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<P align="center" style="font-size: 14pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>
<FONT style="font-size: 12pt">Washington, D.C. 20549
</FONT></B>

<P align="center" style="font-size: 18pt"><B>FORM 8-K</B>

<P align="center" style="font-size: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B>

<P align="center" style="font-size: 10pt"><B>Date of Report (Date of earliest event reported): September 26, 2008</B>

<P align="center">

<P align="center" style="font-size: 24pt"><B>USG Corporation<BR></B>
<FONT style="font-size: 10pt">(Exact name of registrant as specified in its charter)
</FONT>

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    <TD width="32%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="33%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="32%">&nbsp;</TD>
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<TR valign="bottom">
    <TD style="border-bottom: 1px solid #000000"><B>Delaware</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>1-8864</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>36-3329400</B></TD>
</TR>
<TR valign="top">
    <TD>(State or other Jurisdiction of Incorporation)</TD>
    <TD>&nbsp;</TD>
    <TD>(Commission File Number)</TD>
    <TD>&nbsp;</TD>
    <TD>(IRS Employer Identification No.)</TD>
</TR>
</TABLE>

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    <TD width="49%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="49%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD style="border-bottom: 1px solid #000000"><B>550 West Adams Street, Chicago, Illinois<BR></B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>60661-3673</B></TD>
</TR>
<TR valign="top">
    <TD>(Address of Principal Executive Offices)</TD>
    <TD>&nbsp;</TD>
    <TD>(Zip Code)</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt">Registrant&#146;s telephone number, including area code: <B>(312) 436-4000</B>


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    <TD nowrap style="border-bottom: 1px solid #000000"><B>&nbsp;</B></TD>
</TR>
<TR>
    <TD nowrap>(Former name or former address if changed since last report.)</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:

<P align="left" style="font-size: 10pt">
<FONT face="Wingdings">&#111;</FONT> Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<BR>


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<P align="center" style="font-size: 10pt; display: none">1
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<P align="left" style="font-size: 10pt"><B>Section&nbsp;5 &#150; Corporate Governance and Management</B>


<P align="left" style="font-size: 10pt"><B>Item&nbsp;5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.</B>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>(d)</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>On September&nbsp;26, 2008, the Compensation and Organization Committee of the Registrant&#146;s Board of
Directors approved new forms of Employment and Change in Control Severance Agreements for the Registrant&#146;s
executive officers to be entered into effective October&nbsp;1, 2008. The new agreements will supersede the
existing Employment and Change in Control Severance Agreements between the Registrant and its executive
officers. The new agreements reflect principally changes intended to effect compliance with Section&nbsp;409A
of the Internal Revenue Code, as amended (the &#147;Code&#148;), but the terms, benefits and costs of the new
agreements are not materially different from those of the existing agreements. The following are brief
descriptions of the terms and conditions of the new forms of Employment and Change in Control Severance
Agreements.</TD>
</TR>

</TABLE>



<P align="left" style="margin-left:7%; font-size: 10pt"><U>Employment Agreement</U>. The form of Employment Agreement provides that during the employment
period, the executive will receive an annual base salary and may participate in the Registrant&#146;s
benefit plans and perquisite programs on the same basis as other similarly situated executives of the
Registrant. If the executive&#146;s employment is terminated by the Registrant without &#147;cause,&#148; the
Registrant will pay the executive the following severance benefits: a lump sum payment equal to two
times the sum of the executive&#146;s base salary plus the executive&#146;s target annual bonus for the year in
which termination of employment occurs; a lump sum payment equal to the total cost of continuing the
executive&#146;s medical, dental, vision, long-term disability and life insurance coverage for 18&nbsp;months
following termination of the executive&#146;s employment; a lump sum payment equal to the present value of
providing an additional two years of service and age credit under the Registrant&#146;s defined benefit
retirement plans; and outplacement services for a period of at least six months. Severance benefits
will be provided in a manner that complies with Section&nbsp;409A of the Code and are conditioned upon the
executive&#146;s compliance with confidentiality and non-compete obligations and signing a release of
potential claims against the Registrant.



<P align="left" style="margin-left:7%; font-size: 10pt"><U>Change in Control Severance Agreements</U>. Pursuant to the form of Change in Control Severance
Agreement approved for the Registrant&#146;s current named executive officers and two additional executive
officers, if, within the two-year period following a &#147;change in control&#148; of the Registrant, the
executive&#146;s employment is terminated by the Registrant except for &#147;cause,&#148; or the executive resigns
because of certain adverse changes in his or her compensation, benefits or position, then severance
benefits will be payable by the Registrant. Severance benefits include: a lump sum payment equal to
the greater of the executive&#146;s pro-rated target annual bonus for the year in which the termination of
employment occurs or the year in which the change in control of the Registrant occurs; a lump sum
payment equal to three times the sum of the executive&#146;s base salary plus the greater of the executive&#146;s
target annual bonus for the year in which the termination of employment occurs or the year in which the
change in control of the Registrant occurs; the continuation of the executive&#146;s coverage under the
Registrant&#146;s medical, dental, vision, long-term disability and life insurance benefit plans for 18
months following termination of the executive&#146;s employment; a lump sum payment equal to the present
value of the executive&#146;s continued participation in the Registrant&#146;s medical, dental, vision,
long-term disability and life insurance plans for an additional 18&nbsp;months following termination of the
executive&#146;s employment; a lump sum payment equal to the present value of providing an additional three
years of service and age credit under the Registrant&#146;s defined benefit retirement plans; and
outplacement services for a period of at least six months. Payments and benefits under the Change in
Control Severance Agreement are subject to reduction in order to avoid the application of the excise
tax on &#147;excess parachute payments&#148; under the Code, but only if the reduction is less than 10% of the
total amounts payable that would constitute &#147;parachute payments.&#148; If the reduction is 10% or more of
the total amounts payable that would constitute &#147;parachute payments,&#148; the payments will not be
decreased, but rather will be increased by an amount sufficient to provide the executive, after tax, a
net amount equal to the Code Section&nbsp;4999 excise tax imposed on such amounts. Severance benefits will
be provided in a manner that complies with Section&nbsp;409A of the Code and are conditioned upon the
executive&#146;s compliance with confidentiality and non-compete obligations and signing a release of
potential claims against the Registrant. The Registrant must pay attorneys&#146; fees and expenses incurred
by an executive in enforcing his or her rights under the Change in Control Severance Agreement
following a change of control.



<P align="left" style="margin-left:7%; font-size: 10pt">Pursuant to the form of Change in Control Severance Agreement approved for other executive officers of
the Registrant, essentially the same severance benefits as described above are to be provided in
essentially the same circumstances, except that these executive officers are eligible to receive lump
sum payments equal to (1)&nbsp;two rather than three times the applicable compensation, (2)&nbsp;the present
value of continued participation in benefit plans for six rather than 18&nbsp;months and (3)&nbsp;the present
value of two rather than three years of additional service and age credit under the Registrant&#146;s
defined benefit retirement plans.



<P align="left" style="margin-left:7%; font-size: 10pt">If upon a termination of employment, an executive is entitled to severance benefits under the
Employment Agreement and the Change in Control Severance Agreement, the executive will be entitled to
severance benefits only under the agreement that provides for greater benefits and will not be entitled
to benefits under both agreements.

<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt; display: none">2
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<P align="left" style="font-size: 10pt"><B>Section&nbsp;9 &#150; Financial Statements and Exhibits</B>


<P align="left" style="font-size: 10pt"><B>Item&nbsp;9.01 Financial Statements and Exhibits.</B>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>(d)</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Exhibits.</TD>
</TR>

</TABLE>



<P align="left" style="margin-left:3%; font-size: 10pt">Exhibit&nbsp;10.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Form of Employment Agreement



<P align="left" style="margin-left:3%; font-size: 10pt">Exhibit&nbsp;10.2 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Form of Change in Control Severance Agreement (Tier 1 Benefits)



<P align="left" style="margin-left:3%; font-size: 10pt">Exhibit&nbsp;10.3 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Form of Change in Control Severance Agreement (Tier 2 Benefits<B>)</B>

<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt; display: none">3
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<P align="center" style="font-size: 10pt"><U><B>SIGNATURE</B></U>



<P align="left" style="font-size: 10pt; text-indent: 3%">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly authorized.



<P align="left" style="margin-left:46%; font-size: 10pt">USG CORPORATION
<BR>
Registrant


<P align="left" style="font-size: 10pt">Date: October&nbsp;2, 2008



<P align="left" style="margin-left:46%; font-size: 10pt; margin-top: -11pt">By: <U><B>/</B>s/ Stanley L. Ferguson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
<BR>
Stanley L. Ferguson,
<BR>
Executive Vice President
<BR>
and General Counsel

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<P align="center" style="font-size: 10pt; display: none">4
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<P align="center" style="font-size: 10pt"><B>EXHIBIT INDEX</B>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="87%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Exhibit No.</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Exhibit</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Employment Agreement</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Change in Control Severance Agreement (Tier 1 Benefits)</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Change in Control Severance Agreement (Tier 2 Benefits)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt; display: none">5




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{"company-data": {"conformed-name": "USG CORP", "cik": "0000757011", "assigned-sic": "3270", "irs-number": "363329400", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-08864", "film-number": "081102005"}, "business-address": {"street1": "550 WEST ADAMS STREET", "street2": "DEPARTMENT 188", "city": "CHICAGO", "state": "IL", "zip": "60661", "phone": "312-606-4000"}, "mail-address": {"street1": "DEPARTMENT #188", "street2": "550 WEST ADAMS STREET", "city": "CHICAGO", "state": "IL", "zip": "60661"}}
Filed by Bowne Pure Compliance
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 26, 2008
USG Corporation
(Exact name of registrant as specified in its charter)
Delaware
1-8864
36-3329400
(State or other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
550 West Adams Street, Chicago, Illinois
60661-3673
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code:
(312) 436-4000
(Former name or former address if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Section 5 – Corporate Governance and Management
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
(d)
On September 26, 2008, the Compensation and Organization Committee of the Registrant's Board of
Directors approved new forms of Employment and Change in Control Severance Agreements for the Registrant's
executive officers to be entered into effective October 1, 2008. The new agreements will supersede the
existing Employment and Change in Control Severance Agreements between the Registrant and its executive
officers. The new agreements reflect principally changes intended to effect compliance with Section 409A
of the Internal Revenue Code, as amended (the "Code"), but the terms, benefits and costs of the new
agreements are not materially different from those of the existing agreements. The following are brief
descriptions of the terms and conditions of the new forms of Employment and Change in Control Severance
Agreements.
Employment Agreement
. The form of Employment Agreement provides that during the employment
period, the executive will receive an annual base salary and may participate in the Registrant's
benefit plans and perquisite programs on the same basis as other similarly situated executives of the
Registrant. If the executive's employment is terminated by the Registrant without "cause," the
Registrant will pay the executive the following severance benefits: a lump sum payment equal to two
times the sum of the executive's base salary plus the executive's target annual bonus for the year in
which termination of employment occurs; a lump sum payment equal to the total cost of continuing the
executive's medical, dental, vision, long-term disability and life insurance coverage for 18 months
following termination of the executive's employment; a lump sum payment equal to the present value of
providing an additional two years of service and age credit under the Registrant's defined benefit
retirement plans; and outplacement services for a period of at least six months. Severance benefits
will be provided in a manner that complies with Section 409A of the Code and are conditioned upon the
executive's compliance with confidentiality and non-compete obligations and signing a release of
potential claims against the Registrant.
Change in Control Severance Agreements
. Pursuant to the form of Change in Control Severance
Agreement approved for the Registrant's current named executive officers and two additional executive
officers, if, within the two-year period following a "change in control" of the Registrant, the
executive's employment is terminated by the Registrant except for "cause," or the executive resigns
because of certain adverse changes in his or her compensation, benefits or position, then severance
benefits will be payable by the Registrant. Severance benefits include: a lump sum payment equal to
the greater of the executive's pro-rated target annual bonus for the year in which the termination of
employment occurs or the year in which the change in control of the Registrant occurs; a lump sum
payment equal to three times the sum of the executive's base salary plus the greater of the executive's
target annual bonus for the year in which the termination of employment occurs or the year in which the
change in control of the Registrant occurs; the continuation of the executive's coverage under the
Registrant's medical, dental, vision, long-term disability and life insurance benefit plans for 18
months following termination of the executive's employment; a lump sum payment equal to the present
value of the executive's continued participation in the Registrant's medical, dental, vision,
long-term disability and life insurance plans for an additional 18 months following termination of the
executive's employment; a lump sum payment equal to the present value of providing an additional three
years of service and age credit under the Registrant's defined benefit retirement plans; and
outplacement services for a period of at least six months. Payments and benefits under the Change in
Control Severance Agreement are subject to reduction in order to avoid the application of the excise
tax on "excess parachute payments" under the Code, but only if the reduction is less than 10% of the
total amounts payable that would constitute "parachute payments." If the reduction is 10% or more of
the total amounts payable that would constitute "parachute payments," the payments will not be
decreased, but rather will be increased by an amount sufficient to provide the executive, after tax, a
net amount equal to the Code Section 4999 excise tax imposed on such amounts. Severance benefits will
be provided in a manner that complies with Section 409A of the Code and are conditioned upon the
executive's compliance with confidentiality and non-compete obligations and signing a release of
potential claims against the Registrant. The Registrant must pay attorneys' fees and expenses incurred
by an executive in enforcing his or her rights under the Change in Control Severance Agreement
following a change of control.
Pursuant to the form of Change in Control Severance Agreement approved for other executive officers of
the Registrant, essentially the same severance benefits as described above are to be provided in
essentially the same circumstances, except that these executive officers are eligible to receive lump
sum payments equal to (1) two rather than three times the applicable compensation, (2) the present
value of continued participation in benefit plans for six rather than 18 months and (3) the present
value of two rather than three years of additional service and age credit under the Registrant's
defined benefit retirement plans.
If upon a termination of employment, an executive is entitled to severance benefits under the
Employment Agreement and the Change in Control Severance Agreement, the executive will be entitled to
severance benefits only under the agreement that provides for greater benefits and will not be entitled
to benefits under both agreements.
Section 9 – Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(d)
Exhibits.
Exhibit 10.1       Form of Employment Agreement
Exhibit 10.2       Form of Change in Control Severance Agreement (Tier 1 Benefits)
Exhibit 10.3       Form of Change in Control Severance Agreement (Tier 2 Benefits
)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly authorized.
USG CORPORATION
Registrant
Date: October 2, 2008
By:
/
s/ Stanley L. Ferguson
Stanley L. Ferguson,
Executive Vice President
and General Counsel
EXHIBIT INDEX
Exhibit No.
Exhibit
10.1
Form of Employment Agreement
10.2
Form of Change in Control Severance Agreement (Tier 1 Benefits)
10.3
Form of Change in Control Severance Agreement (Tier 2 Benefits)