

Account Number

EXHIBIT 10.24

Year 2015
Annual
Management Incentive
Program
(Executive Officers Only)
USG Corporation

PURPOSE
To enhance USG Corporation's ability to attract, motivate, reward and retain key employees of the Corporation and its operating
subsidiaries and to align management's interests with those of the Corporation's stockholders by providing incentive award
opportunities to managers who make a measurable contribution to the Corporations business objectives.

INTRODUCTION
This Annual Management Incentive Program (the Program) is in effect from January 1, 2015 through December 31, 2015.

ELIGIBILITY
Individuals eligible for participation in this Program are the Corporations executive officers. This Program is executive officers only.

GOALS
For the 2015 Annual Management Incentive Program, Consolidated Net Earnings adjusted for incentive plan purposes and
consolidated, subsidiary and profit center Focus Targets will be determined by the USG Board of Directors after review by the
Compensation and Organization Committee of the USG Board of Directors (the Committee) . The Committee will consider
recommendations submitted from management of USG Corporation.

AWARD VALUES
For this Program, position target incentive values are based on level of accountability and are expressed as a percent of approved
annualized salary. Resulting award opportunities represent a fully competitive incentive opportunity for 100% (target) achievement
of goals:

Position Title

Position Target
Incentive

- Chairman, President & Chief Executive Officer, USG Corporation

120%

- Executive Vice President & Chief Financial Officer, USG Corporation

- Executive Vice President & Chief Operating Officer, USG Corporation

75%

- Executive Vice President & General Counsel, USG Corporation

70%

- Senior Vice President and Chief Technology Officer, USG Corporation

- Senior Vice President; President, USG International

60%

- Senior Vice President, Human Resources and Communications, USG Corporation

- Senior Vice President Business Development and Operational Services, USG Corporation

50%

- Vice President and Associate General Counsel, USG Corporation

- Vice President and Treasurer, USG Corporation
- Vice President and Controller, USG Corporation
- Vice President, Compensation, Benefits, and Corporate Services, USG Corporation
- Vice President, Corporate Innovation Center, USG Corporation

45%

AWARDS
Incentive awards for all participants in this Program will be reviewed and approved by the Committee. For all participants, the
annual incentive award par opportunity is the annualized salary approved by March 31, 2015 that is in effect on March 1, 2015
multiplied by the applicable position target incentive value percent.
Incentive awards for 2015 will be based on a combination of the following elements:
I.

CONSOLIDATED NET EARNINGS ADJ. FOR IC PLAN PURPOSES:

50% OF INCENTIVE

Consolidated Net Earnings adjusted for incentive plan purposes will be as reported on the Corporations year-end financial
statements with adjustments for significant non-operational charges. Such adjustments will be defined by March 31, 2015 and have
in the past been for Fresh Start Accounting, asbestos, restructuring charges, bankruptcy expenses and the cumulative impact of
new accounting pronouncements. For all participants, this portion of the award represents 50% of the incentive par. This portion of
the award will be paid once threshold is met. The threshold award begins at 50% of segment par. The maximum award for this
segment is capped at two times par. Straight line interpolation will be used to determine points between par and minimum or
maximum.
For each executive officer, (i) their individual Net Earnings par shall be determined by March 31, 2015, and (ii) their individual
factors shall be determined by March 31, 2015. Notwithstanding the prior sentence nor any other provision in this Program, each
executive officers factor may be decreased, but not increased, due to changes in the total Program and Other Program par after
March 31, including, but not limited to, changes triggered by the addition or removal of a participant from the Program or the Other
Program or changes in any participants Net Earnings par.
II.

FOCUS TARGETS: 50% OF INCENTIVE

Focus Targets will be measurable, verifiable and derived from the formal strategic planning process. For 2015, Focus Targets are
expected to include North American Operations and L&W Gross Profit and USG Boral JV Adjusted Net Earnings, Wallboard Cost,
and SG&A or other operational priorities. The Focus Targets will be determined by March 31, 2015. The award adjustment factor
for this segment will range from 0.5 (after achieving a minimum threshold performance level) to 2.0 for maximum attainment.
The weighting on any individual Focus Target generally will be in 5% increments and not be less than 10%.The weighting of all
assigned Focus Targets will equal 50% of the individuals total par.

PAYOUT CRITERIA
No awards will be paid under this Program unless the Corporations annual adjusted operating profit for 2015 is positive as
calculated net of all expenses associated with all incentive programs. Positive annual adjusted operating profit is defined as
calendar year gross profit less overhead expenses and before other special items that are included within operating profit/loss as
reflected on the consolidated statement of operations. Special items include litigation settlement income/expense, restructuring and
long-lived asset impairment charges, goodwill and other intangible asset impairment charges, unusual or non-recurring items, and
changes in accounting principles.
The maximum payment to a participant is two times the participants par value amount. No payments will be made beyond this two
times maximum payment level.

WEIGHTINGS OF PROGRAM ELEMENTS

All Corporate Officer participants in this Program, including the most senior executives, will have the same overall weightings of
50% on Consolidated Net Earnings adjusted for incentive plan purposes and 50% on Focus Targets.

GENERAL PROVISIONS
1.

If the Board, or an appropriate committee thereof, has determined that any fraud
or intentional misconduct by an executive officer was a significant contributing factor to the Corporation having to restate all
or a portion of its financial statement(s), the Board or committee shall take, in its discretion, such action as it deems
necessary to remedy the misconduct and prevent its recurrence. In determining what remedies to pursue, the Board or
committee will take into account all relevant factors, including whether the restatement was the result of fraud or intentional
misconduct. The Board may, to the extent permitted by applicable law, require reimbursement of any award under this
Program paid to the executive officer after January 1, 2015, if and to the extent that a) the amount of the award was
calculated based upon the achievement of certain financial results that were subsequently reduced due to a restatement, b)
the executive officer engaged in any fraud or intentional misconduct that caused or contributed to the need for the
restatement, and c) the amount of the compensation that would have been awarded to the executive officer under this
Program had the financial results been properly reported would have been lower than the amount actually awarded. 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 Corporation. If this paragraph 1 is held invalid, unenforceable or otherwise illegal, the remainder of
this Program shall be deemed to be unenforceable due to a failure of consideration, and the executive officers rights to any
incentive compensation that would otherwise be awarded under this Program shall be forfeited.
In order to be entitled to an award of compensation under this Program, an executive officer must execute a written
acknowledgment that such award shall be subject to the terms and conditions of this paragraph 1.

2.

The Committee reserves the right to adjust award amounts under this Program down based on its assessment of the
Corporations overall performance relative to market conditions, provided, however, in no event may the Committee adjust
an award under this Program upward.

3.

The Committee shall review and approve the awards recommended eligible participants in this Program. The Committee
shall submit to the Board of Directors, for its ratification, a report of the awards for all eligible participants approved by the
Committee in accordance with the provisions of the Program.

4.

The Committee shall have full power to make the rules and regulations with respect to the determination of achievement of
goals and the distribution of awards. No awards will be made until the Committee has certified financial achievements and
applicable awards in writing.

5.

The judgment of the Committee in construing this Program or any provisions thereof, or in making any decision hereunder,
shall be final and conclusive and binding upon all employees of the Corporation and its subsidiaries whether or not selected
as beneficiaries hereunder, and their heirs, executors, personal representatives and assignees.

6.

Nothing herein contained shall limit or affect in any manner or degree the normal and usual powers of management,
exercised by the officers, and the Board of Directors or committees thereof, to change the duties or the character of
employment of any employee of the Corporation or to remove the individual from the employment of the Corporation at any
time, all of which rights and powers are expressly reserved.
The awards made to employees shall become a liability of the Corporation or the appropriate subsidiary as of December 31
of the year earned and all payments to be made hereunder will be

made as soon as practicable, but in any event before two and one half months after December 31 of the year earned, after
said awards have been approved by the Committee.

ADMINISTRATIVE GUIDELINES
1.

Award values will be based on annualized salary in effect on March 1, 2015 for each qualifying participant. Any change in
duties, dimensions or responsibilities of a current position resulting in an increase or decrease in salary range reference
point or market rate will result in a pro-rata incentive award. Respective reference points, target incentive values or goals
will be applied based on the actual number of full months of service at each position.

2.

No award is to be paid to any participant who is not a regular full-time employee, or a part time employee as approved by
the Senior Vice President, Human Resources and Communications, USG Corporation, in good standing at the end of the
calendar year to which the award applies. However, if an eligible participant with three (3) or more months of active service
in the Program year subsequently retires, becomes disabled, dies, is discharged from the employment of the Company
without cause, or is on an approved unpaid leave, the participant (or beneficiary) may be recommended for an award which
would otherwise be payable based on goal achievement, prorated for the actual months of active service during the year.

3.

Employees participating in any other incentive or bonus program of the Corporation or a Subsidiary who are transferred
during the year to a position covered by this Program will be eligible to receive a potential award prorated for actual full
months of service in the two positions with the respective incentive program and target incentive values to apply.

4.

In the event of transfer of an employee from an assignment which does not qualify for participation in any incentive or bonus
plan to a position covered by this Program, the employee is eligible to participate in this Program with any potential award
prorated for the actual months of service in the position covered by this Program during the year. A minimum of three
months of service in the eligible position is required.

5.

Participation during the current Program year for individuals employed from outside the Corporation is possible with any
award to be prorated for actual full months of service in the eligible position. A minimum of three full months of eligible
service is required for award consideration.

6.

Exceptions to established administrative guidelines can only be made by the Committee.

EXHIBIT 10.28

THIRD AMENDMENT
OF
USG CORPORATION DEFERRED COMPENSATION PLAN
(Effective as of April 1, 2007)

WHEREAS, USG Corporation maintains the USG Corporation Deferred Compensation Plan (the "Plan"); and
WHEREAS, amendment of the Plan now is considered desirable;
NOW, THEREFORE, pursuant to the amending power reserved to USG Corporation as the "Company" under Section 9 of
the Plan, as amended, and pursuant to the resolution of the Board of Directors of USG Corporation dated November 13, 2014, the
Plan be and is further amended, effective December 3, 2014, by substituting the following for the third sentence of Section 4.2 of the
Plan:

The investment alternatives shall be determined by the Committee in its discretion, except that the investment alternatives shall
not include a Stock Equivalent Account.

IN WITNESS WHEREOF, the Company has caused these presents to be signed on its behalf by an officer thereunto duly
authorized this 21st day of November, 2014.
USG CORPORATION
By: /s/ Chris Rosenthal
Its : Vice President, Compensation, Benefits
and Corporate Services

EXHIBIT 10.46

USG CORPORATION
MARKET SHARE 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 Wealth Management website on the Date of Grant, a targeted number of Market Share Units
pursuant to the Companys 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;
WHEREAS, Market Share Units constitute Performance Shares as defined in the Plan;
WHEREAS, all terms used in this Market Share Units Agreement (this Agreement) with initial capital letters that are defined
in the Plan and not otherwise defined herein shall have the meanings assigned to them in the Plan; and
WHEREAS, the execution of a Market Share Units Agreement substantially in the form hereof to evidence such grant has
been authorized by a resolution of the Board.
NOW, THEREFORE, the Company and the Grantee agree as follows:
1.

Grant of Market Share Units Right. Subject to the terms of the Plan, the Company hereby grants to the Grantee a targeted
number of Market Share Units set forth on the Morgan Stanley Wealth Management website (the Target Market Share
Units), payment of which depends on the Companys share price performance as set forth in this Agreement.

2.

Earning of Award.
(a)

Performance Measure. The Grantees right to receive all, any portion of, or more than, the Target Market Share Units
will be contingent upon the achievement of specified levels of performance of the Market Value per Share of the
Common Shares, as set forth below, and will be measured over all or a portion of the period (the Performance Period)
from January 1, 20[ ] through the end of the fifteenth day in 20[ ] on which the New York Stock Exchange is open for
trading (the Ratio Calculation Date).

(b)

Calculation of Award. The Grantees right to receive all, any portion of, or more than, the Target Market Share Units
will be contingent upon the achievement of specified levels of performance of the Market Value per Share of the
Common Shares measured (as described below) as of the Ratio Calculation Date. Subject to the other terms of this
Agreement, the Grantee shall earn the percentage, between 0% and 150% of the Target Market Share Units (the
Earned Market Share Unit Percentage) set forth in the table below that corresponds to the ratio (determined to the
nearest one-hundredth) of the Market Value per Share of the Common Shares measured (as described below) as of the
Ratio Calculation Date divided by the Market Value per Share of the Common Shares measured (as described below)
as of

January 1, 20[ ] (the Ratio of Market Value), if the Grantee remains in the continuous employ of the Company or a
Subsidiary through December 31, 20[ ]. For purposes of the preceding sentence, the Market Value per Share of the
Common Shares measured as of January 1, 20[ ] will be the average of the closing prices of the Common Shares on the
New York Stock Exchange for the first fifteen days on which the New York Stock Exchange is open for trading in
January of 20[ ], and the Market Value per Share of the Common Shares measured as of the Ratio Calculation Date
will be the average of the closing prices of the Common Shares on the New York Stock Exchange for the first fifteen
days on which the New York Stock Exchange is open for trading in January of 20[ ].
If The Three-Year Ratio of Market Value Is:
Less than 0.50

Then The Three-Year Earned Market Share Unit

Percentage Is:
0%

Greater than or equal to 0.50 but less than 0.53

50%

Greater than or equal to 0.53 but less than 0.57

53%

Greater than or equal to 0.57 but less than 0.60

56%

Greater than or equal to 0.60 but less than 0.63

58%

Greater than or equal to 0.63 but less than 0.67

61%

Greater than or equal to 0.67 but less than 0.70

64%

Greater than or equal to 0.70 but less than 0.73

67%

Greater than or equal to 0.73 but less than 0.77

69%

Greater than or equal to 0.77 but less than 0.80

72%

Greater than or equal to 0.80 but less than 0.83

75%

Greater than or equal to 0.83 but less than 0.87

78%

Greater than or equal to 0.87 but less than 0.90

81%

Greater than or equal to 0.90 but less than 0.93

83%

Greater than or equal to 0.93 but less than 0.97

86%

Greater than or equal to 0.97 but less than 1.00

89%

Greater than or equal to 1.00 but less than 1.03

92%

Greater than or equal to 1.03 but less than 1.07

94%

Greater than or equal to 1.07 but less than 1.10

97%

Greater than or equal to 1.10 but less than 1.13

100%

Greater than or equal to 1.13 but less than 1.17

104%

Greater than or equal to 1.17 but less than 1.20

108%

Greater than or equal to 1.20 but less than 1.23

113%

Greater than or equal to 1.23 but less than 1.27

117%

Greater than or equal to 1.27 but less than 1.30

121%

Greater than or equal to 1.30 but less than 1.33

125%

Greater than or equal to 1.33 but less than 1.37

129%

Greater than or equal to 1.37 but less than 1.40

133%

Greater than or equal to 1.40 but less than 1.43

138%

Greater than or equal to 1.43 but less than 1.47

142%

Greater than or equal to 1.47 but less than 1.50

146%

Greater than or equal to 1.50

150%

In the event the Ratio of Market Value is between the levels set forth in the left-hand column of the above chart,
the Board shall determine the Earned Market Share Unit Percentage by mathematical straight-line interpolation.
(c)

Board Determination; Forfeiture of Market Share Units on Calculation Date. The Board shall determine the Earned
Market Share Unit Percentage at such time as such determination is required under this Agreement. If, on the Ratio
Calculation Date, the Earned Market Share Unit Percentage is less than 100%, then, subject to Sections 3 and 4,

the number of Market Share Units equal to the Target Market Share Units multiplied by the number of percentage
points by which the Earned Market Share Unit Percentage is less than 100% shall be forfeited.
3.

Effect of Change in Control. Notwithstanding anything to the contrary in this Agreement, the following provisions shall
apply in connection with a Change in Control. Subject to the last sentence of this paragraph: (I) the treatment in connection
with a Change in Control of any Market Share Units that are outstanding at the time of such Change in Control will depend
upon whether the Awards made under this Agreement are Assumed (as defined in Section 3(a)(iii) below) by the entity
effecting the Change in Control; (II) if the entity effecting the Change in Control Assumes the Awards made under this
Agreement, Section 3(a) shall apply; and (III) if the entity effecting the Change in Control does not Assume the Awards made
under this Agreement, then Section 3(b) shall apply. Notwithstanding the preceding sentence, Section 4 shall apply and the
following provisions of this Section shall not apply if the Change in Control occurs after termination of the Grantees
employment due to death, Disability or Retirement.
(a)

Awards Assumed by Successor: If the awards made under this Agreement that are outstanding at the time of a Change
in Control are Assumed by the entity effecting the Change in Control, the number of Market Share Units that may
become payable to the Grantee shall be determined pursuant to Section 3(a)(i) below, and the circumstances in which
the Grantee shall earn such number of Market Share Units are described in Section 3(a)(ii) below. Section 3(a)(iii)
contains defined terms for the purposes of this Agreement.
(i)

Upon the occurrence of a Change in Control prior to the Ratio Calculation Date, the number of Market Share
Units that may become payable to the Grantee (the CIC Market Share Units) shall equal the number of Target
Market Share Units that are outstanding at the time of the Change in Control multiplied by the Market Share
Unit Percentage, determined pursuant to Section 2(b) above, but substituting the CIC Date for the Ratio
Calculation Date and using the value ascribed to the Common Shares in the Change in Control as the Market
Value per Share as of the CIC Date. If the calculation pursuant to this Section 3(a)(i) results in a Market Share
Unit Percentage of less than 100%, then the number of Target Market Share Units multiplied by the number of
percentage points by which the Market Share Unit Percentage is less than 100% shall be forfeited.

(ii)

The CIC Market Share Units shall be earned by the Grantee if the Grantee remains employed through
December 31, 20[ ]. Unless clause (A), (B), or (C) below applies, all of the CIC Market Share Units that are
outstanding at the time of the Grantees termination of employment prior to December 31, 20[ ] shall be
forfeited. Notwithstanding the preceding sentence, any CIC Market Share Units that have not been earned by
the Grantee shall be earned on the first to occur of the following events between the CIC Date and December
31, 20[ ]:
(A)

the involuntary termination of the Grantees employment for reasons other than Cause (as defined in
Section 3(a)(iii) below);

(B)

the Grantees voluntary termination of employment for Good Reason (as defined in Section 3(a)(iii)
below); or

(C)
(iii)

the termination of the Grantees employment due to the Grantees death, Disability or Retirement (as
such terms are defined in Section 3(a)(iii) below).

Solely for the purposes of this Agreement, the following terms shall be defined as follows:
(A)

A Market Share Unit award shall be considered Assumed in connection with a Change in Control if
each of the following conditions is met:
(1)

the Market Share Unit award is converted into a replacement award that preserves the value of
such award at the time of the Change in Control;

(2)

the replacement award contains provisions for scheduled vesting and treatment on termination of
employment (including the definitions of Cause and Good Reason) that are no less favorable to
the Grantee than as set forth in this Section 3(a), and all other terms of the replacement award
(other than the security and number of shares represented by the replacement awards) are
substantially similar to, or more favorable to the Grantee than, those set forth in this Agreement;
and

(3)

the security represented by the replacement award, if any, is of a class that is publicly held and
widely traded on an established stock exchange.

(B)

Base Pay means Grantees annual base salary rate as in effect from time to time.

(C)

Cause shall mean that the Grantee shall have:

(1)

been convicted of a criminal violation involving fraud, embezzlement or theft in connection with
the Grantees duties or in the course of the Grantees employment with the Company or any
Subsidiary;

(2)

committed intentional wrongful damage to tangible or intangible property of the Company or

any Subsidiary; or

(3)

committed intentional wrongful disclosure of secret processes or confidential information of the

Company or any Subsidiary.

For purposes of this Agreement, no act or failure to act on the part of the Grantee will be deemed
intentional if it was due primarily to an error in judgment or negligence, but will be deemed
intentional only if done or omitted to be done by the Grantee not in good faith and without reasonable
belief that the Grantees action or omission was in the best interest of the Company. Notwithstanding the
foregoing, the Grantee will not be deemed

to have been terminated for Cause hereunder unless and until there shall have been delivered to the
Grantee a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the
Board then in office (excluding the Grantee if the Grantee is then a member of the Board) at a meeting
of the Board called and held for such purpose, after reasonable notice to the Grantee and an opportunity
for the Grantee, together with the Grantees counsel (if the Grantee chooses to have counsel present at
such meeting), to be heard before the Board, finding that, in the good faith opinion of the Board, the
Grantee had committed an act constituting Cause as herein defined and specifying the particulars
thereof in reasonable detail. Nothing herein will limit the right of the Grantee or the Grantees
beneficiaries to contest the validity or propriety of any such determination.
(D)

Disability shall mean that the Grantee has suffered a total disability within the meaning of the
Companys Long Term Disability Plan for Salaried Employees and is disabled within the meaning of
Section 409A(a)(2)(C) of the Code.

(E)

Good Reason shall mean the occurrence of any of the following events, and the failure of the
Company to remedy any of the following events within 10 calendar days after receipt by the Company
of written notice thereof from the Grantee:
(1)

a material diminution in the Grantees normal duties and responsibilities, including, but not
limited to, the assignment without the Grantees written consent of any diminished duties and
responsibilities which are inconsistent with the Grantees positions, duties and responsibilities
with the Company immediately prior to a Change in Control, or a materially adverse change in
the Grantees reporting responsibilities or titles as in effect immediately prior to the Change in
Control, whether or not resulting from an act of the Company or otherwise, or any removal of
the Grantee from or any failure to re-elect the Grantee to any of such positions, except in
connection with the termination of the Grantees employment for Disability, Retirement, or
Cause or as a result of the Grantees death or by the Grantee other than for Good Reason;

(2)

if the Grantee was serving as a member of the Board immediately prior to the Change in Control,
either (A) the failure to elect or the removal of the Grantee as a member of the Board of the
Company (or any successor thereto) or (B) if the Grantee continues to serve as a member of the
Board of the Company (or any successor thereto) following the Change in Control, the
Companys securities are no longer publicly traded; provided, however, that Good Reason shall
not exist if the Grantee becomes a member of the board of directors of a publicly-traded entity
that as a result of the Change in Control owns the Company or substantially all of the
Companys assets either directly or through one or more subsidiaries;

(F)

(3)

a reduction by the Company in the Grantees Base Pay as in effect on the Date of Grant or as the
same may be increased from time to time;

(4)

a change in the Grantees Target Annual Direct Compensation that results in an aggregate
decrease in such Target Annual Direct Compensation in excess of ten percent (10%);

(5)

the Companys requiring the Grantee, without the Grantees written consent, to be based
anywhere other than within fifty (50) miles of the Grantees office location immediately prior to
the Change in Control, except for required travel on the Companys business to an extent
substantially consistent with business travel obligations immediately prior to the Change in
Control;

(6)

the failure by the Company to continue in effect any investment plan, retirement plan, savings
plan, supplemental retirement plan, deferred compensation plan, supplemental investment plan,
life insurance plan, health and accident plan, disability plan or other welfare benefit plan in
which the Grantee was participating at the time of the Change in Control (or plans providing the
Grantee with substantially similar benefits), the taking of any action by the Company which
would adversely affect the Grantees participation or materially reduce the Grantees benefits or
value under any of such plans or deprive the Grantee of any material fringe benefit enjoyed by
the Grantee at the time of the Change in Control, or the failure by the Company to provide the
Grantee with the number of paid vacation days to which the Grantee was then entitled in
accordance with the Companys normal vacation policy in effect on the date of the Change in
Control; or

(7)

the failure by the Company to obtain the assumption of the obligation to perform any Change in
Control Severance Agreement between the Company and Grantee by any successor as
contemplated in such Change in Control Severance Agreement.

Retirement shall mean the Grantees retirement under a retirement plan (including, without limitation,
any supplemental retirement plan) of the Company or any Subsidiary, or the Grantees retirement from
employment with the Company or any Subsidiary after completing at least three years of continuous
service with the Company or any Subsidiary and attaining the age of 62. Without limiting the generality
of the foregoing, in no event shall Retirement include the involuntary termination of the Grantees
employment by the Company (i) for Cause or (ii) without Cause if, as a result of such termination
without Cause, the Grantee becomes eligible to receive payments on account of such termination under
an employment agreement between the Grantee and the Company.

(G)

(b)

4.

Target Annual Direct Compensation means the sum of the Grantees Base Pay, target annual
incentive opportunity, and the annualized value of the most recent long-term incentive award approved
by the Compensation and Organization Committee of the Board prior to the Change in Control. For
purposes of measuring annualized long-term incentives, the awards shall be measured on their date of
grant using reasonable assumptions, including, but not limited to, fair value principles such as those
identified in Financial Accounting Standards Board Accounting Standards Codification Topic 718; the
value of such awards shall be annualized over the frequency of their grant.

Awards Not Assumed by Successor. Upon the occurrence of a Change in Control, any unearned Market Share Unit
awards outstanding at the time of the Change in Control that are not Assumed by the entity effecting the Change in
Control shall immediately become earned in such amount as shall be determined in accordance with the terms outlined
in Section 3(a)(i) above. Any Target Market Share Units that are not Assumed and that are not earned on the CIC Date
pursuant to this Section 3(b) shall be forfeited.

Termination Due to Death, Disability, Retirement. If the Grantees employment with the Company or a Subsidiary
terminates before December 31, 20[ ] and before the occurrence of a Change in Control, due to the Grantees death, Disability
or Retirement, the Grantee shall earn, and the Company shall pay to the Grantee or his or her executor or administrator, as the
case may be, at the time described in Section 6 a number of the Market Share Units that remain outstanding at the time of such
death, Disability or Retirement calculated as follows:
(a)

If the Grantees employment terminates during 20[ ] due to the Grantees death, Disability or Retirement, the Grantee
shall earn a pro rata number (based on the number of full months during 20[ ] that preceded the date of the Grantees
termination of employment due to the Grantees death, Disability or Retirement, divided by twelve months) of the
Market Share Units that remain outstanding at the time of such termination of employment due to the Grantees death,
Disability or Retirement and that are determined to be payable to the Grantee on the Ratio Calculation Date pursuant to
Section 2(b) above on the basis of the achievement of levels of performance of the Market Value per Share of the
Common Shares. Notwithstanding the foregoing, if a Change in Control occurs after the termination of the Grantees
employment due to death, Disability or Retirement but before the end of the Performance Period, the Grantee shall earn
at the time of such Change in Control the pro rata number (determined as specified above) of such number of the thenoutstanding Target Market Share Units as shall be determined in accordance with Section 3(a)(i), and any Target
Market Share Units that are not earned on the CIC Date pursuant to this sentence shall be forfeited.

(b)

If the Grantees employment terminates on or after January 1, 20[ ] and before December 31, 20[ ] due to the Grantees
death, Disability or Retirement, the Grantee shall earn the Market Share Units that remain outstanding at the time of
such termination of employment due to the Grantees death, Disability or Retirement and that are determined to be
payable to the Grantee on the Ratio Calculation Date pursuant to Section 2(b) above on the basis of the achievement of
levels of performance of the Market Value per Share of the Common Shares. Notwithstanding the foregoing, if a
Change in Control occurs after the termination of the Grantees employment due to death, Disability or Retirement but
before the end of

the Performance Period, the Grantee shall earn at the time of such Change in Control the number of the thenoutstanding Target Market Share Units as shall be determined in accordance with Section 3(a)(i), and any Target
Market Share Units that are not earned on the CIC Date pursuant to this sentence shall be forfeited.
5.

Forfeiture. In addition to forfeiture of the Market Share Units pursuant to other provisions of this Agreement, if either (i) the
Grantees employment with the Company or a Subsidiary terminates before December 31, 20[ ] and before the occurrence of a
Change of Control, for any reason other than as set forth in Section 4 hereof or (ii) the Board (or a committee of the Board)
finds that the Grantee has engaged in any fraud or intentional misconduct as described in Section 20 hereof, all Market Share
Units outstanding at such time will be forfeited. Market Share Units shall be considered to have been forfeited upon the event
that causes such forfeiture and shall not be considered to be outstanding thereafter.

6.

Form and Time of Payment of Market Share Units. Payment of any Market Share Units that become earned as set forth
herein will be made in the form of Common Shares. Except as otherwise provided in Section 3 above, payment will be made as
soon as practicable after the end of the Performance Period or any earlier event that causes Market Share Units to be earned,
but, subject to Section 10 below, in no event shall such payment occur later than the end of the second month following the
month in which the applicable Performance Period ends or such earlier event occurs. Upon and after payment of any Market
Share Units pursuant to this Section 6, such Market Share Units shall not be considered to be outstanding. Notwithstanding the
foregoing, if the event that causes the Market Share Units to be earned is a Change in Control that does not constitute a change
of control for purposes of Section 409A of the Code, then to the extent necessary to comply with Section 409A of the Code,
payment will be made on the next date or event under the Agreement that constitutes a permissible payment date or event under
Code Section 409A. To the extent that the Company or any Subsidiary is required to withhold any federal, state, local or
foreign tax in connection with the payment of earned Market Share Units pursuant to this Agreement, it shall be a condition to
the receipt of such Market Share Units that the Grantee make arrangements satisfactory to the Company or such Subsidiary for
payment of such taxes required to be withheld, which may include by having the Company withhold Common Shares
otherwise payable pursuant to this award.

7.

Payment of Dividends. No dividends shall be accrued or earned with respect to the Market Share Units until such Market
Share Units are earned by the Grantee and Common Shares delivered to the Grantee as provided in this Agreement.

8.

Market Share Units Nontransferable. Until payment is made to the Grantee as provided herein, neither the Market Share
Units 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 shall adjust the number of
Market Share Units 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 Grantees rights under this Agreement such alternative consideration as it may determine to
be equitable in the circumstances, subject to the provisions of Section 3 of this Agreement.
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. If the event triggering the right to payment under this Agreement is the Grantees Retirement or
other separation from service with the Company and its Subsidiaries within the meaning of Section 409A(a)(2)(A)(i) of the
Code and 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 payment under Section 6 above shall be the first day of the seventh month after the
date of the Grantees separation from service or, if earlier, the date of the Grantees death.

11.

No Right to Future Grants; No Right of Employment; Extraordinary Item. In accepting the grant, the 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 Agreement; (b) the grant of the Market
Share Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Market
Share Units or benefits in lieu of Market Share Units, even if Market Share Units 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) the Grantees participation in
the Plan is voluntary; (e) the Market Share Units 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 the
Grantees employment contract, if any; (f) the Market Share Units are not 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 the 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 the Grantees employer; (h) the future value of the underlying Common 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 Market Share Units or diminution in value of the Market Share Units or the Common Shares and the 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 the involuntary termination of the Grantees employment, the
Grantees right to receive Market Share Units and vest in Market Share Units under the Plan, if any, will terminate effective as
of the date that the 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 the involuntary termination of employment, the Grantees right to vest in the Market Share Units
after termination of employment, if any, will be measured

by the date of termination of the Grantees active employment and will not be extended by any notice period mandated under
local law.
12.

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 Grantees employment among the Company and
its Subsidiaries or (b) an approved leave of absence.

13.

Employee Data Privacy. The Grantee hereby explicitly and unambiguously consents to the collection, use and transfer, in
electronic or other form, of the Grantees 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 the Grantees participation in the Plan. The Grantee understands that the Company Group holds certain personal
information about the Grantee, including, but not limited to, the Grantees 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 Market Share Units or any other entitlement to shares of stock awarded, canceled, exercised,
vested, unvested or outstanding in the Grantees favor, for the purpose of implementing, administering and managing the Plan
(Data). The 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 the Grantees country or elsewhere, and that
the recipients country may have different data privacy laws and protections than the Grantees country. The Grantee
understands that the Grantee may request a list with the names and addresses of any potential recipients of the Data by
contacting the Grantees local human resources representative. The 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 the
Grantees participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third
party with whom the Grantee may elect to deposit any Common Shares acquired. The Grantee understands that Data will be
held only as long as is necessary to implement, administer and manage the Grantees participation in the Plan. The Grantee
understands that the 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 consents herein, in any case without cost, by
contacting in writing the Grantees local human resources representative. The Grantee understands, however, that refusing or
withdrawing the Grantees consent may affect the Grantees ability to participate in the Plan. For more information on the
consequences of the Grantees refusal to consent or withdrawal of consent, the Grantee understands that the Grantee may
contact the Grantees local human resources representative.

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 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 Market Share Units.

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 Grantees 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.

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.

Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the Market Share Units and
the Grantees participation in the Plan, or future awards that may be granted under the Plan, by electronic means or request the
Grantees consent to participate in the Plan by electronic means. The Grantee hereby consents to receive such documents by
electronic delivery and the Grantee acknowledges that by clicking on the Accept button on the Morgan Stanley Wealth
Management web page titled Step 3: Confirm the Review/Acceptance of your Award, the Grantee agrees to be bound by the
electronic execution of this Agreement.

20.

Clawback. 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
Market Share Units and/or Common Shares that the Grantee has not disposed of that were paid out pursuant to this Agreement;
and (b) with respect to any Market Share Units and/or 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 Market Share Units on the date such Market Share
Units 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 Grantees rights to the Market Share Units and/or
Common Shares that would otherwise be granted or paid under this Agreement shall be forfeited.

Executed in the name and on behalf of the Company at Chicago, Illinois as of

the [ ] day of [ ], 20[ ].

USG CORPORATION

Name: Brian J. Cook

Title: Senior Vice President,
Human Resources and Corporate
Communications

The undersigned Grantee hereby accepts the award of Market Share Units evidenced by this Market Share Unit Agreement on
the terms and conditions set forth herein and in the Plan.

Name:

PLEASE PRINT AND KEEP A COPY FOR YOUR RECORDS.

EXHIBIT 10.47

USG CORPORATION
PERFORMANCE SHARES 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 Wealth Management website on the Date of Grant, the number of Performance Shares (as defined
in the Plan) pursuant to the Companys 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;
WHEREAS, Exhibit A to this Performance Shares Agreement (this Agreement) contains defined terms that are used in this
Agreement with initial capital letters, and other terms are defined in this Agreement for further use herein with initial capital letters; and
WHEREAS, the execution of a Performance Shares Agreement substantially in the form hereof to evidence such grant has
been authorized by a resolution of the Board.
NOW, THEREFORE, the Company and the Grantee agree as follows:
1.

Grant of Performance Share Right. Subject to the terms of the Plan, the Company hereby grants to the Grantee a targeted
number of Performance Shares (the Target Performance Shares), payment of which depends on the Companys performance
as set forth in this Agreement and in the Statement of Performance Goals (the Statement of Performance Goals) approved by
the Board.

2.

Earning of Award.
(a) Performance Measure. The Grantees right to receive all, any portion of, or more than, the Target Performance
Shares will be contingent upon the achievement of specified levels of performance of the Companys total stockholder return
(including reinvestment of dividends) relative to the performance of the Dow Jones U.S. Construction and Materials Index
(Total Stockholder Return), as set forth in the Statement of Performance Goals and will be measured over the period from
January 1, 20[ ] through the end of the fifteenth day in 20[ ] on which the New York Stock Exchange is open for trading (the
Performance Period).
(b) Below Threshold. If, upon the conclusion of the Performance Period, Total Stockholder Return for the
Performance Period falls below the threshold level, as set forth in the Performance Matrix contained in the Statement of
Performance Goals, no Performance Shares for the Performance Period shall become earned.
(c) Threshold. If, upon the conclusion of the Performance Period, Total Stockholder Return for the Performance
Period equals the threshold level, as set forth in the Performance Matrix contained in the Statement of Performance Goals, 35%
of the Target Performance Shares for the Performance Period shall become earned.

(d) Between Threshold and Target. If, upon the conclusion of the Performance Period, Total Stockholder Return
exceeds the threshold level, but is less than the target level, as set forth in the Performance Matrix contained in the Statement of
Performance Goals, the Target Performance Shares shall become earned based on performance during the Performance Period,
as determined by mathematical straight-line interpolation between 35% of the Target Performance Shares and 100% of the
Target Performance Shares.
(e) Target. If, upon the conclusion of the Performance Period, Total Stockholder Return for the Performance Period
equals the target level, as set forth in the Performance Matrix contained in the Statement of Performance Goals, 100% of the
Target Performance Shares for the Performance Period shall become earned.
(f) Between Target and Intermediate. If, upon the conclusion of the Performance Period, Total Stockholder Return
exceeds the target level, but is less than the intermediate level, as set forth in the Performance Matrix contained in the Statement
of Performance Goals the Target Performance Shares shall become earned based on performance during the Performance
Period, as determined by mathematical straight-line interpolation between 100% of the Target Performance Shares and 150% of
the Target Performance Shares.
(g) Intermediate. If, upon the conclusion of the Performance Period, Total Stockholder Return for the Performance
Period equals the intermediate level, as set forth in the Performance Matrix contained in the Statement of Performance Goals,
150% of the Target Performance Shares for the Performance Period shall become earned.
(h) Between Intermediate and Maximum. If, upon the conclusion of the Performance Period, Total Stockholder
Return exceeds the intermediate level, but is less than the maximum level, as set forth in the Performance Matrix contained in
the Statement of Performance Goals the Target Performance Shares shall become earned based on performance during the
Performance Period, as determined by mathematical straight-line interpolation between 150% of the Target Performance Shares
and 200% of the Target Performance Shares.
(i) Equals or Exceeds Maximum. If, upon the conclusion of the Performance Period, Total Stockholder Return for the
Performance Period equals or exceeds the maximum level, as set forth in the Performance Matrix contained in the Statement of
Performance Goals, 200% of the Target Performance Shares shall become earned.
(j) Conditions; Determination of Earned Award. Except as otherwise provided herein, the Grantees right to receive
any Performance Shares is contingent upon his or her remaining in the continuous employ of the Company or a Subsidiary
through December 31, 20[ ]. Following the Performance Period, the Board shall determine whether and to what extent the
goals relating to Total Stockholder Return have been satisfied for the Performance Period and shall determine the number of
Performance Shares that shall have become earned hereunder.
3.

Effect of Change in Control. Notwithstanding anything to the contrary in this Agreement, the following provisions shall
apply in connection with a Change in Control. Subject to the last sentence of this paragraph: (I) the treatment in connection
with a Change in Control of any Performance Shares that are outstanding at the time of such Change in Control will depend
upon whether the Awards made under this Agreement are Assumed (as defined in Exhibit A to this

Agreement) by the entity effecting the Change in Control; (II) if the entity effecting the Change in Control Assumes the
Awards made under this Agreement, Section 3(a) shall apply; and (III) if the entity effecting the Change in Control does not
Assume the Awards made under this Agreement, then Section 3(b) shall apply. Notwithstanding the preceding sentence,
Section 4 shall apply and the following provisions of this Section shall not apply if the Change in Control occurs after
termination of the Grantees employment due to death, Disability or Retirement.
(a)

Awards Assumed by Successor: If the awards made under this Agreement that are outstanding at the time of a Change
in Control are Assumed by the entity effecting the Change in Control, the number of Performance Shares that may
become payable to the Grantee shall be determined pursuant to Section 3(a)(i) below, and the circumstances in which
the Grantee shall earn such number of Performance Shares are described in Section 3(a)(ii) below. Exhibit A to this
Agreement contains defined terms for the purposes of this Agreement.
(i)

(ii)

Upon the occurrence of a Change in Control, the number of Performance Shares that may become payable to
the Grantee (the CIC Performance Shares) shall be determined pursuant to Section 2 above, except that for
the purposes of such calculation:
(A)

the date on which the Change in Control occurs (the CIC Date) shall be substituted for the last day of
the Performance Period in both Section 2 above and in the Statement of Performance Goals;

(B)

the Performance Period shall be the period from January 1, 20[ ] through the CIC Date;

(C)

the value ascribed to the Common Shares in the Change in Control shall be used as the ending Stock
Price of the Common Shares for purposes of paragraph 3(c) of the Statement of Performance Goals; and

(D)

the average closing prices of the shares of the Peers shall be calculated using the 20 trading days ending
on the trading day preceding the CIC Date for purposes of Section 3(c) of the Statement of Performance
Goals.

The CIC Performance Shares shall become earned by the Grantee if the Grantee remains employed through
December 31, 20[ ]. Unless clause (A), (B) or (C) below applies, all of the CIC Performance Shares that are
outstanding at the time of the Grantees termination of employment prior to December 31, 20[ ] shall be
forfeited. Notwithstanding the preceding sentence, any CIC Performance Shares that have not been earned by
the Grantee pursuant to this Section 3(a)(ii) shall be earned on the first to occur of the following events between
the CIC Date and December 31, 20[ ]:
(A)

the involuntary termination of the Grantees employment for reasons other than Cause (as defined in
Exhibit A);

(B)

the Grantees voluntary termination of employment for Good Reason (as defined in Exhibit A); or

(C)
(b)

the termination of the Grantees employment due to the Grantees death, Disability or Retirement (as
such terms are defined in Exhibit A).

Awards Not Assumed by Successor. Upon the occurrence of a Change in Control, any unearned Performance Shares
outstanding at the time of the Change in Control that are not Assumed by the entity effecting the Change in Control
shall immediately become earned in such amount as shall be determined in accordance with the terms outlined in
Section 3(a)(i) above. Any Target Performance Shares that are not Assumed and that are not earned on the CIC Date
pursuant to this Section 3(b) shall be forfeited.

4.

Termination Due to Death, Disability, Retirement. If the Grantees employment with the Company or a Subsidiary
terminates before December 31, 20[ ] and before the occurrence of a Change in Control due to the Grantees death, Disability
or Retirement, the Company shall pay to the Grantee or his or her executor or administrator, as the case may be, at the time
described in Section 6 and based on the level of achievement of Total Stockholder Return during the Performance Period, a pro
rata number of the Target Performance Shares based on the number of full months during the Performance Period and prior to
January 1, 20[ ] during which the Grantee was employed by the Company, and the remaining performance shares will be
forfeited. Notwithstanding the foregoing, if a Change in Control occurs after the termination of the Grantees employment due
to death, Disability or Retirement but before the end of the Performance Period, the Grantee shall earn at the time of such
Change in Control the pro rata number (determined as specified above) of such number of the Performance Shares as shall be
determined in accordance with Section 3(a)(i), and any Performance Shares that are not earned on the CIC Date pursuant to
this sentence shall be forfeited.

5.

Forfeiture. In addition to the forfeiture of Performance Shares pursuant to other provisions of this Agreement, if either (i) the
Grantees employment with the Company or a Subsidiary terminates before December 31, 20[ ], and before the occurrence of a
Change in Control, for any reason other than as set forth in Section 4 hereof or (ii) the Board (or a committee of the Board)
finds that the Grantee has engaged in any fraud or intentional misconduct as described in Section 20 hereof, the Performance
Shares will be forfeited. Performance Shares shall be considered to have been forfeited upon the event that causes such
forfeiture and shall not be considered to be outstanding thereafter.

6.

Form and Time of Payment of Performance Shares. Payment of any Performance Shares that become earned as set forth
herein will be made in the form of Common Shares. Except as otherwise provided in Section 3, payment will be made as soon
as practicable after the end of the Performance Period, or any earlier event that causes the Performance Shares to be earned, and
the determination by the Board of the level of attainment of Total Stockholder Return, but, subject to Section 10 below, in no
event shall such payment occur later than two and one-half months after the end of the Performance Period or such earlier event
occurs. Upon and after payment of any Performance Shares pursuant to this Section 6, such Performance Shares shall not be
considered to be outstanding. Notwithstanding the foregoing, if the event that causes the Performance Shares to be earned is a
Change in Control that does not constitute a change of control for purposes of Section 409A of the Code, then to the extent
necessary to comply with Section 409A of the Code, payment will be made on the next date or event under the Agreement that
constitutes a permissible payment date or event under Code Section 409A. To the extent that the Company or any Subsidiary is
required to withhold any federal, state, local or foreign tax in connection with the

payment of earned Performance Shares pursuant to this Agreement, it shall be a condition to the receipt of such Performance
Shares that the Grantee make arrangements satisfactory to the Company or such Subsidiary for payment of such taxes required
to be withheld, which may include by having the Company withhold Common Shares otherwise payable pursuant to this
award.
7.

Payment of Dividends. No dividends shall be accrued or earned with respect to the Performance Shares until such
Performance Shares are earned by the Grantee as provided in this Agreement.

8.

Performance Shares Nontransferable. Until payment is made to the Grantee as provided herein, neither the Performance
Shares 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 shall adjust the number of
Performance Shares 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 Grantees rights under this Agreement such
alternative consideration as it may determine to be equitable in the circumstances, subject to the provisions of Section 3 of this
Agreement.

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. If the event triggering the right to payment under this Agreement is the Grantees Retirement or
other separation from service with the Company and its Subsidiaries within the meaning of Section 409A(a)(2)(A)(i) of the
Code and 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 payment under Section 6 above shall be the first day of the seventh month after the
date of the Grantees separation from service or, if earlier, the date of the Grantees death.

11.

No Right to Future Grants; No Right of Employment; Extraordinary Item. In accepting the grant, the 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 Agreement; (b) the grant of the
Performance Shares is voluntary and occasional and does not create any contractual or other right to receive future grants of
Performance Shares or benefits in lieu of Performance Shares, even if Performance Shares 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) the Grantees
participation in the Plan is voluntary; (e) the

Performance Shares 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 the Grantees employment
contract, if any; (f) the Performance Shares are not 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 the 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 the Grantees employer; (h) the future value of the underlying Common 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 Performance Shares or diminution in value of the Performance Shares or the Common Shares and the 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 the involuntary termination of the Grantees
employment, the Grantees right to receive Performance Shares and vest in Performance Shares under the Plan, if any, will
terminate effective as of the date that the 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 the involuntary termination of employment, the Grantees right to vest in the
Performance Shares after termination of employment, if any, will be measured by the date of termination of the Grantees active
employment and will not be extended by any notice period mandated under local law.
12.

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 Grantees employment among the Company and
its Subsidiaries or (b) an approved leave of absence.

13.

Employee Data Privacy. The Grantee hereby explicitly and unambiguously consents to the collection, use and transfer, in
electronic or other form, of the Grantees 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 the Grantees participation in the Plan. The Grantee understands that the Company Group holds certain personal
information about the Grantee, including, but not limited to, the Grantees 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 Performance Shares or any other entitlement to shares of stock awarded, canceled,
exercised, vested, unvested or outstanding in the Grantees favor, for the purpose of implementing, administering and managing
the Plan (Data). The 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 the Grantees country or elsewhere, and that
the recipients country may have different data privacy laws and protections than the Grantees country. The Grantee
understands that the Grantee may request a list with the names and addresses of any potential recipients of the Data by
contacting the Grantees local human resources representative. The 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 the
Grantees participation in the Plan, including any requisite transfer of such Data as

may be required to a broker or other third party with whom the Grantee may elect to deposit any Common Shares acquired.
The Grantee understands that Data will be held only as long as is necessary to implement, administer and manage the Grantees
participation in the Plan. The Grantee understands that the 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 consents herein,
in any case without cost, by contacting in writing the Grantees local human resources representative. The Grantee understands,
however, that refusing or withdrawing the Grantees consent may affect the Grantees ability to participate in the Plan. For
more information on the consequences of the Grantees refusal to consent or withdrawal of consent, the Grantee understands
that the Grantee may contact the Grantees local human resources representative.
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 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 Performance Shares.

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 Grantees 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.

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.

Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the Performance Shares and
the Grantees participation in the Plan, or future awards that may be granted under the Plan, by electronic means or request the
Grantees consent to participate in the Plan by electronic means. The Grantee hereby consents to receive such documents by
electronic delivery and the Grantee acknowledges that by clicking on the Accept button on the Morgan Stanley Wealth
Management web page titled Step 3: Confirm the Review/Acceptance of your Award, the Grantee agrees to be bound by the
electronic execution of this Agreement.

20.

Clawback. 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
Performance Shares and/or Common Shares that the Grantee has not disposed of that were paid out pursuant to this
Agreement; and (b) with respect to any Performance Shares and/or 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 Performance Shares on the date such
Performance 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 Grantees rights to the Performance
Shares and/or Common Shares that would otherwise be granted or paid under this Agreement shall be forfeited.

Executed in the name and on behalf of the Company at Chicago, Illinois as of

the [ ] day of [ ], 20[ ].

USG CORPORATION

Name: Brian J. Cook

Title: Senior Vice President,
Human Resources and Corporate
Communications

The undersigned Grantee hereby accepts the award of Performance Shares evidenced by this Performance Shares Agreement
on the terms and conditions set forth herein and in the Plan.

Name:

PLEASE PRINT AND KEEP A COPY FOR YOUR RECORDS.

EXHIBIT A TO
USG CORPORATION
PERFORMANCE SHARES AGREEMENT
This Exhibit A is attached to and forms a part of the USG Corporation Performance Shares Agreement, dated as of [ ].
Solely for the purposes of this Agreement, the following terms shall be defined as follows:
(A)

An award of Performance Shares shall be considered Assumed in connection with a Change in Control if each of the
following conditions is met:
(1)

The award of Performance Shares is converted into a replacement award that preserves the value of such award
at the time of the Change in Control;

(2)

the replacement award contains provisions for scheduled vesting and treatment on termination of employment
(including the definitions of Cause and Good Reason) that are no less favorable to the Grantee than as set forth
in this Agreement, and all other terms of the replacement award (other than the security and number of shares
represented by the replacement awards) are substantially similar to, or more favorable to the Grantee than, those
set forth in this Agreement; and

(3)

the security represented by the replacement award, if any, is of a class that is publicly held and widely traded on
an established stock exchange.

(B)

Base Pay means the Grantees annual base salary rate as in effect from time to time.

(C)

Cause shall mean that the Grantee shall have:

(1)

been convicted of a criminal violation involving fraud, embezzlement or theft in connection with the Grantees
duties or in the course of the Grantees employment with the Company or any Subsidiary;

(2)

committed intentional wrongful damage to tangible or intangible property of the Company or any Subsidiary; or

(3)

committed intentional wrongful disclosure of secret processes or confidential information of the Company or
any Subsidiary.
For purposes of this Agreement, no act or failure to act on the part of the Grantee will be deemed
intentional if it was due primarily to an error in judgment or negligence, but will be deemed intentional only
if done or omitted to be done by the Grantee not in good faith and without reasonable belief that the Grantees
action or omission was in the best interest of the Company. Notwithstanding the foregoing, the Grantee will not
be deemed to have been terminated for Cause hereunder unless and until there shall have been delivered to
the Grantee a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the Board
then in office (excluding the Grantee if the Grantee is then a member of the Board) at a meeting of the Board
called and held for such purpose, after reasonable notice to the Grantee and an opportunity for the Grantee,
together with the Grantees counsel (if the Grantee chooses to have counsel present at such meeting), to be
heard before the Board, finding that, in the good faith opinion of the Board, the Grantee had committed an act
constituting Cause as herein defined and specifying the particulars thereof in reasonable detail. Nothing herein
will limit the right of the Grantee or the Grantees beneficiaries to contest the validity or propriety of any such
determination.

(D)

Disability shall mean that the Grantee has suffered a total disability within the meaning of the Companys Long Term
Disability Plan for Salaried Employees and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.

(E)

Good Reason shall mean the occurrence of any of the following events, and the failure of the Company to remedy
any of the following events within 10 calendar days after receipt by the Company of written notice thereof from the
Grantee:
(1)

a material diminution in the Grantees normal duties and responsibilities, including, but not limited to, the
assignment without the Grantees written consent of any diminished duties and responsibilities which are
inconsistent with the Grantees positions, duties and responsibilities with the Company immediately prior to a
Change in Control, or a materially adverse change in the Grantees reporting responsibilities or titles as in effect
immediately prior to the Change in Control, whether or not resulting from an act of the Company or otherwise,
or any removal

of the Grantee from or any failure to re-elect the Grantee to any of such positions, except in connection with the
termination of the Grantees employment for Disability, Retirement, or Cause or as a result of the Grantees
death or by the Grantee other than for Good Reason;

(F)

(2)

if the Grantee was serving as a member of the Board immediately prior to the Change in Control, either (A) the
failure to elect or the removal of the Grantee as a member of the Board of the Company (or any successor
thereto) or (B) if the Grantee continues to serve as a member of the Board of the Company (or any successor
thereto) following the Change in Control, the Companys securities are no longer publicly traded; provided,
however, that Good Reason shall not exist if the Grantee becomes a member of the board of directors of a
publicly-traded entity that as a result of the Change in Control owns the Company or substantially all of the
Companys assets either directly or through one or more subsidiaries;

(3)

a reduction by the Company in the Grantees Base Pay as in effect on the Date of Grant or as the same may be
increased from time to time;

(4)

a change in the Grantees Target Annual Direct Compensation that results in an aggregate decrease in such
Target Annual Direct Compensation in excess of ten percent (10%);

(5)

the Companys requiring the Grantee, without the Grantees written consent, to be based anywhere other than
within fifty (50) miles of the Grantees office location immediately prior to the Change in Control, except for
required travel on the Companys business to an extent substantially consistent with business travel obligations
immediately prior to the Change in Control;

(6)

the failure by the Company to continue in effect any investment plan, retirement plan, savings plan,
supplemental retirement plan, deferred compensation plan, supplemental investment plan, life insurance plan,
health and accident plan, disability plan or other welfare benefit plan in which the Grantee was participating at
the time of the Change in Control (or plans providing the Grantee with substantially similar benefits), the taking
of any action by the Company which would adversely affect the Grantees participation or materially reduce the
Grantees benefits or value under any of such plans or deprive the Grantee of any material fringe benefit
enjoyed by the Grantee at the time of the Change in Control, or the failure by the Company to provide the
Grantee with the number of paid vacation days to which the Grantee was then entitled in accordance with the
Companys normal vacation policy in effect on the date of the Change in Control; or

(7)

the failure by the Company to obtain the assumption of the obligation to perform any Change in Control
Severance Agreement between the Company and Grantee by any successor as contemplated in such Change in
Control Severance Agreement.

Retirement shall mean the Grantees retirement under a retirement plan (including, without limitation, any
supplemental retirement plan) of the Company or any Subsidiary, or the Grantees retirement from employment with the
Company or any Subsidiary after

completing at least three years of continuous service with the Company or any Subsidiary and attaining the age of 62.
Without limiting the generality of the foregoing, in no event shall Retirement include the involuntary termination of
the Grantees employment by the Company (i) for Cause or (ii) without Cause if, as a result of such termination without
Cause, the Grantee becomes eligible to receive payments on account of such termination under an employment
agreement between the Grantee and the Company.
(G)

Target Annual Direct Compensation means the sum of the Grantees Base Pay, target annual incentive opportunity,
and the annualized value of the most recent long-term incentive award approved by the Compensation and
Organization Committee of the Board prior to the Change in Control. For purposes of measuring annualized long-term
incentives, the awards shall be measured on their date of grant using reasonable assumptions, including, but not limited
to, fair value principles such as those identified in Financial Accounting Standards Board Accounting Standards
Codification Topic 718; the value of such awards shall be annualized over the frequency of their grant.

EXHIBIT 21
SUBSIDIARIES
The following is a list of certain subsidiaries of USG Corporation as of February 12, 2015, the principal names under which such subsidiaries do business and
the state or country in which each is organized. The list does not include subsidiaries which would not, if considered in the aggregate as a single subsidiary,
have constituted a significant subsidiary within the meaning of Item 601(b)(21)(ii) of Regulation S-K as of December 31, 2014.
Name of Company

United States Gypsum Company

USG Interiors, LLC
Otsego Paper, Inc.
L&W Supply Corporation
USG Foreign Investments, Ltd.
Gypsum Transportation Limited
USG International, Ltd.
USG (U.K.) Ltd.
USG Netherlands Global Holdings B.V.
CGC Inc.
USG Latin America, LLC
USG Holding de Mexico, S.A. de C.V.
USG Mexico, S.A. de C.V.

Organized Under Laws of

Delaware
Delaware
Delaware
Delaware
Delaware
Bermuda
Delaware
United Kingdom
Netherlands
New Brunswick, Canada
Delaware
Mexico
Mexico

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statements No. 33-63554, 333-136289, 333-140949 and 333-168592 on
Form S-8 and Registration Statements No.333-168614, 333-169263, 333-175042, 333-182339 and 333-190378 on Form S-3 of our
reports dated February 12, 2015, relating to the consolidated financial statements and financial statement schedule of USG Corporation
and subsidiaries and the effectiveness of USG Corporation and subsidiaries' internal control over financial reporting, appearing in this
Annual Report on Form 10-K of USG Corporation for the year ended December 31, 2014.
/s/ Deloitte & Touche LLP
Chicago, Illinois
February 12, 2015

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference in Registration Statements No. 33-63554, 333-136289, 333-140949 and 333-168592 on
Form S-8 and Registration Statements No.333-168614, 333-169263, 333-175042, 333-182339 and 333-190378 on Form S-3 of our
report dated February 10, 2015, relating to the consolidated financial statements of USG Boral Building Products Pte. Limited for the
period January 14, 2014 (date of incorporation) to June 30, 2014, furnished along with the Annual Report on Form 10-K of USG
Corporation for the year ended December 31, 2014.

/s/ Deloitte
AF 0080
Chartered Accountants
Kuala Lumpur, Malaysia
February 12, 2015

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference in Registration Statements No. 33-63554, 333-136289, 333-140949 and 333-168592 on
Form S-8 and Registration Statements No.333-168614, 333-169263, 333-175042, 333-182339 and 333-190378 on Form S-3 of USG
Corporation of our report dated February 9, 2015, with respect to the consolidated balance sheets of USG Boral Building Products Pty
Limited and its controlled entities as of June 30, 2014 and 2013, and the related consolidated statements of income, comprehensive
income, changes in equity, and cash flows for each of the years then ended, which report appears in December 31, 2014 Annual
Report on Form 10-K of USG Corporation.

/s/ KPMG
KPMG
Sydney, Australia
February 12, 2015

POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS , that each person whose name appears below constitutes and appoints Stanley
L. Ferguson and Matthew F. Hilzinger, and each of them, his or her true and lawful attorney(s)-in-fact and agent(s), with full power of
substitution and resubstitution, for and in his name, place and stead, in any and all capacities, to sign the Annual Report on Form 10-K
for the year ending December 31, 2014 of USG Corporation, and any or all amendments thereto, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-infact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to
be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their or his or her substitutes, may lawfully do or cause to be
done by virtue hereof.
This power of attorney has been signed as of the 11th day of February 2015 by the following persons:
/s/ Jose Armario
Jose Armario,
Director

/s/ Brian A. Kenney

Brian A. Kenney,
Director

/s/ Thomas A. Burke

Thomas A. Burke,
Director

/s/ Richard P. Lavin

Richard P. Lavin,
Director

/s/ Matthew Carter Jr.

Matthew Carter Jr.,
Director

/s/ Steven F. Leer

Steven F. Leer,
Director

/s/ Gretchen R. Haggerty

Gretchen R. Haggerty,
Director

/s/ James S. Metcalf

James S. Metcalf,
Director, Chairman, President
and Chief Executive Officer

/s/ William H. Hernandez

William H. Hernandez,
Director

EXHIBIT 31.1
CERTIFICATIONS
I, James S. Metcalf, certify that:
1.

I have reviewed this annual report on Form 10-K of USG Corporation (the Corporation);

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by
this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the Corporation as of, and for, the periods presented in this report;

4.

The Corporations other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act rules 13a-15(f) and
15(d)-15(f)) for the Corporation and have:

5.

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the Corporation, including its consolidated subsidiaries, is made known
to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the Corporations disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and

(d)

Disclosed in this report any change in the Corporations internal control over financial reporting that occurred during the
Corporations most recent fiscal quarter (the Corporations fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the Corporations internal control over financial reporting; and

The Corporations other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
to the Corporations auditors and the audit committee of the Corporations board of directors (or persons performing the equivalent functions):
(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which
are reasonably likely to adversely affect the Corporations ability to record, process, summarize and report financial information;
and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the Corporations
internal control over financial reporting.

February 12, 2015

/s/ James S. Metcalf

James S. Metcalf
Chairman, President and Chief Executive Officer

EXHIBIT 31.2
CERTIFICATIONS
I, Matthew F. Hilzinger, certify that:
1.

I have reviewed this annual report on Form 10-K of USG Corporation (the Corporation);

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by
this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the Corporation as of, and for, the periods presented in this report;

4.

The Corporations other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act rules 13a-15(f) and
15(d)-15(f)) for the Corporation and have:

5.

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the Corporation, including its consolidated subsidiaries, is made known
to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the Corporations disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and

(d)

Disclosed in this report any change in the Corporations internal control over financial reporting that occurred during the
Corporations most recent fiscal quarter (the Corporations fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the Corporations internal control over financial reporting; and

The Corporations other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
to the Corporations auditors and the audit committee of the Corporations board of directors (or persons performing the equivalent functions):
(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which
are reasonably likely to adversely affect the Corporations ability to record, process, summarize and report financial information;
and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the Corporations
internal control over financial reporting.

February 12, 2015

/s/ Matthew F. Hilzinger

Matthew F. Hilzinger
Executive Vice President and Chief Financial Officer

EXHIBIT 32.1
SECTION 1350 CERTIFICATIONS
In connection with the Annual Report of USG Corporation (the Corporation) on Form 10-K, as filed with the Securities and Exchange Commission on the
date hereof (the Report), I, James S. Metcalf, Chairman, President and Chief Executive Officer of the Corporation, certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Corporation.

February 12, 2015

/s/ James S. Metcalf

James S. Metcalf
Chairman, President and Chief Executive Officer

EXHIBIT 32.2
SECTION 1350 CERTIFICATIONS
In connection with the Annual Report of USG Corporation (the Corporation) on Form 10-K, as filed with the Securities and Exchange Commission on the
date hereof (the Report), I, Matthew F. Hilzinger, Executive Vice President and Chief Financial Officer of the Corporation, certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1)
(2)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Corporation.

February 12, 2015

/s/ Matthew F. Hilzinger

Matthew F. Hilzinger
Executive Vice President and Chief Financial Officer

EXHIBIT 95
Mine Safety Disclosures
The operation of our ten mines and quarries in the United States is subject to regulation and inspection under the Federal Mine Safety and Health Act
of 1977, or Safety Act. From time to time, inspection of our mines and quarries and their operation results in our receipt of citations or orders alleging
violations of health or safety standards or other violations under the Safety Act. We are usually able to resolve the matters identified in the citations or orders
with little or no assessments or penalties.
Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and rules promulgated by the Securities and Exchange
Commission, or SEC, to implement that Section require that we disclose specified information about mine health and safety in our periodic reports filed with
the SEC. The disclosure requirements set forth in Section 1503 and the SEC rules refer to, and are based on, the safety and health requirements applicable to
mines under the Safety Act which is administered by the U.S. Labor Department's Mine Safety and Health Administration, or MSHA. Under the Safety Act,
MSHA is required to inspect surface mines at least twice a year and underground mines at least four times a year to determine whether there is compliance
with health and safety standards or with any citation, order or decision issued under the Safety Act and whether an imminent danger exists. MSHA also
conducts spot inspections and inspections pursuant to miners' complaints.
If violations of safety or health standards are found, MSHA inspectors will issue citations to the mine operators. Among other activities under the
Safety Act, MSHA also assesses and collects civil monetary penalties for violations of mine safety and health standards.
In addition, an independent adjudicative agency, the Federal Mine Safety and Health Review Commission, or FMSHRC, provides administrative trial
and appellate review of legal disputes arising under the Safety Act. Most cases deal with civil penalties proposed by MSHA to be assessed against mine
operators and address whether the alleged safety and health violations occurred, as well as the appropriateness of proposed penalties.
During the year ended December 31, 2014, we received 14 citations alleging health and safety violations that could significantly and substantially
contribute to the cause and effect of a mine safety or health hazard under the Safety Act, or S&S violations, and 52 citations alleging other health and safety
violations. We have received proposed assessments from MSHA with respect to 63 of the 66 total citations. The total dollar value of proposed assessments
from MSHA with respect to those citations was $19,798. We have resolved 54 of the proposed assessments through payments of penalties aggregating
$17,858. There is one proposed assessment being contested and eight proposed assessments otherwise remain outstanding. No assessments have yet been
made by MSHA with respect to the other three citations. Set forth below is information with respect to the gypsum mines for which citations were received
during the year ended December 31, 2014:

Location of Mines/Quarries

Number of Citations for

S&S Violations

Number of Citations for

Non S&S Violations

Total Proposed
Assessments
$100

Alabaster, Michigan

Empire, Nevada (closed)

Fort Dodge, Iowa

965

Plaster City, California

100

Shoals, Indiana

1,401

Sigurd, Utah

100

Southard, Oklahoma

1,324

Sperry, Iowa

25

7,423

Spruce Pine, North Carolina

Sweetwater, Texas

8,385

Totals

14

52

$19,798

We did not receive any citations or orders for unwarrantable failure to comply with mandatory health and safety standards under the Safety Act, any
orders under the Safety Act regarding withdrawal from a mine as a result of failure to abate in a timely manner a health and safety violation for which a
citation was issued, any imminent danger orders under the Safety Act, any written notice from MSHA of a pattern of violations of mandatory health or safety
standards that are of such a nature as could significantly and substantially contribute to the cause and effect of mine health and safety hazards under the
Safety Act or any written notice from MSHA of the potential to have such a pattern during 2014. Also, there were no flagrant violations under the Safety Act
and no mining-related fatalities during 2014, and no legal actions before the FMSHRC were instituted during 2014 or pending as of December 31, 2014.

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
STATEMENT OF DIRECTORS

In the opinion of the directors, the consolidated financial statements of USG Boral Building Products Pte. Limited and its subsidiaries as
set out on pages 4 to 68 are drawn up so as to give a true and fair view of the state of affairs of the group as at June 30, 2014 and of the
results, changes in equity and cash flows of the group for the financial period from January 14, 2014 (date of incorporation) to June 30,
2014 and at the date of this statement, there are reasonable grounds to believe that the group will be able to pay its debts when they fall
due.
Signed on behalf of the Board of Directors in accordance with a resolution of the Directors:

/s/ Matthew Franklin Hilzinger

Matthew Franklin Hilzinger

/s/ Jennifer Flynn Scanlon

Jennifer Flynn Scanlon
Date: February 10, 2015

INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF

USG BORAL BUILDING PRODUCTS PTE. LIMITED
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of USG Boral Building Products Pte. Limited (the company)
and its subsidiaries (the group), which comprise the consolidated statement of financial position of the group as of June 30, 2014, and
the related consolidated statements of profit or loss and other comprehensive income, changes in equity, and cash flows of the group
for the period from January 14, 2014 (date of incorporation) to June 30, 2014, and the related notes to the consolidated financial
statements.
Directors Responsibility for the Consolidated Financial Statements
The directors of the company are responsible for the preparation and fair presentation of these consolidated financial statements in
accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated
financial statements that are free from material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in
accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the
groups preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the groups internal control. Accordingly, we
express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by directors, as well as evaluating the overall presentation of the consolidated financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
2

INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF

USG BORAL BUILDING PRODUCTS PTE. LIMITED
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of
USG Boral Building Products Pte. Limited and its subsidiaries as of June 30, 2014, and the results of their operations and their cash
flows for the period from January 14, 2014 (date of incorporation) to June 30, 2014 in accordance with International Financial
Reporting Standards as issued by the International Accounting Standards Board.

/s/ DELOITTE
DELOITTE
AF 0080
Chartered Accountants
February 10, 2015
3

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
June 30, 2014

Note

US$000

ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Tax recoverable
Derivative financial instruments
Inventories

6
7

8
9

Total current assets

117,077
108,589
4,283
2,695
310
51,494
284,448

Non-current assets
Other receivables
Property, plant and equipment
Intangible assets
Goodwill
Investment in associates
Deferred tax assets

7
10
11
12
14
15

9,902
528,689
112,136
444,613
54,434
11,818

Total non-current assets

1,161,592

Total assets

1,446,040

LIABILITIES AND EQUITY

Current liabilities
Trade and other payables
Provisions
Loans and borrowings
Tax liabilities
Derivative financial instruments

16
17
18
8

Total current liabilities

145,295
641
23,149
8,030
115
177,230

(Forward)
4

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
June 30, 2014

Note

Non-current liabilities
Retirement benefit obligations
Provisions
Loans and borrowings
Deferred tax liabilities

19
17
18
15

Total non-current liabilities

US$000

11,575
42
50,490
28,425
90,532

Capital, reserves and non-controlling interests

Share capital
Reserves
Retained earnings

20
21

1,022,944
49,768
7,249

Equity attributable to owners of the company

Non-controlling interests

1,079,961
98,317

Total equity

1,178,278

Total liabilities and equity

1,446,040

See accompanying notes to the consolidated financial statements.

5

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
Period from January 14, 2014 (date of incorporation) to June 30, 2014
Note
Revenue
Cost of sales

22

Gross profit

US$000
246,708
(185,907)
60,801

Other income
Finance income
Distribution expenses
Administrative expenses
Finance costs
Share of loss of associates

23
14

377
1,780
(11,092)
(34,284)
(2,664)
(866)

Profit before income tax

Income tax expense

24

14,052
(4,869)

Profit for the financial period

25

9,183

Other comprehensive income:

Items that will not be reclassified subsequently to profit or loss:
Actuarial gain on pension

98

Items that may be reclassified subsequently to profit or loss:

Exchange differences on translating foreign operations
Gains on cash flow hedges

15,294
377

Other comprehensive income for the financial period, net of tax

15,769

Total comprehensive income for the financial period

24,952

Profit attributable to:

Owners of the company
Non-controlling interests

7,249
1,934
9,183

Total comprehensive income attributable to:

Owners of the company
Non-controlling interests

22,826
2,126
24,952

See accompanying notes to the consolidated financial statements.

6

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Period from January 14, 2014 (date of incorporation) to June 30, 2014

Share
capital
US$000
Balance at January
14, 2014 (date of
incorporation)
(Note 20)

Other
comprehensive
income for the
financial period
Total
Dividends paid by a
subsidiary (Note
26)
Balance at June 30,
2014

Translation
reserve

Hedging
reserve

Pension
reserve

Retained
earnings

US$000

US$000

US$000

US$000

Attributable
Non to owners of controlling
the
interests
company
US$000
US$000

Total
US$000

34,191

1,057,135

1,057,135

100,560

100,560

7,249

7,249

1,934

9,183

15,102

377

98

15,577

192

15,769

15,102

377

98

7,249

22,826

2,126

24,952

(4,369)

(4,369)

1,022,944

34,191

15,102

377

98

7,249

1,079,961

98,317

1,178,278

Issue of share capital

(Notes 20 & 21) 1,022,944
Acquisition of
subsidiaries
Profit for the
financial period

Other
capital
reserve
US$000

See accompanying notes to the consolidated financial statements.

7

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
Period from January 14, 2014 (date of incorporation) to June 30, 2014
Note

US$000

Operating activities
Profit for the financial period
Adjustments for:
Income tax expense recognised in profit or loss
Share of loss of associates
Depreciation of property, plant and equipment
Amortisation of intangible assets
Gain on disposal of property, plant and equipment
Unrealised foreign exchange gain
Allowance for doubtful debts
Allowance for doubtful debts no longer required
Finance costs
Retirement benefits expenses
Write-down of value in inventories
Finance income

(1,780)

Operating cash flows before movements in working capital

30,071

9,183
4,869
866
6,619
3,192
(21)
(356)
1,549

(387)
2,664
1,924
1,749

Inventories
Trade and other receivables
Prepayments
Provisions
Trade and other payables

544
(25,539)
189
568
35,736

Cash generated from operations

Income tax refunded
Retirement benefit obligations paid

41,569

Net cash from operating activities

45,833

5,298
(1,034)

Investing activities
Interest received
Purchase of property, plant and equipment
Additions of intangible assets
Cash acquired from acquisition of subsidiaries
Proceeds from sale of property, plant and equipment

1,780
(14,935)
(31)
27

96,541
2,559

Net cash from investing activities

85,914

(Forward)
8

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
Period from January 14, 2014 (date of incorporation) to June 30, 2014

Note

US$000

Financing activities
Interest paid
Repayments of loans and borrowings
Proceeds from loans and borrowings
Dividend to a non-controlling interests

(24,527)

Net cash used in financing activities

(18,125)

Net increase in cash and cash equivalents

113,622

(2,664)
13,435
(4,369)

Cash and cash equivalents at January 14, 2014 (date of incorporation)

Effects of exchange rate changes on the balance of cash held in foreign currencies
Cash and cash equivalents at the end of financial period

3,455
6

See accompanying notes to the consolidated financial statements.

9

117,077

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
1

GENERAL
The company (Registration No. 201401466N) is incorporated in Singapore with its principal place of business and registered
office at 8 Boon Lay Way, #08-14, Singapore 609964. The consolidated financial statements are expressed in United States
Dollars, and all values are rounded to the nearest thousand (US$000), unless otherwise indicated.
The principal activity of the company is that of an investment holding company.
On February 28, 2014, the group acquired all the subsidiaries as detailed in Note 13 to the consolidated financial statements as a
result of the joint venture arrangements between USG Corporation, a company incorporated and listed in the United States of
America, and Boral Limited, a company incorporated and listed in Australia.
The group is the leading multi-country plasterboard producer in Asia, with manufacturing sites in China, Thailand, Indonesia,
South Korea, Vietnam, India, Malaysia, Philippines and Oman. In addition to plasterboard manufacturing plants, the group also
has ceiling tile plants, metal roll forming lines and facilities for the production of jointing compounds and industrial plasters
throughout the region, as well as a gypsum mine in Oman.
The principal activities of the subsidiaries are disclosed in Note 13 to the consolidated financial statements.
The consolidated financial statements of the group for the financial period from January 14, 2014 (date of incorporation) to
June 30, 2014 were authorised for issue by the Board of Directors on February 10, 2015

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING - The consolidated financial statements have been prepared in accordance with the historical cost
basis, except as disclosed in the accounting policies below, and are drawn up in accordance with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standard Board (IASB).
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
10

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date, regardless of whether that price is directly observable or estimated using another
valuation technique. In estimating the fair value of an asset or a liability, the group takes into account the characteristics of the
asset or liability which market participants would take into account when pricing the asset or liability at the measurement date.
Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis,
except for share-based payment transactions that are within the scope of IFRS 2 Shared-based Payments, leasing transactions
that are within the scope of IAS 17 Leases, and measurements that have some similarities to fair value but are not fair value,
such as net realisable value in IAS 2 Inventories or value in use in IAS 36 Impairment of Assets.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to
which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement
in its entirety, which are described as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access
at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability,
either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.

ADOPTION OF NEW AND REVISED STANDARDS On January 14, 2014 (date of incorporation), the group has adopted all
applicable new and revised IFRSs and Interpretations issued by the IASB that are relevant to its operations and effective for
since the date of incorporation
At the date of authorisation of these consolidated financial statements, the following IFRS and amendments to IFRS that are
relevant to the group were issued but not effective:
IFRS 9
Financial Instruments5
IFRS 15
Revenue from Contracts with Customers4
Amendments to IFRS 10, IFRS 12
Investment Entities: Applying the Consolidation
and IAS 28
Exception 3
Amendments to IFRS 10 and IAS 28
Sale or Contribution of Assets between an Investor and its Associate or Joint
Venture3
Amendments to IFRS 11
Accounting for Acquisition of Interests in Joint Operations3
11

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Amendments to
Amendments to
Amendments to
Amendments to
Amendments to
Amendments to
Amendments to
Amendments to
1
2
3
4
5

IAS 1
IAS 16 and IAS 38
IAS 16 and IAS 41
IAS 19
IAS 27
IFRSs
IFRSs
IFRSs

Disclosure Initiative3
Clarification of Acceptable Methods of Depreciation and Amortisation 3
Agriculture: Bearer Plants3
Defined Benefit Plans: Employee Contributions1
Equity Method in Separate Financial Statements3
Annual Improvements to IFRSs 2010 2012 Cycle2
Annual Improvements to IFRSs 2011 2013 Cycle1
Annual Improvements to IFRSs 2012 2014 Cycle3

Effective for annual periods beginning on or after July 1, 2014

Effective for annual periods beginning on or after July 1, 2014, with limited exceptions
Effective for annual periods beginning on or after January 1, 2016
Effective for annual periods beginning on or after January 1, 2017
Effective for annual periods beginning on or after January 1, 2018, with earlier application permitted

The directors anticipate that the adoption of the above IFRS and amendments to IFRS in future periods will not have a material
impact on the financial statements of the group in the period of their adoption.
BASIS OF CONSOLIDATION - The consolidated financial statements incorporate the financial statements of the company and
entities (including structured entities) controlled by the company and its subsidiaries. Control is achieved when the company:

Has power over the investee;

Is exposed, or has rights, to variable returns from its involvement with the investee; and
Has the ability to use its power to affect its returns.

The company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one
or more of the three elements of control listed above.
When the company has less than a majority of the voting rights of an investee, it has power over the investee when the voting
rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The company
considers all relevant facts and circumstances in assessing whether or not the companys voting rights in an investee are
sufficient to give it power, including:

The size of the companys holding of voting rights relative to the size and dispersion of holdings of the other vote holders;
Potential voting rights held by the company, other vote holders or other parties;
12

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Rights arising from other contractual arrangements; and

Any additional facts and circumstances that indicate that the company has, or does not have, the current ability to direct
the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders
meetings.

Consolidation of a subsidiary begins when the company obtains control over the subsidiary and ceases when the company loses
control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the period are
included in the consolidated statement of profit or loss and other comprehensive income from the date the company gains
control until the date when the company ceases to control the subsidiary.
Profit or loss and each component of other comprehensive income are attributed to the owners of the company and to the noncontrolling interests. Total comprehensive income of subsidiaries is attributed to the owners of the company and to the noncontrolling interests even if this results in the non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with
the groups accounting policies.
Changes in the groups ownership interests in existing subsidiaries
Changes in the groups ownership interests in subsidiaries that do not result in the group losing control over the subsidiaries are
accounted for as equity transactions. The carrying amounts of the groups interests and the non-controlling interests are adjusted
to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the noncontrolling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and
attributed to owners of the company.
When the group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference
between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the
previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests.
All amounts previously recognised in other comprehensive income in relation to that subsidiary are accounted for as if the
group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to
another category of equity as specified/permitted by applicable IFRSs). The fair value of any investment retained in the former
subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under
IAS 39, when applicable, the cost on initial recognition of an investment in an associate or a joint venture.
13

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Non-controlling interests in subsidiaries are identified separately from the groups equity therein. The interest of non-controlling
shareholders that are present ownership interests and entitle their holders to a proportionate share of the entitys net assets in the
event of liquidation may be initially measured (at date of original business combination) either at fair value or at the noncontrolling interests proportionate share of the fair value of the acquirees identifiable net assets. The choice of measurement
basis is made on an acquisition-by-acquisition basis. Other types of non-controlling interests are measured at fair value or, when
applicable, on the basis specified in another standard. Subsequent to acquisition, the carrying amount of non-controlling
interests is the amount of those interests at initial recognition plus the non-controlling interests share of subsequent changes in
equity. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests
having a deficit balance.
Changes in the groups interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. The
carrying amounts of the groups interests and the non-controlling interests are adjusted to reflect the changes in their relative
interests in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair
value of the consideration paid or received is recognised directly in equity and attributed to owners of the company.
BUSINESS COMBINATIONS - Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The
consideration for each acquisition is measured at the aggregate of the acquisition date fair values of assets given, liabilities
incurred by the group to the former owners of the acquiree, and equity interests issued by the group in exchange for control of
the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.
Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent consideration
arrangement, measured at its acquisition-date fair value. Subsequent changes in such fair values are adjusted against the cost of
acquisition where they qualify as measurement period adjustments (see below). The subsequent accounting for changes in the
fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent
consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates
and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability
is remeasured at subsequent reporting dates in accordance with IAS 39 Financial Instruments: Recognition and Measurement,
or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being
recognised in profit or loss.
14

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Where a business combination is achieved in stages, the groups previously held interests in the acquired entity are remeasured
to fair value at the acquisition date (i.e. the date the group attains control) and the resulting gain or loss, if any, is recognised in
profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognised
in other comprehensive income are reclassified to profit or loss, where such treatment would be appropriate if that interest were
disposed of.
The acquirees identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under the IFRS are
recognised at their fair value at the acquisition date, except that:

Deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognised and
measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits respectively;
Liabilities or equity instruments related to share-based payment transactions of the acquiree or the replacement of an
acquirees share-based payment awards transactions with share-based payment awards transactions of the acquirer in
accordance with the method in IFRS 2 Share-based Payment at the acquisition date; and
Assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for
Sale and Discontinued Operations are measured in accordance with that Standard.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination
occurs, the group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts
are adjusted during the measurement period (see below), or additional assets or liabilities are recognised, to reflect new
information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected
the amounts recognised as of that date.
The measurement period is the period from the date of acquisition to the date the group obtains complete information about
facts and circumstances that existed as of the acquisition date and is subject to a maximum of one year from acquisition date.
FINANCIAL INSTRUMENTS - Financial assets and financial liabilities are recognised on the groups statement of financial
position when the group becomes a party to the contractual provisions of the instrument.
15

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest
income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash
receipts or payments (including all fees and points paid or received that from an integral part of the effective interest rate,
transaction costs and other premiums or discounts) through the expected life of the financial instrument, or where appropriate, a
shorter period. Income and expense is recognised on an effective interest basis for debt instruments.
Financial assets
All financial assets are recognised and de-recognised on a trade date basis where the purchase or sale of an investment is under
a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are
initially measured at fair value plus transaction costs, except for those financial assets classified as at fair value through profit or
loss which are initially measured at fair value.
Financial assets are classified into the following specified categories: financial assets at fair value through profit or loss, heldto-maturity investments, available-for-sale financial assets and loans and receivables. The classification depends on the
nature and purpose of financial assets and is determined at the time of initial recognition.
Loans and receivables
Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market
are classified as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest
method less impairment. Interest is recognised by applying the effective interest rate method, except for short-term receivables
when the effect of discounting is immaterial.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired
where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial
asset, the estimated future cash flows of the investment have been impacted.
Objective evidence of impairment could include:

significant financial difficulty of the issuer or counterparty; or

breach of contract such as default or delinquency in interest or principal payments; or
16

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

it becoming probable that the borrower will enter bankruptcy or financial re-organisation; or
the disappearance of an active market for that financial asset because of financial difficulties.

For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are, in
addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could
include the groups past experience of collecting payments, an increase in the number of delayed payments in the portfolio past
the average credit period of 30 days, as well as observable changes in national or local economic conditions that correlate with
default on receivables.
For financial assets carried at amortised cost, the amount of the impairment is the difference between the assets carrying
amount and the present value of estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception
of trade receivables where the carrying amount is reduced through the use of an allowance account. When a trade receivable is
uncollectible, it is written off against an allowance account. Subsequent recoveries of amounts previously written off are
credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or
loss.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event
occurring after the impairment loss was recognised, the previously recognised impairment loss is reversed through profit or loss
to the extent the carrying amount of the financial asset at the date the impairment is reversed does not exceed what the
amortised cost would have been had the impairment not been recognised.
Derecognition of financial assets
The group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers
the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the group neither
transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the group
recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the group retains
substantially all the risks and rewards of ownership of a transferred financial asset, the group continues to recognise the
financial asset and also recognises a collateralized borrowing for the proceeds received.
17

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Financial liabilities and equity instruments

Classification as debt or equity
Financial liabilities and equity instruments issued by the group are classified according to the substance of the contractual
arrangements entered into and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its
liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.
Financial liabilities
Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.
Other financial liabilities
Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at
amortised cost, using the effective interest rate method, with interest expense recognised on an effective yield basis.
Interest-bearing bank loans and overdrafts are initially measured at fair value, and are subsequently measured at amortised cost,
using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the settlement or
redemption of borrowings is recognised over the term of the borrowings in accordance with the groups accounting policy for
borrowing costs (see below).
Derecognition of financial liabilities
The group derecognises financial liabilities when, and only when, the group's obligations are discharged, cancelled or they
expire.
18

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Derivative financial instruments and hedge accounting
The group enters into a variety of derivative financial instruments to manage its exposure to foreign exchange rate risk,
including foreign exchange forward contracts. Further details of derivative financial instruments are disclosed in Note 8 to the
financial statements.
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured
to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately unless
the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss
depends on the nature of the hedge relationship. The group designates certain derivatives as hedges of foreign currency risk of
firm commitments (cash flow hedges).
A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than
12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or
current liabilities.
Hedge accounting
The group designates certain hedging instruments, which include derivatives, embedded derivatives and non-derivatives in
respect of foreign currency risk, as cash flow hedges. Hedges of foreign exchange risk on firm commitments are accounted for
as cash flow hedges.
At the inception of the hedge relationship the entity documents the relationship between the hedging instrument and hedged
item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the
inception of the hedge and on an ongoing basis, the group documents whether the hedging instrument that is used in a hedging
relationship is highly effective in offsetting changes in fair values or cash flows of the hedged item.
Cash flow hedge
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are
recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in
profit or loss as part of other gains and losses.
19

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Amounts recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods
when the hedged item is recognised in profit or loss in the same line of the statement of profit or loss and other comprehensive
income as the recognised hedged item. However, when the forecast transaction that is hedged results in the recognition of a
non-financial asset or a non-financial liability, the gains and losses previously accumulated in equity are transferred from equity
and included in the initial measurement of the cost of the asset or liability.
Hedge accounting is discontinued when the group revokes the hedging relationship, the hedging instrument expires or is sold,
terminated, or exercised, or no longer qualifies for hedge accounting. Any gain or loss accumulated in equity at that time
remains in equity and when the forecast transaction is ultimately recognised in profit or loss, such gains and losses are
recognised in profit or loss, or transferred from equity and included in the initial measurement of the cost of the asset or liability
as described above. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was
accumulated in equity is recognised immediately in profit or loss.
LEASES - Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards
of ownership to the lessee. All other leases are classified as operating leases.
The Group as lessee
Assets held under finance leases are recognised as assets of the group at their fair value at the inception of the lease or, if lower,
at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of
financial position as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the
lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged
directly to profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in
accordance with the groups general policy on borrowing costs (see below). Contingent rentals are recognised as expenses in
the periods in which they are incurred.
Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the relevant lease
unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are
consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are
incurred.
20

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The
aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another
systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
INVENTORIES - Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where
applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location
and condition. Cost is calculated using the weighted average method. Net realisable value represents the estimated selling price
less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
PROPERTY, PLANT AND EQUIPMENT - Property, plant and equipment are stated at cost less accumulated depreciation and
any accumulated impairment losses.
Mineral reserves are depreciated by the unit of productions over the estimated production from mining. Depreciation of other
property, plant and equipment is charged so as to write off the cost of assets, other than properties under construction, over their
estimated useful lives, using the straight-line method on the following bases:
Leasehold land
50 - 60 years
Buildings
20 - 50 years
Machinery
5 - 25 years
Office equipment, fixtures and fittings
Office renovation
10 years
Vehicles
3 - 10 years

5 - 7 years

The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any
changes in estimate accounted for on a prospective basis.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, if there is
no certainty that the lessee will obtain ownership by the end of the lease term, the asset shall be fully depreciated over the
shorter of the lease term and its useful life.
The gain or loss arising on disposal or retirement of an item of property, plant and equipment is determined as the difference
between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
21

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

GOODWILL - Goodwill arising in a business combination is recognised as an asset at the date that control is acquired (the
acquisition date). Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any noncontrolling interest in the acquiree and the fair value of the acquirers previously held equity interest (if any) in the entity over
net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.
If, after reassessment, the groups interest in the fair value of the acquirees identifiable net assets exceeds the sum of the
consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of the acquirers
previously held equity interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain
purchase gain.
Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of impairment testing, goodwill is
allocated to each of the groups cash-generating units expected to benefit from the synergies of the combination. Cashgenerating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an
indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount,
the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other
assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for
goodwill is not reversed in a subsequent period.
On disposal of a subsidiary or the relevant cash generating unit, the attributable amount of goodwill is included in the
determination of the profit or loss on disposal.
INTANGIBLE ASSETS - Intangible assets acquired separately are reported at cost less accumulated amortisation (where they
have finite useful lives) and accumulated impairment losses. Intangible assets with finite useful lives are amortised on a straightline basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each
annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets
with indefinite useful lives are not amortised. Each period, the useful lives of such assets are reviewed to determine whether
events and circumstances continue to support an indefinite useful life assessment for the asset.
IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS EXCLUDING GOODWILL - At the end of each reporting period,
the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in
order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an
individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a
reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating
units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent
allocation basis can be identified.
22

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately
in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a
revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A
reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued
amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
ASSOCIATES - An associate is an entity over which the group has significant influence and that is neither a subsidiary nor an
interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the
investee but is not control or joint control over those policies.
The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of
accounting, except when the investment is classified as held for sale, in which case it is accounted for under FRS 105 Noncurrent Assets Held for Sale and Discontinued Operations. Under the equity method, investments in associates are carried in the
consolidated statement of financial position at cost as adjusted for post-acquisition changes in the groups share of the net assets
of the associate, less any impairment in the value of individual investments. Losses of an associate in excess of the groups
interest in that associate (which includes any long-term interests that, in substance, form part of the groups net investment in the
associate) are not recognised, unless the group has incurred legal or constructive obligations or made payments on behalf of the
associate.
Investments in associates are accounted for using the equity method from the date on which the investee becomes an associate
or a joint venture. On acquisition of the investments in associates, any excess of the cost of the investment over the groups
share of the net fair value of the identifiable assets and liabilities of the investee is recognised as goodwill, which is included
within the carrying amount of the investment. Any excess of the groups share of the net fair value of the identifiable assets and
liabilities over the cost of the investment, after reassessment, is recognised immediately in profit or loss in the period in which
the investment is acquired.
23

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

The requirements of FRS 39 are applied to determine whether it is necessary to recognise any impairment loss with respect to
the groups investments in associates. When necessary, the entire carrying amount of the investment (including goodwill) is
tested for impairment in accordance with FRS 36 Impairment of Assets as a single asset by comparing its recoverable amount
(higher of value in use and fair value less costs to sell) with its carrying amount, any impairment loss recognised forms part of
the carrying amount of the investment. Any reversal of that impairment loss is recognised in accordance with FRS 36 to the
extent that the recoverable amount of the investment subsequently increases.
Any excess of the cost of acquisition over the groups share of the net fair value of the identifiable assets, liabilities and
contingent liabilities of the associate recognised at the date of acquisition is recognised as goodwill. The goodwill is included
within the carrying amount of the investment and is assessed for impairment as part of the investment. Any excess of the
groups share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after
reassessment, is recognised immediately in profit or loss.
Where a group entity transacts with an associate of the group, profits and losses are eliminated to the extent of the groups
interest in the relevant associate.
PROVISIONS - Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past
event, it is probable that the group will be required to settle the obligation, and a reliable estimate can be made of the amount of
the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end
of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is
measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash
flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the
receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable
can be measured reliably.
A restructuring provision is recognised when the group has developed a detailed formal plan for the restructuring and has raised
a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or announcing its
main features to those affected by it. The measurement of a restructuring provision includes only the direct expenditures arising
from the restructuring, which are those amounts that are both necessarily entailed by the restructuring and not associated with
the ongoing activities of the entity.
24

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

REVENUE RECOGNITION - Revenue is measured at the fair value of the consideration received or receivable. Revenue is
reduced for estimated customer returns, rebates and other similar allowances.
Sale of goods
Revenue from the sale of goods is recognised when all the following conditions are satisfied:

The group has transferred to the buyer the significant risks and rewards of ownership of the goods;
The group retains neither continuing managerial involvement to the degree usually associated with ownership nor
effective control over the goods sold;
The amount of revenue can be measured reliably;
It is probable that the economic benefits associated with the transaction will flow to the entity; and
The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable.
BORROWING COSTS - Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,
which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost
of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on
the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing
costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
RETIREMENT BENEFIT COSTS - Payments to defined contribution retirement benefit plans are charged as an expense as they
fall due. Payments made to state-managed retirement benefit schemes in various countries, are dealt with as payments to defined
contribution plans where the groups obligations under the plans are equivalent to those arising in a defined contribution
retirement benefit plan.
25

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method,
with actuarial valuations being carried out at the end of each reporting period. Remeasuement, comprising actuarial gains and
losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected
immediately in the statement of financial position with a charge or credit recognised in other comprehensive income in the
period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained
earnings and will not be reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan
amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit
liability or asset. Defined benefit costs are categorised as follows:

Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);
Net interest expense or income; and
Remeasurement.

The group presents the first two components of defined benefit costs in profit or loss. Curtailment gains and losses are
accounted for as past service costs.
The retirement benefit obligations recognised in the statement of financial position represents the present value of the defined
benefit obligation as adjusted for unrecognised actuarial gains and losses and unrecognised past service cost. Any surplus
resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the
plans or reductions in future contributions to the plan.
A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of the
termination benefit and when the entity recognises any related restructuring costs.
EMPLOYEE LEAVE ENTITLEMENT - Employee entitlements to annual leave are recognised when they accrue to employees.
A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the end of
the reporting period.
INCOME TAX - Income tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the period. Taxable profit differs from profit as reported in the statement
of profit and loss and other comprehensive income because it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are not taxable or tax deductible. The groups liability for current tax
is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in countries where the company and
subsidiaries operate by the end of the reporting period.
26

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the consolidated financial
statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally
recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination)
of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised on taxable temporary differences arising on investments in subsidiaries and associates,
and interests in joint ventures, except where the group is able to control the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible
temporary differences associated with such investments and interests are only recognised to the extent that it is probable that
there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no
longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised
based on the tax rates (and tax laws) that have enacted or substantively enacted by the end of the reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current
tax liabilities and when they relate to income taxes levied by the same taxation authority and the group intends to settle its
current tax assets and liabilities on a net basis.
Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items credited or
debited outside profit or loss (either in other comprehensive income or directly in equity), in which case the tax is also
recognised outside profit or loss (either in other comprehensive income or directly in equity, respectively), or where they arise
from the initial accounting for a business combination. In the case of a business combination, the tax effect is taken into account
in calculating goodwill or determining the excess of the acquirers interest in the net fair value of the acquirees identifiable
assets, liabilities and contingent liabilities over cost.
27

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION - The individual financial statements of each group entity are
measured and presented in the currency of the primary economic environment in which the entity operates (its functional
currency). The consolidated financial statements of the group are presented in United States Dollars, which is the functional
currency of the company and the presentation currency for the groups consolidated financial statements.
In preparing the financial statements of the individual entities, transactions in currencies other than the entitys functional
currency are recorded at the rate of exchange prevailing on the date of the transaction. At the end of each reporting period,
monetary items denominated in foreign currencies are retranslated at the rates prevailing at the end of the reporting period. Nonmonetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date
when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are
not retranslated.
Exchange differences arising on the settlement of monetary items, and on retranslation of monetary items are included in profit
or loss for the period. Exchange differences arising on the retranslation of non-monetary items carried at fair value are included
in profit or loss for the period except for differences arising on the retranslation of non-monetary items in respect of which gains
and losses are recognised in other comprehensive income. For such non-monetary items, any exchange component of that gain
or loss is also recognised in other comprehensive income.
Exchange differences on foreign currency borrowings relating to assets under construction for future productive use, are
included in the cost of those assets when they are regarded as an adjustment to interest costs on those foreign currency
borrowings.
Exchange differences on transactions entered into in order to hedge certain foreign currency risks are described in the hedge
accounting policies above.
For the purpose of presenting consolidated financial statements, the assets and liabilities of the groups foreign operations are
expressed in United States Dollars using exchange rates prevailing at the end of the reporting period. Income and expense items
are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in
which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in
other comprehensive income and accumulated in a separate component of equity under the header of translation reserve.
28

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

On the disposal of a foreign operation (i.e. a disposal of the groups entire interest in a foreign operation, or a disposal involving
loss of control over a subsidiary that includes a foreign operation, loss of joint control over a jointly controlled entity that
includes a foreign operation, or loss of significant influence over an associate that includes a foreign operation), all of the
accumulated exchange differences in respect of that operation attributable to the group are reclassified to profit or loss. Any
exchange differences that have previously been attributed to non-controlling interests are derecognised, but they are not
reclassified to profit or loss.
In the case of a partial disposal (i.e. no loss of control) of a subsidiary that includes a foreign operation, the proportionate share
of accumulated exchange differences are re-attributed to non-controlling interests and are not recognised in profit or loss. For all
other partial disposals (i.e. of associates or jointly controlled entities that do not result in the group losing significant influence or
joint control), the proportionate share of the accumulated exchange differences is reclassified to profit or loss.
On consolidation, exchange differences arising from the translation of the net investment in foreign entities (including monetary
items that, in substance, form part of the net investment in foreign entities), and of borrowings and other currency instruments
designated as hedges of such investments, are recognised in other comprehensive income and accumulated in a separate
component of equity under the header of foreign currency translation reserve.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the
foreign operation and translated at the closing rate.
CASH AND CASH EQUIVALENTS IN THE STATEMENT OF CASH FLOWS - Cash and cash equivalents in the statement of
cash flows comprise cash on hand and demand deposits and other short-term highly liquid investments that are readily
convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the groups accounting policies, which are described in Note 2, the directors are required to make
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from
other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered
to be relevant. Actual results may differ from these estimates.
29

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
3

CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (contd)

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future
periods if the revision affects both current and future periods.
Critical judgements in applying the groups accounting policies
The directors are of the opinion that there are no instances of application of judgments which are expected to have a significant
effect on the amounts recognised in the consolidated financial statements.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period,
that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
financial year are discussed below:
Depreciation of property, plant and equipment
The cost of property, plant and equipment except for freehold land and capital work-in-progress, is depreciated on a straightline basis over the assets useful lives. The group reviews the remaining useful lives of property, plant and equipment at the end
of each reporting period and ensures consistency with previous estimates and patterns of consumption of the economic benefits
that embodies the items in these assets. Changes in useful lives of property, plant and equipment may result in revision of future
depreciation charges.
Impairment of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which
goodwill has been allocated. The value in use calculation requires the group to estimate the future cash flows expected to arise
from the cash-generating unit and a suitable discount rate in order to calculate the present value. The carrying amount of the
groups goodwill amounted to US$444,613,000. Further details are disclosed in Note 12.
Deferred tax assets
Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the
extent that it is probable that future taxable profits will be available against which the deductible temporary differences, unused
tax losses and unused tax credits can be utilised. Significant directors judgement is required to determine the amount of
deferred tax assets that can be recognised, based upon likely timing and level of future tax planning strategies. As of June 30,
2014, the unused tax losses and of the group is disclosed in Note 15.
30

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (contd)

Impairment of trade receivables
The group assesses at the end of each reporting period whether there is any objective evidence that a financial asset is impaired.
To determine whether there is objective evidence of impairment, the group considers factors such as the probability of
insolvency or significant difficulties of the debtor and default or significant delay in payments.
Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical
loss experience for assets with similar credit risk characteristics. While the estimation process includes historical data and
analysis, there is a significant amount of judgement applied in selecting inputs and analysing the results produced to determine
the impairment allowances. The carrying amounts of the groups trade receivables at the end of the reporting period are
disclosed in Note 7.
Allowance for inventories obsolescence
The group's policy for allowance for inventories obsolescence is based on the aging analysis of inventories and on
management's judgement on the realisability of the inventories. At the end of each reporting period, management is of the
opinion that the allowance for inventories obsolescence is adequate and not excessive. The carrying amount of group's
inventories at June 30, 2014 were approximately US$51,494,000, net of allowance for inventories of US$3,972,000.
Employee benefits
The groups defined benefit plan is determined based on actuarial valuation. The actuarial valuation involves making
assumptions regarding the discount rate, future salary increases and attrition rates. Due to the long term nature of the defined
benefit plan, such estimates are subject to significant uncertainty. Information on the actuarial technique and assumptions used
are disclosed in Note 19.
31

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT

(a)

Categories of financial instruments

The following table sets out the financial instruments as at the end of the reporting period:
US$000
Financial assets
Loans and receivables:
Trade and other receivables (Note 7)
Cash and cash equivalents
Derivative instruments in designated hedge accounting

118,491
117,077
310

Financial liabilities
Other financial liabilities:
Trade and other payables
Loans and borrowings
Derivative instruments in designated hedge accounting
(b)

145,295
73,639
115

Financial risk management policies and objectives (contd)

The operations of the group are subject to various financial risks which include credit risk, foreign currency risk, interest
rate risk, liquidity risk and market price risk. The group has taken measures to minimise their exposure to risks and/or
costs associated with the financing, investing and operating activities of the group.
The group seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposure.
The use of financial derivatives is governed by the groups policies approved by the Board of Directors. Compliance
with policies and exposure limits is monitored on an ongoing basis to mitigate risk exposures.
(i)

Foreign exchange risk management

The group transacts business in various foreign currencies. The groups foreign exchange exposures arise
mainly from the exchange rate movement of these foreign currencies against the respective entitys functional
currency.
32

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

At the end of the reporting period, the significant carrying amounts of monetary assets and monetary liabilities
denominated in currencies other than the respective entitys functional currency are as follows:
Assets
US$000

United States Dollar

Liabilities
US$000

7,187

16,005

Foreign currency sensitivity

The following table details the sensitivity analysis of a 10% increase and decrease in the relevant foreign
currencies against the functional currency of each group entity. 10% is the sensitivity rate used when reporting
foreign currency risk internally to key management personnel and represents the directors assessment of the
reasonably possible change in foreign exchange rates.
If the relevant foreign currency strengthens/weakens by 10% against the functional currency of each group
entity, profit or loss will increase/decrease by:
Profit or loss
Increase (decrease)
+10%
US$000

Profit or loss
Increase (decrease)
10%
US$000

(882)

882

United States Dollar

(ii)

Interest rate risk management

The groups fixed rate borrowings are exposed to a risk of change in their fair value due to changes in interest
rates. The groups variable rate borrowings are exposed to a risk of change in cash flows due to changes in
interest rates.
The group adopts a practice to continuously seek alternative banking facilities which provide competitive
interest rates to finance and/or refinance its working capital requirement.
33

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
4

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

Interest rate sensitivity
The sensitivity analyses below have been determined based on the exposure to interest rates for both derivatives
and non-derivative instruments at the end of the reporting period and the stipulated change taking place at the
beginning of the financial year and held constant throughout the reporting period in the case of instruments that
have floating rates. A 100 basis point increase or decrease is used when reporting interest rate risk internally to
key management personnel and represents the directors assessment of the reasonably possible change in interest
rates.
If interest rates had been 100 basis points higher or lower and all other variables were held constant, the groups
profit for the financial period would decrease/increase by US$110,000. This is mainly attributable to the group's
exposure to interest rates on its variable rate borrowings.
(iii)

Credit risk management

Credit risk is the risk of a financial loss to the group if a counterparty to a financial instrument fails to meet its
contractual obligations. The groups exposure to credit risk arises principally from its receivables from
customers.
Directors have a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit
evaluations are performed on all customers requiring credit over a certain amount.
As at the end of the reporting period, the maximum exposure to credit risk arising from receivables is
represented by the carrying amounts in the consolidated statement of financial position.

(iv)

Liquidity risk management

Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The
groups exposure to liquidity risk arises principally from its various payables, loans and borrowings.
The group maintains a level of cash and cash equivalents and bank facilities deemed adequate by the directors to
ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they fall due.
34

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

Liquidity and interest risk analysis
Non-derivative financial liabilities
The following tables detail the remaining contractual maturity for non-derivative financial liabilities. The tables
have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on
which the group can be required to pay. The table includes both interest and principal cash flows. The
adjustment column represents the possible future cash flows attributable to the instrument included in the
maturity analysis which is not included in the carrying amount of the financial liability on the consolidated
statement of financial position.

Weighted
average
On
effective demand
interest or within
rate
1 year
%
US$000
Noninterest
bearing
Variable
interest
rate
Fixed
interest
rate

Within 2
to 5
years
US$000

After 5
years
US$000

Adjustment
US$000

Total
US$000

145,295

145,295

1.75-11.00

27,374

37,313

(7,612)

57,075

7.00-9.38

1,411

7,730

8,852

(1,429)

16,564

174,080

45,043

8,852

(9,041)

218,934

35

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

Derivative financial liabilities
The following table details the liquidity analysis for derivative financial instruments. The table has been drawn
up based on the undiscounted net cash inflows/(outflows) on the derivative instrument that settle on a net basis
and the undiscounted gross inflows and (outflows) on those derivatives that require gross settlement. When the
amount payable or receivable is not fixed, the amount disclosed has been determined by reference to the
projected interest rates as illustrated by the yield curves existing at the end of the reporting period.

Gross settled:
Foreign exchange
forward contracts

On demand
or within
1 year
US$000

Within
2 to 5
years
US$000

After 5
years
US$000

115

36

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

(v)

Fair value

The group determines fair values of various financial assets and financial liabilities in the following manner
Fair value of financial asset and financial liability that re-measured at fair value on a recurring basis
Fair value as at
June 30, 2014
Financial
Assets
Liabilities
assets/liabilities US$000 US$000
Foreign
currency
forward
contracts

310

115

Fair
value
hierarchy

Valuation
technique(s)
and key
input(s)

Significant
unobservable
input

Relationship
of
unobservable
inputs to fair
value

Level 2

Discounted
cash flow.
Future cash
flows
are
estimated
based on
forward
exchange
rates (from
observable
forward
exchange
rates at the
end of
the reporting
period) and
contract
forward rates,
discounted at
a rate that
reflects the
credit risk of
various
counterparties.

N/A

N/A

There were no transfers between level 1 and level 2 during the financial period.

37

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (contd)

Fair value of the groups financial assets and financial liabilities that are not measured at fair value on a recurring basis
(but fair value disclosures are required)
The carrying amounts of the financial assets and financial liabilities recognised at amortised cost approximate their fair
values due to relatively short-term nature or immediate maturity of these financial instruments other than as stated
below:

(c)

Term Loans: As the term loans were obtained from local licensed financial institutions at the prevailing market rate,
the carrying value of these financial liabilities approximates its fair value.

Capital risk management policies and objectives

The groups objectives when managing capital is to maintain a strong capital base and safeguard the groups ability to
continue as a going concern, so as to maintain investor and creditor confidence and to sustain future development of the
business. The directors monitor and are determined to maintain an optimal debt-to-equity ratio that complies with debt
covenants.

RELATED COMPANY TRANSACTIONS

Compensation of key management personnel
The remuneration of other members of key management during the financial period was as follows:
US$000
Salaries and short-term benefits
Contribution to defined contribution plans

1,445
64
1,509
38

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

CASH AND CASH EQUIVALENTS

US$000
Cash at bank
Deposits placed with licensed banks

47,961
69,116

Cash and cash equivalents in the consolidated statement of cash flows

117,077

The average effective interest rate and maturity of deposits at the end of the financial period were as follows:
Effective interest rate
Maturity days
7

2.50%
40

TRADE AND OTHER RECEIVABLES

US$000
Current:
Trade receivables
Less: Allowance for doubtful debts

91,761
(1,255)

Other receivables and refundable deposits

90,506
18,083
108,589

Non-current:
Long-term loans to employees
Refundable deposits
Amount due from associate
Club membership
Others

3,581
3,087
539
472
2,223
9,902

Long-term loans to employees bear interest at rates ranging from 2.0% to 6.9% per annum and are repayable within the next 2
to 20 years.
39

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
7

TRADE AND OTHER RECEIVABLES (contd)

Amount due from associate, which arose mainly from payments on behalf, is interest-free and repayable after the next 12 months.
The average credit period on sales of goods is 30 days. No interest is charged on the outstanding trade receivables.
Trade receivables disclosed above include amounts that are past due at the end of the reporting period for which the group has not
recognised an allowance for doubtful debts because there has not been a significant change in credit quality and the amounts are
still considered recoverable. The group does not hold any collateral or other credit enhancements over these balances nor does it
have a legal right of offset against any amounts owed by the group to the counterparty.
The table below is an analysis of trade receivables as at June 30, 2014:
US$000
Not past due and not impaired
Past due and not impaired

51,057
39,449
90,506

The ageing of these trade receivables are as follows:

US$000
Not past due
Past due 1 - 30 days
Past due 31 - 90 days
Past due more than 90 days

51,057
19,481
11,737
8,231
90,506

Movement in the allowance for doubtful debts

US$000
At January 14, 2014 (date of incorporation)
Additions (Note 25)
Allowance no longer required (Note 25)
Effect of foreign currency exchange differences

1,549
(387)
93

At June 30, 2014

1,255

40

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
7

TRADE AND OTHER RECEIVABLES (contd)

Impaired trade receivables are all past due more than 90 days.
In determining the recoverability of a trade receivable, the group considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the end of the reporting date. The directors believe that no further
credit provision is required.

DERIVATIVE FINANCIAL INSTRUMENTS

US$000
Derivative financial assets:
Foreign currency forward contract

310

Derivative financial liabilities:

Foreign currency forward contract

115

The group utilises currency derivatives to hedge significant future transactions and cash flows. The group is party to a variety of
forward foreign exchange contracts and options in the management of its exchange rate exposures. The instruments purchased
are primarily denominated in the currencies of the groups principal markets.
At the end of the reporting period, the total notional amount of outstanding forward foreign exchange contracts to which the
group is committed are as follows.
Group
US$000
Forward foreign exchange contracts:
- Buy United States Dollar
- Sell United States Dollar
- Sell Singapore Dollar

4,358
33,050
1,500

In addition, the group had options to purchase United States Dollar equivalent to an amount of approximately US$4.36 million
and sell United States Dollar equivalent to an amount of approximately US$33.05 million as a hedge against exchange losses on
future purchases of goods and proceeds from settlement of intercompany loan by the subsidiaries within the group.
These arrangements are designed to address significant exchange exposures and are renewed on a revolving basis as required.
The fair value of currency derivatives that are designated and effective as cash flow hedges amounting to US$377,000 has been
recognised in other comprehensive income.
41

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
8

DERIVATIVE FINANCIAL INSTRUMENTS (contd)

The following table details the forward foreign currency contracts outstanding as at the end of the reporting period.

Outstanding contracts
Group
Sell United States Dollar
Less than 3 months
- Thai Baht
3 to 7 months
- Thai Baht
- Korean Won
Buy United States Dollar
Less than 3 months
- Korean Won
- Australian Dollar
3 to 7 months
- Korean Won
Sell Singapore Dollar
Less than 3 months
- Thai Baht
3 to 7 months
- Thai Baht

Average
exchange rate
US$000

Foreign
currency
000

Contract
value
US$000

Fair value
US$000

32.10

43,498

1,350

(1,341)

32.77

56,763

1,700

(1,750)

1,017.80

30,936,000

30,000

(30,497)

1,033.23

2,587,547

2,480

2,551

0.93

1,484

1,373

1,395

1,029.47

528,488

505

521

25.61

17,982

700

(692)

25.84

20,760

800

(799)
(30,612)

42

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
9

INVENTORIES
US$000
Raw materials
Work-in-progress
Finished goods
Spare parts and other supplies

20,988
694
26,355
7,429
55,466

Less: Allowance for inventories obsolescence

(3,972)
51,494

Recognised in profit or loss:

Inventories recognised as cost of sales

140,285

43

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
10

PROPERTY, PLANT AND EQUIPMENT

Mineral
reserves
and
leasehold
land
US$000

Buildings
US$000

Machinery,
office
equipment,
Properties
vehicles,
under construction
fixtures and
fittings
US$000
US$000

Total
US$000

Cost
At January 14, 2014 (date of
incorporation)
Acquired on acquisition of
subsidiaries
Additions
Disposals
Reclassification
Transferred to intangible
assets
Transferred to other
receivables
Effect of foreign currency
exchange
differences
At June 30, 2014

120,949

115,392

266,998

13,963

517,302

559

6,038

8,338

14,935

(33)

(7,790)

(7,823)

540

(540)

(31)

(31)

(75)

(75)

1,570

2,021

7,726

(275)

11,042

122,519

118,479

272,972

21,380

535,350

44

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
10

PROPERTY, PLANT AND EQUIPMENT (contd)

Mineral
reserves
and
leasehold
land
US$000
Accumulated depreciation
At January 14, 2014 (date of
incorporation)
Depreciation charge for the
period
Disposals
Effect of foreign currency
exchange
differences
At June 30, 2014
Carrying Amount
At June 30, 2014

Buildings
US$000

Machinery,
office
equipment,
Properties
vehicles,
under construction
fixtures and
fittings
US$000
US$000

Total
US$000

290

1,820

4,509

6,619

(2)

(5,283)

(5,285)

(21)

1,318

4,030

5,327

269

3,136

3,256

6,661

122,250

115,343

269,716

21,380

528,689

As at June 30, 2014, net book value of the groups property, plant and equipment held under finance lease arrangements totaled
US$698,000.
45

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
11

INTANGIBLE ASSETS
Other intangible assets
Software
US$000
Cost
At January 14, 2014 (date of
incorporation)
Acquired on acquisition of subsidiaries
Additions
Transferred from property, plant and
equipment
Effect of foreign currency exchange
differences

Total
US$000

US$000

1,005

114,360

115,365

31

31

31

31

190

(96)

94

1,226

114,295

115,521

114

3,078

3,192

294

(101)

193

At June 30, 2014

408

2,977

3,385

Carrying amount
At June 30, 2014

818

111,318

112,136

At June 30, 2014

Accumulated amortization
At January 14, 2014 (date of
incorporation)
Amortisation for the period (Note 25)
Effect of foreign currency exchange
differences

The other intangible assets included above have indefinite and finite useful lives. The intangible assets that have finite useful
lives, over which the assets are amortised, have an average amortisation period of eight years.
The groups other intangible assets are mainly consist of technology intellectual property and distribution network and customer
relationships. Technology intellectual property is licensed patents and trade secrets used by the group to manufacture and sell
plasterboard, joint compound, ceiling tile, ceiling grid, and other products.
The carrying amount of technology intellectual property at June 30, 2014 is US$53,200,000. The average remaining
amortisation period is 11 years. Distribution network and customer relationships are network distributors through which the
group indirectly sells to the end customers by geographical region. The carrying amount of distribution network and customer
relationships at June 30, 2014 is US$25,500,000. The average remaining amortisation period is 7 years.
46

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
12

GOODWILL
US$000
At January 14, 2014 (date of incorporation)
Arising on acquisition of subsidiaries
Effect of foreign currency exchange differences

442,637
1,976

At June 30, 2014

444,613

Goodwill acquired in a business combination is allocated, at acquisition, to the cash generating units (CGUs) that are expected
to benefit from that business combination. Before recognition of impairment losses, the carrying amount of goodwill had been
allocated as follows:
US$000
Korea
Thailand
Indonesia
China
India
Malaysia/Singapore
The Philippines
UAE
Vietnam
Associates

162,631
112,417
21,771
76,674
5,089
45,235
1,333
1,408
13,452
4,603
444,613

The group will test goodwill for impairment annually or more frequently if there are indications that goodwill might be
impaired.
The recoverable amounts of the cash generating units (CGUs) are determined from value in use calculations. The key
assumptions for the value in use calculations are those regarding the discount rates, growth rates and expected changes to
selling prices and direct costs during the period. The directors estimate discount rates using pre-tax rates that reflect current
market assessments of the time value of money and the risks specific to the CGUs. The growth rates are based on industry
growth forecasts. Changes in selling prices and direct costs are based on past practices and expectations of future changes in the
market. No impairment loss has been recognised for the group based on the above basis.
47

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
12

GOODWILL (contd)
The group prepares cash flow forecasts derived from the most recent financial budgets approved by directors for the next five
years based on an estimated growth rate of 9.2%.
The average rate used to discount the forecast cash flows from the group is 10%.

13

SUBSIDIARIES
Details of the subsidiaries are as follows:

Name of
subsidiary
USG Boral Building Products Sdn.
Bhd.
BGA Holdings Limited
South Korean Plasterboard
Corporation 1
Siamsum Corporation 1
Boral Plasterboard System Co. Ltd. 2
Boral Gypsum
Korea Co. Ltd. 2
China Plasterboard Corporation 1
Boral Gypsum (Shanghai)
Co. Ltd. 2
Boral Gypsum (Chongqing)
Co. Ltd. 2
Boral Gypsum (Chengdu)
Co. Ltd. 2
Boral Plasterboard (Shanghai) Co.
Ltd. 2

Country of
incorporation

Proportion of
ownership interest and
voting power held

Principal
activities

Malaysia

100%

Investment holding

Labuan, Malaysia
Labuan, Malaysia

100%
100%

Investment holding
Investment holding

Labuan, Malaysia
South Korea

100%
100%

South Korea

100%

British Virgin Islands

China

100%
100%

China

100%

China

100%

China

96.80%

Investment holding
Manufacturing and trading
of building materials
Manufacturing and trading
of building materials
Investment holding
Manufacturing and trading
of building materials
Manufacturing and trading
of building materials
Manufacturing and trading
of building materials
Manufacturing and trading
of building materials

(Forward)
48

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
13

SUBSIDIARIES (contd)

Name of
subsidiary
Boral Gypsum (Shandong)
Co. Ltd. 2
Boral Management Services
Shanghai Co. Ltd.5
USG Boral Building
Products India Pvt. Ltd.
(formerly known as Boral
India Private Ltd.).5
PT Petrojaya Boral Plasterboard

Boral Plasterboard (Malaysia) Sdn.

Bhd.
Boral Plasterboard (Marketing) Sdn.
Bhd.
Boral Building Materials (Malaysia)
Sdn. Bhd. 5
Boral Plasterboard Philippines Inc. 2
Boonyavajara Mining Co.,
Ltd. 2
Boral Prestia Co. Ltd. 2
The Siam Gypsum Industry Co. Ltd.

Country of
incorporation

Proportion of
ownership interest and
voting power held

China

100%

China

100%

India

100%

Manufacturing and trading

of building materials

Indonesia

100%

Malaysia

100%

Malaysia

100%

Manufacturing and trading

of building materials
Manufacturing and trading
of building materials
Trading of building materials

Malaysia

N/A

Philippines
Thailand

100%
100%

Thailand

100%

Thailand

71%

Thailand

71%

Thailand

71%

Principal
activities
Manufacturing and trading
of building materials
Management services

Currently under members

voluntary deregistration
Trading of building materials
Mining and trading of
building materials
Manufacturing and trading
of building materials
Investment holding

The Siam Gypsum Industry

(Saraburi) Co. Ltd. 2
The Siam Gypsum Industry
(Songkla) Co. Ltd. 2
(Forward)

49

Manufacturing and trading

of building materials
Manufacturing and trading
of building materials

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
13

SUBSIDIARIES (contd)

Name of
subsidiary
SGI Development Co.Ltd. 2
Gypsum Business Limited 3
Boral Middle East FZE 2
Boral Middle East (Dubai) L.L.C. 2, 4
USG Boral Gypsum
Vietnam Co., Ltd.
(formerly known as Boral
Gypsum Vietnam Co.
Ltd.) 2
USG Cayman Holdings Ltd 5
USG Asia Pacific Holdings Pte Ltd 5
USG ChinaLux S.a.r.l 5
USG Manufacturing Worldwide Ltd

Country of
incorporation

Proportion of
ownership interest and
voting power held

Thailand
Thailand
UAE
UAE
Vietnam

71%
100%
100%
49%
100%

Trading of building materials

Dormant
Trading of building materials
Trading of building materials
Manufacturing and trading
of building materials

Cayman Islands
Singapore
Luxembourg
Cayman Islands

100%
100%
100%
100%

Investment holding
Investment holding
Investment holding
Investment holding

Malaysia

100%

Malaysia
India

100%
100%

Singapore
UAE
Oman

100%
100%
55%

Oman

50%

Manufacturing and trading

of building materials
Trading of building materials
Manufacturing and trading
of building materials
Trading of building materials
Investment holding
Mining and trading of
building materials
Manufacturing and trading
of building materials

Principal
activities

USG Interiors (Far East) Sdn Bhd

USG Interiors (Malaysia) Sdn Bhd

USG India Private Limited 5
Pacific Interiors Supply Pte Ltd
International Resources Ltd 5
Zawawi Gypsum LLC 5
Zawawi Drywall LLC 5

Not required to be audited pursuant to the relevant regulations of the place of incorporation and are not material to the
group.

The financial statements of these subsidiaries are audited by a member firm of auditors of the company.
50

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
13

SUBSIDIARIES (contd)
3

The financial statements of these subsidiaries are audited by auditors other than auditors of the company.

Although the company owns less than half of the voting rights of Boral Middle East (Dubai) L.L.C., it has the power to
appoint and remove the majority of the board of directors and control of this entity is by their board. Consequently, the
entity is controlled by the company and is consolidated in these consolidated financial statements.

Consolidated based on management accounts.

Details of non-wholly owned subsidiaries that have non-controlling interests

The table below shows details of non-wholly owned subsidiaries of the group that have non-controlling interests:
Proportion of
ownership interests
and voting rights
Place of incorporation
held by nonand principal place of
controlling
business
interests

Profit (loss)
allocated to noncontrolling
interests

Accumulated
non-controlling
interests

US$000

US$000

Name of subsidiaries

The Siam Gypsum

Industry Co. Ltd. and
its subsidiaries
Individually immaterial
subsidiaries with noncontrolling interests

Thailand

29%

2,446

86,983

N/A

N/A

(512)

11,334

1,934

98,317

51

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
13

SUBSIDIARIES (contd)
Summarised financial information in respect of the groups subsidiaries that have material non-controlling interests is set out
below. The summarised financial information below represents amounts before intragroup eliminations.
US$000
Current assets
Non-current assets

51,723
86,662

Current liabilities
Non-current liabilities

(41,389)
(3,882)

Equity attributable to owners of the company

Non-controlling interests

66,111

Revenue
Profit for the financial period
Total comprehensive income for the financial period, net of tax

47,478

27,003

22,670
22,975

Dividends paid to non-controlling interests

4,369

Net cash inflow from operating activities

Net cash inflow from investing activities
Net cash outflow from financing activities

15,402
15,865
(30,911)

Net cash inflow

356

52

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

14

INVESTMENT IN ASSOCIATES
US$000
Cost of investment in associates
Share of post-acquisition loss

55,300
(866)
54,434

Details of the associates are as follows:

Name of
associate
Star-USG Building
Materials Co. Ltd 1
USG Middle East Ltd
1

Place of
incorporation and
operation

Proportion of
ownership interest and voting
power held

Principal
activities

China

50%

Trading of building materials

Saudi Arabia

45%

Manufacturing

Equity accounted based on management accounts.

Summarised financial information in respect of the groups associates is set out below:
US$000
Total assets
Total liabilities

105,957
(53,643)

Net assets

52,314

Revenue

29,384

Loss for the financial period

(1,513)

53

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
15

DEFERRED TAX ASSETS/(LIABILITIES)

US$000
At January 14, 2014 (date of incorporation)
Assumed at acquisition of subsidiaries
(Charge)/Credit to profit or loss for the period:
Property, plant and equipment
Retirement benefit obligations
Others

(18,283)
1,967
(71)
397
2,293

Effects of foreign currency exchange differences

(617)

At June 30, 2014

(16,607)

Certain deferred tax assets and liabilities have been offset in accordance with the groups accounting policy. The following is
the analysis of the deferred tax balances (after offset) for consolidated statement of financial position purposes:
US$000
Deferred tax liabilities
Deferred tax assets

(28,425)
11,818
(16,607)

Subject to the agreement by the tax authorities, at the end of the reporting period, the group has unutilised tax losses of
US$54,329,000 available for offset against future profits. No deferred tax assets have been recognised due to unpredictability of
future profit streams.

54

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014

15

DEFERRED TAX ASSETS/(LIABILITIES) (contd)

The deferred tax assets/(liabilities) provided in the consolidated financial statements are in respect of the tax effects on the
following:
US$000
Deferred tax assets (before offsetting):
Temporary differences arising from:
Property, plant and equipment
Provisions and retirement benefit obligations

10,205
4,077
14,282

Offsetting

(2,464)

Deferred tax assets (after offsetting)

11,818

Deferred tax liabilities (before offsetting):

Temporary differences arising from:
Property, plant and equipment
Others

(30,241)
(648)
(30,889)

Offsetting

2,464

Deferred tax liabilities (after offsetting)

16

(28,425)

TRADE AND OTHER PAYABLES

US$000
Trade payables
Other payables and accrued expenses

93,019
52,276
145,295

The average credit period for trade purchases ranges from 30 to 60 days. No interest is
charged on the outstanding balances.
55

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
17.

PROVISIONS

Non-Current Provision
Site
Restoration
Total
US$000
US$000
At January 14, 2014
(date of
incorporation)
Assumed on
acquisition
of subsidiaries
Additional provision
during the period
Utilisation of
provisions
Exchange
differences
on translating
foreign operations
At June 30, 2014

Current Provision
Restructuring
US$000

Litigations
US$000

Total
US$000

50

50

24

41

65

536

45

581

(9)

(9)

(4)

(1)

(5)

42

42

556

85

641

56

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
18

LOANS AND BORROWINGS

US$000
Current
Unsecured:
- Term loans
- Revolving credits
- Bank overdrafts

2,630
8,601
11,618

Secured:
- Finance lease payables

300
23,149

Non-Current
Unsecured:
27,949
Secured:
- Term loans
- Finance lease payables

22,068
473
50,490
73,639

The remaining maturities of the loans and borrowings at June 30, 2014 are as follows:
US$000
More than 1 year and less than 2 years
More than 2 years and less than 5 years
More than 5 years

6,231
36,108
8,151
50,490

Bank overdrafts are repayable on demand.

57

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
18

LOANS AND BORROWINGS (contd)

The weighted average interest rates per annum for loans and borrowings at June 30, 2014 are as follows:
% p.a.
Term loans
Revolving credits
Bank overdrafts (Note 6)
Finance lease payables

6.30-9.80
1.75-6.80
1.77-11.00
9.20

The secured term loans, revolving credits and bank overdrafts are backed by the corporate guarantees given by the company
and the shareholders.
Minimum lease
payments
US$000

Present value of
minimum lease
payments
US$000

Amounts payable under finance leases:

Within one year
In the second to fifth years inclusive

Less: future finance charges

Present value of lease obligations

355
518

300
473

873
(100)

773
-

773

773

The Group leased certain motor vehicles under finance leases. The average lease term is 5 years. For the period ended
30 June 2014, the average effective borrowing rate was 9.2%. The Group has option to purchase the equipment for a nominal
amount at the end of the lease terms.

58

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
19

RETIREMENT BENEFIT OBLIGATIONS

The defined benefit plan typically exposes the group to actuarial risks such as longevity risk and salary risk.
Type

Risk

Longevity risk

The present value of the defined benefits plan liability is calculated by reference to the best
estimate of the mortality of plan participants during their employment. An increase in the life
expectancy of the plan participants will increase the plans liability.
The present value of the defined benefit plan liability is calculated by reference to the future
salaries of plan participants. As such, an increase in the salary of the plan participants will
increase the plans liability.

Salary risk

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out by
external actuaries in the respective countries. The present value of the defined benefit obligation and the related current service
cost and past service cost, were measured using projected unit credit method.
The principal assumptions used for the purpose of the actuarial valuations were as follows:
% p.a.
Discount rate
Future salary increase
Employee provident fund

1.84 - 5.75
4.50 - 10.00
2.00 - 12.00

Movement in the liability recognised in the consolidated statement of financial position:

US$000
At January 14, 2014 (date of incorporation)
Assumed on acquisition of subsidiaries
Expense recognised in profit or loss
Benefits paid
Effect of exchange differences

10,794
1,924
(1,034)
(109)

At June 30, 2014

11,575
59

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
19

RETIREMENT BENEFIT OBLIGATIONS (contd)

The amount recognised in the consolidated statement of financial position are analysed as follows:
US$000
Present value of unfunded obligation
Fair value of plan assets

(5,510)

Net liability arising from retirement benefit obligations

11,575

17,085

Reconciliation of the present value of unfunded obligation are as follows:

US$000
At January 14, 2014 (date of incorporation)
Assumed on acquisition of subsidiaries
Benefits paid
Current service cost
Interest on obligation
Effect of foreign currency exchange differences

15,129
(1,034)
1,745
536
709

At June 30, 2014

17,085

The amounts recognised in profit or loss are as follows:

US$000
Current service cost
Interest on obligation

1,745
179
1,924

60

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
19

RETIREMENT BENEFIT OBLIGATIONS (contd)

Reconciliation in the fair value plan assets are as follows:
Group
US$000
At January 14, 2014 (date of incorporation)
Assumed on acquisition of subsidiaries
Interest income
Effect of foreign currency exchange differences

4,335
357
818

At June 30, 2014

20

5,510

SHARE CAPITAL
No. of shares
000

US$000

Issued and fully paid:

Ordinary shares:
At January 14, 2014 (date of incorporation)
Issued during the financial period

1,022,944

1,022,944

At June 30, 2014

1,022,944

1,022,944

Fully paid ordinary shares, which have no par value, carry one vote per share and a right to dividends as and when declared by
the company.
The company was incorporated on January 14, 2014 with an issued and paid-up share capital of US$2, comprising 2 ordinary
shares.
As approved by the directors via an ordinary resolution on February 28, 2014, the issued and paid-up share capital of the
company was increased from US$2, comprising 2 ordinary shares, to US$1,022,944,002, comprising 1,022,944,002 ordinary
shares, by way of issuance of 1,022,944,000 new ordinary shares amounting to US$1,022,944,000 to acquire the subsidiaries
as disclosed in Note 27.
61

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
21

RESERVES
Other capital reserve
Other capital reserve comprises the fair value reserve amounting to US$34,191,000, which resulted from the difference between
the fair value of assets contributed by Boral Limited and the USG Corporation against the total amount of shares issued to the
shareholders.
Translation reserve
The translation reserve comprises foreign currency differences arising from the translation of the financial statements of the
group entities to US$.
Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedges related
to hedged transactions that have not yet occurred.
Pension reserve
The pension reserve comprised the actuarial gains and losses on pension provision.

22

REVENUE
Revenue of the group relates to sales of plasterboard, ceiling tile, metal stud, compound and plaster, and other products.

23

FINANCE COSTS
US$000
Interest on bank overdrafts and loans
Other finance cost

2,568
96
2,664

62

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
24

INCOME TAX EXPENSE

US$000
Current tax:
Singapore
Foreign
Deferred tax (Note 15)

96
7,066
(2,293)
4,869

Domestic income tax is calculated at 17% of the estimated assessable profit for the period. Taxation for other jurisdictions is
calculated at the rates prevailing in the relevant jurisdictions.
The total charge for the period can be reconciled to the accounting profit as follows:
US$000
Profit before tax

14,052

Income tax expense calculated at 17%

Effects of different tax jurisdiction rates
Effects of:
Tax holidays and incentives
Expenses not deductible for tax purposes
Deferred tax asset not recognised
Withholding tax

2,389
1,363
(1,126)
531
(18)
1,730
4,869

63

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
25

PROFIT FOR THE FINANCIAL PERIOD

Profit for the financial period has been arrived after charging/(crediting) the following:
US$000
After charging:
Directors remuneration
Other employee benefits
Contribution to defined benefit plans
Defined contribution plan expense
Depreciation of property, plant and equipment (Note 10)
Amortisation of intangible assets (Note 11)
Allowance on doubtful debts (Note 7)
Write-down of value in inventories

1,159
27,625
293
1,924
6,619
3,192
1,549
1,749

After crediting:
Interest income
Allowance for doubtful debts no longer required (Note 7)
Net foreign exchange gains
Gains on disposal of property, plant and equipment
26

1,553
387
356
21

DIVIDEND PAID
On March 25, 2014, a subsidiary paid a dividend amounting to USD4,369,000 to non-controlling interests.

27

ACQUISITION OF SUBSIDIARIES
On February 28, 2014, the group acquired all the subsidiaries as detailed in Note 13 as a result of the joint venture arrangements
between USG Corporation, a company incorporated and listed in the United States of America, and Boral Limited, a company
incorporated and listed in Australia. This transaction has been accounted for by the acquisition method of accounting.
64

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
27

ACQUISITION OF SUBSIDIARIES (contd)

Assets acquired and liabilities assumed at the date of acquisition of subsidiaries are as follows:
US$000
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Tax recoverable
Derivative financial instruments
Inventories

96,541
80,049
4,472
15,857
312
53,787

Total current assets

251,018

Non-current assets
Property, plant and equipment
Intangible assets
Investment in associates
Deferred tax assets
Other receivables

517,302
115,365
55,300
11,471
7,786

Total non-current assets

707,224

Total assets

958,242

LIABILITIES
Current liabilities
Trade and other payables
Provisions
Loans and borrowings
Income tax payable
Derivative financial instruments

109,374
65
40,687
7,530
687

Total current liabilities

(Forward)

158,343

65

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
27

ACQUISITION OF SUBSIDIARIES (contd)

US$000
Non-current liabilities
Retirement benefit obligations
Provisions
Loans and borrowings
Deferred tax liabilities
Derivative financial liabilities

10,794
50
44,044
29,754
199

Total non-current liabilities

84,841

Total liabilities

243,184

Net assets acquired and liabilities assumed

715,058

The non-controlling interest in The Siam Gypsum Industry Co. Ltd. and its subsidiaries (29%), Boral Plasterboard (Shanghai)
Co., Ltd. (3%), Zawawi Gypsum LLC (45%) and Zawawi Drywall LLC (50%) recognised at the acquisition date were measured
by reference to the fair value of the non-controlling interests and amounted to US$88,700,000, US$800,000, US$32,200,000
and (US$21,140,000) respectively. The fair values were estimated by applying an income approach. The following were the
key model inputs used in determining the fair values:

Assumed discount rate range of 10% to 11%;

Assumed long-term sustainable growth rates up to 9.2%; and
Assumed adjustments because of the lack of control or lack of marketability that market participants would consider when
estimating the fair values of the non-controlling interests.

Goodwill arising on acquisition:

US$000
Consideration transferred
Plus: Non-controlling interests
Less: Fair value of identifiable net assets acquired

1,057,135
100,560
(715,058)

Goodwill arising on acquisition

442,637

66

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
27

ACQUISITION OF SUBSIDIARIES (contd)

It is not practical to disclose the information of the revenue and profit or loss of the subsidiaries for the current reporting period
as though the acquisition date for the business combination that occurred during the period had been as of the date of
incorporation as the completion of the business combination occurred later than the date of incorporation. Also, it is not
practical to obtain the consolidation information of those subsidiaries acquired before the completion of the business
combination.
Net cash inflow in acquisition of subsidiaries mainly arose from cash and cash equivalents acquired as below:
Group
US$000
Cash and cash equivalents

96,541

Goodwill arose in the acquisition of subsidiaries because the cost of the combination included a control premium. In addition,
the consideration paid for the combination effectively included amounts in relation to the benefit of expected synergies, revenue
growth, future market development and the assembled workforce of the subsidiaries. These benefits are not recognised
separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets
None of the goodwill arising on these acquisitions is expected to be deductible for tax purposes.
28

OPERATING LEASE COMMITMENTS

US$000
Minimum lease payments under operating leases included in the consolidated
statement of profit or loss and other comprehensive income

756

At the end of the reporting period, the group has outstanding commitments under non-cancellable operating leases, which fall
due as follows:
US$000
Within 1 year
Within 2 to 5 years

3,207
11,088
14,295

67

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2014
28

OPERATING LEASE COMMITMENTS (contd)

Operating lease payments represent rentals payable by the group for its office premises. Leases are negotiated for an average
term of 5 years and rentals are fixed for an average of 3 years.

29

CAPITAL COMMITMENTS

Group
US$000
Commitments for the acquisition of property, plant and equipment

30

16,880

COMPARATIVES
The consolidated financial statements cover the period from the date of incorporation on January 14, 2014 to June 30, 2014 or
for a period 5 months. This being the first set of consolidated financial statements, there are no comparative figures.

.
68

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
CONTENTS

Statement of directors
Independent auditors' report
Consolidated statement of financial position
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements

PAGE
1
2-3
4-5
6
7
8-9
10 - 68

USG BORAL BUILDING PRODUCTS PTE. LIMITED

AND ITS SUBSIDIARIES
(Registration No. 201401466N)

CONSOLIDATED FINANCIAL STATEMENTS

PERIOD FROM JANUARY 14, 2014
(DATE OF INCORPORATION)
TO JUNE 30, 2014