EXHIBIT 10(v)

                                 USG CORPORATION
                           KEY EMPLOYEE RETENTION PLAN
                         (JULY 1, 2001 - JUNE 30, 2004)

GENERAL PROGRAM DESCRIPTION

The USG Corporation Key Employee Retention Program (KERP) provides eligible
participants with a cash payment equal to a specified percentage of their annual
Base Salary payable in semi-annual installments in return for continued
employment with USG Corporation or one of its participating subsidiaries. To be
eligible for payment of an award for any semi-annual period, the participant
must continue to be an employee in good standing (as defined below) on the last
day of the semi-annual period. The initial Plan was implemented May 16, 2001 and
will continue in effect through June 30, 2004 subject to annual approval by the
Compensation and Organization Committee of the USG Corporation Board of
Directors, or until the bankruptcy court confirms plans of reorganization for
USG Corporation and its subsidiaries, whichever comes first. USG Corporation
retains the right to propose a subsequent retention plan to begin following the
conclusion of the current KERP.

ELIGIBILITY

To be eligible for the Key Employee Retention Program, you must be employed by
USG Corporation or a participating subsidiary, and be eligible to participate in
the USG Corporation Long Term Equity Program.

AWARD AMOUNTS

Awards under the Key Employee Retention Program are computed as a percentage of
annual Base Salary in effect on the first day of the semi-annual award period.
Individual KERP award percentages and projected dollar awards are provided to
each participant in the form of a Statement of Acceptance. Salary increases or
position changes during a semi-annual period will not affect the award during
that period. Such changes will be factored into the award amount effective with
the next semi-annual award period.



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AWARD QUALIFICATION

The participant must be an "employee in good standing" of USG Corporation or one
of its participating subsidiaries throughout and including the last day of any
semi-annual period to receive that installment of the KERP award. The first
semi-annual period of the KERP ends on December 31, 2001 and the last ends on
June 30, 2004.

An "employee in good standing" means that the participant is employed by USG or
a participating subsidiary throughout and including the last day of the
semi-annual period in an eligible regular full-time or part-time position that
is not temporary and is actively fulfilling the duties of that position, is on
an approved paid leave from that position, or is on an unpaid leave protected by
statute. This does not include employees on continuing payrolls, unpaid leave
(not protected by statute), or suspension.

AWARD PAYMENT

Awards earned under the plan shall become a liability of USG Corporation or the
appropriate subsidiary as of the last day of any semi-annual period and will be
paid in the next month or as soon as practical. Awards are taxable to the
eligible participant when paid and are considered benefit eligible for the USG
Corporation Retirement Plan, the USG Corporation Investment Plan, and any
supplemental plans that complement these plans, in accordance with the
provisions of those plans.

TERMINATION BY DISABILITY, DEATH, RETIREMENT OR DISCHARGE WITHOUT CAUSE

In the event that an eligible participant in the KERP dies, becomes disabled,
retires or is discharged without cause, that participant may be recommended for
a pro rated award for the current semi-annual period based on the number of full
months worked.

ALL OTHER TERMINATIONS AND VOLUNTARY RESIGNATIONS

Participants whose employment is terminated for any reason other than those
listed above, including voluntary resignation, will not be eligible for a KERP
pro rated award payment for the semi-annual period in which they terminate
employment.

NEWLY ELIGIBLE PARTICIPANTS

Participants who become eligible for the KERP during a semi-annual period
through promotion or who are hired into a position that is eligible to
participate in the USG Corporation Long Term Equity Program may be recommended
for a pro rated award payment for that semi-annual period provided they remain
an "employee in good standing" through the last day of the period. The pro rated
award payment would be based on the number of full months



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worked. A participant must be in an eligible position for two full months to
earn a pro rated award.

SPECIAL AWARDS

In addition to the KERP award provided by this program, special awards may be
recommended for any participant (other than Officers of the Corporation) or
non-participant who has made an extraordinary contribution to USG Corporation or
its subsidiaries' welfare or earnings.

GENERAL PROVISIONS

The KERP and its provisions have been approved by the Compensation and
Organization Committee of the USG Corporation Board of Directors, subject to
annual approval by that Committee. Program eligibility, award amounts, award
payments and administrative rules are interpreted, determined and approved by
the Vice President Human Resources, USG Corporation. In the event that the
bankruptcy court confirms plans of reorganization for USG Corporation and its
subsidiaries prior to the end of the plan on June 30, 2004, a pro rata award
will be determined for the current semi-annual period and paid to participants.
In addition, for Corporation officers, a pro-rata portion of the June 30, 2004
award would be paid. For all other participants excluding those with a 30%
annual KERP award, a pro rata portion of the December 31,2002 award would be
paid if the reorganization occurs before that date. Otherwise, a pro rata
portion of the June 30, 2004 KERP award would be paid.

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 or to remove the individual from the employment of
the Corporation at any time, all of which rights and powers are expressly
reserved.




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