8-K

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): October 16, 2013

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	60661-3676
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (312) 436-4000

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 (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 1 – Registrant’s Business and Operations

Item 1.01 Entry into a Material Definitive Agreement.

On October 16, 2013, USG Corporation (“USG” or the “Company”) entered into a share sale and subscription agreement (the “Asia Subscription Agreement”) by and among the Company, USG Netherlands Global Holdings B.V., Boral Limited (“Boral”), Boral International Pty Limited, and Boral Gypsum Asia Sdn Bhd, and a share sale and subscription agreement (the “Australasia Subscription Agreement” and together with the Asia Subscription Agreement, the “Subscription Agreements”) by and among the Company, USG Foreign Investments, Ltd., USG Netherlands Global Holdings B.V., Boral, Boral Building Materials Pty Limited, and Boral Australian Gypsum Limited.

Pursuant to the Subscription Agreements and the Shareholders Agreement (as defined below), USG and Boral have agreed to establish a joint venture (the “USG Boral Joint Venture”) to manufacture, distribute and sell certain building products, mine raw gypsum and sell natural and synthetic gypsum throughout Asia, Australasia and the Middle East (the “Territory”). The products that USG and Boral expect to manufacture and distribute through the USG Boral Joint Venture include products for wall, ceiling, floor lining and exterior systems that utilize gypsum, wallboard, mineral fiber ceiling tiles, cement board, steel grid and studs, joint compound and other products.

Under the terms of the Subscription Agreements, USG will acquire through its subsidiaries 50% of the equity interest of each of USG Boral Building Products Pte Limited (“USG Boral Asia”), which will be a newly formed company and the sole shareholder of Boral Gypsum Asia Sdn Bhd (the “Boral Asia Business”), and Boral Australian Gypsum Limited (the “Boral Australia Business” and together with the Boral Asia Business, the “Boral Business”), which will change its name to USG Boral Building Products Pty Limited (“USG Boral Australasia”). Boral will hold through its subsidiaries the remaining 50% of each of USG Boral Asia and USG Boral Australasia. USG Boral Asia and USG Boral Australasia, together with their respective subsidiaries, will constitute the USG Boral Joint Venture.

The Company expects to fund its investment in the USG Boral Joint Venture through a $500 million cash payment to Boral, the contribution to the USG Boral Joint Venture of certain USG businesses located in the Territory and the grant to the USG Boral Joint Venture of a license to use certain USG intellectual property rights in the Territory. In the event certain performance targets are satisfied by the USG Boral Joint Venture, the Company will also pay Boral earnout payments in the amount 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. Boral will fund its investment in the USG Boral Joint Venture through the contribution of the Boral Business and the grant to the USG Boral Joint Venture of a license to use certain Boral intellectual property rights in the Territory.

The USG Boral Joint Venture would be operated in accordance with the terms of a shareholders agreement (the “Shareholders Agreement”) that the Company and its subsidiaries expect to enter into with Boral and its subsidiaries upon the consummation of the Subscription Agreements.

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The Shareholders Agreement provides that each of USG and Boral initially will be entitled to appoint four directors (one for each 12.5% interest held in the USG Boral Joint Venture by each shareholder) to the board of directors of each of USG Boral Asia and USG Boral Australasia and one additional local director to the board of USG Boral Asia. The chair of each board of directors is expected to be Jennifer Scanlon, USG’s Senior Vice President and President, International, through December 31, 2015. Thereafter, the right to appoint the chair will rotate every two years between USG and Boral. Frederic de Rougemont, the current Chief Executive Officer of the Boral Business, is expected to be the chief executive officer of the USG Boral Joint Venture, and Paul Monzella, Senior Vice President of United States Gypsum Company, is expected to be its chief financial officer. USG and Boral jointly will appoint any future chief executive officer or chief financial officer of the USG Boral Joint Venture.

Generally, any matter considered by the boards of USG Boral Asia and USG Boral Australasia would be approved by a majority vote. Certain specified fundamental matters would be approved only by the unanimous consent of the entire board, including, among other things, approval of a strategic plan and budget for the USG Boral Joint Venture, certain material contracts or transactions involving the joint venture, the declaration of dividends and the appointment of the chief executive officer and chief financial officer. In addition, certain fundamental matters would be approved only by the unanimous consent of those shareholders holding at least a 37.5% interest in the USG Boral Joint Venture (each such shareholder, a “Major Shareholder”), including, among other things, capital calls, changes to the business, certain material transactions involving the joint venture and matters related to the disposal of intellectual property. Certain other fundamental matters would be approved only by the unanimous consent of those shareholders holding at least a 12.5% interest in the USG Boral Joint Venture, including the issuance of additional securities of either USG Boral Asia or USG Boral Australasia, changes to the targeted dividend policy of the joint venture, matters related to the protection of intellectual property and the winding up of either of USG Boral Asia and USG Boral Australasia. The Shareholders Agreement includes a mechanism for the resolution of a deadlock at either the board or shareholder level. The mechanism would escalate from required negotiations at the USG and Boral parent company level, through mediation and may finally trigger a sale process conducted by a third party sale agent.

Under the Shareholders Agreement, the business of the USG Boral Joint Venture would be conducted in accordance with an annually approved budget and a rolling five-year strategic plan, each subject to approval by the unanimous vote of the boards. The USG Boral Joint Venture would target the distribution of 50% of combined after tax profits to USG and Boral in proportion to their respective ownership interests; provided, however, that the USG Boral Joint Venture would not pay dividends if such payments are, among other things, restricted pursuant to the terms of any credit facilities maintained by the USG Boral Joint Venture, inconsistent with the then-applicable strategic plan, or illegal. It is anticipated that the balance of the combined after tax profits would be retained for reinvestment in the business of the USG Boral Joint Venture. If the USG Boral Joint Venture requires additional funding for its operations and has exhausted all other reasonable alternatives, the shareholders, by unanimous vote of the Major Shareholders, may approve a capital call, provided that generally no shareholder will be obligated to provide additional funding, and provided further that any shareholder that does not provide additional funding in response to an approved capital call may be subject to dilution.

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Under the Shareholders Agreement, the USG Boral Joint Venture has the exclusive right to conduct its business in the Territory. In addition, the Shareholders Agreement contains non-competition and non-solicitation provisions applicable to each of USG, Boral and their respective affiliates and confidentiality provisions applicable to all parties.

The Company and Boral have unconditionally and irrevocably guaranteed the obligations of their respective subsidiaries under the Subscription Agreements and have agreed to indemnify the other party and its subsidiaries for all losses, actions, proceedings and judgments resulting from any default or delay in performance by their respective subsidiaries thereunder. The Shareholders Agreement contains similar guarantee and indemnification provisions.

For a period of seven years following entry into the Shareholders Agreement, subject to certain exceptions, neither USG nor Boral would be permitted to dispose of any of their shares in the USG Boral Joint Venture without the written consent of the other shareholder. Thereafter, USG or Boral would be permitted to dispose of all (but not less than all) of their respective shares in the USG Boral Joint Venture in accordance with certain preemptive rights of the other party.

Upon the occurrence of certain events of default, including a change of control of USG or Boral or certain of their affiliates, the non-defaulting shareholder would have the right to purchase all (but not less than all) of the defaulting shareholder’s shares in the USG Boral Joint Venture at fair market value, as determined in accordance with the Shareholders Agreement. The Shareholders Agreement will be terminable at any time by USG’s written agreement with Boral or upon a shareholder becoming the sole shareholder of all interests in the USG Boral Joint Venture.

USG intends to fund the cash portion of its investment in the USG Boral Joint Venture with up to $150 million of cash on hand and $350 million of long term debt. In addition, on October 16, 2013, USG entered into a bridge commitment letter (the “Bridge Commitment Letter”) with Goldman Sachs Lending Partners LLC and JPMorgan Chase Bank, N.A. (collectively, the “Bridge Commitment Lenders”) and J.P. Morgan Securities LLC, pursuant to which the Bridge Commitment Lenders have committed to provide, in the event necessary, unsecured senior increasing rate bridge loans in an aggregate principal amount of $350 million on the terms and subject to the conditions set forth in the Bridge Commitment Letter. The obligation of the Bridge Commitment Lenders to provide any debt financing under the Bridge Commitment Letter is subject to certain customary conditions. The final termination date for the Bridge Commitment Letter is February 17, 2014. USG will not draw any bridge loans under the facility contemplated by the Bridge Commitment Letter if USG secures a sufficient amount of long-term debt financing necessary to fund the cash portion of the investment from other sources.

As an ongoing operation, it is intended that the USG Boral Joint Venture will be funded from its net cash flow from operations and third-party financing.

In connection with the closing of the USG Boral Joint Venture transaction, the parties will also enter into various ancillary agreements. These ancillary agreements include certain intellectual property license agreements, which will govern the USG Boral Joint Venture’s use of USG and Boral intellectual property, and transition services agreements, pursuant to which the parties will, on a transitional basis, provide the USG Boral Joint Venture with certain support services and other assistance after closing.

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The Subscription Agreements contain customary representations and warranties made by each of USG, Boral and their respective subsidiaries party thereto, and USG, Boral and their respective subsidiaries have also agreed to various covenants in the Subscription Agreements, including, among other things, covenants (i) to conduct their respective material operations in the ordinary course of business consistent with past practice and (ii) not to take certain actions prior to the closing of the USG Boral Joint Venture transaction without prior consent of the other.

USG currently expects to close on the USG Boral Joint Venture transaction in the first quarter of 2014, with a targeted closing date of January 31, 2014. The closing of the USG Boral Joint Venture transaction is subject to certain customary conditions precedent, including, among other things, receipt of necessary regulatory approvals and third party consents.

The foregoing description of the Subscription Agreements and the Shareholders Agreement is qualified in its entirety by reference to the Asia Subscription Agreement, the Australasia Subscription Agreement and the form of Shareholders Agreement, respectively, which are filed as Exhibit 2.1, Exhibit 2.2 and Exhibit 10.1 hereto, respectively, and incorporated herein by reference.

The Subscription Agreements and form of Shareholders Agreement have been included as exhibits to this Current Report on Form 8-K to provide investors and security holders with information regarding their respective terms. They are not intended to provide any other financial information about the parties thereto or their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the Subscription Agreements or the Shareholders Agreement are made only for purposes of those agreements and as of specific dates; are solely for the benefit of the parties thereto; may be subject to limitations agreed upon by such parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties thereto instead of establishing these matters as facts; and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts or condition of the parties to the Subscription Agreements or the Shareholders Agreement or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the dates of the Subscription Agreements or the Shareholders Agreement, which subsequent information may or may not be fully reflected in public disclosures by the parties thereto.

Section 2 – Financial Information

Item 2.02 Results of Operations and Financial Condition.

On October 16, 2013, the Company issued a press release containing preliminary, unaudited results for the quarter ended September 30, 2013. A copy of the press release is furnished as Exhibit 99.1 hereto.

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The information contained in this Item 2.02, including the Exhibit hereto, shall not be deemed to be filed for purposes of the Securities Exchange Act of 1934 and it shall not be deemed to be incorporated by reference in any filing under the Securities Act of 1933 except as expressly set forth by specific reference in such filing.

Section 7 – Regulation FD

Item 7.01 Regulation FD Disclosure.

On October 16, 2013, the Company and Boral issued a joint press release announcing the USG Boral Joint Venture transaction. A copy of the press release is furnished as Exhibit 99.2 hereto.

The Company and Boral will hold a joint conference call and webcast to discuss the USG Boral Joint Venture at 6:30 p.m. Central Time on October 16, 2013. A copy of the slides to be presented as part of the webcast is furnished as Exhibit 99.3 hereto.

The information contained in this Item 7.01, including the Exhibits hereto, shall not be deemed to be filed for purposes of the Securities Exchange Act of 1934 and it shall not be deemed to be incorporated by reference in any filing under the Securities Act of 1933 except as expressly set forth by specific reference in such filing.

Cautionary Statement Regarding Forward-Looking Statements

This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related expectations about future conditions. These forward-looking statements include, among others, statements regarding expected synergies and benefits of the USG Boral Joint Venture, expectations about future business plans, prospective performance and opportunities, regulatory approvals and the expected timing of the completion of the USG Boral Joint Venture transaction. These forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “objective,” “plan,” “potential,” “predict,” “projection,” “should,” “will” or other similar words, or the negative of these terms. There is no assurance that the USG Boral Joint Venture transaction will be consummated, and there are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements made herein. These risks and uncertainties include: 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 the Company’s credit agreement or other financings; the Company’s substantial indebtedness and 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 the Company’s pension plans; the loss of one or more major customers and customers’ ability to meet their financial obligations to the Company; capacity utilization rates for the Company and the industry; the Company’s ability to

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expand into new geographic markets and the stability of such markets; the Company’s ability to successfully enter into and operate the USG Boral Joint Venture, including risks that the Company’s joint venture partner, Boral, may not fulfill its obligations as an investor or may take actions that are inconsistent with the Company’s objectives; the Company’s ability to protect its 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; the Company’s 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. These risks and uncertainties are discussed in more detail under the heading “Risk Factors” in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2012 and in the other documents and reports filed by the Company with the SEC. Investors and security holders are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. The Company has no obligation and makes no undertaking to update or revise any forward-looking information.

Section 9 – Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	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.*†
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.*†
10.1	Form of Shareholders Agreement.
99.1	USG Corporation press release, dated October 16, 2013.
99.2	USG Corporation press release, dated October 16, 2013.
99.3	Joint investor presentation, dated October 16, 2013.

* 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.

† Dated October 17, 2013 Sydney, Australia time, but fully executed by all parties on October 16, 2013, U.S. Central Time.

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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 16, 2013	By:	/s/ Stanley L. Ferguson
		Stanley L. Ferguson
		Executive Vice President, General Counsel and Secretary

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EXHIBIT INDEX

Exhibit No.	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.*†
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.*†
10.1	Form of Shareholders Agreement.
99.1	USG Corporation press release, dated October 16, 2013.
99.2	USG Corporation press release, dated October 16, 2013.
99.3	Joint investor presentation, dated October 16, 2013.

* 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.

† Dated October 17, 2013 Sydney, Australia time, but fully executed by all parties on October 16, 2013, U.S. Central Time.

EX-2.1

Exhibit 2.1

Share Sale and Subscription Agreement

Asia

USG Netherlands Global Holdings B.V.

USG Corporation

Boral Limited ACN 008 421 761

Boral International Pty Limited ACN 000 341 239

Boral Gypsum Asia Sdn Bhd

Jones Day

Level 41, Aurora Place

88 Phillip Street

Sydney NSW 2000

Tel: 61 2 8272 0500

Fax: 61 2 8272 0599

www.jonesday.com

Share Sale and Subscription Agreement

1.	INTERPRETATION	5
2.	SUBSCRIPTION FOR SUBSCRIPTION SHARES AND SALE OF SALE SHARES	16
3.	PRE-COMPLETION	18
4.	CONDUCT OF THE BUSINESS PRIOR TO COMPLETION	20
5.	COMPLETION	30
6.	PURCHASE PRICE ADJUSTMENT	34
7.	WARRANTIES	44
8.	LIMITATIONS OF LIABILITY	47
9.	INDEMNITIES	55
10.	THIRD PARTY CLAIMS AND TAX DEMANDS	59
11.	CLAIMS	61
12.	TAX	62
13.	TERMINATION	63
14.	CONFIDENTIALITY AND ANNOUNCEMENTS	66
15.	EXCLUSIVITY	67
16.	DUTIES, COSTS AND EXPENSES	68
17.	GUARANTEES	69
18.	NOTICES	71
19.	GENERAL	72
SIGNING PAGES		78
SCHEDULE 1	WARRANTIES	80
SCHEDULE 2	JV WARRANTIES	112
SCHEDULE 3	BORAL TAX WARRANTIES	141
SCHEDULE 4	USG TAX WARRANTIES	144
SCHEDULE 5	COMPLETION STEPS	147
SCHEDULE 6	PERMITTED ACTIONS	152
SCHEDULE 7	GUARANTEES	153
SCHEDULE 8	BAKER & MCKENZIE REPORT	154
SCHEDULE 9	BGA COMPLETION STATEMENT	155
SCHEDULE 10	USG COMPLETION STATEMENT	161
SCHEDULE 11	STRUCTURE DIAGRAMS	167
SCHEDULE 12	BORAL DISCLOSURE SCHEDULE	172
SCHEDULE 13	USG DISCLOSURE SCHEDULE	173

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SCHEDULE 14	LOANS AND BORROWINGS	174
SCHEDULE 15	FREEHOLD PROPERTIES	176
SCHEDULE 16	USG INTELLECTUAL PROPERTY REGISTRATIONS	178
SCHEDULE 17	BUSINESS NAMES	179
SCHEDULE 18	BANK ACCOUNT AND SIGNATORY TABLE	181
SCHEDULE 19	NOTICE DETAILS	183
SCHEDULE 20	FORM OF SHAREHOLDERS AGREEMENT	184
SCHEDULE 21	FORM OF USG ASIA IP LICENCE	185
SCHEDULE 22	FORM OF BORAL ASIA IP LICENCE	186
SCHEDULE 23	FORM OF USG TOSA	187
SCHEDULE 24	FORM OF BORAL TOSA	188
SCHEDULE 25	DATA ROOM INDICES	189

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Share Sale and Subscription Agreement

DATE	OCTOBER 17, 2013
PARTIES

Boral Limited ACN 008 421 761 of Level 39, 50 Bridge Street, Sydney NSW 2000, Australia (Boral)

Boral International Pty Limited ACN 000 341 239 of C/- Boral Limited, ‘AMP Centre’ Level 39, 50 Bridge Street, Sydney NSW 2000, Australia (Boral Seller)

Boral Gypsum Asia Sdn Bhd a company incorporated under the laws of Malaysia with company number 880595-D of Lot 606, Off Jalan SS 13/1K Subang Jaya, Selangor Darul Ehsan Malaysia 47500 (BGA)

USG Netherlands Global Holdings B.V. a company incorporated under the laws of The Netherlands with Commercial Register No. 58458670 of Muiderstraat 9, 1011PZ Amsterdam (Acquirer)

USG Corporation of 550 West Adams Street, Chicago, Illinois (USG)

RECITALS

A. Boral Seller is the registered holder of the entirety of the issued shares in BGA.

B. SingCo is to be incorporated before Completion in accordance with this Agreement.

C. Boral Seller has agreed to contribute certain intellectual property rights to SingCo by executing the Boral Asia IP Licences

D. The Acquirer has agreed to contribute, and SingCo will acquire, the USG Contributed Shares in exchange for SingCo shares on the terms and conditions set out in this Agreement.

E. The Acquirer has agreed to contribute certain intellectual property to SingCo by executing the USG Asia IP Licences in exchange for SingCo shares on the terms and conditions set out in this Agreement.

F. Boral Seller has agreed to contribute all of the issued shares in BGA to SingCo in exchance for SingCo shares on and subject to the terms and conditions set out in this Agreement.

G. The contribution of property by Boral Seller and the Acquirer to SingCo in exchange for shares of SingCo is considered part of a single integrated transaction qualifying under sections 351 and 368 of the United States Internal Revenue Code of 1986, as amended.

H. Boral Seller has agreed to sell, and the Acquirer has agreed to purchase, the Sale Shares on and subject to the terms and conditions set out in this Agreement.

I. Boral has agreed to provide the Boral Warranties and the Boral Tax Warranties in respect to the BGA Group and the Boral JV Warranties in respect to the Boral Joint Venture, on and subject to the terms and conditions set out in this Agreement.

J. USG has agreed to provide the USG Warranties and the USG Tax Warranties in respect to the USG Contributed Entities and the USG JV Warranties in respect to the USG Joint Ventures on and subject to the terms and conditions set out in this Agreement.

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OPERATIVE PROVISIONS

1. INTERPRETATION

1.1 Definitions

The following definitions apply in this Agreement unless the context requires otherwise.

Accepting Party means:

(a) if the Notifying Party is Boral, the relevant USG Party (or Parties) which may be subject to a Boral Claim as contemplated by clause 10.1(a); and

(b) if the Notifying Party is USG, the relevant Boral Party (or Parties) which may be subject to a USG Claim as contemplated by clause 10.1(b).

Agreement means this Agreement.

Anti-Corruption Laws means the Australian Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 (Cth) (as amended from time to time), the US Foreign Corrupt Practices Act and any other analogous Legal Requirements (as defined in Schedule 1) that prohibit bribery, the provision or acceptance of unlawful gratuities, facilitation payments or other benefits to or from any Government Official (as defined in Schedule 1 or any other Person.

Application Forms means application forms for the subscription by the Acquirer for the Subscription Shares and by the Boral Seller for the Boral Subscription in the form agreed between USG and Boral (acting reasonably and in good faith having regard to customary market practice).

Australasia Completion has the meaning given to the term “Completion” in the Australasia Sale Agreement.

Australasia Sale Agreement means the Share Sale and Subscription Agreement between BAGL, Boral, Boral Building Materials Pty Limited, USG, the Acquirer and USG Foreign Investments, Ltd dated on or about the date of this Agreement.

Australasia Sale Agreement Claim has the meaning given to the term “Claim” in the Australasia Sale Agreement.

Australasia Sale Agreement Party means a party to the Australasia Sale Agreement.

BAGL means Boral Australian Gypsum Limited a company incorporated in Australia with Australian Company Number 004 231 976 of C/- Boral Limited, ‘AMP Centre’ Level 39, 50 Bridge Street, Sydney NSW 2000, Australia.

BAGL Group has the meaning given to that term in the Australasia Sale Agreement.

Baker & McKenzie Report the report to be prepared by Baker & McKenzie in accordance with the scope of work determined in accordance with Schedule 8.

BGA Group means BGA and its Subsidiaries, excluding the Boral Joint Venture and excluding any entity which becomes a Subsidiary of BGA at Completion as a result of this Agreement (and BGA Group Member means any member of the BGA Group from time to time).

Boral Asia IP Licences means:

(a) the Umbrella Intellectual Property Licence Agreement in the form set out in Schedule 22 (or such other form as Boral and USG may agree before Completion); and

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(b) each agreement forming a schedule to that agreement (in each case in the form set out the relevant schedule at Schedule 22 (or such other form as Boral and USG may agree before Completion).

Boral Australasia IP Licences has the meaning given to that term in the Australasia Sale Agreement.

Boral Claim means a Claim of or brought by a Boral Claim Group Member in accordance with this Agreement.

Boral Claim Group means Boral and the Boral Seller and Boral Claim Group Member means any of them.

Boral Contributed Shares means the Boral Contributed Tranche 1 Shares and the Boral Contributed Tranche 2 Shares.

Boral Contributed Tranche 1 Shares means the 349,869,439 issued shares in BGA as per share certificate number 5 dated 9 December 2011.

Boral Contributed Tranche 2 Shares means all issued shares in BGA other than the Boral Contributed Tranche 1 Shares.

Boral Disclosure Schedule means the disclosure schedule relating to the Boral Warranties and the disclosure schedule relating to the Boral JV Warranties set out in Schedule 12.

Boral Group means Boral and each of its Subsidiaries, but excluding the BGA Group and the BAGL Group (and for the avoidance of doubt after Completion the Joint Venture Group) and excluding the Boral Joint Venture and its Subsidiaries (and Boral Group Member means any member of the Boral Group from time to time).

Boral Joint Venture means The Siam Gypsum Industry Co., Ltd.

Boral JV Warranty means each warranty stated in Schedule 2, given on the basis that the Warrantor is a Boral Group Member (and so that for the avoidance of doubt such warranties are given in relation to the Boral Joint Venture and not the USG Joint Ventures).

Boral Party means Boral and each other Boral Group Member who is a Party to this Agreement.

Boral Q&A Responses means the ‘Q&A’ responses provided by or on behalf of Boral via the relevant Data Room to questions asked during the due diligence process.

Boral Subscription Shares means the Boral Subscription Tranche 1 Shares and the Boral Subscription Tranche 2 Shares.

Boral Subscription Tranche 1 Shares means 415,470,520 fully paid ordinary shares in SingCo (to be issued to the Boral Seller in exchange for the contribution of the Boral Contributed Tranche 1 Shares to SingCo).

Boral Subscription Tranche 2 Shares means 534,529,480 fully paid ordinary shares in SingCo (to be issued to the Boral Seller in exchange for the contribution of the Boral Contributed Tranche 2 Shares to SingCo).

Boral Tax Warranty means each warranty stated in Schedule 3.

Boral TOSA means the services agreement substantially in the form set out in Schedule 24 (or such other form as Boral and USG may agree before Completion).

Boral Warranty means each warranty stated in Schedule 1, given on the basis that the Warrantor is a Boral Group Member (and so that for the avoidance of doubt such warranties are given in relation to the Boral Sale Group and not the USG Sale Group as defined in Schedule 1).

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BRINDO means PT Petrojaya Boral Plasterboard, a limited liability company established and existing under the laws of the Republic of Indonesia, having its legal domicile in Jakarta.

Business Day means a day on which banks are open for business in Sydney, Chicago and Kuala Lumpur and Singapore.

Claim means any claim, demand, proceeding or cause of action, whether arising in contract, tort, or under statute in connection with:

(a) any provision of this Agreement;

(b) the Subscription Shares or their issue and allotment to the Acquirer;

(c) the Sale Shares or their transfer to the Acquirer;

(d) the Boral Contributed Shares or their transfer to SingCo;

(e) the USG Contributed Shares or their transfer to SingCo; or

(f) any other matter connected with this Agreement,

but does not include any IP Claim, TOSA Claim or Australasia Sale Agreement Claim.

Claim Group means, in relation to any Claim, the Claimant Party as defined in clause 10.1 and each other member of:

(a) the Boral Claim Group (if the Claimant Party is a member of the Boral Group); or

(b) the USG Claim Group (if the Claimant Party is a member of the USG Group).

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

Competing Proposal – USG means any enquiries, expressions of interest, offers or proposals from any Person (other than a Boral Group Member, BGA Group Member or Person acting on their behalf):

(a) relating to any acquisition or purchase of any interest in any USG Contributed Entity or otherwise in the USG Group’s gypsum operations in the Territory, or in the business or all or any material portion of the assets of any USG Contributed Entity (other than sales and purchases in the ordinary course of business);

(b) to enter into any merger, recapitalisation, joint venture or other business combination with respect to any USG Contributed Entity or otherwise with respect to the USG Group’s gypsum operations in the Territory; or

(c) to enter into any other extraordinary business transaction involving or otherwise in relation to any USG Contributed Entity or otherwise with respect to the USG Group’s gypsum operations in the Territory.

Competing Proposal – Boral means any enquiries, expressions of interest, offers or proposals from any Person (other than a USG Group Member or Person acting on its behalf):

(a) relating to any acquisition or purchase of any interest in any BGA Group Member or otherwise in the Boral Group’s gypsum operations in the Territory, or in the business or all or any material portion of the assets of any BGA Group Member (other than sales and purchases in the ordinary course of business);

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(b) to enter into any merger, recapitalisation, joint venture or other business combination with respect to any BGA Group Member or otherwise with respect to the Boral Group’s gypsum operations in the Territory; or

(c) to enter into any other extraordinary business transaction involving or otherwise in relation to any BGA Group Member or otherwise with respect to the Boral Group’s gypsum operations in the Territory.

Completion means completion of the issue and allotment of the Subscription Shares and the Boral Subscription Shares and the sale and purchase of the Sale Shares in accordance with clause 4.

Completion Date means the date on which Completion occurs.

Condition Satisfaction Date means the date on which all of the Conditions have been satisfied or waived in accordance with this Agreement.

Conditions means the conditions specified in clause 3.2.

Consequential Loss means any Loss which would not fairly and reasonably be considered to arise naturally, that is according to the usual course of things, from the breach, event or act or omission giving rise to the relevant liability.

Corporations Act means the Australian Corporations Act 2001 (Cth).

Disputing Action means, in respect of Tax Demand, any action to cause the Tax Demand to be withdrawn, reduced or postponed or to avoid, resist, object to, defend, appear against or compromise the Tax Demand and any judicial or administrative proceedings arising out of that action.

Duty means any stamp, transaction or registration duty or similar charge which is imposed by any Taxing Authority and includes any interest, fine, penalty, charge or other amount which is imposed in relation to that duty or charge.

Earn-Out Amounts means:

(a) such part of the First Earn-Out Amount, as defined Schedule 8 of the Australasia Sale Agreement, as is characterised in clause 2.7(b)(ii) of Schedule 8 of the Australasia Sale Agreement as an adjustment to the Purchase Price under this Agreement; and

(b) such part of the Second Earn-Out Amount, as defined Schedule 8 of the Australasia Sale Agreement, as is characterised in clause 2.8(b)(ii) of Schedule 8 as an adjustment to the Purchase Price under this Agreement.

Encumbrance means a mortgage, charge, pledge, lien, encumbrance, security interest, title retention, or any other security agreement or arrangement in favour of any Person by way of security for the payment of a debt or any other monetary obligation or the performance of any other obligation, whether registered or unregistered.

End Date means 30 September 2014.

Environmental Warranties means the Warranties in paragraphs 11.13 to 11.16 of Schedule 1.

Exclusivity Period means the period commencing on the date of this Agreement and expiring on the earlier of Completion or termination of this Agreement in accordance with its terms.

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Final Adjustment Date is a Business Day that is no later than 5 Business Days after the date on which the BGA Adjustment Amount and the Asia USG Adjustment Amount are agreed or otherwise finally determined under clause 6.

Fund has the meaning given to it in Schedule 1 or Schedule 2 (as applicable).

Government Action means any executive, legislative or administrative action, any decision or any order of a government, including any regional, municipal or local authority, any court or tribunal, any regulator or any working group of the aforementioned.

Initial Purchase Price means US$345 million.

Intellectual Property Rights means:

(a) patents, design, trade marks and service marks (whether registered or unregistered) and any applications for, or rights to apply for, registration of any patent, design, trade mark or service mark;

(b) copyright (including copyright in software, websites, databases and advertising and other promotional materials);

(c) all rights to have information (including trade secrets, know-how, operating procedures and technical information) kept confidential; and

(d) all other rights or protecting having similar effect anywhere in the world.

IP Claim means any claim, demand, proceeding or cause of action whether arising in contract, tort, or under statute, made pursuant to the Boral Australasia IP Licences, the Boral Asia IP Licences, the USG Australasia IP Licences or the USG Asia IP Licences.

Joint Venture Group means, in respect of any period after Completion, BAGL, SingCo and their respective Subsidiaries and Joint Venture Group Member means any of them.

Loss means any loss, damage, liability, cost or expense of any kind and however arising, including penalties, fines and interest, compliance, monitoring or investigation costs, and loss, liability, cost or expense that is prospective or contingent and the amount of which for the time being is not ascertained or ascertainable.

Material Adverse Change means:

(a) in relation to Boral, a material adverse change in relation to the business, operations, financial condition or performance, results of operations, assets, liabilities or prospects of the BAGL Group and the BGA Group taken as a whole and which is reasonably expected to materially adversely impact the value of the aggregate consideration received at Completion by the USG Group under the Transaction Documents; and

(b) in relation to USG, a material adverse change in relation to:

(i) the business, operations, financial condition or performance, results of operations, assets, liabilities or prospects of the USG Contributed Entities and the ‘USG Contributed Entities’ as defined in the Australasia Sale Agreement, taken as a whole; and

(ii) the Intellectual Property Rights the subject of the USG Australasia IP Licences and the USG Asia IP Licences,

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taken as a whole and which is reasonably expected to materially adversely impact the value of the aggregate consideration received at Completion by the Boral Group under the Transaction Documents (and for these purposes the consideration to the Boral Group is to be taken to include 50% of the value of assets and rights contributed by the USG Group to BAGL and SingCo at Completion in addition to the cash purchase price paid by USG under this Agreement and the Australasia Sale Agreement at Completion).

Notifying Party means:

(a) in the circumstances contemplated by clause 10.1(a), Boral; and

(b) in the circumstances contemplated by clause 10.1(b), USG.

Parent Guarantee means:

(a) in relation to Boral, the guarantees, indemnities, charges or other securities listed in Part 1 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a Boral Group Member to a Third Party to better secure the performance of a BGA Group Member or required for the benefit of a BGA Group Member; and

(b) in relation to USG, the guarantees, indemnities, charges or other securities listed in Part 1 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a USG Group Member to a Third Party to better secure the performance of a USG Contributed Entity or required for the benefit of a USG Contributed Entity.

Party means a party to this Agreement (and includes SingCo following its accession to this Agreement as contemplated by clause 2.4).

Person means any individual, corporation (including any non-profit corporation), general partnership, limited partnership, limited liability partnership, joint venture, estate, trust, company (including any limited liability company or joint stock company), firm or other enterprise, association, organization, entity or Regulatory Authority.

Pudong Site means No. 4199 Chen hang Highway, Shanghai, PRC, 201114, China occupied by Boral Plasterboard Systems (Shanghai) Company Limited.

Purchase Price means:

(a) the Initial Purchase Price as adjusted in accordance with this Agreement; and

(b) the Earn-Out Amounts (if any).

Receiving Party means:

(a) if Boral or Boral Seller is the Claimant Party, USG; and

(b) if USG or the Acquirer is the Claimant Party, Boral.

Related Corporation means in relation to an entity, each body corporate:

(a) that is a Subsidiary of that entity;

(b) of which the entity is a Subsidiary; or

(c) that is a Subsidiary of a company of which the entity is also a Subsidiary.

Relevant Conduct is defined in Schedule 8.

Representatives means the officers, employees, contractors, consultants, professional advisers and agents of a Party.

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Sale Shares means 380,000,000 fully paid ordinary shares in SingCo (for the avoidance of doubt being a portion of the Boral Subscription Tranche 1 Shares to be issued to Boral Seller at Completion).

Settle means to:

(a) accept, compromise or pay;

(b) agree to arbitrate, compromise or settle; or

(c) make any admission or take any action in relation to,

any Claim or Third Party Claim or Tax Demand as relevant.

SGI Group and SGI Group Member are defined in clause 6.15(a)(i).

Shareholders Agreement means the shareholders agreement in the form set out in Schedule 20 (or such other form as Boral and USG may agree before Completion).

Shareholding Percentage means , in respect of any time after Completion:

(a) in relation to Boral, the Shareholding Percentage of Boral (in each case as defined in the Shareholders Agreement) for the purposes of the Shareholders Agreement at the relevant time; and

(b) in relation to USG, the Shareholding Percentage of USG (in each case as defined in the Shareholders Agreement) for the purposes of the Shareholders Agreement at the relevant time.

SingCo means the Singapore company to be incorporated before Completion as contemplated by clause 2.4.

Subscription Shares means 190,000,000 fully paid ordinary shares in SingCo (to be issued to the Acquirer).

Subsidiary has the meaning provided in Section 46 of the Corporations Act.

Subsidiary Guarantees means:

(a) in relation to Boral, the guarantees, indemnities, charges or other securities listed in Part 2 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a BGA Group Member to a Third Party to better secure the performance of a Boral Group Member or required for the benefit of a Boral Group Member; and

(b) in relation to USG, the guarantees, indemnities, charges or other securities listed in Part 2 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a USG Contributed Entity to a Third Party to better secure the performance of a USG Group Member or required for the benefit of a USG Group Member.

Tax means any tax, levy, rates, deduction, excise, duty, charge, surcharge, contribution, withholding tax, impost or withholding obligation of whatever nature, whether direct or indirect, by whatever method collected or recovered, assessed, levied or imposed by the Commonwealth of Australia, a state or any other government, regional, municipal or local authority (Australian or overseas) and includes capital gains tax, fringe benefits tax, income tax, luxury car tax, superannuation guarantee charge, training guarantee levy, payroll tax, any tax associated with a franking account, goods and services tax or other value added tax, group tax, Pay As You Go withholding, withholding tax, land tax, customs duty, together with any fees, penalties, fines, interest or statutory charges and whether imposed by contract or imposed on a joint, several or secondary basis as a result of being a member of an affiliated group of companies or any payments required to be made under a valid Tax Sharing Agreement or Tax Funding Agreement.

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Tax Attributes means any thing that would reduce the base on which Tax is assessed or the amount of Tax payable.

Tax Claim means a Claim arising from a breach of a Boral Tax Warranty or a USG Tax Warranty, or a Claim under an indemnity in clause 9.1(a) or 9.2(a).

Tax Cost means all costs, and expenses incurred in:

(a) managing an inquiry by any Taxing Authority; or

(b) conducting any action in relation to a Tax Demand to cause the Tax Demand to be withdrawn, reduced or postponed or to avoid, resist, object to, defend, appear against or compromise the Tax Demand and any judicial or administrative proceedings arising out of that action.

Tax Demand means:

(a) a demand or assessment from a Taxing Authority requiring the payment of any Tax;

(b) any document received from a Taxing Authority administering any Tax assessing, imposing or claiming any Tax; or

(c) lodgement of a tax return or a request for an amendment under a law about self-assessment of Tax.

Tax Law means any:

(a) Tax legislation in force; and

(b) common law,

in each case which imposes Tax.

Taxing Authority means any governmental authority with the power to levy and collect Taxes or Duties.

Third Party Claim means any claim, demand, proceeding or cause of action, whether arising in contract, tort, or under statute against any Party to this Agreement, which is made or threatened by a Person other than a member of the Boral Group, the USG Group or the Joint Venture Group (including the USG Contributed Entities), but excludes a Tax Demand.

Territory has the meaning given to that term in the Shareholders Agreement.

Title Warranty means the Warranties in paragraphs 3.1 to 3.5, 4.1 and 4.3 of Schedule 1.

Transaction Documents means:

(a) this Agreement and the Australasia Sale Agreement;

(b) the Shareholders Agreement;

(c) the Boral Australasia IP Licences and the Boral Asia IP Licences;

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(d) the USG Australasia IP Licences and the USG Asia IP Licences;

(e) the Boral TOSA; and

(f) the USG TOSA.

TOSA Claim means any claim, demand, proceeding or cause of action whether arising in contract, tort, or under statute, made pursuant to the Boral TOSA or the USG TOSA.

USG Asia IP Licences means:

(a) the Umbrella Intellectual Property Licence Agreement in the form set out in Schedule 21 (or such other form as Boral and USG may agree before Completion); and

(b) each agreement forming a schedule to that agreement (in each case in the form set out the relevant schedule at Schedule 21 (or such other form as Boral and USG may agree before Completion).

USG Australasia IP Licences has the meaning given to that term in the Australasia Sale Agreement.

USG Claim means a Claim of or brought by a USG Claim Group Member in accordance with this Agreement.

USG Claim Group means USG and the Acquirer and USG Claim Group Member means any of them.

USG Contributed Entities means:

(a) USG Asia Pacific Holdings Pte Ltd (a Singapore company with registered number 199403661C);

(b) USG Cayman Holdings Ltd (a Cayman Islands company with registered number 89670);

(c) USG ChinaLux S.a.r.l. (a Luxembourg company with registered number B119341);

(d) USG Manufacturing Worldwide, Ltd (a Cayman Islands company with registered number 45712);

(e) International Resources Limited (a United Arab Emirates company with registered number IC/3153/10)

(f) Pacific Interiors Supply Pte Ltd (a Singapore company with registered number 199100099Z);

(g) USG India Supply Pte. Ltd (an Indian company with registered number U45309DL2009PTC194801);

(h) USG Interiors (Far East) Sdn Bhd (a Malaysian company with registered number 131744-K); and

(i) USG Interiors (Malaysia) Sdn Bhd (a Malaysian company with registered number 485755-P).

USG Contributed Shares means all issued shares, securities or other ownership interests in:

(a) USG Asia Pacific Holdings Pte Ltd;

(b) USG Cayman Holdings Ltd;

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(c) USG ChinaLux S.a.r.l.; and

(d) USG Manufacturing Worldwide, Ltd.

USG Disclosure Schedule means the disclosure schedule relating to the USG Warranties and the disclosure schedule relating to the USG JV Warranties set out in Schedule 13.

USG Group means USG and each of its Subsidiaries from time to time, but excluding the USG Contributed Entities and excluding the USG Joint Ventures and their respective Subsidiaries (and USG Group Member means any member of the USG Group from time to time).

USG IP Warranty means a warranty given by a USG Group Member in the USG Australasia IP Licences and the USG Asia IP Licences.

USG Joint Ventures means USG-Zawawi Drywall LLC, Zawawi Gypsum LLC, USG Middle East Ltd and Star-USG Building Materials Co., Ltd.

USG JV Warranty means each warranty stated in Schedule 2, given on the basis that the Warrantor is a USG Group Member (and so that for the avoidance of doubt such warranties are given in relation to the USG Joint Ventures and not the Boral Joint Venture).

USG Party means USG and each other USG Group Member who is a Party to this Agreement.

USG Q&A Responses means the ‘Q&A’ responses provided by or on behalf of USG via the relevant Data Room to questions asked during the due diligence process.

USG Tax Warranty means each warranty stated in Schedule 4.

USG TOSA means the services agreement substantially in the form set out in Schedule 23 (or such other form as Boral and USG may agree before Completion);

USG Warranty means each warranty stated in Schedule 1, given on the basis that the Warrantor is a USG Group Member (and so that for the avoidance of doubt such warranties are given in relation to the USG Sale Group and not the Boral Sale Group as defined in Schedule 1).

Warranties means the Boral Warranties, the Boral Tax Warranties, the Boral JV Warranties, the USG Warranties, the USG Tax Warranties and the USG JV Warranties.

Warranty Claim means a Claim arising from a breach of Warranty.

1.2 Interpretation

In this Agreement:

(a) Headings and bold type are for convenience only and do not affect the interpretation of this Agreement.

(b) The singular includes the plural and the plural includes the singular, words of any gender include all genders, and other parts of speech and grammatical forms of a word or phrase defined in this Agreement have a corresponding meaning.

(c) A reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment or exhibit to, this Agreement.

(d) A reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements or re-enactments of any of them.

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(e) A reference to a document includes all amendments or supplements to, or replacements or novations of, that document, and a reference to a party to a document includes that party’s successors and permitted assignees.

(f) A reference to an agreement other than this Agreement includes a deed and any legally enforceable undertaking, agreement, arrangement or understanding, whether or not in writing.

(g) A reference to a body, other than a party to this agreement (including an institute, association or authority), whether statutory or not:

(i) which ceases to exist; or

(ii) whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions.

(h) If a period of time is specified and dates from a given day or the day of an act or event, it is to be calculated exclusive of that day.

(i) A reference to a day is to be interpreted as the period of time commencing at midnight and ending 24 hours later.

(j) If an act prescribed under this Agreement to be done by a Party on or by a given day is done after 5.00pm on that day, it is taken to be done on the next day.

(k) A reference to time is a reference to Sydney time unless otherwise specified.

(l) A reference to $ is to US dollars unless denominated otherwise.

1.3 Business Day

Where the day on or by which any thing is to be done is not a Business Day, that thing must be done on or by the next Business Day.

1.4 Inclusive expressions

Specifying anything in this agreement after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included.

1.5 Agreement components

This Agreement includes the schedules.

1.6 The rule about “contra proferentem”

This Agreement is not to be interpreted against the interests of a Party merely because that Party proposed this Agreement or some provision in it or because that Party relies on a provision of this Agreement to protect itself.

1.7 Reasonable endeavours

Any provision of this Agreement which requires a Party to use reasonable endeavours or all reasonable endeavours to procure that something is performed or occurs or does not occur does not include any obligation to commence any legal action or proceeding against any person, except where that provision expressly specifies otherwise.

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1.8 Payments

(a) Except to the extent this Agreement expressly provides otherwise in any given case, all payments required to be made under this agreement must be tendered in US Dollars by way of direct transfer of immediately available funds to the bank account nominated in writing by the recipient and by no later than 5:00 pm (recipient’s time) on the due Business Day for payment.

(b) To the extent any payment to be made under this Agreement is calculated or original expressed in a currency other than US Dollars, the payment will be translated into US Dollars at the mid-market US$ exchange rate as quoted by Bloomberg on the relevant date of payment.

(c) Any reference in this Agreement to a payment to any Party includes payment to another Person at the written direction of that Party.

2. SUBSCRIPTION FOR SUBSCRIPTION SHARES AND SALE OF SALE SHARES

2.1 Agreement

(a) Subject to the terms and conditions of this Agreement, on Completion (and without limiting any other steps any Party is required to take under this Agreement at Completion):

(i) the Acquirer must enter into the USG Asia IP Licences;

(ii) the Acquirer must contribute to SingCo, and SingCo must acquire from the Acquirer, the USG Contributed Shares free of all Encumbrances;

(iii) SingCo must allot and issue to the Acquirer, and the Acquirer agrees to subscribe for, the Subscription Shares free of all Encumbrances;

(iv) Boral Seller must contribute to SingCo, and SingCo must acquire from Boral Seller, the Boral Contributed Tranche 1 Shares free of all Encumbrances;

(v) Boral Seller must contribute to SingCo, and SingCo must acquire from Boral Seller, the Boral Contributed Tranche 2 Shares free of all Encumbrances;

(vi) Boral Seller will enter into the Boral Asia IP Licences;

(vii) SingCo agrees to allot and issue to Boral Seller, and Boral Seller agrees to subscribe for, the Boral Subscription Tranche 1 Shares free of all Encumbrances in exchange for the Boral Contributed Tranche 1 Shares;

(viii) SingCo agrees to allot and issue to Boral Seller, and Boral Seller agrees to subscribe for, the Boral Subscription Tranche 2 Shares free of all Encumbrances in exchange for the Boral Contributed Tranche 2 Shares; and

(ix) the Boral Seller will sell the Sale Shares to the Acquirer and the Acquirer will purchase from the Boral Seller the Sale Shares free from all Encumbrances.

(b) The Boral Contributed Shares and the USG Contributed Shares must in each case be transferred from the Boral Seller and Acquirer respectively to SingCo with all rights, including dividend rights, attached or accruing to them on and from Completion.

(c) The Sale Shares must be transferred from the Boral Seller to the Acquirer with all rights, including dividend rights, attached or accruing to them on and from Completion.

(d) Legal and beneficial title to the Boral Contributed Shares and the USG Contributed Shares and property and risk in them passes to SingCo on Completion.

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(e) Legal and beneficial title to the Sale Shares and the Subscription Shares and property and risk in them passes to the Acquirer and the Boral Seller (as applicable) on Completion.

2.2 Consideration

(a) The consideration for the issue of the Subscription Shares to the Acquirer is:

(i) the contribution of the USG Contributed Shares to SingCo; and

(ii) the grant of the USG Asia IP Licences to SingCo.:

(b) The consideration for the issue of the Boral Subscription Tranche 1 Shares to Boral Seller is the contribution by the Boral Seller of the Boral Contributed Tranche 1 Shares to SingCo.

(c) The consideration for the issue of the Boral Subscription Tranche 2 Shares to Boral Seller is:

(i) the contribution by the Boral Seller of the Boral Contributed Tranche 2 Shares to SingCo; and

(ii) the grant of the Boral Asia IP Licences to SingCo.

(d) The consideration for the sale of the Sale Shares to the Acquirer is the payment by the Acquirer to Boral Seller of the Purchase Price in accordance with the relevant provisions of this Agreement.

2.3 Payment of Purchase Price

The Purchase Price must be paid as follows:

(a) the Initial Purchase Price must be paid by the Acquirer to Boral Seller at Completion;

(b) adjustments to the Initial Purchase Price must be paid in accordance with the relevant provisions of this Agreement (including for the avoidance of doubt clause 5.5); and

(c) the Parties covenant and agree that no value-added tax or goods and services tax is imposed or shall be invoiced with respect to the issuance of the Subscription Shares or the conveyance, transfer or sale of the Sale Shares; and

(d) the Earn-Out Amounts (if any) must be paid by the Acquirer to Boral Seller in accordance with Schedule 8 of the Australasia Sale Agreement.

2.4 Establishment of SingCo

USG and Boral must each use their respective best endeavours to ensure that, as soon as practicable after this agreement:

(a) SingCo is registered in Singapore as a private company limited by shares and so that:

(i) the Boral Seller and the Acquirer are the registered holders of 1 issued share each (or such other number as USG and Boral may agree but so that on incorporation the Boral Seller and the Acquirer each hold 50% of the issued shares in SingCo);

(ii) SingCo’s corporate name is ‘USG-Boral Building Products Pte Limited’ (or such other name as Boral and USG may agree); and

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(b) following its incorporation SingCo accede to this Agreement as a Party (on the basis that it will have all rights and obligations ascribed to SIngCo in this Agreement) in a form and on terms acceptable to Boral and USG, each acting reasonably and in good faith.

2.5 IP

(a) The Acquirer must pay all Tax or Duty in respect of the execution, delivery and performance of the USG Asia IP Licences (and must satisfy any obligation of SingCo to pay any such Tax or Duty on SingCo’s behalf).

(b) The Boral Seller must pay all Tax or Duty in respect of the execution, delivery and performance of the Boral Asia IP Licenses (and must satisfy any obligation of SingCo to pay any such Tax or Duty on SingCo’s behalf).

3. PRE-COMPLETION

3.1 Pre-Completion

Boral and USG acknowledge and agree that if prior to Completion:

(a) a Boral Group Member becomes aware of any facts, matters or circumstances which give or are reasonably likely to give rise to a breach of a Boral Warranty, a Boral Tax Warranty or a Boral JV Warranty; or

(b) a USG Group Member becomes aware of any facts, matters or circumstances which give or are reasonably likely to give rise to a breach of a USG Warranty, a USG Tax Warranty or a USG JV Warranty;

then Boral or USG (as relevant) will promptly notify the other of such fact, matter or circumstance, provided that, for the avoidance of doubt, such notice will in no way constitute disclosure for the purpose of clause 7.1 of this Agreement or otherwise limit or exclude any Claim.

3.2 Conditions to Completion

Clause 2 will not bind the Parties and Completion will not proceed unless:

(a) SingCo has been incorporated and has acceded to this Agreement as required under clause 2.4;

(b) Baker & McKenzie has issued the Baker & McKenzie Report;

(c) by reference to the Baker & McKenzie Report:

(i) both USG and Boral are satisfied (each acting reasonably and in good faith) there will be no Relevant Conduct that is on-going as at the Completion Date; and

(ii) USG and Boral have agreed (each acting reasonably and in good faith) reasonably proportionate measures to be taken to address any prior Relevant Conduct and prevent a recurrence of such Relevant Conduct;

(d) either:

(i) all consents and waivers from the financiers to the BGA Group which are necessary to ensure Completion under this Agreement does not cause a breach, default, review event, acceleration right or similar under the relevant financing arrangements to which BGA Group Members are party have been obtained; or

(ii) the relevant financing arrangements have been repaid in conjunction with a refinancing as envisaged by clause 3.3(d);

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(e) Zawawi Minerals LLC has waived in writing (either unconditionally or on terms acceptable to Boral and USG, each acting reasonably and in good faith) the non-compete obligation in clause 15 of the joint venture agreement dated 27 March 2012 between USG Manufacturing Worldwide, Inc and Zawawi Minerals LLC relating to USG-Zawawi Drywall LLC insofar as it would otherwise apply to any operations of any Joint Venture Group Members in India after Completion other than:

(i) USG Manufacturing Worldwide, Inc; and

(ii) any entity which is at the date of this Agreement an affiliate (within the meaning of the relevant provisions of the joint venture agreement) of USG Manufacturing Worldwide, Inc; and

(f) all conditions precedent to completion under the Australasia Sale Agreement (other than the equivalent of the specific condition in this clause 3.2(f)) have been satisfied or waived in accordance with that agreement.

(Conditions).

3.3 Cooperation

(a) Without limiting any specific obligations of a Party under the remaining provisions of this clause 3.3, the Parties must each use their commercially reasonable endeavours in good faith to satisfy the Conditions as soon as practicable after the date of this Agreement.

(b) Boral and USG agree that any conditions sought to be imposed by Zawawi Minerals LLC on any waiver of the non-compete obligations contemplate by the Condition in clause 3.2(f) will be regarded as acceptable to Boral and USG for the purposes of clause 3.2(f) to the extent that they require any Joint Venture Group Member to accept with effect from Completion undertakings to the effect any or all of the following:

(i) that the Joint Venture Group will acquire all gypsum rock and Plaster of Paris requirements in India from Zawawi Gypsum LLC insofar as it is economically viable to do so (in the Joint Venture Group’s sole reasonable opinion);

(ii) that if any Joint Venture Group Member decides to seek a third party equity investor in connection with building a wallboard manufacturing plant in India, the Joint Venture Group will grant USG-Zawawi Drywall LLC a right of first offer in relation to such equity investment; and

(iii) in the event the Joint Venture Group has one or more wallboard manufacturing plants in India, the Joint Venture Group will endeavour to cause the plasterboard manufacturing facility operated by USG-Zawawi Drywall LLC, once constructed, (the Oman Plant) to operate at a capacity utilization not lower than the average annual capacity utilization of all of the Joint Venture Group’s wallboard manufacturing plants in India, except in extraordinary circumstances such as a shutdown of the Oman Plant to retool for a new product line and except as otherwise agreed by the management committee of USG-Zawawi Drywall LLC,

provided that if an undertaking is given in relation to capacity utilisation as contemplated by clause 3.3(b)(iii), then USG undertakes to Boral (and to SingCo) that it will indemnify the Joint Venture Group Members in respect of any Loss suffered by any Joint Venture Group Members at any time during the period of 5 years after Completion as a result of anti-dumping duties being imposed on products sold from the Oman Plant on the basis that the relevant Loss will be the negative impact on EBITDA relative to the position if anti-dumping duties had not been imposed. Clause 8.4(a) will apply in relation to Claims under this indemnity on the basis that the applicable time limit for receipt of a Claim Notice will be 5 years after Completion. .

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(c) Boral must ensure that the members of the BGA Group, and use all reasonable endeavours to ensure that (to the extent within Boral’s control) its employees and agents, cooperate fully with Baker & McKenzie, provide access to all Records requested by Baker & McKenzie, and respond truthfully and without omission to questions from Baker & McKenzie for the purpose of the preparation of the Baker & McKenzie Report in accordance with the scope determined in accordance with Schedule 8.

(d) Where the reasonable endeavours of Boral and BGA have not resulted in the obtaining of the consents or waivers required as contemplated in clause 3.2(d)(i) and Boral believes (acting reasonably) that such consents or waivers will not be obtained prior to the Completion Date, then Boral and BGA must use their best endeavours to obtain, on commercially reasonable terms, alternative financing so that the existing financing arrangements of the BGA Group can be repaid as contemplated in clause 3.2(d)(ii), and USG will provide reasonable assistance to Boral and BGA in this regard.

3.4 Waiver of Conditions

The Conditions are for the benefit of both USG and Boral and may only be waived by written agreement between USG and Boral.

3.5 Result of non-satisfaction of Conditions

(a) If:

(i) the Conditions are not satisfied (or waived in accordance with clause 3.4); by the End Date or

(ii) any of the Conditions becomes incapable of satisfaction or the parties agree that any of the Conditions cannot be satisfied (and the relevant Condition is not waived in accordance with clause 3.4 by the End Date),

then either USG or Boral may terminate this Agreement at any time before Completion by giving not less than 7 days written notice to the other Parties.

(b) If Completion does not occur by the termination date specified in a notice under clause 3.5(a) then this Agreement will automatically terminate.

4. CONDUCT OF THE BUSINESS PRIOR TO COMPLETION

4.1 Carrying on of business – BGA Group

(a) Subject to clause 4.2, between the date of this Agreement and the earlier of Completion and termination of this Agreement, Boral and the Boral Seller must ensure that the business of the BGA Group is conducted materially in the ordinary course in accordance with past practice and, in particular, that no BGA Group Member:

(i) issues any shares, debentures, convertible notes, options or other securities that are convertible into shares or debentures, or other equity or debt securities in that BGA Group Member (Securities);

(ii) varies any rights attaching to or the class of any issued Securities or redeems, buys-back or cancels any issued Securities;

(iii) distributes or returns any capital to its members (other than to another BGA Group Member);

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(iv) declares or pays any dividends or declares or makes any other distributions in kind or in cash (other than to another BGA Group Member);

(v) alters its constitution or equivalent documents;

(vi) ceases or makes any material change to the Business;

(vii) acquires any business or shares or other equity securities in any entity;

(viii) disposes any business or shares or other equity securities in any entity;

(ix) enters into any new business, including the establishment of any business in a jurisdiction in which the BAGL Group or the BGA Group does not have existing operations at the date of this agreement;

(x) establishes any new Subsidiary or enters into any partnership, joint venture or profit or revenue sharing arrangement with any entity;

(xi) enters into an agreement to or otherwise merges or amalgamates any BGA Group Member with any other entity;

(xii) makes an application or commences any proceedings or takes any other steps for the winding up, dissolution or appointment of an administrator to any BGA Group Member or enters into an arrangement, compromise or composition for the benefit of that BGA Group Member’s creditors, a class or them or any of them;

(xiii) enters into, materially varies or terminates any agreement or arrangement involving:

(A) consideration to or from a BGA Group Member of more than US$10 million in relation to a customer/supplier arrangement;

(B) subject to clause 4.1(a)(xiii)(A), consideration to or from a BGA Group Member of more than US$1 million

(C) transactions that are not on bona fide arms’ length terms or otherwise outside the ordinary course of business;

(D) any non-compete undertakings, exclusivity provisions or similar restrictive covenants;

(E) any BGA Group Member assuming any ‘take or pay’ or similar obligations exceeding US$1 million;

or otherwise effecting any material, non-ordinary course business transaction or action;

(xiv) enters into or varies any contract, agreement or arrangement (whether oral or in writing) with a Boral Group Member involving consideration to or from a BGA Group Member of more than US$500,000 in any individual case or A$1 million in aggregate (and excluding ad hoc purchases or supplies of products or materials in the ordinary course);

(xv) enters into or becomes liable under any guarantee or similar arrangement under which it might incur liability in respect of the financial obligation of any other person (including any other BGA Group Member) other than performance guarantees in the ordinary course of business;

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(xvi) acquires, disposes or leases (whether as lessor or lessee) any assets (other than the sale or purchase of inventory, raw material materials, finished product and similar items in the ordinary course of the business), in any transaction or series of related transactions where the market value of such assets or the consideration in respect to the sale or acquisition of such assets is in excess of US$2 million or enter into any agreement to do so;

(xvii) engages any new permanent employee with a total annual remuneration in excess of US$150,000, excluding replacements of existing roles in the ordinary course of business;

(xviii) terminates the employment of Frederic de Rougemont or Tony Charnock, other than for cause;

(xix) materially alters its arrangements with respect to any Fund relating to its employees;

(xx) defers any capital expenditure or undertakes any capital expenditure that is, together with all such capital expenditure by all other BGA Group Members in the relevant period, in excess of US$5 million;

(xxi) enters into any financial accommodation or borrows any money (other from another BGA Group Member and other than drawings on working capital facilities in the ordinary course and trade credit in the ordinary course consistent with past practice) in excess of US$2 million; or

(xxii) provides any loan or financial accommodation to any person other than another BGA Group Member, other than trade credit in the ordinary course consistent with past practice;

(xxiii) purchases or enters into foreign currency swaps or other derivative instruments other than hedges entered into in accordance with past practice;

(xxiv) commences or settles (to the extent the settlement does not involve a cash payment) any litigation, arbitration or other proceedings, which will cause or is likely to cause, the BGA Group to incur costs or expenses (including legal costs) in excess of US$500,000; or

(xxv) creates an Encumbrance over any of its assets other than in the ordinary course of business.

(b) Subject to clause 4.2, between the date of this Agreement and the earlier of Completion and termination of this Agreement, the Boral Seller must ensure that:

(i) any calls for capital or other funding (whether by way of equity or debt) to any BGA Group Member from the Boral Joint Venture are met in full when due in accordance with the relevant shareholders agreement or other applicable contract; and

(ii) no scheduled or proposed calls for capital or other funding by the Boral Joint Venture are deferred.

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4.2 Permitted acts

Nothing in clause 4.1 restricts any Boral Group Member or any BGA Group Member from doing any of the following permitted actions:

(a) Transaction Agreements: anything that is required or expressly permitted in this Agreement or any Transaction Document (including in connection with the satisfaction of any Condition);

(b) Permitted acts: anything (or part of anything) described in Part 1 of Schedule 6;

(c) emergencies: anything to reasonably and prudently respond to an emergency or disaster (including a situation giving rise to a risk of personal injury or damage to property);

(d) legal obligations: anything to the extent necessary for a BGA Group Member to meet its legal or contractual obligations (such contractual obligations being as disclosed in the Data Room or the Boral Disclosure Schedule); or

(e) USG approval or non-objection: anything that is approved in writing by USG, such approval not to be unreasonably withheld or delayed, or in respect of which USG fails to notify Boral in writing of its objection to the doing of that thing within 3 business days (being normal business days in Kuala Lumpur and Chicago) after receipt of written notice from Boral notifying USG of a Boral Group Member’s or a BGA Group Member’s intention to do that thing. For these purposes USG must on the date of this agreement nominate at least two senior executives (each a USG Contact) to whom notifications of proposed actions can be submitted. Despite clause 18, notification to each USG Contact by email by or on behalf of Boral or BGA will constitute written notice to USG of the relevant matter for the purposes of this clause 4.2(e), and any approval by email by any USG Contact of any action for the purposes of this clause 4 will be taken to be an approval in writing by USG. USG may from time to time during the period before Completion nominate additional or replacement USG Contacts by notice in writing to Boral (provided at least two remain current at all times).

4.3 Carrying on of business – USG Contributed Entities

(a) Subject to clause 4.4, between the date of this Agreement and the earlier of Completion and termination of this Agreement, USG must ensure that the business of the USG Contributed Entities is conducted materially in the ordinary course and, in particular, that no USG Contributed Entity does anything described in clause 4.1(a) amended so that references to ‘BGA Group Member’ are replaced with references to ‘USG Contributed Entity’ (and references to ‘USG’ are replaced with ‘Boral)’ and so that:

(i) the amount in clause 4.1(a)(xiii)(A) is changed to US$10 million;

(ii) the amount in clause 4.1(a)(xiii)(B) is changed to US$500,000;

(iii) the amount in clause 4.1(a)(xiii)(E) is changed to US$500,000;

(iv) the amount in clause 4.1(a)(xvi) is changed to US$1 million;

(v) Jennifer Scanlon is replaced as the identified individual in clause 4.1(a)(xviii); and

(vi) the amount in clause 4.1(a)(xx) is changed to US$2.5 million.

(b) Subject to clause 4.4, between the date of this Agreement and the earlier of Completion and termination of this Agreement, USG must ensure that clauses 4.1(b)(i) and 4.1(b)(ii) are complied with, amended so that each reference to ‘BGA Group Member’ is replaced with a reference to ‘USG Contributed Entity’ and so that each instance of the word ‘Boral’ is replaced with the word ‘USG’.

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4.4 Permitted acts

Nothing in clause 4.3 restricts any USG Group Member or any USG Contributed Entity from doing any of the following permitted actions:

(a) Transaction Agreements: anything that is required or expressly permitted in this Agreement or any Transaction Document;

(b) Permitted acts: anything (or part of anything) described in Part 2 of Schedule 6;

(c) emergencies: anything to reasonably and prudently respond to an emergency or disaster (including a situation giving rise to a risk of personal injury or damage to property);

(d) legal obligations: anything to the extent necessary for a USG Contributed Entity to meet its legal or contractual obligations (such contractual obligations being as disclosed in the USG Disclosure Schedule); or

(e) Boral approval or non-objection: anything that is approved in writing by Boral, such approval not to be unreasonably withheld or delayed, or in respect of which Boral fails to notify USG in writing of its objection to the doing of that thing within 3 business days (being normal business days in Chicago and Sydney) after receipt of written notice from USG notifying Boral of a USG Group Member’s or a USG Contributed Entity’s intention to do that thing. For these purposes Boral must on the date of this agreement nominate at least two senior executives (each a Boral Contact) to whom notifications of proposed actions can be submitted. Despite clause 18, notification to each Boral Contact by email by or on behalf of USG or any USG Contributed Entity will constitute written notice to Boral of the relevant matter for the purposes of this clause 4.4(e), and any approval by email by any Boral Contact of any action for the purposes of this clause 4 will be taken to be an approval in writing by Boral. Boral may from time to time during the period before Completion nominate additional or replacement Boral Contacts by notice in writing to USG (provided at least two remain current at all times).

4.5 Intra-group loans

(a) Before Completion, Boral must (except where this Agreement expressly permits such loans to remain outstanding):

(i) identify all existing loans between a Boral Group Member and a BGA Group Member; and

(ii) procure that all payments are made and such other actions are taken as may be necessary to ensure the payment in full of loan balances between any Boral Group Members on the one hand and any BGA Group Members on the other hand (or that the relevant loan balances are capitalised provided that no additional shares are issued by BGA which are inconsistent with any obligation under this Agreement).

(b) Before Completion, USG must (except where this Agreement expressly permits such loans to remain outstanding):

(i) identify all existing loans between a USG Group Member and a USG Contributed Entity; and

(ii) procure that all payments are made and such other actions are taken as may be necessary to ensure the payment in full of loan balances between any USG Group Members on the one hand and any USG Contributed Entities on the other hand (or that the relevant loan balances are capitalised provided that no additional shares are issued by the USG Contributed Entities whose shares are USG Contributed Shares).

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4.6 Parent Guarantees

(a) Before Completion Boral and USG must take all reasonable steps to ensure that, effective from Completion each Boral Group Member and each USG Group Member is released from any actual, contingent or accrued liabilities under a Parent Guarantee given by it.

(b) For the purposes of this clause 4.6, ‘reasonable steps’ includes USG (or another USG Group Member acceptable to the relevant Third Party) and Boral (another Boral Group Member acceptable to the relevant Third Party) providing the relevant Third Party with a replacement guarantee or security on terms the same or substantially the same as the terms of the existing Parent Guarantee but so that USG and Boral are severally liable in proportion to their respective Shareholding Percentages.

(c) If a Boral Group Member has not been released from a Parent Guarantee in accordance with clause 4.6(a) by Completion, USG must pay Boral an amount equal to USG’s Shareholding Percentage (at the time of the relevant Loss) of any Loss that the Boral Group Member pays, suffers, incurs or is liable for under or in relation to that Parent Guarantee after Completion.

(d) If a USG Group Member has not been released from a Parent Guarantee in accordance with clause 4.6(a) by Completion, Boral must pay USG an amount equal to Boral’s Shareholding Percentage (at the time of the relevant Loss) of any Loss that the USG Group Member pays, suffers, incurs or is liable for under or in relation to that Parent Guarantee after Completion.

4.7 Subsidiary Guarantees

(a) Before Completion Boral must ensure that, effective from (or before) Completion, each BGA Group Member is released from any actual, contingent or accrued liabilities under a Subsidiary Guarantee given by it.

(b) Before Completion USG must ensure that, effective from (or before) Completion, each USG Contributed Entity is released from any actual, contingent or accrued liabilities under a Subsidiary Guarantee given by it.

4.8 Access

(a) During the period between the date of this Agreement up to the earlier of Completion and termination of this Agreement, Boral must ensure that USG and a reasonable number of persons authorised by USG are given, on reasonable notice:

(i) reasonable, non-disruptive access during normal business hours at the relevant location to inspect the assets, premises, books and records of the BGA Group Members; and

(ii) reasonable, non-disruptive access during reasonable mutually agreed hours to senior management of the BGA Group Members,

provided that USG must ensure that any persons provided with such access comply with the reasonable requirements of the BGA Group Members or any relevant Third Party in respect of the access and do not interfere with the business or operations of the BGA Group.

(b) During the period between the date of this Agreement up to the earlier of Completion and termination of this Agreement, USG must ensure that Boral and a reasonable number of persons authorised by Boral are given, during normal business hours and on reasonable notice:

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(i) reasonable, non-disruptive access to inspect the assets, premises, books and records of the USG Contributed Entities; and

(ii) reasonable, non-disruptive access to senior management of the USG Contributed Entities,

provided that Boral must ensure that any persons provided with such access comply with the reasonable requirements of the USG Contributed Entities or any relevant Third Party in respect of the access and do not interfere with the business or operations of the USG Contributed Entities.

4.9 USG Financing

During the period prior to Completion, Boral shall cause the BGA Group to promptly provide, in connection with any financing arrangement to be entered into by USG for the purpose of funding the payment of the Initial Purchase Price, such cooperation as may be reasonably requested by USG, including:

(a) participation (whether in person or by phone) in a reasonable number of meetings or sessions with prospective lenders, investors and rating agencies;

(b) furnishing USG and its financiers with financial and (subject to confidentiality undertakings satisfactory to Boral, acting reasonably) other pertinent information regarding the BGA Group;

(c) assisting with the preparation of customary offering documents and materials, including prospectuses, private placement memoranda, information memoranda and packages, lender and investor presentations, rating agency presentations, and similar documents and materials;

(d) requesting assistance and cooperation of the BGA Group’s independent accountants, including participation in a reasonable number of drafting and accounting due diligence sessions and provision of consents for the use of their reports in materials related to the aforementioned financing and customary “comfort” letters (including “negative assurance” comfort) with respect to the financial information to be included in any offering memorandum, and providing such accountants with any documentation reasonably requested by them in connection therewith; and

(e) consenting to the use of the Accounts of BGA Group and other BGA Group financial information (in a form and substance satisfactory to Boral, acting reasonably having regard to the extent to which such information is publicly available) for the aforementioned offering documents and materials.

USG must promptly reimburse the Boral Group and the BGA Group (as applicable) for all reasonable out-of-pocket costs and expenses incurred in providing co-operation at USG’s request under this clause 4.9.

4.10 TOSAs

(a) Boral and USG will work together in good faith to agree detailed service schedules for inclusion in the Boral TOSA and the USG TOSA as soon as practicable following the date of this Agreement.

(b) Boral will before the Completion Date keep USG notified of Third Party Approvals obtained for the purposes of clause 5.1 of the Boral TOSA.

(c) USG will before the Completion Date keep Boral notified of Third Party Approvals obtained for the purposes of clause 5.1 of the USG TOSA.

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4.11 Third Party consents – general

(a) Before Completion Boral must use reasonable endeavours to obtain consents from relevant counterparties (or meet other applicable contractual requirements) under ‘change of control’ or similar provisions in contracts or property leases to which any BGA Group Member is party, to the extent such provisions would otherwise be triggered by the transactions contemplated by this Agreement, including without limitation consent to change of control under the Distributorship Agreement dated 1 January 2009 between Byuksan Corporation, Boral Plasterboard System Co., Ltd and Boral Gypsum Korea Co., Ltd.

(b) Before Completion USG must use reasonable endeavours to obtain consents from relevant counterparties (or meet other applicable contractual requirements) under ‘change of control’ or similar provisions in contracts or property leases to which any USG Contributed Entity is party, to the extent such provisions would otherwise be triggered by the transactions contemplated by this Agreement, including without limitation:

(i) consent to change of control under the Manufacturing and Supply Agreement between USG India and Metcraft Engineering Private Ltd;

(ii) consent to change of control under the Manufacturing and Supply Agreement between USG India and Premium Steels; and

(iii) giving prior written notification to Pelaburan Hartanah Berhad under the Tenancy Agreement between USG Far East and PHB in relation to the office premises in Petaling, Malaysia.

(c) To the extent any consents referred to in clauses 4.11(a) or 4.11(b) are not obtained by Completion, Boral and USG will discuss in good faith how to address the situation having regard to the best interests of the Joint Venture Group going forward.

(d) USG undertakes that it will not (and it will procure that any other relevant member of the USG Group does not) exercise any right to terminate:

(i) the Intellectual Property License Agreement (Manufacturing) between United States Gypsum Company and USG Corporation (as licensors) and USG-Zawawi Drywall LLC (to the extent such agreement has been entered into); or

(ii) any other existing intellectual property licence to any other USG Joint Venture,

to the extent any such rights arise on Completion as a result of the transactions contemplated by this Agreement.

4.12 Safety

Boral and USG each acknowledge their respective commitments to ensuring safe workplaces. Boral and USG agree:

(a) to co-operate in good faith between the date of this Agreement and Completion to agree proposed measures to be implemented following Completion to improve work practices and safety at sites under the control of the Boral Joint Venture or the USG Joint Ventures, consistent with safety practices of Boral and USG;

(b) to submit such agreed measures to the boards of BAGL and SingCo for approval as soon as practicable after Completion; and

(c) to exercise the Joint Venture Group’s rights in relation to the Boral Joint Venture and the USG Joint Ventures after Completion to implement such agreed measures to the extent it is within the Joint Venture Group’s power to do so.

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4.13 Expanded Baker & McKenzie review

Boral and USG will each use their respective best endeavours (having regard to their ability to control or influence the actions of the relevant entities) to ensure that:

(a) the consent of Rondo Building Services Pty Limited and each USG Joint Venture is obtained as soon as practicable after the date of this Agreement to the inclusion of (in the case of Rondo) Rondo’s operations in Asian jurisdictions and (in the case of the USG Joint Ventures) the operations of the relevant USG Joint Venture and its Subsidiaries within the review to be conducted by Baker & McKenzie; and

(b) (subject to such consent) such operations of Rondo and the operations of each USG Joint Venture (and their respective Subsidiaries) are so included,

on the basis that:

(c) the scope of the review will be determined in accordance with Schedule 8;

(d) USG and Boral will instruct Baker & McKenzie to include the results of such reviews in the Baker & McKenzie Report; and

(e) following Completion USG and Boral agree that the Joint Venture Group will (having regard to its ability to control or influence the actions of the relevant entity in each case) take all reasonable steps to seek the approval of Rondo Building Services Pty Limited and each USG Joint Venture for the implementation of the recommendations in the Baker & McKenzie Report in relation to the relevant entity and to ensure such approvals, if obtained, are acted upon.

In addition, following Completion USG and Boral agree that the Joint Venture Group will exercise its rights in relation the Boral Joint Venture and the USG Joint Ventures so as to ensure that, to the extent it is within the Joint Venture Group’s power to do so, that entity creates and implements guidelines and procedures for the proper monitoring of compliance with applicable International Trade Laws (as defined in Schedule 1) which are in the nature of sanctions or embargoes.

4.14 Other matters

(a) USG must ensure that from Completion all exports of Star-USG Building Materials Co, Ltd (or any Subsidiary) out of China and into any country or geographical area forming part of the Territory are made through a Joint Venture Group Member (and not for the avoidance of doubt any USG Group Member).

(b) USG and Boral will each use their commercially reasonable endeavours in good faith to reach, as soon as practicable after the date of this Agreement, mutually acceptable accommodations with BBMG Corporation in relation to the operations of the Joint Venture Group in China, to take effect from Completion. USG and Boral acknowledge the objective of such arrangements is to achieve a beneficial arrangement for the Joint Venture Group, while minimising as far as practicable any adverse financial impact on the Joint Venture Group arising from pre-existing commitments in relation to Star-USG Building Products Co., Ltd.

(c) USG and Boral will each use their commercially reasonable endeavours in good faith to reach, as soon as practicable after the date of this Agreement, mutually acceptable accommodations with relevant third parties in relation to the operations of the Joint Venture Group in the Middle East region, to take effect from Completion. USG and Boral acknowledge the objective of such arrangements is to achieve a beneficial arrangement for the Joint Venture Group, while minimising as far as practicable any adverse financial impact on the Joint Venture Group arising from pre-existing commitments in relation to USG Middle East Ltd and Arabian Coast Trading, S.A..

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4.15 US tax matters

(a) Boral must before Completion provide USG with properly completed United States Internal Revenue Service Forms 8832 for the following entities (“Checked Entities”) together with proof of filing:

(i) Boral Middle East (Dubai) L.L.C.

(ii) Boral Plasterboard Marketing Sdn. Bhd.

(iii) Gypsum Business Ltd.

(iv) South Korean Plasterboard Corporation

(v) Siamsum Corporation

(vi) China Plasterboard Corporation

(vii) BGA Holdings Ltd.

(b) Boral and the Boral Seller agree to cooperate with USG (and Boral and USG agree that SingCo will co-operate with USG) to ensure that elections are filed to treat each of the following entities as disregarded entities for U.S. federal income tax purposes effective two (2) days after the Completion: (a) USG Manufacturing Worldwide Ltd.; (b) USG Asia Pacific Holdings Ltd.; and (c) USG Cayman Holdings Ltd.

4.16 USG restructure

Before Completion, USG must ensure that each of the following actions occurs (without cost or liability to any USG Contributed Entity):

(a) CGC Inc. distributes its shares in USG ChinaLux S.à r.l., to the Acquirer;

(b) USG Latin America, LLC distributes its shares in USG Manufacturing Worldwide, Ltd. to the Acquirer;

(c) USG Interiors International, LLC distributes its interests in USG Interiors Pacific, Ltd, USG Interiors Australia Pty Limited, and USG Cayman Holdings Ltd. to the Acquirer;

(d) USG Interiors International, LLC is liquidated, distributing the shares in USG Asia Pacific Holdings Pte Ltd to the Acquirer;

(e) USG Corporation licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences;

(f) United States Gypsum Company licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences;

(g) USG Interiors, LLC licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences; and

(h) USG Foreign Investments, Ltd licenses to the Acquirer the Intellectual Property Rights to be licensed at Completion under the USG Asia IP Licences.

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4.17 Share figures

If Boral and USG agree before Completion that there needs to be changes to any number of shares identified in this Agreement or the Australasia Sale Agreement to be issued or transferred at Completion, the allocation of aggregate value between this Agreement and the Australasia Sale Agreement (or both) they agree to work together in good faith to agree any consequential reallocation of the value of the USG contributed assets and the Boral contributed assets and any consequential changes to share numbers and the split of the aggregate initial purchase price across this Agreement and the Australasia Sale Agreement (being US$500 million). For the avoidance of doubt any such changes will be an allocation exercise only and there is to be no change to the aggregate transaction value or to the aggregate purchase price.

5. COMPLETION

5.1 Date and place

Completion must take place at 10.00 am at the offices of Jones Day, 88 Phillip Street, Sydney, NSW 2000, on the day which is:

(a) the last Business Day of the month during which the Condition Satisfaction Date falls; or

(b) if the Business Day determined under clause 5.1(a) would be less than 7 days after the Condition Satisfaction Date, the last Business Day of the following month,

or such other time or place as the parties may agree in writing.

5.2 Completion obligations

(a) On Completion (or before where the nature of the action permits it), each Party must carry out the Completion steps referable to it in accordance with Schedule 5.

(b) Subject to clause 5.4 Completion is taken to have occurred when each party has performed all its obligations under this clause 5.2 and Schedule 5.

5.3 Order of events at Completion

(a) Subject to clause 5.3(c) (and except to the extent Schedule 5 requires certain actions to be taken before Completion), the actions to take place as contemplated by clause 5.2 and Schedule 5 are interdependent and must take place, as nearly as possible, simultaneously, but so that they are taken to have occurred in the following sequence:

(i) first, the entry into the USG Asia IP Licences between the Acquirer and SingCo;

(ii) second, the transfer of the USG Contributed Shares to SingCo by the Acquirer;

(iii) third, the subscription and issue of the Subscription Shares to the Acquirer;

(iv) fourth, the transfer of the Boral Contributed Tranche 1 Shares to SingCo by Boral Seller in exchange for the issue of the Boral Subscription Tranche 1 Shares to Boral Seller; and

(v) fifth, the entry into the Boral Asia IP Licenses between Boral Seller and SingCo;

(vi) sixth, the transfer of the Boral Contributed Tranche 2 Shares to SingCo by Boral Seller

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(vii) seventh, the issue of the Boral Subscription Tranche 2 Shares to the Boral Seller; and

(viii) eighth, the transfer of the Sale Shares by the Boral Seller to the Acquirer and all other actions.

(b) If one action required by clause 5.2 and Schedule 5 does not take place, then without prejudice to any rights available to any party as a consequence:

(i) there is no obligation on any party to undertake or perform any of the other actions;

(ii) to the extent that such actions have already been undertaken, the parties must do everything reasonably required to reverse those actions; and

(iii) each Party must return to the relevant other Party all documents delivered to it under clause 5.2 and Schedule 5 and must each repay to the relevant other Party all payments received by it under clause 5.2 and Schedule 5, without prejudice to any other rights any Party may have in respect of that failure.

(c) USG may, in its sole discretion, waive any or all of the actions that any Boral Group Member or BGA Group Member is required to perform under Schedule 5 and Boral may, in its sole discretion, waive any or all of the actions that any USG Group Member is required to perform under Schedule 5.

5.4 Interdependency with Australasia Completion

(a) Completion under this Agreement is interdependent with, and is to occur (as far as possible having regard to clause 5.3 and the equivalent provision of the Australasia Sale Agreement) simultaneously with, Australasia Completion under the Australasia Sale Agreement.

(b) If Australasia Completion under the Australasia Sale Agreement does not occur for any reason, Completion under this Agreement will be taken not to have occurred (notwithstanding clause 5.2 and Schedule 5 having otherwise being complied with) and clause 5.3(b) will apply.

5.5 Notice to complete

(a) If a Party (Failing Party) fails to satisfy all of its obligations under clause 5.2 and Schedule 5 on the day and at the place and time for Completion determined under clause 5.1 (or fails to satisfy its obligations under clause 7.11(d) in relation to ensuring SingCo satisfies all of its obligations at Completion) then:

(i) if the Failing Party is a Boral Party or a BGA Group Member, USG; or

(ii) if the Failing Party is a USG Party, Boral,

(in each case the Notifying Party) may give the Failing Party a notice requiring the Failing Party to satisfy those obligations on any Business Day within a period of 14 days from the date of the notice and declaring time to be of the essence.

(b) If the Failing Party fails to satisfy those obligations within those 14 days the Notifying Party may, without limitation to any other rights it may have, terminate this agreement with immediate effect by giving written notice to each other Party.

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5.6 Post Completion actions

(a) From Completion until the Sale Shares are registered in the name of the Acquirer, Boral Seller must:

(i) appoint the Acquirer as its sole proxy as holder of Sale Shares to attend shareholders’ meetings and exercise the votes attaching to the Sale Shares;

(ii) not vote at any shareholders’ meetings of SingCo in respect of the Sale Shares;

(iii) take all other actions in the capacity of a registered holder of the Sale Shares as the Acquirer directs,

and the Acquirer indemnifies Boral Seller against all Loss suffered or incurred by it arising out of the implementation of any action taken in accordance with such proxy.

(b) From Completion until the USG Contributed Shares are registered in the name of SingCo, the Acquirer must:

(i) appoint SingCo as its sole proxy as holder of the relevant USG Contributed Shares to attend shareholders’ meetings and exercise the votes attaching to the USG Contributed Shares;

(ii) not attend and vote at any shareholders’ meetings of any USG Contributed Entity; and

(iii) take all other actions in the capacity of a registered holder of the USG Contributed Shares as SingCo directs,

and Boral and USG must (severally in accordance with their respective Shareholding Percentages) indemnify the Acquirer against all Loss suffered or incurred by it arising out of the implementation of any action taken by SingCo in accordance with such proxy.

(c) From Completion until the Boral Contributed Shares are registered in the name of SingCo, Boral Seller must:

(i) appoint SingCo as its sole proxy as holder of the Boral Contributed Shares to attend shareholders’ meetings and exercise the votes attaching to the Boral Contributed Shares;

(ii) not attend and vote at any shareholders’ meetings of BGA; and

(iii) take all other actions in the capacity of a registered holder of the Boral Contributed Shares as SingCo directs,

and Boral and USG must (severally in accordance with their respective Shareholding Percentages) indemnify Boral Seller all Loss suffered or incurred by it arising out of the implementation of any action taken by SingCo in accordance with the relevant proxy.

(d) As soon as practicable following Completion (and in any event within applicable statutory timeframes) Boral and USG must procure that all requisite forms and notifications are lodged with the appropriate Governmental Agency in respect of the actions undertaken at Completion.

5.7 Co-operation

(a) Following Completion, Boral agrees to cooperate with USG in good faith to ensure that the ownership of entities by the Joint Venture Group are structured to enable the USG Group to maintain the level of ownership required by section 902 of the Code.

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(b) Boral acknowledges and agrees that the shares and assets owned by the following entities are subject to a gain recognition agreement filed with the U.S. government and that, from Completion, the Joint Venture Group will not sell or cause to be sold the shares or assets of these businesses prior to January 1, 2019:

(i) USG Manufacturing Worldwide Ltd;

(ii) USG ChinaLux S.a.r.l.;

(iii) Star-USG Building Materials Co., Ltd.

(iv) USG Asia Pacific Holdings Pte. Ltd.

(v) USG Interiors Pacific Ltd.;

(vi) USG Interiors Australia Pty Ltd; and

(vii) USG Cayman Holdings Ltd.

(c) Boral acknowledges and agrees that USG, as a U.S.-based multinational, is subject to various detailed reporting requirements (as amended from time to time) and that to comply with these reporting requirements the USG Group will require, and the Joint Venture Group will following Completion provide, detailed information regarding the computation of earnings and profits earned by each entity within the Joint Venture Group, and the nature of those earnings and will also need receipts evidencing foreign taxes paid by the entities within the Joint Venture Group.

5.8 Long term incentive arrangements

(a) Boral and USG acknowledge that:

(i) certain employees and officers of the BGA Group participate in the Boral Group’s long term incentive programs (Boral LTI); and

(ii) certain employees and officers of the USG Contributed Entities participate in the USG Group’s long term incentive programs (USG LTI).

(b) Boral and USG agree that:

(i) the Boral Group will be solely responsible for, and after Completion Boral will reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Member in respect of, long term incentive entitlements of BGA Group employees and officers under the Boral LTI in respect of the Boral financial year ending 30 June 2014 (and for the avoidance of doubt in respect of all previous financial years); and

(ii) the USG Group will be solely responsible for, and after Completion USG will reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Member in respect of, long term incentive entitlements of USG Contributed Entity employees and officers under the USG LTI in respect of the USG financial year during which Completion occurs (and for the avoidance of doubt in respect of all previous financial years),

with the expectation that in respect of later periods the Joint Venture Group will establish its own standalone long term incentive arrangements.

(c) This clause 5.8 does not apply in relation to bonus entitlements or similar short term incentives to which employees or officers of the BGA Group or any USG Contributed Entity (including participants in the Boral LTI or the USG LTI) may be entitled. Following Completion these entitlements will be the responsibility of the Joint Venture Group.

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5.9 Expatriates

Boral and USG agree that:

(a) the Boral Group will be solely responsible for, and after Completion Boral will reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Member in respect of, all costs of repatriation and re-employment of expatriate employees seconded by the Boral Group to the BGA Group as at Completion; and

(b) the USG Group will be solely responsible for, and USG will after Completion reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Company in respect of, all costs of repatriation and re-employment of expatriate employees seconded by the USG Group to the USG Contributed Entities as at Completion.

6. PURCHASE PRICE ADJUSTMENT

6.1 Definitions

The meanings of the terms used in this clause 6 are set out below.

Asia USG Adjustment Amount has the meaning given in Part 1 of Schedule 10.

BGA Adjustment Amount has the meaning given in Part 1 of Schedule 9.

BGA Completion Statement means a statement prepared under this clause 6, calculating the BGA Adjustment Amount in the manner and format prescribed in Schedule 9 for the BGA Group prepared as at close of business on the Completion Date.

Independent Expert has the meaning provided in clause 6.8(a).

Dispute Notice is defined in clause 6.5(b).

Review Period means the period of 30 days commencing on the later to occur of:

(a) USG delivering a draft USG Completion Statement under clause 6.4(a); and

(b) Boral delivering a draft BGA Completion Statement under clause 6.4(b).

USG Completion Statement means a statement prepared under this clause 6, calculating the Asia USG Adjustment Amount in the manner and format prescribed in Schedule 10 for the USG Contributed Entities prepared as at close of business on the Completion Date.

6.2 Purchase Price

The Initial Purchase Price will be adjusted:

(a) at Completion, in accordance with clause 6.3; and

(b) after Completion, in accordance with clauses 6.4 to 6.11.

6.3 Estimated positions at Completion

(a) No later than 7 days before the scheduled date for Completion under clause 5.1:

(i) USG must deliver to Boral a statement setting out USG’s estimate, prepared in good faith, of the Asia USG Adjustment Amount as at that scheduled Completion date together with reasonable supporting workings; and

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(ii) Boral must deliver to USG a statement setting out Boral’s estimate, prepared in good faith, of the BGA Adjustment Amount as at that scheduled Completion date together with reasonable supporting workings.

(b) If either Boral or USG fails to deliver a statement complying with clause 6.3(a) by the date required by that clause, the relevant party will be taken to have delivered an estimated Asia USG Adjustment Amount or estimated BGA Adjustment Amount (as the case may be) of zero.

(c) The Initial Purchase Price payable at Completion will be adjusted so that:

(i) if the estimated BGA Adjustment Amount is higher than the estimated Asia USG Adjustment Amount, the Initial Purchase Price will be increased by an amount equal to 50% of the difference; and

(ii) if the BGA Adjustment Amount is lower than the Asia USG Adjustment Amount, the Initial Purchase Price will be decreased by an amount equal to 50% of the difference,

provided that no adjustment will be made if the required increase or decrease would be, when aggregated with the corresponding required increase or decrease under the Australasia Sale Agreement, less than US$200,000.

(d) If Completion is delayed beyond the date for which the estimates were prepared, Boral and USG must consult in good faith regarding any material changes to their estimates (and if updated estimates are agreed the adjustments to the Initial Purchase Price under clause 6.3(c) will be made accordingly).

6.4 Post Completion – final adjustments

(a) USG must procure that a draft of the USG Completion Statement is prepared in accordance with this clause 6 and delivered to Boral by the date which is 90 days after the Completion Date (or such other date as Boral and USG agree in writing).

(b) Boral must procure a draft of the BGA Completion Statement is prepared in accordance with this clause 6 and delivered to USG by the date which is 90 days after the Completion Date (or such other date as Boral and USG agree in writing).

6.5 Review and dispute

(a) By no later than the end of the Review Period:

(i) Boral must give USG a written notice, which states that Boral either:

(A) accepts the draft USG Completion Statement; or

(B) disputes one or more items or the calculation of one or more items in the draft USG Completion Statement (in which case clause 6.5(b) will apply); and

(ii) USG must give Boral a written notice, which states that USG either:

(A) accepts the draft BGA Completion Statement; or

(B) disputes one or more items or the calculation of one or more items in the draft BGA Completion Statement (in which case clause 6.5(b) will apply).

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(b) If Boral wishes to dispute any item or calculation of any item in the draft USG Completion Statement, or USG wishes to dispute any item or calculation of any item in the draft BGA Completion Statement, then that Party must, before the end of the Review Period, also give a written notice (Dispute Notice) to the other which:

(i) sets out details of each item or calculation of each item that is in dispute;

(ii) sets out a separate dollar value for each of the disputed items; and

(iii) sets out full details of the reasons why each of the relevant items is in dispute.

(c) Boral may only give one Dispute Notice and USG may only give one Dispute Notice.

6.6 Acceptance and Deemed Acceptance

If either Boral or USG:

(a) gives a notice under clause 6.5(a)(i) or 6.5(a)(ii) (as the case may be) accepting the draft BGA Completion Statement or the draft USG Completion Statement(as relevant); or

(b) notwithstanding the requirements of clause 6.5 fails to give the other a notice accepting or disputing the draft BGA Completion Statement or the draft USG Completion Statement (as relevant) within the Review Period; or

(c) gives a notice to the other purporting to dispute the draft BGA Completion Statement or the draft USG Completion Statement (as relevant) after expiry of the Review Period; or

(d) gives a notice to the other purporting to dispute the draft BGA Completion Statement or the draft USG Completion Statement (as relevant) within the Review Period but fails to give a Dispute Notice within the Review Period,

then the draft BGA Completion Statement or the draft USG Completion Statement (as relevant) in the form in which it was delivered under clause 6.4 will be taken to be the definitive “BGA Completion Statement” or “USG Completion Statement” (as relevant) for the purposes of this Agreement, and will be final and binding on the Parties (including for the avoidance of doubt for the determination of the BGA Adjustment Amount or the Asia USG Adjustment Amount, as the case may be).

6.7 Dispute Resolution Procedure

(a) If either Boral or USG gives a Dispute Notice within the Review Period pursuant to clause 6.5(b), then Boral and USG must, within 30 days after expiry of the Review Period, use their reasonable endeavours in good faith to:

(i) resolve the issues set out in the Dispute Notice or Dispute Notices; and

(ii) reflect any resolution regarding those issues in a written agreement.

(b) If any agreement reached under clause 6.7(a) resolves all outstanding issues in relation to the BGA Completion Statement or the USG Completion Statement (as relevant), the parties must make any required changes that arise from that agreement to the draft BGA Completion Statement or the draft USG Completion Statement (as relevant), and the resulting document will be taken to be the definitive “BGA Completion Statement” or “USG Completion Statement” (as relevant) for the purposes of this Agreement, and will be final and binding on the Parties (including for the avoidance of doubt for the determination of the BGA Adjustment Amount or the Asia USG Adjustment Amount, as the case may be).

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6.8 Referral to Independent Expert

(a) If USG and Boral have not been able to resolve the issues set out in a Dispute Notice given pursuant to clause 6.5(b) within 30 days of the expiry of the Review Period, then the unresolved matters must be referred for resolution to an independent person agreed between USG and Boral within a further 7 days. If USG and Boral cannot agree on who the independent person will be within that time period, the dispute must be referred to one of the following accounting firms (to be drawn by lot in the presence of a representative of USG and Boral):

(i) PwC Australia;

(ii) Deloitte Australia;

(iii) KPMG Australia;

(iv) Ernst & Young Australia,

and if each of the above firms refuse the appointment, then a firm shall be selected from the following list (to be drawn by lot in the presence of a representative of USG and Boral):

(v) BDO

(vi) Grant Thornton;

(vii) PKF,

and the Independent Expert for the purposes of this clause 6 will be the person agreed or selected under this clause 6.8(a). For the avoidance of doubt, if both the BGA Completion Statement and the USG Completion Statement are in dispute, both disputes must be referred to the same Independent Expert at the same time.

(b) The Independent Expert must be instructed by USG and Boral:

(i) to determine only the unresolved issues in the Dispute Notice or Dispute Notices;

(ii) to decide the procedures and timing to be followed in order to resolve the dispute (save as set out in this clause 6);

(iii) to provide a written determination to USG and Boral no later 30 days after receipt of the submissions contemplated by clause 6.8(c) setting out the Independent Expert’s determination as to:

(A) the unresolved issues;

(B) amendments (if any) required to be made to the BGA Completion Statement, the USG Completion Statement, or both (as the case may be depending on the subject matter of the dispute or disputes);

(C) the BGA Adjustment Amount, the Asia USG Adjustment Amount, or both (as the case may be depending on the subject matter of the dispute or disputes); and

(D) the allocation of the Independent Expert’s costs.

(c) USG and Boral may make separate written submissions to the Independent Expert (to be delivered within 14 days after the Independent Expert is appointed) and may make a response to the submissions of the other.

(d) The Independent Expert will act as an expert and not as an arbitrator in determining the dispute. The Independent Expert’s decision in relation to the matters in its written determination will be final, conclusive and binding on the Parties (except in the case of manifest error).

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(e) The Independent Expert must be instructed to, in reaching its determination:

(i) apply the requirements of this clause 6 (and Schedule 9 or Schedule 10 (as applicable)) insofar as they relate to financial and accounting matters and the format of the respective completion statements;

(ii) not take into account any other dispute that may be ongoing between the parties and unrelated to the Dispute Notice or Dispute Notices submitted to the Independent Expert; and

(iii) rely solely on the submissions by the Parties to the Independent Expert and not independent review.

(f) The Independent Expert must be instructed that, in resolving any disputed item, the Independent Expert may not assign a greater value to any such item than the greatest value for such item claimed by either USG or Boral in the written submissions to the Independent Expert or less than the lowest value for such item claimed by either USG or Boral in such submissions.

(g) Any written correspondence between the Independent Expert and any of the Parties must be copied to each of the other Parties at the same time as it is sent to the principal recipient.

(h) Each of the Parties must promptly provide the Independent Expert with any information, assistance and cooperation that the Independent Expert reasonably requests to assist in making his or her determination.

(i) The costs of the Independent Expert will be borne in the proportion determined by the Independent Expert having regard to the outcome of the dispute or disputes referred to the Independent Expert (and failing any cost allocation by the Independent Expert, equally between USG and Boral. In addition, at the time of appointing the Independent Expert Boral and USG must agree to any customary terms of engagement of the Independent Expert, including as to indemnities in favour of the Independent Expert

6.9 Access

(a) USG must ensure that each USG Group Member permits representatives of Boral and its advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the USG Contributed Entities for the period before Completion in their possession or control as Boral and its advisers reasonably request in relation to the review of, and agreement to, the USG Completion Statement.

(b) Boral must ensure that each Boral Group Member permits representatives of USG and its advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the BGA Group for the period before Completion in their possession or control as USG and its advisers reasonably request in relation to:

(i) the preparation of, and agreement to, the USG Completion Statement; and

(ii) the review of, and agreement to, the BGA Completion Statement.

(c) USG and Boral must use all reasonable endeavours to ensure (as ultimate shareholders in BGA after Completion) that each BGA Group Member permits representatives of USG, Boral and their respective advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the BGA Group and the USG Contributed Entities for the period before Completion in their possession or control as USG, Boral and their respective advisers reasonably request in relation to the preparation and review of, and agreement to, the USG Completion Statement and the BGA Completion Statement.

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6.10 If Expert process fails

If this clause 6 requires any disputed matters to be referred to an Independent Expert for resolution but no Independent Expert determination on the relevant matters is possible because:

(a) USG and Boral do not agree on the Independent Expert and none of the firms selected as potential Independent Experts agrees to the accept the appointment;

(b) an Independent Expert is appointed but the Independent Expert subsequently withdraws or advises that it is for any reason unable to make a determination; or

(c) for any other reason,

and USG and Boral cannot within a further 14 days agree on the appointment of an alternative Independent Expert, then the Independent Expert process will be taken to have failed and any party may commence proceedings in a court of competent jurisdiction in relation to the resolution of the relevant disputed matters (on the basis that each party will for the avoidance of doubt still have an obligation to make the payments required by clause 6.11).

6.11 Payment of final adjustments

(a) If the BGA Adjustment Amount finally agreed or determined in accordance with this clause 6 is higher than the Asia USG Adjustment Amount finally agreed or determined in accordance with this clause 6, then subject to clause 6.11(c)on the Final Adjustment Date the Acquirer must pay to Boral Seller, as an increase to the Initial Purchase Price:

(i) an amount equal to 50% of the difference; less

(ii) the amount (if any) by which the Initial Purchase Price paid at Completion was increased under clause 6.3(c),

provided that if the amount under clause 6.11(a)(i) above is smaller than the amount under clause 6.11(a)(ii) above so that the calculation results in a negative number (an Adjustment Shortfall):

(iii) the Acquirer will have no obligation to make a payment to Boral Seller under this clause 6.11(a); and

(iv) Boral Seller must instead pay to the Acquirer on the Final Adjustment Date an amount equal to the relevant Adjustment Shortfall.

(b) If the BGA Adjustment Amount finally agreed or determined in accordance with this clause 6 is lower than the Asia USG Adjustment Amount finally agreed or determined in accordance with this clause 6, then then subject to clause 6.11(c) on the Final Adjustment Date Boral Seller must pay to the Acquirer, as a reduction to the Initial Purchase Price:

(i) an amount equal to 50% of the difference; less

(ii) the amount (if any) by which the Initial Purchase Price paid at Completion was reduced under clause 6.3(c),

provided that if the amount under clause 6.11(b)(i) above is smaller than the amount under clause 6.11(b)(ii) above so that the calculation results in a negative number (an Adjustment Shortfall):

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(iii) the Boral Seller will have no obligation to make a payment to the Acquirer under this clause 6.11(b); and

(iv) the Acquirer must instead pay to Boral Seller on the Final Adjustment Date an amount equal to the relevant Adjustment Shortfall.

(c) No amount will be payable by any Party (and no adjustment to the Initial Purchase Price will be made) under this clause 6.11 unless the amount determined under clause 6.11(a) or 6.11(b) would be, when aggregated with any amount payable by the Party (or any Related Body Corporate of the Party) under the corresponding provision under the Australasia Sale Agreement, exceeds US$200,000.

6.12 Interaction with Australasia Sale Agreement

If a dispute is referred to an Independent Expert under clause 6.8 in circumstances where:

(a) a ‘Dispute Notice’ has also been given under the corresponding provisions of the Australasia Sale Agreement; and

(b) there are unresolved issues between the parties in relation to that Dispute Notice,

then both disputes must be referred to the same Independent Expert at the same time.

6.13 Additional adjustments – Korea

(a) The Parties acknowledge that:

(i) Boral Plasterboard Systems Ltd (BPS), a Korean Subsidiary of BGA, may at Completion have surplus cash available for distribution (the Surplus Cash); and

(ii) the BGA Completion Statement will be prepared on the basis that the ‘Boral Korea Withholding Tax Adjustment’ will be applied to the net cash position of BPS at Completion in the amount and in the circumstances contemplated by clause 1.5 of Part 1 of Schedule 9; and

(iii) the ‘Boral Korea Withholding Tax Adjustment’ will be either 15%, 10% or zero (in accordance with the relevant provisions of clause 1.5 of Part 1 of Schedule 9.

(b) This clause 6.13 applies in circumstances where the ‘Boral Korea Withholding Tax Adjustment’ applied to net cash of BPS in the BGA Completion Statement is 15% or 10% (but not if it is zero). Where this clause 6.13 applies, the amount of cash of BPS to which the ‘Boral Korea Withholding Tax Adjustment’ applied is the Surplus Cash.

(c) The following applies to each distribution by BPS of any of the Surplus Cash to its immediate shareholding entity at any time after Completion:

(i) if the Korean withholding tax applicable to the distribution is at the same rate as the applicable ‘Boral Korea Withholding Tax Adjustment’, no adjustment will be made under this clause 6.13;

(ii) if the Korean withholding tax applicable to the distribution is applied at a higher rate than the rate applied in the ‘Boral Korea Withholding Tax Adjustment’, then within 10 Business Days after the date of the distribution the Boral Seller must pay to the Acquirer as a reduction to the Initial Purchase Price an amount equal to 50% of the difference between:

(A) the value ascribed to the amount distributed in the BGA Completion Statement (being 90% of the relevant amount or 85% of the relevant amount, as applicable); and

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(B) the amount of the distribution net of the applicable withholding tax; and

(iii) if the Korean withholding tax applicable to the distribution is applied at a lower rate than the rate applied in the applicable ‘Boral Korea Withholding Tax Adjustment’, then within 10 Business Days after the date of the distribution the Acquirer must pay to the Boral Seller as an increase to the Initial Purchase Price an amount equal to 50% of the difference between:

(A) the value ascribed to the amount distributed in the BGA Completion Statement (being 90% of the relevant amount or 85% of the relevant amount, as applicable); and

(B) the amount of the distribution net of the applicable withholding tax; and

(d) If at any time after Completion Boral and USG agree in writing that all or any part of the Surplus Cash to which the ‘Boral Korea Withholding Tax Adjustment’ was applied is to be reinvested or otherwise applied in the business of BPS (as opposed to being distributed) (such part of the Surplus Cash being the Reinvested Amount) then the Acquirer must pay to the Boral Seller as an increase to the Initial Purchase Price an amount equal to 50% of the difference between:

(i) the value ascribed to the Reinvested Amount in the BGA Completion Statement (being 90% of the relevant amount or 85% of the relevant amount, as applicable); and

(ii) the actual face value of the Reinvested Amount.

(e) For the purposes of the preceding provisions of this clause 6.13, any distributions by BPS after Completion will be taken to be sourced from the Surplus Cash before any other cash assets of BPS.

(f) Without limiting clause 6.13(c), following Completion:

(i) USG and Boral agree to ensure that, if requested by Boral in writing at any time within 2 years after Completion, the Surplus Cash is distributed by BPS to its then immediate shareholding entity or entities (and conversely that no such distribution of the Surplus Cash by BPS occurs during that period without Boral’s consent); and

(ii) USG and Boral agree to ensure that, if requested by Boral in writing at any time within 2 years after Completion, the shares in BPS are transferred from the current BGA Group Members which hold those shares to BGA (and conversely that no transfer of the shares in BPS occurs during that period without Boral’s consent.

(g) If Boral requires the transfer of the shares in BPS under clause 6.13(f)(ii) then to the extent any BGA Group Member incurs capital gains tax in respect of the transfer which is not refunded by the Korean tax authorities, the Boral Seller must pay to the Acquirer as a reduction to the Initial Purchase Price an amount equal to 50% of the tax liability.

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6.14 Additional adjustments – Oman

(a) In respect of the period before Completion USG will, to the extent within its power, use all reasonable endeavours to ensure that, and in respect of the period after Completion USG and Boral will, to the extent within their power, procure that the Joint Venture Group uses all reasonable endeavours to procure that:

(i) USG-Zawawi Drywall LLC constructs and commissions as expeditiously as is practicable a plasterboard manufacturing facility in accordance with the specifications set out in the documents located at Data Room references 4.6.1.6, 4.6.1.26, and 4.6.2.9 (the Oman Plant); and

(ii) Zawawi Gypsum LLC constructs and commissions as expeditiously as is practicable a gypsum mine in accordance with the specifications set out in the documents located at Data Room references 4.6.2.11, 4.6.2.14, 4.6.2.15, 4.6.2.18 (the Oman Mine).

(b) For the purposes of this clause 6.14:

(i) Plant Completion means the first date on which each of the following is satisfied in respect of the Oman Plant:

(A) the Oman Plant has achieved 3 consecutive operating shifts, 8 hr shift minimums, at 75% Overall Equipment Efficiency. For these purposes Overall Equipment Efficiency means the product of (Quality x Uptime x Design Speed)% where:

(I) Quality means the off machine saleable production meeting specifications divided by total production;

(II) Uptime means the time making saleable product divided by the total time (being the shift time scheduled for operations, time making saleable product is mixer run time).

(III) Speed means the actual speed on  ¹⁄₂” standard board divided by the capex approved speed (14 mpm on  ¹⁄₂” standard board);

(B) all permits and compliance certificates enabling operation have been issued and operation is in compliance those permits and compliance certificates; and

(C) 5/8” fire rated board and  ¹⁄₂”moisture resistant board are produced and meet all required specifications.

(ii) Mine Completion means the first date on which each of the following is satisfied in respect of the Oman Mine:

(A) the Oman Mine has achieved 5 consecutive days of operation for regularly scheduled shifts of not less than 8 hours at an average throughput of 425 metric tons/hour over the total scheduled operating period, where:

(I) operation for these purposes is based on production of 500 metric tons per hour of finished product sized 2” to dust as authorized in the applicable capex approval;

(II) throughput will be calculated as the quantity of gypsum rock—2” to dust produced divided by the sum of total hours of scheduled operation for each shift; and

(III) total hours of scheduled operation will be the period from the start of raw material feed to the crushing plant until the scheduled end of the shift; and

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(B) all permits and compliance certificates enabling operation have been issued and operation is in compliance with those permits and compliance certificates.

(c) The Parties acknowledge that the USG Completion Statement will include, in accordance with clause 1.5 of Part 1 of Schedule 10:

(i) an adjustment to increase Net Debt of USG-Zawawi Drywall LLC for the Oman Plant development in progress representing the estimate of USG-Zawawi Drywall LLC’s share of the remaining capital expenditures to occur between the Completion Date and Plant Completion; and

(ii) an adjustment to increase Net Debt of Zawawi Gypsum LLC for the Oman Mine development in progress representing the estimate of Zawawi Gypsum LLC’s share of the remaining capital expenditures to occur between the Completion Date and Mine Completion.

(d) If the actual cost to USG-Zawawi Drywall LLC from the Completion Date to achieve Plant Completion (including for the avoidance of doubt both capital expenditure and operational expenditure to the extent required to achieve Plant Completion):

(i) is more than the amount included in the USG Completion Statement calculated on the same basis, then within 30 days after Plant Completion the Acquirer must pay to the Boral Seller as an increase to the Initial Purchase Price an amount equal to 25% of the difference between that amount and the relevant actual cost; and

(ii) is less than the amount included in the USG Completion Statement calculated on the same basis, then within 30 days after Plant Completion the Boral Seller must pay to the Acquirer as a reduction to the Initial Purchase Price an amount equal to 25% of the difference between that amount and the relevant actual cost.

(e) If the actual cost to Zawawi Gypsum LLC from the Completion Date to achieve Mine Completion (including for the avoidance of doubt both capital expenditure and operational expenditure to the extent required to achieve Mine Completion):

(iii) is more than the amount included in the USG Completion Statement calculated on the same basis, then within 30 days after Mine Completion the Acquirer must pay to the Boral Seller as an increase to the Initial Purchase Price an amount equal to 27.5% of the difference between that amount and the relevant actual cost; and

(iv) is less than the amount included in the USG Completion Statement calculated on the same basis, then within 30 days after Mine Completion the Boral Seller must pay to the Acquirer as a reduction to the Initial Purchase Price an amount equal to 27.5% of the difference between that amount and the relevant actual cost.

(f) For the avoidance of doubt, this clause 6.14 (and the relevant provisions of clause 1.5 of Part 1 of Schedule 10) are intended to operate so that USG bears all the costs relevant to the total post-Completion shareholding of both Boral and USG in USG-Zawawi Drywall LLC and Zawawi Gypsum LLC, for both capital expenditure and operating expenditure to the extent required, to achieve Plant Completion and Mine Completion for USG-Zawawi Drywall LLC and Zawawi Gypsum LLC respectively.

6.15 Thai land sale adjustment

(a) For the purposes of this clause 6.15:

(i) the SGI Group means the Boral Joint Venture and its Subsidiaries (each an SGI Group Member); and

(ii) the SGI Land means the surplus flood-prone land owned by the SGI Group at Navanakorn Industrial Estate, Thailand.

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(b) If there has not been a completed sale of the SGI Land by the SGI Group by Completion, but a sale of the SGI Land by the SGI Group is completed within 6 months after Completion, then USG and Boral agree:

(i) that they (and the Joint Venture Group) will take all steps required to ensure that the sale proceeds received by the SGI Group (net of costs) will be paid as soon as practicable after such settlement via dividends from relevant SGI Group members and Joint Venture Group members to Boral Seller and the Acquirer (as shareholders in SingCo); and

(ii) the Acquirer will promptly upon receipt (and as an adjustment to the Initial Purchase Price) pay to Boral Seller an amount equal to the amount (net of all applicable taxes) of any dividend received by the Acquirer from SingCo which is referable to the sale of the SGI Land.

7. WARRANTIES

7.1 Boral Warranties, Boral JV Warranties and Boral Tax Warranties

Boral and Boral Seller warrant to USG and the Acquirer that each of the Boral Warranties, the Boral JV Warranties and the Boral Tax Warranties is true and correct.

7.2 USG Warranties, USG JV Warranties and USG Tax Warranties

USG and the Acquirer warrant to Boral and the Boral Seller that each of the USG Warranties, the USG Tax Warranties, the USG IP Warranties and the USG JV Warranties is true and correct.

7.3 Effective dates

(a) Subject to clause 7.3(b), the Warranties are given both as at the date of this Agreement and as at Completion.

(b) Where a Warranty is expressed to be made as at a date, it is given with respect to that date only.

(c) Where a Warranty is given as at Completion, that Warranty is given disregarding the change of ownership of the Sale Shares, the Boral Contributed Shares and the USG Contributed Shares that will occur upon Completion and the effect of that change of ownership.

7.4 Independent warranties

Each of the Warranties is to be construed independently of the others and is not limited by reference to any other Warranty.

7.5 Acknowledgment

(a) The Boral Parties acknowledge that the USG Parties have entered into this Agreement and will complete this Agreement in reliance on the Boral Warranties, the Boral JV Warranties and the Boral Tax Warranties.

(b) The USG Parties acknowledge that the Boral Parties have entered into this Agreement and will complete this Agreement in reliance on the USG Warranties, the USG Tax Warranties and the USG JV Warranties.

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7.6 No merger

The Warranties are continuing and do not merge on Completion but remain in full force, subject to the limitations set forth in this Agreement.

7.7 Warranties personal

Any rights of a Party to make a Claim for breach of a Warranty are personal to that Party and may not be assigned to any other Person.

7.8 No other warranties

(a) Each of the Parties acknowledge that, except for the Warranties (and any express warranties in any other Transaction Document), no Party nor any of its Representatives makes any express or implied representation or warranty at all in relation to this Agreement and the transactions contemplated in this Agreement.

(b) Without limiting the foregoing, each Party acknowledges that:

(i) at no time has any Party or any of their respective Representatives made or given, nor has any Party relied on, any representation, warranty, promise, forward-looking statement, projection or forecast in connection with this Agreement except for the Warranties; and

(ii) to the full extent permitted by applicable law, every condition, guarantee, warranty, term, provision, representation or undertaking (whether express, implied, written, oral, collateral, statutory or otherwise) in relation to the transactions contemplated by this Agreement except the Warranties is excluded.

(c) To the full extent permitted by law, each Party agrees not to make, and releases any right they may have to make, against any other Party or their respective Representatives any Claim based on Part 7.10 (including section 1041H) of the Corporations Act, Part 2 Division 2 (including section 12DA or 12DB) of the Australian Securities and Investments Commission Act 2001 (Cth), Parts 2-1, 2-2 or 3-1 (including sections 18, 20, 21, 22 and 29) of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) or on any corresponding provision of any State or Australian Territory legislation, or on a similar provision under any other applicable law, for any act or omission of another Party or for any statement or representation that is not expressly contained in this Agreement.

7.9 Mitigation of losses

Each Party must take, and must ensure each of its Related Corporations following Completion, takes, all reasonable action to mitigate any Loss suffered for which a Claim could be made against any Party pursuant to this Agreement. Nothing in this Agreement restricts or limits any general obligation at law to mitigate any Loss.

7.10 BGA

(a) The Parties acknowledge and agree that:

(i) Boral Seller and the Acquirer will immediately following Completion each have an indirect 50% interest in BGA;

(ii) it is the intent of the Parties that BGA is a party to this Agreement only insofar as it is required to undertake specified actions (which may be the subject of a claim for specific performance) and that it is not intended that BGA should have, and BGA will not have:

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(A) any liability in respect of any Claim by any other Party (except for specific performance of an obligation owed by it that is to be performed at or before Completion); or

(B) any right to bring any Claim against any other Party (except for specific performance of an obligation owed to it that is to be performed at or before Completion.

(b) To the extent this Agreement requires BGA to do anything before or at Completion, Boral must procure that BGA does the relevant thing in accordance with the relevant provisions of this Agreement. For the avoidance of doubt this does not apply to any matters after Completion.

(c) In relation to Claims by or against BGA:

(i) each Party undertakes and agrees not to make any Claim against BGA which is inconsistent with clause 7.10(a)(ii);

(ii) Boral undertakes and agrees to ensure that BGA does not make any Claim against any other Party at any time before Completion (or if Completion does not occur) which is inconsistent with clause 7.10(a)(ii); and

(iii) BGA undertakes and agrees (and Boral Seller and the Acquirer, as shareholders in SingCo, must ensure) that BGA does not make any Claim against any other Party at any time after Completion which is inconsistent with clause 7.10(a)(ii).

7.11 SingCo

(a) The Parties acknowledge and agree that:

(i) Boral Seller and the Acquirer will upon establishment of SingCo, and immediately following Completion, each be 50% owners of the Shares in SingCo;

(ii) it is the intent of the Parties that SingCo is a party to this Agreement only insofar as it is required to undertake specified actions (which may be the subject of a claim for specific performance) and that it is not intended that SingCo should have, and SingCo will not have:

(A) any liability in respect of any Claim by any other Party (except for specific performance of an obligation owed by it that is to be performed at or before Completion); or

(B) any right to bring any Claim against any other Party (except for specific performance of an obligation owed to it that is to be performed at or before Completion.

(d) To the extent this Agreement requires SingCo to do anything before or at Completion, Boral and USG must each do everything within their control as 50% shareholders in SingCo to procure that SingCo does the relevant thing in accordance with the relevant provisions of this Agreement.

(b) In relation to Claims by or against SingCo:

(i) each Party undertakes and agrees not to make any Claim against SingCo which is inconsistent with 7.11(a)(ii);

(ii) Boral and USG (severally) undertake and agree to ensure that SingCo does not make any Claim against any other Party at any time which is inconsistent with 7.11(a)(ii); and

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7.12 Claim to be reduction of Purchase Price

Any payment to a USG Party in respect of any Claim against a Boral Party is taken to be a reduction of the Purchase Price (and any Payment to a Boral Party in respect of any Claim against a USG Party is taken to be an increase in the Purchase Price).

8. LIMITATIONS OF LIABILITY

8.1 Disclosure

(a) None of Boral, the Boral Seller or BGA is liable in respect of a Warranty Claim (other than a Claim arising from a breach of a Title Warranty) to the extent a fact, matter or circumstance giving rise to the Warranty Claim:

(i) is disclosed or described in any Transaction Document (in the form such document exists at the date of this Agreement); or

(ii) is fairly disclosed in the Data Room documents that are listed or referred to in the Boral Disclosure Schedule or in any narrative description in the Boral Disclosure Schedule (or both taken together) in circumstances where the relevant documents or narrative description (or both) are identified in the Boral Disclosure Schedule as being disclosed against:

(A) the particular Warranty to which the relevant Warranty Claim relates; or

(B) the group of Warranties (as classified by reference to the subject headings in the relevant Warranty schedule) in which that particular Warranty falls; or

(iii) is fairly disclosed:

(A) in the narrative of the Boral Q&A Responses; or

(B) in any document referred to in a Boral Q&A Response (but in this case only to the extent the relevant fact, matter or circumstance relates to the question to which the relevant Boral Q&A Response responds); or

(iv) is within the actual knowledge of Specified Executives of USG,

and each Party acknowledges that Boral, the Boral Seller and BGA have disclosed or are deemed to have disclosed against the Boral Warranties, and the Boral JV Warranties (other than the Title Warranties) and each Party will be treated as having actual knowledge of) all facts, matters and circumstances that fall within any of clauses 8.1(a)(i) to 8.1(a)(iv) above.

(b) Neither USG nor the Acquirer is liable in respect of a Warranty Claim (other than a Claim arising from a breach of a Title Warranty) to the extent a fact, matter or circumstance giving rise to the Warranty Claim:

(i) is disclosed or described in any Transaction Document (in the form such document exists at the date of this Agreement); or

(ii) is fairly disclosed in the Data Room documents that are listed or referred to in the USG Disclosure Schedule or in any narrative description in the USG Disclosure Schedule (or both taken together) where the relevant documents or narrative description (or both) are identified in the USG Disclosure Schedule as being disclosed against:

(A) the particular Warranty to which the relevant Warranty Claim relates; or

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(B) the group of Warranties (as classified by reference to the subject headings in the relevant Warranty schedule) in which that particular Warranty falls; or

(iii) is fairly disclosed:

(A) in the narrative of the USG Q&A Responses; or

(B) in any document referred to in a USG Q&A Response (but in this case only to the extent the relevant fact, matter or circumstance relates to the question to which the relevant USG Q&A Response responds); or

(iv) is within the actual knowledge of Specified Executives of Boral,

and each Party acknowledges that USG and the Acquirer have disclosed or are deemed to have disclosed against the USG Warranties and the USG JV Warranties (other than the Title Warranties) and each Party will be treated as having actual knowledge of) all facts, matters and circumstances that fall within any of clauses 8.1(b)(i) to 8.1(b)(iv) above.

8.2 Fair disclosure and actual knowledge

(a) For the purposes of clause 8.1, a fact, matter or circumstance is fairly disclosed if sufficient information has been disclosed that a sophisticated investor, experienced in transactions of the nature of those contemplated by this Agreement, would be aware of the substance and significance of the information and would be aware of the nature and extent of the relevant breach of Warranty.

(b) For the purposes of clause 8.1, a fact, matter or circumstance is within the actual knowledge of a Specified Executive only if the fact, matter or circumstance is within the actual knowledge of that individual prior to the date of this Agreement and a sophisticated investor, experienced in transactions of the nature of those contemplated by this Agreement would be aware, prior to the date of this Agreement, of the substance and significance of that fact, matter or circumstance and the nature and extent of the relevant breach of Warranty.

8.3 Warranties not limited by inquiries or knowledge

(a) Except as expressly set out in this Agreement, no Boral Warranty, Boral JV Warranty or Boral Tax Warranty is excluded or limited by:

(i) any inquiry or investigation made by or on behalf of USG or the Acquirer or any of their respective Representatives;

(ii) any actual or constructive knowledge of USG, the Acquirer or any of their respective Representatives that any Boral Warranty, Boral JV Warranty or Boral Tax Warranty is or may be incorrect; or

(iii) any other act, matter or thing.

(b) Except as expressly set out in this Agreement, no USG Warranty, USG Tax Warranty or USG JV Warranty is excluded or limited by:

(i) any inquiry or investigation made by or on behalf of Boral, BGA or the Boral Seller or any of their respective Representatives;

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(ii) any actual or constructive knowledge of Boral, BGA or the Boral Seller or any of their respective Representatives that any USG Warranty, USG Tax Warranty or USG JV Warranty is or may be incorrect; or

(iii) any other act, matter or thing.

8.4 Time limits for Claims

A Party is not liable in respect of a Claim unless:

(a) it has received a Claim Notice in accordance with clause 11.1 of this Agreement by no later than:

(i) the date which is 6 years after the Completion Date in respect of a Claim arising from a breach of a Title Warranty;

(ii) the end of any applicable statute of limitations with respect to a Tax Claim; and

(iii) the date which is the earlier of:

(A) 2 years after the Completion Date; and

(B) 6 months after the completion of the audit of each of the Joint Venture Companies in respect of the first full financial year which occurs after the Completion Date,

in respect of any other Claim; and

(b) within 6 months (or such longer period as may be agreed) after receipt of the Claim Notice:

(i) the Claim has been agreed, compromised or settled; or

(ii) the Party that gave the Claim Notice (or another member of the same Claim Group) has issued and served legal proceedings against the relevant Party (or another member of its Claim Group) in respect of the Claim,

provided that:

(iii) if at the time the Claim Notice is given sufficient Claims have not been made that, in aggregate, exceed any relevant threshold referred to in clause 8.6, the 6 month period referred to in this clause 8.4(b) will commence from the earlier of the date the threshold is exceeded and the date the time period for Claims of the relevant type under clause 8.4(a) above expires; and

(iv) if the Claim Notice relates to a liability that is a contingent liability, then provided always that:

(A) clause 11.1 has been complied with in relation to the Claim; and

(B) the events, matters or circumstances detailed in the relevant Claim Notice as the basis of the Claim occurred before the expiry of the applicable period under clause 8.4(a),

the 6 month period referred to in clause 8.4(b) above will commence from the earlier of the date the contingent becomes an actual liability and is due and payable and the date which is 6 years after the date of the Claim Notice.

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8.5 Minimum amount for Claims

(a) None of Boral, the Boral Seller or BGA is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim and all other Claims by members of the same Claim Group arising from the same or similar facts, matters or circumstances is at least US$400,000.

(b) Neither USG nor the Acquirer is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim and all other Claims by members of the same Claim Group arising from the same or similar facts, matters or circumstances is at least US$400,000.

8.6 Threshold for Claims

(a) None of Boral, the Boral Seller or BGA is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim either alone or together with the amount finally agreed or adjudicated to be payable in respect of other Claims and Australasia Sale Agreement Claims by members of the USG Group that satisfy clause 8.5(a) (or the corresponding provision of the Australasia Sale Agreement) is at least US$4 million, in which event Boral, the Boral Seller or BGA (as relevant) is liable for the whole of that amount and not merely the excess.

(b) Neither USG nor the Acquirer is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim either alone or together with the amount finally agreed or adjudicated to be payable in respect of other Claims and Australasia Sale Agreement Claims by members of the Boral Group that satisfy clause 8.5(b) (or the corresponding provision of the Australasia Sale Agreement) is at least US$4 million, in which event USG or the Acquirer (as relevant) is liable for the whole of that amount and not merely the excess.

8.7 Maximum recovery

(a) The maximum aggregate amount recoverable by the Boral Claim Group in relation to:

(i) all Claims under this Agreement and all Australasia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties and Environmental Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Australasia Sale Agreement and Australasia Sale Agreement Claims arising from breaches of ‘Title Warranties’ and ‘Environmental Warranties’ as defined in the Australasia Sale Agreement,

is an amount equal to US$30 million;

(ii) without limiting (i) above in relation to Claims to which it applies, all Claims under this Agreement and all Australasia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Australasia Sale Agreement and Australasia Sale Agreement Claims arising from breaches of ‘Title Warranties’ as defined in the Australasia Sale Agreement,

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but for the avoidance of doubt including all other Claims and Australasia Sale Agreement Claims (including Claims arising from breaches of Environmental Warranties and Australasia Sale Agreement Claims arising from breaches of ‘Environmental Warranties’ as defined in the Australasia Sale Agreement) is an amount equal to US$60 million; and

(iii) all Claims under this Agreement and all Australasia Sale Agreement Claims (including Claims excluded from paragraphs (i) and (ii) above) is an amount equal toUS$150 million.

(b) The maximum aggregate amount recoverable by the USG Claim Group in relation to:

(i) all Claims under this Agreement and all Australasia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties and Environmental Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Australasia Sale Agreement and Australasia Sale Agreement Claims arising from breaches of ‘Title Warranties’ and ‘Environmental Warranties’ as defined in the Australasia Sale Agreement,

is an amount equal to US$135 million;

(ii) without limiting (i) above in relation to Claims to which it applies, all Claims under this Agreement and all Australasia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Australasia Sale Agreement and Australasia Sale Agreement Claims arising from breaches of ‘Title Warranties’ as defined in the Australasia Sale Agreement,

but for the avoidance of doubt including all other Claims and Australasia Sale Agreement Claims (including Claims arising from breaches of Environmental Warranties and Australasia Sale Agreement Claims arising from breaches of ‘Environmental Warranties’ as defined in the Australasia Sale Agreement) is an amount equal to US$270 million; and

(iii) all Claims under this Agreement and all Australasia Sale Agreement Claims (including Claims excluded from paragraphs (i) and (ii) above) is an amount equal to US$675 million.

8.8 No double recovery

(a) A Party is not liable in respect of any Claim for any Loss to the extent that:

(i) in respect to USG Claims, the Loss is recovered by any member of the USG Group under another Claim or an Australasia Sale Agreement Claim or is made good or otherwise compensated for without material cost to the USG Group (including recovery under a policy of insurance) (and USG must ensure that any available insurance claims are pursued expeditiously and in good faith);

(ii) in respect to Boral Claims, the Loss is recovered by any member of the Boral Group under another Claim or an Australasia Sale Agreement Claim or is made good or otherwise compensated for without material cost to the Boral Group (including recovery under a policy of insurance) (and Boral must ensure that any available insurance claims are pursued expeditiously and in good faith);

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(b) If, after a Party has made a payment in respect of a Claim, the relevant recipient (or any other member of the same Claim Group) recovers, or is compensated for by any other means, any Loss to which that payment related, the relevant recipient must as soon as practicable pay to the Party who made the payment the amount of the Loss that was recovered or compensated for, less costs and expenses.

8.9 Other limitations of liability

A Party is not liable in respect of any Claim (other than a Claim under clause 9.1(a) or 9.2(a)) for any Loss to the extent that:

(a) the Loss arises out of anything done or omitted to be done in accordance with the terms of any Transaction Document or with the prior written approval of:

(i) in respect to USG Claims, USG; or

(ii) in respect to Boral Claims, Boral; or

(b) the Loss arises from any of the following after the date of this Agreement;

(i) the enactment or amendment of any legislation, regulations or other Legal Requirement;

(ii) a change in the judicial or administrative interpretation of any Legal Requirement; or

(iii) a change in the practice or policy of any Regulatory Authority;

(c) the Loss would not have arisen but for a change after Completion in any accounting policy or practice of any member of the Joint Venture Group, any USG Contributed Entity, the Boral Joint Venture, any USG Joint Venture or:

(i) in the case of USG Claims, any member of the USG Group; and

(ii) in the case of Boral Claims, and member of the Boral Group,

that (in each case) applied before Completion;

(d) the Loss is remediable, provided that:

(i) in the case of USG Claims, it is remedied at the cost of the Boral Group to the satisfaction of USG, acting reasonably, within 60 days after the relevant Claimant Party gives written notice of the Claim under clause 11.1; and

(ii) in the case of Boral Claims, it is remedied at the cost of the USG Group to the satisfaction of Boral, acting reasonably, within 60 days after the relevant Claimant Party gives written notice of the Claim under clause 11.1; or

(e) the Loss is Consequential Loss, provided that this will not prevent recovery of Loss by the Claimant Party to the extent such Loss comprises costs associated with monitoring and ensuring compliance with anti-corruption or anti-bribery measures as required by any applicable law, regulation or regulator (including for avoidance of doubt the United States Foreign Corrupt Practices Act 1977 and the Securities and Exchange Commission) resulting from the matter giving rise to the relevant Claim.

8.10 Accounting provisions

(a) A Party is not liable in respect of any Claim (including a Tax Claim) for any Loss to the extent of any amount that has been included as a provision, allowance, reserve or accrual that caters for the matter giving rise to the Claim:

(i) in the case of a USG Claim, in the BGA Completion Statement; or

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(ii) in the case of a Boral Claim, in the USG Completion Statement,

up to a maximum reduction in liability of an amount equal to the amount of the relevant provision, allowance, reserve or accrual multiplied by:

(iii) in the case of a USG Claim, USG’s Shareholding Percentage at the relevant time; or

(iv) in the case of a Boral Claim, Boral’s Shareholding Percentage at the relevant time.

(b) A Party is not liable in respect of any Claim under clause 9.1(a) or 9.2(a) in respect of Taxes relating to any period before Completion to the extent the liability of the BGA Group or the USG Contributed Entities (as the case may be) is offset by Tax Attributes that relate to a financial year before Completion (with the intention that the relevant Party’s liability will be determined by reference to the net overall Tax liabilities of the relevant entities in respect of the period before Completion) provided that those Tax Attributes were not generated post Completion and carried back into a period ending on or prior to Completion and to the extent those Tax Attributes are not reflected as assets in the applicable Completion Statement.

(c) If:

(i) an accrual, allowance, provision or reserve in the BGA Completion Statement in respect of a Tax exceeds the actual liability in respect of that Tax and that liability has been finally satisfied; or

(ii) an entitlement to any Tax relief that is shown as an asset in the BGA Completion Statement is understated and the amount of the understatement has been actually received by a member of the BGA Group,

then the liability of the Boral Group in respect of any Claims (including Tax Claims) will be reduced by the amount of the actual excess or actual understatement (as applicable).

(d) If:

(i) an accrual, allowance, provision or reserve in the USG Completion Statement in respect of a Tax exceeds the actual liability in respect of that Tax and that liability has been finally satisfied; or

(ii) an entitlement to any Tax relief that is shown as an asset in the USG Completion Statement is understated and the amount of the understatement has been actually received by a USG Contributed Entity,

then the liability of the USG Group in respect of any Claims (including Tax Claims) will be reduced by the amount of the actual excess or actual understatement (as applicable).

8.11 Opinions, estimates and forecasts

(a) The parties acknowledge that no member of the Boral Group, the BAGL Group or the BGA Group is under any obligation to provide any member of the USG Group or its advisers with any information on the future financial performance or prospects of any member of the BAGL Group or the BGA Group or the Boral Joint Venture. If a member of the USG Group has received (including in the Boral Q&A Responses) opinions, estimates, projections, business plans, budget information or other forecasts in respect of any member or member of the BAGL Group or the BGA Group or the Boral Joint Venture, each USG Claim Group Member acknowledges and agrees that:

(i) there are uncertainties inherent in attempting to make these estimates, projections, business plans, budgets and forecasts and the USG Claim Group is familiar with these uncertainties;

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(ii) the USG Claim Group is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections, business plans, budgets and forecasts furnished to it; and

(iii) neither Boral nor the Boral Seller is liable in respect of a Claim arising out of or relating to any opinions, estimates, projections, business plans, budgets or forecasts in respect of any member or members of the BAGL Group or the BGA Group or the Boral Joint Venture.

(b) The parties acknowledge that no member of the USG Group is under any obligation to provide any member of the Boral Group or its advisers with any information on the future financial performance or prospects of any USG Contributed Entities or any USG Joint Venture. If a member of the Boral Group has received (including in the USG Q&A Responses) opinions, estimates, projections, business plans, budget information or other forecasts in respect of any of the USG Contributed Entities or any USG Joint Venture, each Boral Claim Group Member acknowledges and agrees that:

(i) there are uncertainties inherent in attempting to make these estimates, projections, business plans, budgets and forecasts and the Boral Claim Group is familiar with these uncertainties;

(ii) the Boral Claim Group is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections, business plans, budgets and forecasts furnished to it; and

(iii) neither USG nor the Acquirer is liable in respect of a Claim arising out of or relating to any opinions, estimates, projections, business plans, budgets or forecasts in respect of any USG Contributed Entity or any USG Joint Venture.

Nothing in this clause 8.11 qualifies or limits the express rights and obligations of the parties in respect of the Earn-Out Amounts under clause 2.3(d) and under Schedule 8 to the Australasia Sale Agreement.

8.12 Circumstances where limitations not to apply

(a) Notwithstanding the foregoing, none of the limitations in the preceding clauses 8.1 to 8.10 (inclusive) apply to any Losses relating to or Claims brought by a Party:

(i) for payment of any part of the Purchase Price (including the Earn-Out Amounts);

(ii) for payment of any adjustment to the Purchase Price under clause 6.11, 6.13, 6.14 or 6.15; or

(b) Notwithstanding the foregoing, none of the limitations in the preceding clauses 8.1 to 8.10 (inclusive) apply to any Losses in respect of a Claim to the extent that:

(i) the Claim relates to a breach of Warranty given by a Party and the relevant Warranty was given dishonestly or fraudulently by that Party; or

(ii) in the case of any other Claim, the Loss is a result of or arises from any fraud or dishonesty on the part of another Party.

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8.13 No action against Representatives

(a) The Parties waive, and Boral and USG must procure that each Boral Group Member and each USG Group Member waives, all rights and claims that they may have against current or former Representatives in relation to any matter arising directly or indirectly in connection with this Agreement except to the extent that such rights or claims arise out of the fraud, wilful misconduct, wilful concealment or wilful default of such person.

(b) The Parties acknowledge and agree that:

(i) each Party has sought and obtained this waiver as agent for and on behalf of each of their respective current and former Representatives and holds the benefit of this clause 8.13 as trustee for them; and

(ii) the provisions of this clause 8.13 may be enforced by a Party on behalf of and for the benefit of any of their respective current and former Representatives and those persons may plead this clause 8.13 in answer to any claim made by any Party against them.

9. INDEMNITIES

9.1 Indemnities in favour of USG

(a) After Completion Boral must pay to USG an amount equal to USG’s Shareholding Percentage at the relevant time (or in the case of any Tax or Tax Costs payable or incurred by the Boral Joint Venture or any Subsidiary of the Boral Joint Venture, USG’s Shareholding Percentage multiplied by the Joint Venture Group’s percentage holding in the Boral Joint Venture at the relevant time) of:

(i) the amount of any Tax payable by a BGA Group Member or by the Boral Joint Venture or any Subsidiary of the Boral Joint Venture to the extent that Tax relates to any period, or part period, up to and including Completion; and

(ii) Tax Costs incurred by or on behalf of a BGA Group Member or the Boral Joint Venture or any Subsidiary of the Boral Joint Venture to the extent those Tax Costs arise from or relate to any of the matters for which Boral may be liable under clause 9.1(a)(i),

except to the extent that Boral’s liability is limited or qualified under clause 8 (and excluding any Korean tax covered by the price adjustment provisions in clause 6.13.

(b) For the purpose of clause 9.1(a):

(i) Taxes imposed on revenues, income or gain shall be apportioned to periods ending on or prior to the Completion Date based on a hypothetical closing of the books method; and

(ii) Taxes imposed on the value of an item for a period shall be apportioned to periods ending on or prior to the Completion Date on a pro rata basis determined by multiplying the Taxes by a fraction, the numerator of which is the number of days in the period falling on or before the Completion Date, and the denominator of which is the total number of days in the period for which the Tax is imposed.

(c) If any Joint Venture Group Member suffers any Loss (other than to another Joint Venture Group Member) after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Joint Venture Group Member in connection with:

(i) any breach or alleged breach before Completion by any BGA Group Member, the Boral Joint Venture or any Subsidiary of the Boral Joint Venture (Relevant Entity) of any Anti-Corruption Law applicable to the Relevant Entity;

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(ii) any conduct before Completion by a Relevant Entity or any of their employees or agents (in the case of agents, in the relevant agent’s work for the Relevant Entity as opposed to for other clients) of a type listed in Warranty 18.2(a); or

(iii) any breach or alleged breach before Completion by any Relevant Entity of any International Trade Law applicable to the Relevant Entity which is in the nature of a sanction or embargo,

(each a Relevant Event) then Boral must promptly pay to USG an amount equal to the relevant Loss multiplied by USG’s Shareholding Percentage at the relevant time.

(d) In addition (except to the extent compensated under clause 9.1(c)) if any USG Group Member suffers any Loss after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the USG Group Member in connection with any Relevant Event (as defined in clause 9.1(c))) then Boral indemnifies the relevant USG Group Member in respect of such Loss. USG holds the benefit of this indemnity on trust for each other USG Group Member which is not a party to this Agreement.

(e) If any Joint Venture Group Member suffers any Loss (other than to another Joint Venture Group Member) after Completion as a result of any Third Party Claim (including any claim by a current or former employee) against the Joint Venture Group Member in connection with exposure by the relevant claimant to wallboard which was manufactured with contaminated vermiculite prior to Completion by a BGA Group Member in China (any such Loss a China Vermiculite Liability), then Boral must promptly pay to USG an amount equal to the China Vermiculite Liability multiplied by USG’s Shareholding Percentage at the relevant time.

(f) If any Joint Venture Group Member suffers any Loss (other than to another Joint Venture Group Member) after Completion in connection with the sale or transfer of the shares or assets of BRINDO in compliance with an order made by a governmental or regulatory authority or a Court or tribunal made within 2 years after the Completion Date as a result any non-compliance by BRINDO with foreign ownership laws in Indonesia (any such Loss a BRINDO Disposal Loss) then Boral must promptly pay to USG an amount equal to the Brindo Disposal Loss multiplied by USG’s Shareholding Percentage at the relevant at the relevant time. Any BRINDO Disposal Loss must for the avoidance of doubt be assessed net of any sale proceeds received by any Joint Venture Group Member in connection with the relevant sale or transfer of shares or assets.

(g) If any Joint Venture Group Member suffers any Loss (other than to another Joint Venture Group Member) after Completion as a result of a Government Action on or prior to the date which is 2 years after the Completion Date which rezones the Pudong Site or the area in which the Pudong Site is situated (including the costs of land remediation and construction costs) (any such Loss a Pudong Rezoning Loss), then Boral must promptly pay to USG an amount equal to the Pudong Rezoning Loss multiplied by USG’s Shareholding Percentage at the relevant time. Any Pudong Rezoning Loss must for the avoidance of doubt be assessed net of any compensation and any sale proceeds (or comparable receipts) received by any Joint Venture Group Member in connection with the relevant rezoning.

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(h) If any Joint Venture Group Member or any SGI Group Member suffers a Thai Shareholding Loss after Completion then Boral must promptly pay to USG:

(i) where a Joint Venture Group Member suffers the Thai Shareholding Loss, an amount equal to the Thai Shareholding Loss multiplied by USG’s Shareholding Percentage at the relevant time; or

(ii) where an SGI Group Member suffers the Thai Shareholding Loss, an amount equal to the Thai Shareholding Loss multiplied by USG’s Shareholding Percentage at the relevant time multiplied by the percentage shareholding of the Joint Venture Group in SGI at the relevant time (but only to the extent that USG is not compensated in respect of the relevant matter by a payment under clause 9.1(h)(i)).

For the purposes of this clause 9.1(h) Thai Shareholding Loss means any Loss incurred by the relevant entity as a result of the shares in:

(iii) any BGA Thai Holding (as defined in paragraph 3.3(a)(i) of Schedule 1) being held by the relevant holder set out in the table in paragraph 3.3(a)(i) of Schedule 1; or

(iv) any SGI Thai Holding (as defined in paragraph 3.3(a)(ii) of Schedule 1) being held by the relevant holder set out in the table in paragraph 3.3(a)(ii) of Schedule 1,

in each case, as opposed to the position the relevant Joint Venture Group Member or SGI Group Member (as applicable) would have been in had all BGA Thai Holdings been legally any beneficially owned by a Joint Venture Group Member and all SGI Thai Holdings been legally and beneficially owned by an SGI Group Member.

9.2 Indemnities in favour of Boral

(a) After Completion USG must pay to Boral an amount equal to Boral’s Shareholding Percentage at the relevant time (or in the case of any Tax or Tax Costs payable or incurred by a USG Joint Venture or any Subsidiary of a USG Joint Venture, Boral’s Shareholding Percentage multiplied by the Joint Venture Group’s percentage holding in the USG Joint Venture at the relevant time) of:

(i) the amount of any Tax payable by a USG Contributed Entity or by a USG Joint Venture or any Subsidiary of a USG Joint Venture to the extent that Tax relates to any period, or part period, up to and including Completion; and

(ii) Tax Costs incurred by or on behalf of USG Contributed Entity a USG Joint Venture or any Subsidiary of a USG Joint Venture to the extent those Tax Costs arise from or relate to any of the matters for which USG may be liable under clause 9.2(a)(i),

except to the extent that USG’s liability is limited or qualified under clause 8.

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(b) For the purpose of clause 9.2(a):

(i) Taxes imposed on revenues, income or gain shall be apportioned to periods ending on or prior to the Completion Date based on a hypothetical closing of the books method; and

(ii) Taxes imposed on the value of an item for a period shall be apportioned to periods ending on or prior to the Completion Date on a pro rata basis determined by multiplying the Taxes by a fraction, the numerator of which is the number of days in the period falling on or before the Completion Date, and the denominator of which is the total number of days in the period for which the Tax is imposed;

(c) If, after Completion, USG Manufacturing Worldwide, Ltd. pays any amount to Zawawi Minerals LLC (or any successor in title or permitted assign) under or in respect of clause 3.1.4 of the ‘Agreement for the purchase of the entire issued share capital of International Resources Ltd’ between those parties dated 27 March 2012 due to any default, actions or inactions of USG Manufacturing Worldwide, Ltd. at any time before Completion (a Relevant USG Event Payment), then:

(i) USG must promptly pay to Boral an amount equal to the Relevant USG Event Payment multiplied by Boral’s Shareholding Percentage at the relevant time; and

(ii) USG in addition indemnifies the Boral Parties against any Loss suffered or incurred by the Boral Parties as a result of liquidation of International Resources Ltd. as contemplated by clause 3.1.4 of the relevant agreement.

(d) If any Joint Venture Group Member suffers any Loss (other than, in either case to another Joint Venture Group Member) after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Joint Venture Group Member in connection with:

(i) any breach or alleged breach before Completion by any USG Contributed Entity , any USG Joint Venture or any Subsidiary of a USG Joint Venture (Relevant Entity) of any Anti-Corruption Law applicable to the Relevant Entity;

(ii) any conduct before Completion by a Relevant Entity or any of their employees or agents (in the case of agents, in the relevant agent’s work for the Relevant Entity as opposed to for other clients) of a type listed in Warranty 18.2(a); or

(iii) any breach or alleged breach before Completion by any Relevant Entity of any International Trade Law applicable to the Relevant Entity which is in the nature of a sanction or embargo,

(each a Relevant Event) then USG must promptly pay to Boral an amount equal to the relevant Loss multiplied by Boral’s Shareholding Percentage at the relevant time.

(e) In addition (except to the extent compensated under clause 9.2(d)) if any Boral Group Member suffers any Loss after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Boral Group Member in connection with any Relevant Event (as defined in clause 9.2(d)) then USG indemnifies the relevant Boral Group Member in respect of such Loss. Boral holds the benefit of this indemnity on trust for each other Boral Group Member which is not a party to this Agreement.

9.3 Claim Procedure

For the avoidance of doubt, any Claims brought by a Party pursuant to this clause 9 shall be subject to clause 11.

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10. THIRD PARTY CLAIMS AND TAX DEMANDS

10.1 Notice

Without limiting any other rights of a Party under this Agreement:

(a) if after Completion a Boral Party becomes aware of a Third Party Claim or Tax Demand which may give rise to a Boral Claim against a USG Group Member or a USG Claim against a Boral Group Member, Boral must promptly give notice to USG of that Third Party Claim or Tax Demand, copying each other Party under this agreement; and

(b) if after Completion a USG Party becomes aware of a Third Party Claim or Tax Demand which may give rise to a USG Claim against a Boral Group Member or a Boral Claim against a USG Group Member, USG must promptly give notice to Boral of that Third Party Claim or Tax Demand, copying each other Party under this agreement.

Any notice under clause 10.1(a) or clause 10.1(b) must include reasonable details of the facts, matters or circumstances giving rise to the Third Party Claim or Tax Demand, the basis of the Third Party Claim or Tax Demand, copies of any relevant documentation and (if possible in the circumstances) an estimate of the amount of the Third Party Claim or Tax Demand.

10.2 Obligations not to Settle

(a) This clause 10.2(a) applies in relation to any Third Party Claim or Tax Demand (whether or not notified under clause 10.1) that may lead to liability on the part of any USG Group Member under a Boral Claim. Where this clause 10.2(a) applies in relation to a Third Party Claim or Tax Demand:

(i) Boral must not Settle, and must ensure that no Boral Group Member Settles; and

(ii) Boral Seller and the Acquirer must each do everything within their control as shareholders in SingCo to procure that no Joint Venture Group Member Settles,

the relevant Third Party Claim or Tax Demand without USG’s prior written consent, which shall not be unreasonably withheld or delayed. However, a Boral Group Member or Joint Venture Group Member may pay any Tax to a Taxing Authority by the due date for payment without affecting any Boral Group Member’s rights under this Agreement. For the avoidance of doubt, any Settlement effected without the prior written consent of USG (whether or not unreasonably withheld or delayed) shall in no event be determinative of the validity of any Boral Claim against, or the amount of any Losses alleged to be the responsibility of, any USG Group Member.

(b) This clause 10.2(b) applies in relation to any Third Party Claim or Tax Demand (whether or not notified under clause 10.1) that may lead to liability on the part of any Boral Group Member under a USG Claim. Where this clause 10.2(b) applies in relation to a Third Party Claim or Tax Demand:

(i) USG must not Settle, and must ensure that no USG Group Member Settles; and

(ii) Boral Seller and the Acquirer must each do everything within their control as shareholders in SingCo to procure that no Joint Venture Group Member Settles,

the relevant Third Party Claim or Tax Demand without Boral’s prior written consent, which shall not be unreasonably withheld or delayed. However, a USG Group Member or Joint Venture Group Member may pay any Tax to a Taxing Authority by the due date for payment without affecting any USG Group Member’s rights under this Agreement. For the avoidance of doubt, any Settlement effected without the prior written consent of Boral (whether or not unreasonably withheld or delayed) shall in no event be determinative of the validity of any USG Claim against, or the amount of any Losses alleged to be the responsibility of, any Boral Group Member

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10.3 Conduct of dispute

(a) Following receipt of a notice under clause 10.1 (or equivalent information in a notice under clause 11, if not previously notified under clause 10.1), the Accepting Party may, by giving written notice to the Notifying Party, assume the conduct of the defence of the Third Party Claim or elect to contest the Tax Demand (as the case may be).

(b) If the Accepting Party advises the Notifying Party that it wishes to assume the conduct of the defence of the Third Party Claim or to contest the Tax Demand:

(i) provided that the Accepting Party provides the Notifying Party with an indemnity against all Loss which may result from such action, the Notifying Party must promptly take, and must procure that each other Boral Group Member or USG Group Member (as applicable) takes, all action reasonably requested by the Accepting Party to avoid, contest, compromise or defend the Third Party Claim, or to conduct Disputing Action in respect of the Tax Demand, including using professional advisers nominated by the Accepting Party and approved by the Accepting Party for this purpose;

(ii) the Notifying Party must provide the Accepting Party with all reasonable assistance requested by it in relation to the Third Party Claim or Tax Demand, including:

(A) reasonable access to such employees, witnesses and records of the Party as are required in connection with the Third Party Claim or Tax Demand; and

(B) use all reasonable endeavours (including the reimbursement of all reasonable out of pocket expenses) to procure that employees and officers provide such witness statements and other evidence that is required to avoid, dispute, resist, defend, appeal, compromise or mitigate the Third Party Claim or to conduct Disputing Action in relation to the Tax Demand;

(iii) in conducting any proceedings or actions in respect of the Third Party Claim or Tax Demand, the Accepting Party must:

(A) act in good faith;

(B) liaise with the Notifying Party in relation to the defence of the Third Party Claim or the conduct of Disputing Action in relation to the Tax Demand; and

(C) provide the Notifying Party with reasonable access to a copy of any notice, correspondence or other document relating to the Third Party Claim or Tax Demand.

(c) If the Accepting Party advises the Notifying Party that it does not wish to assume the conduct of the defence of the Third Party Claim (or to contest the Tax Demand, as the case may be), then the Notifying Party must procure that it and each other Boral Group Member or USG Group Member (as applicable) conducting any proceedings or actions in respect of that Third Party Claim or Tax Demand:

(i) acts in good faith;

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(ii) liaises with the Accepting Party in relation to the defence of the Third Party Claim or contesting (or otherwise) of the Tax Demand as the case may be; and

(iii) provide the Accepting Party with reasonable access to a copy of any notice, correspondence or other document relating to the Third Party Claim or Tax Demand.

For the avoidance of doubt this clause 10 does not apply in relation to a Boral Claim in relation to any Earn-Out Amount.

11. CLAIMS

11.1 Written notice of Claims

Subject to clause 7.10 and clause 11.4, if a Party (Claimant Party) decides to make a Claim against another Party to this Agreement, then the Claimant Party must promptly give a written notice to the relevant Receiving Party setting out the details of the Claim, including:

(a) reasonable details of the events, matters or circumstances that give rise to the Claim, to the extent available to the Claimant Party at the time of the notice (but so that in any event the basis of the Claim is identified with reasonable specificity), and copies of any Third Party Claim or Tax Demand giving rise to the Claim;

(b) the nature of the Claim;

(c) the estimated amount of Loss claimed (Claim Amount); and

(d) how the Claim Amount is calculated;

(Claim Notice), provided that (subject always to clause 8.4) clauses 11.1(c) and 11.1(d) do not limit a Party’s right to notify a Claim which relates to a contingent liability that is identified but has not yet become an actual liability or is not yet due and payable during the time periods identified above, provided the other required details are included and the omitted information is provided promptly upon the Claimant Party being reasonably able to provide it.

If the Claimant Party does not fully comply with this clause 11.1 in respect of a Claim, the Party against whom the Claim is made is not liable under the Claim to the extent that the non-compliance has increased the amount of the Claim.

11.2 Dealing with Claims

(a) On receipt of a Claim Notice under clause 11.1, the Receiving Party will have 45 days (Consideration Period) to evaluate the Claim and the circumstances around it.

(b) The Receiving Party must give the Claimant Party a written notice before the end of the Consideration Period if it disputes the Claim setting out:

(i) in reasonable detail the reason why the Receiving Party disputes the Claim Notice; and

(ii) the monetary amount (if any) admitted by the Receiving Party as owing to the Claimant Party for the Loss incurred or estimated to be incurred in respect of that Claim,

(Claim Dispute Notice).

(c) If the Receiving Party does not give the Claimant Party a Claim Dispute Notice within the Consideration Period, then the Receiving Party (and any other Boral Group Member or

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USG Group Member, as the case may be, against which the relevant Claim has been made) will be taken to have admitted the full Claim Amount that is the subject of the Claim Notice.

(d) If the Receiving Party gives the Claimant Party a Claim Dispute Notice within the Consideration Period that disputes the whole or part of the Claim Amount, then clause 11.3 applies.

(e) The Receiving Party (and any other Boral Group Member or USG Group Member, as the case may be, against which the relevant Claim has been made) is taken to have admitted any part (or the entirety) of the Claim Amount that is not disputed in the Claim Notice.

11.3 Lesser or no Claim Amount admitted

(a) If a Claim Dispute Notice has been given under clause 11.2(b), the Claimant Party and the Receiving Party must seek to resolve the dispute through negotiations.

(b) If the Claimant Party and the Receiving Party fail to reach agreement as to the amount (if any) to which the Receiving Party is entitled in relation to that Claim within a further 30 days, or if a party to the dispute refuses to participate in such negotiations, then any party to the dispute will be entitled to commence proceedings in relation to the Claim, and the part of the Claim Amount that is not admitted pursuant to clause 11.2(c) or clause 11.2(e), to proceedings.

11.4 Exclusion

This clause 11 does not limit or restrict the ability of a Party to bring a Claim for specific performance of this Agreement or to seek urgent injunctive or similar relief, and does not apply in respect to Claims relating to the adjustment of the Purchase Price pursuant to clause 6.11, 6.13, 6.14 or 6.15 or the calculation or payment of the Earn-Out Amount (if any) pursuant to clause 2.3(d) and to Schedule 8 of the Australasia Sale Agreement.

11.5 Payment

To the extent a Party admits (or is taken to have admitted) liability for the whole or part of a Claim Amount pursuant to clause 11.2(c) or clause 11.2(e) (Admitted Claim Amount), then that Party must pay the Claimant Party the Admitted Claim Amount within 14 days of the end of the Consideration Period.

12. TAX

12.1 GST

(a) For the purposes of this clause Goods and Services Tax (GST) means any tax payable on a supply of goods or services which is due by virtue of the Goods and Services Tax Act Cap 117A (Singapore) and its subsidiary legislation.

(b) The consideration expressed in this Agreement is exclusive of any applicable GST.

(c) If any supply under or in respect of this Agreement is determined to be subject to GST the parties agree that the amount payable under or in respect of this Agreement shall be adjusted by the amount of the GST.

(d) The recipient of the supply shall only pay the GST due on the supply on receipt of a valid tax invoice as defined in Goods and Services Tax Act and subsidiary legislation.

(e) The parties will maintain all necessary business records in respect of GST.

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12.2 Pre Completion tax returns

(f) The parties will co-operate in connection with the preparation and filing of any Tax return or Tax statement of a BGA Group Member or a USG Contributed Entity with respect to a period or part period before the Completion Date and any administrative proceeding involving any such Tax return or Tax statement.

(g) Boral will, at its own cost and expense, have the sole conduct and control of the preparation and filing of all Tax returns, forms or statements of each BGA Group Member to the extent they relate to any periods (or part periods) ending on or before the Completion Date.

(h) USG will, at its own cost and expense, have the sole conduct and control of the preparation and filing of all Tax returns, forms or statements of each USG Contributed Entity to the extent they relate to any periods (or part periods) ending on or before the Completion Date.

(i) The Joint Venture Group will, at its own cost and expense, have the sole control of the preparation and filing of all Tax returns, forms or statements of each BGA Group Member and each USG Contributed Entity for any period that includes, but does not end on or before the Completion Date (Straddle Returns).

(j) The Acquirer and Boral Seller (as shareholders of SingCo after Completion) must severally procure that each Straddle Return is prepared in a manner consistent with the requirements of any Tax Law and that each Straddle Return is delivered to:

(i) Boral (in the case of a return relating to BGA Group Members); or

(ii) USG (in the case of a return relating to a USG Contributed Entity),

as soon as it is available but no later than 30 days before it is due to be filed for the relevant Party’s review and comment.

12.3 Election

USG and Boral agree that, if requested by Boral, SingCo will make a joint election with Boral for purposes of section 124-780(3)(d) of the Australian Income Tax Assessment Act 1997 (Cth); and

13. TERMINATION

13.1 Termination for breach of Agreement

(a) Boral may terminate this Agreement at any time before Completion by notice in writing to the other Parties if any USG Party:

(i) is in breach of any material provision of this Agreement (excluding a breach of Warranty) and does not effectively remedy that breach to the satisfaction of Boral (acting reasonably) within 21 days from the receipt of a written notice from Boral to the Party in default identifying the breach and requiring that the breach be remedied (or before the scheduled date for Completion under clause 5.1, if earlier); or

(ii) commits a breach of an essential term of this Agreement (excluding a breach of Warranty) which is incapable of remedy.

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(b) USG may terminate this Agreement at any time before Completion by notice in writing to the other Parties if any Boral Party or BGA:

(i) is in breach of any material provision of this Agreement (excluding a breach of Warranty) and does not effectively remedy that breach to the satisfaction of USG (acting reasonably) within 21 days from the receipt of a written notice from USG to the Party in default identifying the breach and requiring that the breach be remedied (or before the scheduled date for Completion under clause 5.1, if earlier); or

(ii) commits a breach of an essential term of this Agreement (excluding a breach of Warranty) which is incapable of remedy

13.2 Termination for breach of warranty / Material Adverse Change

Without limiting any other rights or remedies available to a Party under this Agreement, at any time prior to Completion:

(a) USG may terminate this Agreement by notice in writing to the other Parties if:

(i) there is a breach or breaches of the Boral Warranties, the Boral JV Warranties or the Boral Tax Warranties in circumstances that would be reasonably likely to result in an aggregate Loss claimable by the USG Claim Group in excess of US$40 million; or

(ii) a Material Adverse Change occurs in relation to Boral; or

(iii) any Boral Group Member, or any of their officers, employees, agents or advisers has engaged in fraud or dishonesty in relation to the entry by a USG Party into a Transaction Document.

(b) Boral may terminate this Agreement by notice in writing to the other Parties if:

(i) there is a breach or breaches of the USG Warranties, the USG JV Warranties, or the USG Tax Warranties in circumstances that would be reasonably likely to result in an aggregate Loss claimable by the Boral Claim Group in excess of US$40 million;

(ii) there is a breach or breaches of the USG IP Warranties (on the assumption they were given at the date of this Agreement) that, in the reasonable and good faith opinion of Boral, would result in the loss in value of the intellectual property to be licensed under the USG Australasia IP Licences and the USG Asia IP Licences of US$20 million or more;

(iii) any USG Group Member, or any of their officers, employees agents or advisers has engaged in fraud or dishonesty in relation to the entry by a Boral Party into a Transaction Document; or

(iv) a Material Adverse Change occurs in relation to USG.

13.3 Termination for insolvency

(a) USG may terminate this Agreement at any time before Completion by notice in writing to the other Parties if an Insolvency Event (other than one that is or forms part of a solvent restructuring to which the entity in question is party) occurs in relation to:

(i) SingCo or any BGA Group Member; or

(ii) any Boral Party or any other Boral Group Member which is (or will at Completion become) a party to any Transaction Document.

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(b) Boral may terminate this Agreement at any time before Completion by notice in writing to the other Parties if an Insolvency Event (other than one that is or forms part of a solvent restructuring to which the entity in question is party) occurs in relation to:

(i) SingCo or any USG Contributed Entity

(ii) any USG Party or any other USG Group Member which is (or will at Completion become) a party to any Transaction Document.

13.4 Definition of Insolvency Event

For the purposes of clause 13.3 an Insolvency Event occurs in relation to a person or entity (the Relevant Person) if any of the following occurs:

(a) controller: any of the following occur:

(i) a controller (as defined in section 9 of the Corporations Act) is appointed; or

(ii) a resolution to appoint controller is passed,

to the Relevant Person or over an asset of the Relevant Person unless, in the case of an appointment, Boral or USG (being the Party with the potential right to terminate as the case may be) is satisfied that the appointment of the controller is capable of being set aside, and it is set aside, within 7 days of the appointment being made;

(b) winding up: any of the following occur:

(i) an order is made; or

(ii) a resolution is passed,

for the winding up of the Relevant Person;

(c) administration: any of the following occur:

(i) an administrator is appointed to the Relevant Person; or

(ii) a resolution to appoint an administrator to the Relevant Person is passed;

(d) deregistration: the Relevant Person is deregistered;

(e) suspends payment: the Relevant Person suspends payment of its debts generally;

(f) insolvency: the Relevant Person is:

(i) unable to pay its debts when they are due; or

(ii) presumed to be insolvent under the Corporations Act;

(g) arrangements: the Relevant Person enters into or resolves to enter into any arrangement, composition or compromise with, or assignment for the benefit of, any of its creditors;

(h) ceasing business: the Relevant Person ceases to carry on business; or

(i) analogous event: anything analogous to or having a substantially similar effect to any of the events specified in clauses 13.4(a) to 13.4(h) above happens in relation to the Relevant Person under the laws of any jurisdiction.

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13.5 Termination with Mutual Consent

This Agreement may be terminated at any time with the mutual consent in writing of Boral and USG.

13.6 Cross termination

This Agreement will terminate with immediate effect without the requirement for action by any Party if the Australasia Sale Agreement terminates for any reason before Completion occurs.

13.7 Effect of termination

If this agreement is terminated under clause 3.5, clause 5.5 or this clause 13, then:

(a) the Parties must procure that each Transaction Document (if permitted by the terms of that contract) that has already been executed is terminated in accordance with its terms;

(b) each Party is released from its obligations to further perform its obligations under this Agreement and the Transaction Documents, except those expressed to survive termination;

(c) each Party retains the rights it has against any other Party in respect of any breach of this Agreement occurring before termination;

(d) the rights and obligations of each Party under each of the following provisions will (subject to the terms of each of those provisions) continue independently from the other obligations of the Parties and survive termination of this Agreement:

(i) clause 1 (Interpretation);

(ii) clause 12.1 (GST);

(iii) clause 14 (Confidentiality and announcements);

(iv) clause 15 (Exclusivity)

(v) clause 16 (Duties, costs and expenses);

(vi) clause 17 (Guarantees); and

(vii) clause 19 (General).

13.8 No other right to terminate or rescind

No Party may terminate or rescind this Agreement (including on the grounds of any breach of Warranty or misrepresentation that occurs or becomes apparent before Completion) except as permitted under clause 3.5, clause 5.5 or this clause 13.

14. CONFIDENTIALITY AND ANNOUNCEMENTS

14.1 Agreed announcement

A Party may not make any public announcement relating to this Agreement or a Transaction Document (including the fact that the parties have executed this Agreement or any Transaction Document) unless the other party has consented to the announcement, including the timing, form and content of that disclosure, or unless the announcement would be permitted under an exemption in clauses 14.2(a)(i),14.2(a)(ii) or 14.2(a)(iii).

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14.2 Confidentiality

(a) Each Party (recipient) must keep secret and confidential, and must not divulge or disclose any information relating to another Party or its business (which has been or which is disclosed to the recipient by the other Party or its Representatives), or the terms of this Agreement or any Transaction Document other than to the extent that:

(i) the information is in the public domain as at the date of this agreement (or subsequently becomes in the public domain other than by breach of any obligation of confidentiality binding on the recipient);

(ii) the recipient is required to disclose the information by applicable law or regulation or the rules of any recognised stock exchange on which its shares or the shares of any of its Related Corporations are listed, provided that the recipient has to the extent possible having regard to the required timing of the disclosure consulted with the provider of the information as to the form and content of the disclosure;

(iii) the disclosure is expressly permitted under any Transaction Document;

(iv) the disclosure is necessary to seek satisfaction of any of the Conditions provided that the relevant recipient is made aware of the confidential nature of the information and (except in the case of a Regulatory Authority has agreed for the benefit of both Boral and USG to maintain the confidentiality of the information disclosed);

(v) the disclosure is required for use in legal proceedings regarding this Agreement or the transactions contemplated by it; or

(vi) the Party to whom the information relates has consented in writing before the disclosure.

(b) Each Party must ensure that its directors, officers, employees, agents, representatives and Related Corporations comply in all respects with the Party’s obligations as a recipient under this clause 14.2.

15. EXCLUSIVITY

(a) During the Exclusivity Period, USG must not, and must ensure that no member or Representative of the USG Group and no USG Contributed Entity or Representative of any USG Contributed Entity:

(i) solicits, invites, initiates, encourages or accepts any Competing Proposal - USG;

(ii) participates in any discussions, conversations, negotiations or communications with, or otherwise provides information to, any Third Party in relation to a Competing Proposal - USG; or

(iii) otherwise facilitates, assists or participates in a Competing Proposal - USG.

(b) During the Exclusivity Period, Boral must not, and must ensure that (no member or Representative of the Boral Group or the BGA Group:

(i) solicits, invites, initiates, encourages or accepts any Competing Proposal - Boral;

(ii) participates in any discussions, conversations, negotiations or communications with, or otherwise provides information to, any Third Party in relation to a Competing Proposal - Boral; or

(iii) otherwise facilitates, assists or participates in a Competing Proposal - Boral.

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(c) For the avoidance of doubt, Boral and USG must immediately cease and cause to be immediately terminated any existing discussions, conversations, negotiations, or other communications with respect to a Competing Proposal – Boral or a Competing Proposal - USG.

16. DUTIES, COSTS AND EXPENSES

16.1 Duties

(a) The Acquirer must pay all Duty in respect of the execution, delivery and performance of this Agreement and any agreement or document entered into or signed under this Agreement, to the extent it relates to the subscription and issue of the Subscription Shares or to the sale and transfer of the Sale Shares.

(b) Boral must pay all Duty in respect of the execution, delivery and performance of this Agreement and any agreement or document entered into or signed under this Agreement, to the extent it relates to the sale and transfer of the USG Contributed Shares to SingCo (and must satisfy any obligation of SingCo to pay any such Duty on SingCo’s behalf).

(c) Subject to clause 16.1(d), SingCo must otherwise pay (and the Acquirer and the Boral Seller must procure that SingCo pays) all Duty in respect of the execution, delivery and performance of this Agreement and any agreement or document entered into or signed under this Agreement (including for the avoidance of doubt to the extent it relates to the subscription and issue of the Boral Subscription Shares or to the sale and transfer of the Boral Contributed Shares to SingCo).

(d) To the extent that SingCo pays Duty in respect of the sale and transfer of the Boral Contributed Shares to SingCo, Boral will promptly pay to USG an amount equal to 25% of the relevant Duty paid by Singco and any such payment will be a reduction in the initial Purchase Price.

16.2 Costs and expenses

(a) Unless otherwise provided for in this Agreement or any Transaction Document:

(i) Boral must pay its own costs and expenses and the costs and expenses of each relevant Boral Group Member and each BGA Group Member in respect of the negotiation, preparation, execution, delivery and registration of this Agreement and any other agreement or document entered into or signed under this Agreement (including each Transaction Document); and

(ii) USG must pay its own costs and expenses and the costs and expenses of each relevant USG Group Member and each of the USG Contributed Entities in respect of the negotiation, preparation, execution, delivery and registration of this Agreement and any other agreement or document entered into or signed under this Agreement (including each Transaction Document); and

(iii) Boral and USG must share equally the costs payable to Baker & McKenzie for the Baker & McKenzie Report.

(b) Any action to be taken by any Party in performing its obligations under this Agreement or under any Transaction Document must be taken at its own cost and expense unless otherwise provided in this Agreement or any Transaction Document.

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17. GUARANTEES

17.1 Boral guarantee

(a) Boral:

(i) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of each other Boral Party’s obligations under this Agreement; and

(ii) as a separate and additional liability, indemnifies each USG Party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the Party arising from any default or delay in the due and punctual performance of a Boral Party’s obligations under this Agreement.

(b) The liability of Boral under this clause 17.1 is not affected by anything which, but for this clause 17.1, might operate to release or exonerate Boral in whole or in part from its obligations including any of the following, whether with or without the consent of Boral:

(i) the grant to Boral, any other Boral Party or any other person of any time, waiver or other indulgence, or the discharge or release of Boral, any other Boral Party or any other person from any liability or obligation;

(ii) any transaction or arrangement that may take place between any Party, any Related Corporation of a Party, Boral or any other person;

(iii) any other Party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against Boral, any other Boral Party or any other person;

(iv) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any Party or any Related Corporation of a Party from Boral, any other Boral Party or any other person or by the taking of or failure to take any security;

(v) the failure or omission or any delay by any Party to give notice to Boral of any default by any Boral Party or any other person under this Agreement; and

(vi) any legal limitation, disability, incapacity or other circumstances related to Boral, any other Boral Party or any other person.

(c) This clause 17.1 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this Agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 17.1 is a continuing obligation of Boral, and remains in full force and effect for so long as any Boral Party has any liability or obligation to any other Party under this Agreement and until all of those liabilities or obligations have been fully discharged.

(e) Boral must make all payments which become due under this clause 17.1, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If Boral is compelled by law to deduct any withholding, then, in addition to any payment under this clause 17.1, it must pay to the relevant beneficiary Party such amount as is necessary to ensure that the net amount received by that Party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

(f) Boral must pay all moneys that it becomes liable to pay under this clause 17.1 in the currency in which they are payable under this Agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

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(g) Boral has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 17.1, against any moneys that any other Party may be, or become, liable to pay to a Boral Group Member whether under this Agreement or otherwise.

(h) Boral’s liability under this clause 17.1 in respect of any Claim against any Boral Party will not exceed the relevant Boral Party’s liability in respect of that Claim.

17.2 USG guarantee

(a) USG:

(i) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of each other USG Party’s obligations under this Agreement; and

(ii) as a separate and additional liability, indemnifies each Boral Party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the Party arising from any default or delay in the due and punctual performance of a USG Party’s obligations under this Agreement.

(b) The liability of USG under this clause 17.2 is not affected by anything which, but for this clause 17.2, might operate to release or exonerate USG in whole or in part from its obligations including any of the following, whether with or without the consent of USG:

(i) the grant to USG, any other USG Party or any other person of any time, waiver or other indulgence, or the discharge or release of USG, any other USG Party or any other person from any liability or obligation;

(ii) any transaction or arrangement that may take place between any Party, any Related Corporation of a Party, USG or any other person;

(iii) any other Party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against USG, any other USG Party or any other person;

(iv) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any Party or any Related Corporation of a Party from USG, any other USG Party or any other person or by the taking of or failure to take any security;

(v) the failure or omission or any delay by any Party to give notice to USG of any default by any USG Party or any other person under this Agreement; and

(vi) any legal limitation, disability, incapacity or other circumstances related to USG, any other USG Party or any other person.

(c) This clause 17.2 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this Agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 17.2 is a continuing obligation of Boral, and remains in full force and effect for so long as any USG Party has any liability or obligation to any other Party under this Agreement and until all of those liabilities or obligations have been fully discharged.

(e) USG must make all payments which become due under this clause 17.2, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If USG is

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compelled by law to deduct any withholding, then, in addition to any payment under this clause 17.2, it must pay to the relevant beneficiary Party such amount as is necessary to ensure that the net amount received by that Party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

(f) USG must pay all moneys that it becomes liable to pay under this clause 17.2 in the currency in which they are payable under this Agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

(g) USG has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 17.2, against any moneys that any other Party may be, or become, liable to pay to a USG Group Member whether under this Agreement or otherwise.

(i) USG’s liability under this clause 17.2 in respect of any Claim against any USG Party will not exceed the relevant USG Party’s liability in respect of that Claim.

18. NOTICES

18.1 Form of Notice

A notice or other communication to a Party under this Agreement (Notice) must be:

(a) in writing and in English and signed on behalf of the sending Party; and

(b) addressed to that Party in accordance with the details nominated in Schedule 19 (or any alternative details nominated to the sending Party by Notice).

18.2 How Notice must be given and when Notice is received

(a) A Notice must be given by one of the methods set out in the table below.

(b) A Notice is regarded as given and received at the time set out in the table below.

However, if this means the Notice would be regarded as given and received outside the period between 9.00am and 5.00pm (addressee’s time) on a Business Day (Business Hours Period), then the Notice will instead be regarded as given and received at the start of the following Business Hours Period.

Method of giving Notice	When Notice is regarded as given and received
By hand to the nominated address	When delivered to the nominated address
By a globally recognized courier to the nominated address	When confirmed delivered by the courier: 1       by 5.00 pm (local time in the place of receipt) on a Business Day – on that day; or 2       after 5.00 pm (local time in the place of receipt) on a Business Day, or on a day that is not a Business Day – on the next Business Day.
By email to the nominated email address	When the email (including any attachment) comes to the attention of the recipient party or a person acting on its behalf.

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18.3 Notice must not be given by electronic communication

A Notice must not be given by electronic means of communication (other than email as permitted in clause 18.2).

19. GENERAL

19.1 Governing law and jurisdiction

(a) This Agreement is governed by the law in force in New South Wales.

(b) Each party irrevocably submits to the (non-exclusive, as between the two) jurisdiction of:

(i) courts exercising jurisdiction in New South Wales, Australia and courts of appeal from them; and

(ii) courts exercising jurisdiction in Illinois, United States of America, and courts of appeal from them,

in relation to any proceedings arising out of or in connection with this Agreement, and no party submits to the jurisdiction of any other courts in relation to any such proceedings.

19.2 Service of process

Without preventing any other mode of service, any document in an action (including, any writ of summons or other originating process or any third or other party notice) may be served on any party by being delivered to or left for that party at its address for service of Notices under clause 18.

19.3 Invalidity and enforceability

(a) If any provision of this agreement is invalid under the law of any jurisdiction the provision is enforceable in that jurisdiction to the extent that it is not invalid, whether it is in severable terms or not.

(b) Clause 19.3(a) does not apply where enforcement of the provision of this Agreement in accordance with clause 19.3(a) would materially affect the nature or effect of the parties’ obligations under this Agreement.

19.4 Waiver

(a) No Party to this agreement may rely on the words or conduct of any other party as a waiver of any right unless the waiver is in writing and signed by the party granting the waiver.

(b) In this clause 19.4:

(i) conduct includes delay in the exercise of a right;

(ii) right means any right arising under or in connection with this Agreement and includes the right to rely on this clause; and

(iii) waiver includes an election between rights and remedies, and conduct which might otherwise give rise to an estoppel.

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(c) A provision of, or a right, discretion or authority created under, this Agreement may not be:

(i) waived except in writing signed by the Party granting the waiver; and

(ii) varied except in writing signed by the Parties.

(d) A failure or delay in exercise, or partial exercise, of a power, right, authority, discretion or remedy arising from a breach of, or default under this Agreement does not result in a waiver of that right, power, authority, discretion or remedy.

19.5 Assignment

Rights arising out of or under this Agreement are not assignable by a Party without the prior written consent of the other Parties.

19.6 Further action to be taken at each party’s own expense

Subject to clause 15, each Party must, at its own expense, do all things and execute all documents necessary to give full effect to this Agreement and the transactions contemplated by it.

19.7 Relationship of the Parties

(a) Nothing in this Agreement gives a Party authority to bind any other Party in any way.

(b) Nothing in this Agreement imposes any fiduciary duties on a Party in relation to any other Party.

19.8 Exercise of rights

(a) Unless expressly required by the terms of this Agreement, a Party is not required to act reasonably in giving or withholding any consent or approval or exercising any other right, power, authority, discretion or remedy, under or in connection with this Agreement.

(b) A Party may (without any requirement to act reasonably) impose conditions on the grant by it of any consent or approval, or any waiver of any right, power, authority, discretion or remedy, under or in connection with this Agreement. Any conditions must be complied with by the party relying on the consent, approval or waiver.

19.9 Remedies cumulative

Except as provided in this Agreement and permitted by law, the rights, powers and remedies provided in this Agreement are cumulative with and not exclusive to the rights, powers or remedies provided by law independently of this Agreement.

19.10 Counterparts

(a) This Agreement may be executed in any number of counterparts.

(b) All counterparts, taken together, constitute one instrument.

(c) A Party may execute this agreement by signing any counterpart.

19.11 Entire Agreement

This Agreement and the Transaction Documents state all the express terms of the agreement between the parties in respect of their subject matter. They supersede all prior discussions, negotiations, understandings and agreements in respect of their subject matter.

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19.12 Default Interest

(a) If a Party fails to pay any amount payable under this Agreement on the due date for payment, that Party must in addition to a continuing liability to pay the amount unpaid pay interest on the amount unpaid at the higher of:

(i) the daily 11.00am cash rate quoted on Reuters page RBA30, plus 3% per annum; or

(ii) the rate (if any) fixed or payable under any judgment or other thing into which the liability to pay the amount becomes merged.

(b) The interest payable under clause 19.12(a):

(i) accrues from day to day from and including the due date for payment up to and including the actual date of payment, before and, as an additional and independent obligation, after any judgment or other thing into which the liability to pay the amount becomes merged; and

(ii) may be capitalised by the person to whom it is payable at monthly intervals on the basis of a 360 day year.

(c) The right to require payment of interest under this clause 19.12 is without prejudice to any other rights the non-defaulting Party may have against the defaulting Party at law or in equity.

(d) A failure to pay any amount under this agreement is not remedied until both the amount unpaid and any interest payable under this clause 19.12 have been paid in full.

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SIGNING PAGES

EXECUTED as an agreement

Executed for Boral Limited ACN 008 421 761 by its attorneys

/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney Michael Patrick Kane		Signature of attorney Dominic Millgate
Name of attorney (print)		Name of attorney (print)
Executed for Boral Gypsum Asia Sdn Bhd by it attorneys
/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney Michael Patrick Kane		Signature of attorney Dominic Millgate
Name of attorney (print)		Name of attorney (print)
Executed by Boral International Pty Limited ACN 000 341 239 by its attorneys
/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney Michael Patrick Kane		Signature of attorney Dominic Millgate
Name of attorney (print)		Name of attorney (print)

Page 75

Executed by USG Netherlands Global Holdings B.V. By: USG Foreign Investments, Ltd. Its: Managing Director
/s/ Stanley L. Ferguson	¬
Signature of authorised signatory Stanley L. Ferguson
Name of authorised signatory (print)
Executed by USG Corporation
/s/ Stanley L. Ferguson	¬
Signature of authorised signatory Stanley L. Ferguson
Name of authorised signatory (print)

Page 76

EX-2.2

Exhibit 2.2

Share Sale and Subscription Agreement

Australasia

USG Foreign Investments, Ltd.

USG Netherlands Global Holdings B.V.

USG Corporation

Boral Limited ACN 008 421 761

Boral Building Materials Pty Limited ACN 090 736 888

Boral Australian Gypsum Limited ACN 004 231 976

Jones Day

Level 41, Aurora Place

88 Phillip Street

Sydney NSW 2000

Tel: 61 2 8272 0500

Fax: 61 2 8272 0599

www.jonesday.com

Share Sale and Subscription Agreement

1.	INTERPRETATION	5
2.	SUBSCRIPTION FOR SUBSCRIPTION SHARES AND SALE OF SALE SHARES	15
3.	PRE-COMPLETION	17
4.	CONDUCT OF THE BUSINESS PRIOR TO COMPLETION	19
5.	COMPLETION	28
6.	PURCHASE PRICE ADJUSTMENT	31
7.	WARRANTIES	37
8.	LIMITATIONS OF LIABILITY	40
9.	INDEMNITIES	48
10.	THIRD PARTY CLAIMS AND TAX DEMANDS	51
11.	CLAIMS	53
12.	TAX	54
13.	TERMINATION	56
14.	CONFIDENTIALITY AND ANNOUNCEMENTS	59
15.	EXCLUSIVITY	60
16.	DUTIES, COSTS AND EXPENSES	61
17.	GUARANTEES	61
18.	NOTICES	64
19.	GENERAL	65
SIGNING PAGES		68

SCHEDULE 1     WARRANTIES	70
SCHEDULE 2     BORAL JV WARRANTIES	97
SCHEDULE 3     BORAL TAX WARRANTIES	120
SCHEDULE 4     USG TAX WARRANTIES	123
SCHEDULE 5     COMPLETION STEPS	125
SCHEDULE 6     PERMITTED ACTIONS	130
SCHEDULE 7     GUARANTEES	131
SCHEDULE 8     CALCULATION OF EARN-OUT AMOUNTS	132
SCHEDULE 9     BAGL COMPLETION STATEMENT	141
SCHEDULE 10     USG COMPLETION STATEMENT	146
SCHEDULE 11     STRUCTURE DIAGRAMS	151
SCHEDULE 12     BORAL DISCLOSURE SCHEDULE	154
SCHEDULE 13     USG DISCLOSURE SCHEDULE	155

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SCHEDULE 14     LOANS AND BORROWINGS	156
SCHEDULE 15     FREEHOLD PROPERTIES	158
SCHEDULE 16     USG INTELLECTUAL PROPERTY REGISTRATIONS	160
SCHEDULE 17     BUSINESS NAMES	161
SCHEDULE 18     BANK ACCOUNT AND SIGNATORY TABLE	162
SCHEDULE 19     NOTICE DETAILS	164
SCHEDULE 20     FORM OF SHAREHOLDERS AGREEMENT	165
SCHEDULE 21     FORM OF USG AUSTRALASIA IP LICENCE	166
SCHEDULE 22     FORM OF BORAL AUSTRALASIA IP LICENCE	167
SCHEDULE 23     FORM OF USG TOSA	168
SCHEDULE 24     FORM OF BORAL TOSA	169
SCHEDULE 25     LEASE TERM SHEETS	170
SCHEDULE 26     DATA ROOM INDICES	171

Page 3

Share Sale and Subscription Agreement

DATE                                                                              OCTOBER 17, 2013

PARTIES

Boral Limited ACN 008 421 761 of Level 39, 50 Bridge Street, Sydney NSW 2000, Australia (Boral)

Boral Building Materials Pty Limited ACN 090 736 888 of C/- Boral Limited, ‘AMP Centre’ Level 39, 50 Bridge Street, Sydney NSW 2000, Australia (Boral Seller)

Boral Australian Gypsum Limited ACN 004 231 976 of C/- Boral Limited, ‘AMP Centre’ Level 39, 50 Bridge Street, Sydney NSW 2000, Australia (BAGL)

USG Foreign Investments, Ltd. of 550 West Adams Street, Chicago, Illinois, United States of America (Subscriber 1)

USG Netherlands Global Holdings B.V. a company incorporated under the laws of The Netherlands with Commercial Register No. 58458670 of Muiderstraat 9, 1011PZ Amsterdam (insofar as it is acting in its capacity as subscriber of shares, Subscriber 2)

USG Netherlands Global Holdings B.V. a company incorporated under the laws of The Netherlands with Commercial Register No. 58458670 of Muiderstraat 9, 1011PZ Amsterdam (insofar as it is acting in any capacity other than as a subscriber of shares, the Acquirer )

USG Corporation of 550 West Adams Street, Chicago, Illinois (USG)

RECITALS

A. Boral Seller is the registered holder of the entirety of the issued shares in BAGL.

B. Boral Seller wishes to contribute certain intellectual property rights to BAGL by executing the Boral Australasia IP Licences.

C. Subscriber 1 wishes to contribute certain intellectual property to BAGL by executing the USG Australasia IP Licences in exchange for BAGL’s issuance of the Subscription 1 Shares on and subject to the terms of Completion.

D. Subscriber 2 has agreed to contribute, and BAGL has agreed to acquire, the USG Contributed Shares in exchange for the Subscription 2 Shares on and subject to the terms of Completion.

E. The execution of the Boral Australasia IP Licences, the execution of the USG Australasia IP Licences and the contribution of the USG Contributed Shares to BAGL are part of a single integrated transaction qualifying under sections 351 and 368 of the United States Internal Revenue Code of 1986, as amended.

F. Boral Seller has agreed to sell, and the Acquirer has agreed to purchase, the Sale Shares on and subject to the terms and conditions set out in this Agreement.

G. Boral has agreed to provide the Boral Warranties and the Boral Tax Warranties in respect to the BAGL Group and the Boral JV Warranties in respect to the Boral Joint Ventures, on and subject to the terms and conditions set out in this Agreement.

H. USG has agreed to provide the USG Warranties and the USG Tax Warranties in respect to the USG Contributed Entities on and subject to the terms and conditions set out in this Agreement.

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OPERATIVE PROVISIONS

1. INTERPRETATION

1.1 Definitions

The following definitions apply in this Agreement unless the context requires otherwise.

Accepting Party means:

(a) if the Notifying Party is Boral, the relevant USG Party (or Parties) which may be subject to a Boral Claim as contemplated by clause 10.1(a); and

(b) if the Notifying Party is USG, the relevant Boral Party (or Parties) which may be subject to a USG Claim as contemplated by clause 10.1(b).

Agreement means this Agreement.

Anti-Corruption Laws means the Australian Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 (Cth) (as amended from time to time), the US Foreign Corrupt Practices Act and any other analogous Legal Requirements (as defined in Schedule 1) that prohibit bribery, the provision or acceptance of unlawful gratuities, facilitation payments or other benefits to or from any Government Official (as defined in Schedule 1 or any other Person.

Application Forms means application forms for the subscription by the Subscribers for the Subscription Shares in the form agreed between USG and Boral (acting reasonably and in good faith having regard to customary market practice).

Asia Completion has the meaning given to the term “Completion” in the Asia Sale Agreement.

Asia Sale Agreement means the Share Sale and Subscription Agreement between BGA, Boral, Boral International Pty Limited, USG and USG Netherlands Global Holdings B.V. dated on or about the date of this Agreement.

Asia Sale Agreement Claim has the meaning given to the term “Claim” in the Asia Sale Agreement.

Asia Sale Agreement Party means a party to the Asia Sale Agreement.

BAGL Group means BAGL and its Subsidiaries, excluding the Boral Joint Ventures and excluding any entity which becomes a Subsidiary of BAGL at Completion as a result of this Agreement (and BAGL Group Member means any member of the BAGL Group from time to time).

BGA means Boral Gypsum Asia Sdn Bhd a company incorporated under the laws of Malaysia with company number 880595-D of Lot 606, Off Jalan SS 13/1K Subang Jaya, Selangor Darul Ehsan Malaysia 47500.

BGA Group and BGA Group Member have the meanings given to that term in the Asia Sale Agreement.

Boral Asia IP Licences has the meaning given to that term in the Asia Sale Agreement.

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Boral Australasia IP Licences means:

(a) the Umbrella Intellectual Property Licence Agreement in the form set out in Schedule 22 (or such other form as Boral and USG may agree before Completion); and

(b) each agreement forming a schedule to that agreement (in each case in the form set out the relevant schedule at Schedule 22 (or such other form as Boral and USG may agree before Completion).

Boral Claim means a Claim of or brought by a Boral Claim Group Member in accordance with this Agreement, other than a Claim in relation to any Earn-Out Amount.

Boral Claim Group means Boral and the Boral Seller and Boral Claim Group Member means any of them.

Boral Consolidated Group means the Consolidated Group of which Boral Seller and any of the BAGL Group Members are members.

Boral Disclosure Schedule means the disclosure schedule relating to the Boral Warranties and the disclosure schedule relating to the Boral JV Warranties set out in Schedule 12.

Boral Group means Boral and each of its Subsidiaries, but excluding the BGA Group and the BAGL Group (and for the avoidance of doubt after Completion the Joint Venture Group) and excluding the Boral Joint Ventures and their respective Subsidiaries (and Boral Group Member means any member of the Boral Group from time to time).

Boral Joint Ventures means Gypsum Resources Australia Pty Ltd and Rondo Building Services Pty Ltd.

Boral JV Warranty means each warranty stated in Schedule 2, given on the basis that the Warrantor is a Boral Group Member.

Boral Party means Boral and each other Boral Group Member who is a Party to this Agreement.

Boral Q&A Responses means the ‘Q&A’ responses provided by or on behalf of Boral via the relevant Data Room to questions asked during the due diligence process.

Boral Tax Sharing Agreement means the Tax Sharing Agreement entered into between Boral and each relevant BAGL Group Member dated 26 July 2010.

Boral Tax Warranty means each warranty stated in Schedule 3.

Boral TOSA means the services agreement substantially in the form set out in Schedule 24 (or such other form as Boral and USG may agree before Completion).

Boral Warranty means each warranty stated in Schedule 1, given on the basis that the Warrantor is a Boral Group Member (and so that for the avoidance of doubt such warranties are given in relation to the Boral Sale Group and not the USG Sale Group as defined in Schedule 1).

Business Day means a day on which banks are open for business in Sydney, Chicago and Kuala Lumpur and Singapore.

Claim means any claim, demand, proceeding or cause of action, whether arising in contract, tort, or under statute in connection with:

(a) any provision of this Agreement;

(b) the Subscription Shares or their issue and allotment to the Subscribers;

Page 6

(c) the Sale Shares or their transfer to the Acquirer;

(d) the USG Contributed Shares or their transfer to BAGL; or

(e) any other matter connected with this Agreement,

but does not include any IP Claim, TOSA Claim, Asia Sale Agreement Claim or Lease Term Sheet Claim.

Claim Group means, in relation to any Claim, the Claimant Party as defined in clause 10.1 and each other member of:

(a) the Boral Claim Group (if the Claimant Party is a member of the Boral Group); or

(b) the USG Claim Group (if the Claimant Party is a member of the USG Group).

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

Competing Proposal – USG means any enquiries, expressions of interest, offers or proposals from any Person (other than a Boral Group Member, BAGL Group Member or Person acting on their behalf):

(a) relating to any acquisition or purchase of any interest in any USG Contributed Entity or otherwise in the USG Group’s gypsum operations in the Territory, or in the business or all or any material portion of the assets of any USG Contributed Entity (other than sales and purchases in the ordinary course of business);

(b) to enter into any merger, recapitalisation, joint venture or other business combination with respect to any USG Contributed Entity or otherwise with respect to the USG Group’s gypsum operations in the Territory; or

(c) to enter into any other extraordinary business transaction involving or otherwise in relation to any USG Contributed Entity or otherwise with respect to the USG Group’s gypsum operations in the Territory.

Competing Proposal – Boral means any enquiries, expressions of interest, offers or proposals from any Person (other than a USG Group Member or Person acting on its behalf):

(a) relating to any acquisition or purchase of any interest in any BAGL Group Member or otherwise in the Boral Group’s gypsum operations in the Territory, or in the business or all or any material portion of the assets of any BAGL Group Member (other than sales and purchases in the ordinary course of business);

(b) to enter into any merger, recapitalisation, joint venture or other business combination with respect to any BAGL Group Member or otherwise with respect to the Boral Group’s gypsum operations in the Territory; or

(c) to enter into any other extraordinary business transaction involving or otherwise in relation to any BAGL Group Member or otherwise with respect to the Boral Group’s gypsum operations in the Territory.

Completion means completion of the issue and allotment of the Subscription Shares and the sale and purchase of the Sale Shares in accordance with clause 4.

Completion Date means the date on which Completion occurs.

Condition Satisfaction Date means the date on which all of the Conditions have been satisfied or waived in accordance with this Agreement.

Conditions means the conditions specified in clause 3.2.

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Consequential Loss means any Loss which would not fairly and reasonably be considered to arise naturally, that is according to the usual course of things, from the breach, event or act or omission giving rise to the relevant liability.

Consolidated Group means a Consolidated Group or a MEC group as those terms are defined in section 995-1 of the ITAA 1997.

Corporations Act means the Australian Corporations Act 2001 (Cth).

Disputing Action means, in respect of Tax Demand, any action to cause the Tax Demand to be withdrawn, reduced or postponed or to avoid, resist, object to, defend, appear against or compromise the Tax Demand and any judicial or administrative proceedings arising out of that action.

Duty means any stamp, transaction or registration duty or similar charge which is imposed by any Taxing Authority and includes any interest, fine, penalty, charge or other amount which is imposed in relation to that duty or charge.

Earn-Out Amounts means:

(a) such part of the First Earn-Out Amount, as defined Schedule 8, as is characterised in clause 2.7(b)(i) of Schedule 8 as an adjustment to the Purchase Price under this Agreement; and

(b) such part of the Second Earn-Out Amount, as defined Schedule 8, as is characterised in clause 2.8(b)(i) of Schedule 8 as an adjustment to the Purchase Price under this Agreement.

Encumbrance means a mortgage, charge, pledge, lien, encumbrance, security interest, title retention, or any other security agreement or arrangement in favour of any Person by way of security for the payment of a debt or any other monetary obligation or the performance of any other obligation, whether registered or unregistered.

End Date means 30 September 2014.

Environmental Warranties means the Warranties in paragraphs 11.13 to 11.16 of Schedule 1.

Exclusivity Period means the period commencing on the date of this Agreement and expiring on the earlier of Completion or termination of this Agreement in accordance with its terms.

Exit Payment means the payment required to be made by clause 4.8(c) in accordance with the Boral Tax Sharing Agreement and pursuant to section 721 35 of the ITAA 1997.

Final Adjustment Date is a Business Day that is no later than 5 Business Days after the date on which the BAGL Adjustment Amount and the USG Adjustment Amount are agreed or otherwise finally determined under clause 6.

Fund has the meaning given to it in Schedule 1 or Schedule 2 (as applicable).

Group Liability has the same meaning as that term is defined in section 721 10(1)(a) of the ITAA 1997.

Initial Purchase Price means US$155 million.

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Intellectual Property Rights means:

(a) patents, design, trade marks and service marks (whether registered or unregistered) and any applications for, or rights to apply for, registration of any patent, design, trade mark or service mark;

(b) copyright (including copyright in software, websites, databases and advertising and other promotional materials);

(c) all rights to have information (including trade secrets, know-how, operating procedures and technical information) kept confidential; and

(d) all other rights or protecting having similar effect anywhere in the world.

IP Claim means any claim, demand, proceeding or cause of action whether arising in contract, tort, or under statute, made pursuant to the Boral Australasia IP Licences, the Boral Asia IP Licences, the USG Australasia IP Licences or the USG Asia IP Licences.

ITAA 1936 means the Income Tax Assessment Act 1936 (Cth).

ITAA 1997 means the Income Tax Assessment Act 1997 (Cth).

Joint Venture Group means, in respect of any period after Completion, BAGL, SingCo and their respective Subsidiaries and Joint Venture Group Member means any of them.

Lease Term Sheet Claim means any claim, demand, proceeding or cause of action whether arising in contract, tort, or under statute, made pursuant to any lease or sublease entered into as contemplated by clause 4.17.

Lease Term Sheets means the non-binding term sheets in Schedule 25.

Loss means any loss, damage, liability, cost or expense of any kind and however arising, including penalties, fines and interest, compliance, monitoring or investigation costs, and loss, liability, cost or expense that is prospective or contingent and the amount of which for the time being is not ascertained or ascertainable.

Material Adverse Change means:

(a) in relation to Boral, a material adverse change in relation to the business, operations, financial condition or performance, results of operations, assets, liabilities or prospects of the BAGL Group and the BGA Group taken as a whole and which is reasonably expected to materially adversely impact the value of the aggregate consideration received at Completion by the USG Group under the Transaction Documents; and

(b) in relation to USG, a material adverse change in relation to:

(i) the business, operations, financial condition or performance, results of operations, assets, liabilities or prospects of the USG Contributed Entities and the ‘USG Contributed Entities’ as defined in the Asia Sale Agreement, taken as a whole; and

(ii) the Intellectual Property Rights the subject of the USG Australasia IP Licences and the USG Asia IP Licences,

taken as a whole and which is reasonably expected to materially adversely impact the value of the aggregate consideration received at Completion by the Boral Group under the Transaction Documents (and for these purposes the consideration to the Boral Group is to be taken to include 50% of the value of assets and rights contributed by the USG Group to BAGL and SingCo at Completion in addition to the cash purchase price paid by USG under this Agreement and the Asia Sale Agreement at Completion).

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Notifying Party means:

(a) in the circumstances contemplated by clause 10.1(a), Boral; and

(b) in the circumstances contemplated by clause 10.1(b), USG.

Parent Guarantee means:

(a) in relation to Boral, the guarantees, indemnities, charges or other securities listed in Part 1 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a Boral Group Member to a Third Party to better secure the performance of a BAGL Group Member or required for the benefit of a BAGL Group Member; and

(b) in relation to USG, the guarantees, indemnities, charges or other securities listed in Part 1 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a USG Group Member to a Third Party to better secure the performance of a USG Contributed Entity or required for the benefit of a USG Contributed Entity.

Party means a party to this Agreement.

Person means any individual, corporation (including any non-profit corporation), general partnership, limited partnership, limited liability partnership, joint venture, estate, trust, company (including any limited liability company or joint stock company), firm or other enterprise, association, organization, entity or Regulatory Authority.

Purchase Price means:

(a) the Initial Purchase Price as adjusted in accordance with this Agreement; and

(b) the Earn-Out Amounts (if any).

Receiving Party means:

(a) if Boral or Boral Seller is the Claimant Party, USG; and

(b) if USG, the Acquirer or any Subscriber is the Claimant Party, Boral.

Related Corporation means in relation to an entity, each body corporate:

(a) that is a Subsidiary of that entity;

(b) of which the entity is a Subsidiary; or

(c) that is a Subsidiary of a company of which the entity is also a Subsidiary.

Representatives means the officers, employees, contractors, consultants, professional advisers and agents of a Party.

Sale Shares means 421,304,349 fully paid ordinary shares in BAGL.

Settle means to:

(a) accept, compromise or pay;

(b) agree to arbitrate, compromise or settle; or

(c) make any admission or take any action in relation to,

any Claim or Third Party Claim or Tax Demand as relevant.

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Share Contribution Agreement means an agreement between Subscriber 1 and Subscriber 2 in which Subscriber 1 transfers the Subscription 1 Shares, which Subscriber 1 received in exchange for the USG Australasia IP License, to Subscriber 2 in exchange for share premium in Subscriber 2 (in a form substantially the same as that disclosed to Boral prior to the date of this Agreement).

Shareholders Agreement means the shareholders agreement in the form set out in Schedule 20 (or such other form as Boral and USG may agree before Completion).

Shareholding Percentage means, in respect of any time after Completion:

(a) in relation to Boral, the Shareholding Percentage of Boral (in each case as defined in the Shareholders Agreement) for the purposes of the Shareholders Agreement at the relevant time; and

(b) in relation to USG, the Shareholding Percentage of USG (in each case as defined in the Shareholders Agreement) for the purposes of the Shareholders Agreement at the relevant time.

SingCo means the Singapore company to be incorporated before Completion as contemplated by clause 2.4 of the Asia Sale Agreement.

Subscribers means:

(a) Subscriber 1; and

(b) Subscriber 2, acting in its capacity as a subscriber for shares.

Subscription 1 Shares means 99,130,435 fully paid ordinary shares in BAGL (to be issued to Subscriber 1).

Subscription 2 Shares means 49,565,217 fully paid ordinary shares in BAGL (to be issued to Subscriber 2).

Subscription Shares means the Subscription 1 Shares and Subscription 2 Shares.

Subsidiary has the meaning provided in Section 46 of the Corporations Act.

Subsidiary Guarantees means:

(a) in relation to Boral, the guarantees, indemnities, charges or other securities listed in Part 2 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a BAGL Group Member to a Third Party to better secure the performance of a Boral Group Member or required for the benefit of a Boral Group Member; and

(b) in relation to USG, the guarantees, indemnities, charges or other securities listed in Part 2 of Schedule 7 and any other guarantees, indemnities, charges or other securities, including bank guarantees and cash deposits, given by a USG Contributed Entity to a Third Party to better secure the performance of a USG Group Member or required for the benefit of a USG Group Member.

Tax means any tax, levy, rates, deduction, excise, duty, charge, surcharge, contribution, withholding tax, impost or withholding obligation of whatever nature, whether direct or indirect, by whatever method collected or recovered, assessed, levied or imposed by the Commonwealth of Australia, a state or any other government, regional, municipal or local authority (Australian or overseas) and includes capital gains tax, fringe benefits tax, income tax, luxury car tax, superannuation guarantee charge, training guarantee levy, payroll tax, any tax associated with a franking account, goods and services tax, group tax, Pay As You Go withholding, withholding tax,

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land tax, customs duty, together with any fees, penalties, fines, interest or statutory charges and whether imposed by contract or imposed on a joint, several or secondary basis as a result of being a member of an affiliated group of companies or any payments required to be made under a valid Tax Sharing Agreement or Tax Funding Agreement.

Tax Attributes means any thing that would reduce the base on which Tax is assessed or the amount of Tax payable.

Tax Claim means a Claim arising from a breach of a Boral Tax Warranty or a USG Tax Warranty, or a Claim under an indemnity in clause 9.1(a) or 9.2(a).

Tax Cost means all costs, and expenses incurred in:

(a) managing an inquiry by any Taxing Authority; or

(b) conducting any action in relation to a Tax Demand to cause the Tax Demand to be withdrawn, reduced or postponed or to avoid, resist, object to, defend, appear against or compromise the Tax Demand and any judicial or administrative proceedings arising out of that action.

Tax Demand means:

(a) a demand or assessment from a Taxing Authority requiring the payment of any Tax;

(b) any document received from a Taxing Authority administering any Tax assessing, imposing or claiming any Tax; or

(c) lodgement of a tax return or a request for an amendment under a law about self-assessment of Tax.

Tax Funding Agreement means any agreement where a BAGL Group Member may be required to pay an amount to Boral to pay a Group Liability or to reimburse Boral after payment of the Group Liability.

Tax Law means any:

(a) Tax legislation in force; and

(b) common law,

in each case which imposes Tax.

Tax Related Liabilities means the tax related liabilities set out in the table in section 721-10(2) of the ITAA 1997.

Tax Sharing Agreement means an agreement contemplated by section 721 25 of the ITAA 1997.

Taxing Authority means any governmental authority with the power to levy and collect Taxes or Duties.

Third Party Claim means any claim, demand, proceeding or cause of action, whether arising in contract, tort, or under statute against any Party to this Agreement, which is made or threatened by a Person other than a member of the Boral Group, the USG Group or the Joint Venture Group (including the USG Contributed Entities), but excludes a Tax Demand.

Territory has the meaning given to that term in the Shareholders Agreement.

Title Warranty means the Warranties in paragraphs 3.1 to 3.7, 4.1 and 4.3 of Schedule 1.

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Transaction Documents means:

(a) this Agreement and the Asia Sale Agreement;

(b) the Shareholders Agreement;

(c) the Boral Australasia IP Licences and the Boral Asia IP Licences;

(d) the USG Australasia IP Licences and the USG Asia IP Licences;

(e) the Boral TOSA; and

(f) the USG TOSA.

TOSA Claim means any claim, demand, proceeding or cause of action whether arising in contract, tort, or under statute, made pursuant to the Boral TOSA or the USG TOSA.

USG Asia IP Licences has the meaning given to that term in the Asia Sale Agreement.

USG Australasia IP Licences means:

(a) the Umbrella Intellectual Property Licence Agreement in the form set out in Schedule 21 (or such other form as Boral and USG may agree before Completion); and

(b) each agreement forming a schedule to that agreement (in each case in the form set out the relevant schedule at Schedule 21 (or such other form as Boral and USG may agree before Completion).

USG Claim means a Claim of or brought by a USG Claim Group Member in accordance with this Agreement.

USG Claim Group means USG, the Subscribers and the Acquirer and USG Claim Group Member means any of them.

USG Contributed Entities means:

(a) USG Interiors Australia Pty Ltd ACN 000 852 175; and

(b) USG Interiors Pacific Limited (a New Zealand company with registered number 77828).

USG Contributed Shares means:

(a) all issued shares in USG Interiors Pacific Limited; and

(b) all issued shares in USG Interiors Australia Pty Ltd to the extent not legally and beneficially owned by USG Interiors Pacific Limited.

USG Disclosure Schedule means the disclosure schedule relating to the USG Warranties set out in Schedule 13.

USG Group means USG and each of its Subsidiaries from time to time, but excluding the USG Contributed Entities (and USG Group Member means any member of the USG Group from time to time).

USG IP Warranty means a warranty given by a USG Group Member in the USG Australasia IP Licences and the USG Asia IP Licences.

USG Party means USG and each other USG Group Member who is a Party to this Agreement.

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USG Q&A Responses means the ‘Q&A’ responses provided by or on behalf of USG via the relevant Data Room to questions asked during the due diligence process.

USG Tax Warranty means each warranty stated in Schedule 4.

USG TOSA means the services agreement substantially in the form set out in Schedule 23 (or such other form as Boral and USG may agree before Completion);

USG Warranty means each warranty stated in Schedule 1, given on the basis that the Warrantor is a USG Group Member (and so that for the avoidance of doubt such warranties are given in relation to the USG Sale Group and not the Boral Sale Group as defined in Schedule 1).

Warranties means the Boral Warranties, the Boral Tax Warranties, the Boral JV Warranties, the USG Warranties and the USG Tax Warranties.

Warranty Claim means a Claim arising from a breach of Warranty.

1.2 Interpretation

In this Agreement:

(a) Headings and bold type are for convenience only and do not affect the interpretation of this Agreement.

(b) The singular includes the plural and the plural includes the singular, words of any gender include all genders, and other parts of speech and grammatical forms of a word or phrase defined in this Agreement have a corresponding meaning.

(c) A reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment or exhibit to, this Agreement.

(d) A reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements or re-enactments of any of them.

(e) A reference to a document includes all amendments or supplements to, or replacements or novations of, that document, and a reference to a party to a document includes that party’s successors and permitted assignees.

(f) A reference to an agreement other than this Agreement includes a deed and any legally enforceable undertaking, agreement, arrangement or understanding, whether or not in writing.

(g) A reference to a body, other than a party to this agreement (including an institute, association or authority), whether statutory or not:

(i) which ceases to exist; or

(ii) whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions.

(h) If a period of time is specified and dates from a given day or the day of an act or event, it is to be calculated exclusive of that day.

(i) A reference to a day is to be interpreted as the period of time commencing at midnight and ending 24 hours later.

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(j) If an act prescribed under this Agreement to be done by a Party on or by a given day is done after 5.00pm on that day, it is taken to be done on the next day.

(k) A reference to time is a reference to Sydney time unless otherwise specified.

(l) A reference to $ is to US dollars unless denominated otherwise.

1.3 Business Day

Where the day on or by which any thing is to be done is not a Business Day, that thing must be done on or by the next Business Day.

1.4 Inclusive expressions

Specifying anything in this agreement after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included.

1.5 Agreement components

This Agreement includes the schedules.

1.6 The rule about “contra proferentem”

This Agreement is not to be interpreted against the interests of a Party merely because that Party proposed this Agreement or some provision in it or because that Party relies on a provision of this Agreement to protect itself.

1.7 Reasonable endeavours

Any provision of this Agreement which requires a Party to use reasonable endeavours or all reasonable endeavours to procure that something is performed or occurs or does not occur does not include any obligation to commence any legal action or proceeding against any person, except where that provision expressly specifies otherwise.

1.8 Payments

(a) Except to the extent this Agreement expressly provides otherwise in any given case, all payments required to be made under this agreement must be tendered in US Dollars by way of direct transfer of immediately available funds to the bank account nominated in writing by the recipient and by no later than 5:00 pm (recipient’s time) on the due Business Day for payment.

(b) To the extent any payment to be made under this Agreement is calculated or original expressed in a currency other than US Dollars, the payment will be translated into US Dollars at the mid-market US$ exchange rate as quoted by Bloomberg on the relevant date of payment.

(c) Any reference in this Agreement to a payment to any Party includes payment to another Person at the written direction of that Party.

2. SUBSCRIPTION FOR SUBSCRIPTION SHARES AND SALE OF SALE SHARES

2.1 Agreement

(a) Subject to the terms and conditions of this Agreement, on Completion (and without limiting any other steps any Party is required to take under this Agreement at Completion):

(i) Subscriber 1 will enter into the USG Australasia IP Licences with BAGL;

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(ii) Subscriber 2 must transfer to BAGL, and BAGL must acquire from Subscriber 2, the USG Contributed Shares free of all Encumbrances;

(iii) BAGL agrees to allot and issue to Subscriber 1, and Subscriber 1 agrees to subscribe for, the Subscription 1 Shares free of all Encumbrances;

(iv) BAGL agrees to allot and issue to Subscriber 2, and Subscriber 2 agrees to subscribe for, the Subscription 2 Shares free of all Encumbrances;

(v) the Boral Seller will sell the Sale Shares to the Acquirer and the Acquirer will purchase from the Boral Seller the Sale Shares free from all Encumbrances.

(b) The USG Contributed Shares must in each case be transferred from Subscriber 2 to BAGL with all rights, including dividend rights, attached or accruing to them on and from Completion.

(c) The Sale Shares must be transferred from the Boral Seller to the Acquirer with all rights, including dividend rights, attached or accruing to them on and from Completion.

(d) Legal and beneficial title to the USG Contributed Shares and property and risk in them passes to BAGL on Completion.

(e) Legal and beneficial title to the Sale Shares and the Subscription Shares and property and risk in them passes to the Acquirer, Subscriber 1 and Subscriber 2 on Completion.

2.2 Consideration

(a) The consideration for the issue of the Subscription 1 Shares to Subscriber 1 is the execution of the USG Australasia IP Licences.

(b) The consideration for the issue of the Subscription 2 Shares to Subscriber 2 is the transfer of the USG Contributed Shares to BAGL.

(c) The consideration for the sale of the Sale Shares to the Acquirer is the payment by the Acquirer to Boral Seller of the Purchase Price in accordance with the relevant provisions of this Agreement.

2.3 Payment of Purchase Price

The Purchase Price must be paid as follows:

(a) the Initial Purchase Price must be paid by the Acquirer to Boral Seller at Completion;

(b) adjustments to the Initial Purchase Price must be paid in accordance with the relevant provisions of this Agreement (including for the avoidance of doubt clause 5.5); and

(c) the Parties covenant and agree that no value-added tax or goods and services tax is imposed or shall be invoiced with respect to the issuance of the Subscription Shares or the conveyance, transfer or sale of the Sale Shares; and

(d) the Earn-Out Amounts (if any) must be paid by the Acquirer to Boral Seller in accordance with Schedule 8.

2.4 Loan

At Completion, Subscriber 1 must lend to BAGL an amount equal to the amount BAGL is obliged to pay to the Commissioner of Taxation pursuant to section 14-10 of Schedule 1 to the Taxation Administration Act 1953 (Cth) as a result of the entry into the USG Australia IP Licences. Subscriber 1 and BAGL must then set off this loan against the debt that will arise from Subscriber 1 to BAGL pursuant to section 14-15 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (and after Completion USG and Boral must procure that BAGL does so).

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3. PRE-COMPLETION

3.1 Pre-Completion

Boral and USG acknowledge and agree that if prior to Completion:

(a) a Boral Group Member becomes aware of any facts, matters or circumstances which give or are reasonably likely to give rise to a breach of a Boral Warranty, a Boral Tax Warranty or a Boral JV Warranty; or

(b) a USG Group Member becomes aware of any facts, matters or circumstances which give or are reasonably likely to give rise to a breach of a USG Warranty or a USG Tax Warranty ;

then Boral or USG (as relevant) will promptly notify the other of such fact, matter or circumstance, provided that, for the avoidance of doubt, such notice will in no way constitute disclosure for the purpose of clause 7.1 of this Agreement or otherwise limit or exclude any Claim.

3.2 Conditions to Completion

Clause 2 will not bind the Parties and Completion will not proceed unless:

(a) The Acquirer and the Subscribers have notified the Treasurer of the Commonwealth of Australia of the proposed acquisition of the Sale Shares and the Subscription Shares by the Acquirer and the Subscribers pursuant to this Agreement (FIRB Notification) and the Treasurer of the Commonwealth of Australia has either:

(i) provided written advice or confirmation which is unconditional, or subject only to conditions acceptable to USG and Boral (acting reasonably), stating that there is no objection to the proposed acquisition of the Sale Shares and the Subscription Shares by the Acquirer and the Subscribers ; or

(ii) has become or is precluded (at any time before Completion) from making an order in respect the proposed acquisition of the Sale Shares and the Subscription Shares by the Acquirer and the Subscribers pursuant to this Agreement;

(b) USG and Boral have jointly submitted a courtesy letter to the Australian Competition and Consumer Commission (ACCC) informing the ACCC of the proposed acquisition of the Sale Shares and the Subscription Shares by the Acquirer and the Subscribers pursuant to this Agreement and of the proposed acquisition of the USG Contributed Shares by BAGL pursuant to this Agreement (ACCC Notification) and:

(i) the ACCC has informed USG in writing that it does not propose to intervene in the matter pursuant to Section 50 of the Competition and Consumer Act 2010; or

(ii) either of the following applies:

(A) the ACCC has not, within 45 days from the date of the ACCC Notification, or if later, by the day on which all other Conditions have been satisfied or waived in accordance with this Agreement, requested that the Parties do not complete this Agreement or commenced an informal merger investigation in relation to the transactions contemplated by this Agreement (or any of them); or

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(B) the ACCC has within the time period described in paragraph (A) above requested that the Parties do not complete this Agreement or commenced an informal merger investigation in relation to the transactions contemplated by this Agreement (or any of them), or both, but the ACCC has subsequently advised USG and Boral (or either of them) to the effect that the request no longer stands, it does not opposed the transaction in which the investigation was commenced, or both (as applicable);

(c) USG and Boral have jointly submitted a courtesy notification to the New Zealand Commerce Commission (NZCC) informing the NZCC of the proposed acquisition of the Sale Shares and the Subscription Shares by the Acquirer and the Subscribers pursuant to this Agreement and of the proposed acquisition of the USG Contributed Shares by BAGL pursuant to this Agreement (NZCC Notification) and:

(i) the NZCC has informed USG in writing that it does not propose to intervene in the matter pursuant to Section 47 of the Commerce Act 1986; or

(ii) has not, within 45 days from the date of the NZCC Notification, or if later, by the day on which all other Conditions have been satisfied or waived in accordance with this Agreement, indicated that a formal clearance application under Section 66(1) of the Commerce Act 1986 would be appropriate, or otherwise indicated material concerns regarding the transaction that can be reasonably interpreted as suggesting an expectation that a formal clearance application be made, or if it has done so, USG and Boral have (or at least one of them has) submitted such an application and the NZCC has subsequently provided a letter advising that it gives clearance to USG and Boral to complete the transaction.

(d) all conditions precedent to completion under the Asia Sale Agreement (other than the equivalent of the specific condition in this clause 3.2(d)) have been satisfied or waived in accordance with that agreement.

(Conditions).

3.3 Cooperation

(a) Without limiting any specific obligations of a Party under the remaining provisions of this clause 3.3, the Parties must each use their commercially reasonable endeavours in good faith to satisfy the Conditions as soon as practicable after the date of this Agreement.

(b) The Parties agree that:

(i) The Parties provide all reasonable co-operation and assistance to each other (including through provision of relevant information) in preparing and submitting the FIRB Notification, the ACCC Notification and the NZCC Notification;

(ii) USG must ensure that the FIRB Notification is prepared and lodged as soon as practicable after the date of this Agreement, and that the Parties will agree and submit the ACCC Notification and the NZCC Notification as soon as reasonably possible after the FIRB Notification; and

(iii) prior to submission of any such documents, the Parties will consult with each other regarding the content of any documents to be submitted in relation to the FIRB Notification, ACCC Notification and the NZCC Notification in addition to providing copies of those documents to all Parties for their review and consideration.

(c) The Parties will keep each other informed of progress with the FIRB Notification, ACCC Notification and NZCC Notification, and provide on request copies of all communications to or from FIRB, the ACCC and the NZCC in connection with the FIRB Notification, ACCC Notification and NZCC Notification respectively.

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3.4 Waiver of Conditions

The Conditions are for the benefit of both USG and Boral and may only be waived by written agreement between USG and Boral.

3.5 Result of non-satisfaction of Conditions

(a) If:

(i) the Conditions are not satisfied (or waived in accordance with clause 3.4); by the End Date or

(ii) any of the Conditions becomes incapable of satisfaction or the parties agree that any of the Conditions cannot be satisfied (and the relevant Condition is not waived in accordance with clause 3.4 by the End Date),

then either USG or Boral may terminate this Agreement at any time before Completion by giving not less than 7 days written notice to the other Parties.

(b) If Completion does not occur by the termination date specified in a notice under clause 3.5(a) then this Agreement will automatically terminate.

4. CONDUCT OF THE BUSINESS PRIOR TO COMPLETION

4.1 Carrying on of business – BAGL Group

(a) Subject to clause 4.2, between the date of this Agreement and the earlier of Completion and termination of this Agreement, Boral and the Boral Seller must ensure that the business of the BAGL Group is conducted materially in the ordinary course in accordance with past practice and, in particular, that no BAGL Group Member:

(i) issues any shares, debentures, convertible notes, options or other securities that are convertible into shares or debentures, or other equity or debt securities in that BAGL Group Member (Securities);

(ii) varies any rights attaching to or the class of any issued Securities or redeems, buys-back or cancels any issued Securities;

(iii) distributes or returns any capital to its members (other than to another BAGL Group Member);

(iv) declares or pays any dividends or declares or makes any other distributions in kind or in cash (other than to another BAGL Group Member);

(v) alters its constitution or equivalent documents;

(vi) ceases or makes any material change to the Business;

(vii) acquires any business or shares or other equity securities in any entity;

(viii) disposes any business or shares or other equity securities in any entity;

(ix) enters into any new business, including the establishment of any business in a jurisdiction in which the BAGL Group or the BGA Group does not have existing operations at the date of this agreement;

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(x) establishes any new Subsidiary or enters into any partnership, joint venture or profit or revenue sharing arrangement with any entity;

(xi) enters into an agreement to or otherwise merges or amalgamates any BAGL Group Member with any other entity;

(xii) makes an application or commences any proceedings or takes any other steps for the winding up, dissolution or appointment of an administrator to any BAGL Group Member or enters into an arrangement, compromise or composition for the benefit of that BAGL Group Member’s creditors, a class or them or any of them;

(xiii) enters into, materially varies or terminates any agreement or arrangement involving:

(A) consideration to or from a BAGL Group Member of more than A$10 million in relation to a customer/supplier arrangement;

(B) subject to clause 4.1(a)(xiii)(A), consideration to or from a BAGL Group Member of more than A$1 million

(C) transactions that are not on bona fide arms’ length terms or otherwise outside the ordinary course of business;

(D) any non-compete undertakings, exclusivity provisions or similar restrictive covenants;

(E) any BAGL Group Member assuming any ‘take or pay’ or similar obligations exceeding A$1 million;

or otherwise effecting any material, non-ordinary course business transaction or action;

(xiv) enters into or varies any contract, agreement or arrangement (whether oral or in writing) with a Boral Group Member involving consideration to or from a BAGL Group Member of more than A$500,000 in any individual case or A$1 million in aggregate (and excluding ad hoc purchases or supplies of products or materials in the ordinary course);

(xv) enters into or becomes liable under any guarantee or similar arrangement under which it might incur liability in respect of the financial obligation of any other person (including any other BAGL Group Member) other than performance guarantees in the ordinary course of business;

(xvi) acquires, disposes or leases (whether as lessor or lessee) any assets (other than the sale or purchase of inventory, raw material materials, finished product and similar items in the ordinary course of the business), in any transaction or series of related transactions where the market value of such assets or the consideration in respect to the sale or acquisition of such assets is in excess of A$2 million or enter into any agreement to do so;

(xvii) engages any new permanent employee with a total annual remuneration in excess of A$150,000, excluding replacements of existing roles in the ordinary course of business;

(xviii) terminates the employment of Frederic de Rougemont or Tony Charnock, other than for cause;

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(xix) materially alters its arrangements with respect to any Fund relating to its employees;

(xx) defers any capital expenditure or undertakes any capital expenditure that is, together with all such capital expenditure by all other BAGL Group Members in the relevant period, in excess of A$5 million;

(xxi) enters into any financial accommodation or borrows any money (other from another BAGL Group Member and other than drawings on working capital facilities in the ordinary course and trade credit in the ordinary course consistent with past practice) in excess of A$2 million; or

(xxii) provides any loan or financial accommodation to any person other than another BAGL Group Member, other than trade credit in the ordinary course consistent with past practice;

(xxiii) purchases or enters into foreign currency swaps or other derivative instruments other than hedges entered into in accordance with past practice;

(xxiv) commences or settles (to the extent the settlement does not involve a cash payment) any litigation, arbitration or other proceedings, which will cause or is likely to cause, the BAGL Group to incur costs or expenses (including legal costs) in excess of A$500,000;

(xxv) creates an Encumbrance over any of its assets other than in the ordinary course of business.

(b) Subject to clause 4.2, between the date of this Agreement and the earlier of Completion and termination of this Agreement, the Boral Seller must ensure that:

(i) any calls for capital or other funding (whether by way of equity or debt) to any BAGL Group Member from any Boral Joint Venture are met in full when due in accordance with the relevant shareholders agreement or other applicable contract; and

(ii) no scheduled or proposed calls for capital or other funding by any Boral Joint Venture are deferred.

4.2 Permitted acts

Nothing in clause 4.1 restricts any Boral Group Member or any BAGL Group Member from doing any of the following permitted actions:

(a) Transaction Agreements: anything that is required or expressly permitted in this Agreement or any Transaction Document (including in connection with the satisfaction of any Condition);

(b) Permitted acts: anything (or part of anything) described in Part 1 of Schedule 6;

(c) emergencies: anything to reasonably and prudently respond to an emergency or disaster (including a situation giving rise to a risk of personal injury or damage to property);

(d) legal obligations: anything to the extent necessary for a BAGL Group Member to meet its legal or contractual obligations (such contractual obligations being as disclosed in the Data Room or the Boral Disclosure Schedule); or

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(e) USG approval or non-objection: anything that is approved in writing by USG, such approval not to be unreasonably withheld or delayed, or in respect of which USG fails to notify Boral in writing of its objection to the doing of that thing within 3 business days (being normal business days in Sydney and Chicago) after receipt of written notice from Boral notifying USG of a Boral Group Member’s or a BAGL Group Member’s intention to do that thing. For these purposes USG must on the date of this agreement nominate at least two senior executives (each a USG Contact) to whom notifications of proposed actions can be submitted. Despite clause 18, notification to each USG Contact by email by or on behalf of Boral or BAGL will constitute written notice to USG of the relevant matter for the purposes of this clause 4.2(e), and any approval by email by any USG Contact of any action for the purposes of this clause 4 will be taken to be an approval in writing by USG. USG may from time to time during the period before Completion nominate additional or replacement USG Contacts by notice in writing to Boral (provided at least two remain current at all times).

4.3 Carrying on of business – USG Contributed Entities

(a) Subject to clause 4.4, between the date of this Agreement and the earlier of Completion and termination of this Agreement, USG must ensure that the business of the USG Contributed Entities is conducted materially in the ordinary course and, in particular, that no USG Contributed Entity does anything described in clause 4.1(a) amended so that references to ‘BAGL Group Member’ are replaced with references to ‘USG Contributed Entity’ (and references to ‘USG’ are replaced with ‘Boral)’ and so that:

(i) the amount in clause 4.1(a)(xiii)(A) is changed to US$10 million;

(ii) the amount in clause 4.1(a)(xiii)(B) is changed to US$500,000;

(iii) the amount in clause 4.1(a)(xiii)(E) is changed to US$500,000;

(iv) the amount in clause 4.1(a)(xvi) is changed to US$1 million;

(v) Jennifer Scanlon is replaced as the identified individuals in clause 4.1(a)(xviii); and

(vi) the amount in clause 4.1(a)(xx) is changed to US$2.5 million; and

(vii) any reference to A$ in any other provision is changed to US$.

4.4 Permitted acts

Nothing in clause 4.3 restricts any USG Group Member or any USG Contributed Entity from doing any of the following permitted actions:

(a) Transaction Agreements: anything that is required or expressly permitted in this Agreement or any Transaction Document;

(b) Permitted acts: anything (or part of anything) described in Part 2 of Schedule 6;

(c) emergencies: anything to reasonably and prudently respond to an emergency or disaster (including a situation giving rise to a risk of personal injury or damage to property);

(d) legal obligations: anything to the extent necessary for a USG Contributed Entity to meet its legal or contractual obligations (such contractual obligations being as disclosed in the USG Disclosure Schedule); or

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(e) Boral approval or non-objection: anything that is approved in writing by Boral, such approval not to be unreasonably withheld or delayed, or in respect of which Boral fails to notify USG in writing of its objection to the doing of that thing within 3 business days (being normal business days in Chicago and Sydney) after receipt of written notice from USG notifying Boral of a USG Group Member’s or a USG Contributed Entity’s intention to do that thing. For these purposes Boral must on the date of this agreement nominate at least two senior executives (each a Boral Contact) to whom notifications of proposed actions can be submitted. Despite clause 18, notification to each Boral Contact by email by or on behalf of USG or any USG Contributed Entity will constitute written notice to Boral of the relevant matter for the purposes of this clause 4.4(e), and any approval by email by any Boral Contact of any action for the purposes of this clause 4 will be taken to be an approval in writing by Boral. Boral may from time to time during the period before Completion nominate additional or replacement Boral Contacts by notice in writing to USG (provided at least two remain current at all times).

4.5 Intra-group loans

(a) Before Completion, Boral must (except where this Agreement expressly permits such loans to remain outstanding):

(i) identify all existing loans between a Boral Group Member and a BAGL Group Member; and

(ii) procure that all payments are made and such other actions are taken as may be necessary to ensure the payment in full of loan balances between any Boral Group Members on the one hand and any BAGL Group Members on the other hand (or that the relevant loan balances are capitalised provided that no additional shares are issued by BAGL which are inconsistent with any obligation under this Agreement).

(b) Before Completion, USG must (except where this Agreement expressly permits such loans to remain outstanding):

(i) identify all existing loans between a USG Group Member and a USG Contributed Entity; and

(ii) procure that all payments are made and such other actions are taken as may be necessary to ensure the payment in full of loan balances between any USG Group Members on the one hand and any USG Contributed Entities on the other hand (or that the relevant loan balances are capitalised provided that no additional shares are issued by the USG Contributed Entities whose shares are USG Contributed Shares).

4.6 Parent Guarantees

(a) Before Completion Boral and USG must take all reasonable steps to ensure that, effective from Completion each Boral Group Member and each USG Group Member is released from any actual, contingent or accrued liabilities under a Parent Guarantee given by it.

(b) For the purposes of this clause 4.6, ‘reasonable steps’ includes USG (or another USG Group Member acceptable to the relevant Third Party) and Boral (another Boral Group Member acceptable to the relevant Third Party) providing the relevant Third Party with a replacement guarantee or security on terms the same or substantially the same as the terms of the existing Parent Guarantee but so that USG and Boral are severally liable in proportion to their respective Shareholding Percentages.

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(c) If a Boral Group Member has not been released from a Parent Guarantee in accordance with clause 4.6(a) by Completion, USG must pay Boral an amount equal to USG’s Shareholding Percentage (at the time of the relevant Loss) of any Loss that the Boral Group Member pays, suffers, incurs or is liable for under or in relation to that Parent Guarantee after Completion.

(d) If a USG Group Member has not been released from a Parent Guarantee in accordance with clause 4.6(a) by Completion, Boral must pay USG an amount equal to Boral’s Shareholding Percentage (at the time of the relevant Loss) of any Loss that the USG Group Member pays, suffers, incurs or is liable for under or in relation to that Parent Guarantee after Completion.

4.7 Subsidiary Guarantees

(a) Before Completion Boral must ensure that, effective from (or before) Completion, each BAGL Group Member is released from any actual, contingent or accrued liabilities under a Subsidiary Guarantee given by it.

(b) Before Completion USG must ensure that, effective from (or before) Completion, each USG Contributed Entity is released from any actual, contingent or accrued liabilities under a Subsidiary Guarantee given by it.

4.8 Exit from consolidated group

For each BAGL Group Member which is, or will be, a member of the Boral Consolidated Group with effect from a date prior to Completion, Boral must:

(a) on or before Completion, provide USG with a copy of the Boral Tax Sharing Agreement;

(b) at least 7 days prior to Completion, provide USG with a draft calculation of the Exit Payment for each relevant BAGL Group Member, for USG’s review;

(c) procure that each BAGL Group Member pays the relevant Exit Payments to Boral at least one Business Day prior to Completion; and

(d) procure that, at Completion, Boral releases each BAGL Group Member from its obligations under the Boral Tax Sharing Agreement or under any Tax Funding Agreement.

4.9 Access

(a) During the period between the date of this Agreement up to the earlier of Completion and termination of this Agreement, Boral must ensure that USG and a reasonable number of persons authorised by USG are given, on reasonable notice:

(i) reasonable, non-disruptive access during normal business hours at the relevant location to inspect the assets, premises, books and records of the BAGL Group Members; and

(ii) reasonable, non-disruptive access during reasonable mutually agreed hours to senior management of the BAGL Group Members,

provided that USG must ensure that any persons provided with such access comply with the reasonable requirements of the BAGL Group Members or any relevant Third Party in respect of the access and do not interfere with the business or operations of the BAGL Group.

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(b) During the period between the date of this Agreement up to the earlier of Completion and termination of this Agreement, USG must ensure that Boral and a reasonable number of persons authorised by Boral are given, during normal business hours and on reasonable notice:

(i) reasonable, non-disruptive access to inspect the assets, premises, books and records of the USG Contributed Entities; and

(ii) reasonable, non-disruptive access to senior management of the USG Contributed Entities,

provided that Boral must ensure that any persons provided with such access comply with the reasonable requirements of the USG Contributed Entities or any relevant Third Party in respect of the access and do not interfere with the business or operations of the USG Contributed Entities.

4.10 USG Financing

During the period prior to Completion, Boral shall cause the BAGL Group to promptly provide, in connection with any financing arrangement to be entered into by USG for the purpose of funding the payment of the Initial Purchase Price, such cooperation as may be reasonably requested by USG, including:

(a) participation (whether in person or by phone) in a reasonable number of meetings or sessions with prospective lenders, investors and rating agencies;

(b) furnishing USG and its financiers with financial and (subject to confidentiality undertakings satisfactory to Boral, acting reasonably) other pertinent information regarding the BAGL Group;

(c) assisting with the preparation of customary offering documents and materials, including prospectuses, private placement memoranda, information memoranda and packages, lender and investor presentations, rating agency presentations, and similar documents and materials;

(d) requesting assistance and cooperation of the BAGL Group’s independent accountants, including participation in a reasonable number of drafting and accounting due diligence sessions and provision of consents for the use of their reports in materials related to the aforementioned financing and customary “comfort” letters (including “negative assurance” comfort) with respect to the financial information to be included in any offering memorandum, and providing such accountants with any documentation reasonably requested by them in connection therewith; and

(e) consenting to the use of the Accounts of BAGL Group and other BAGL Group financial information (in a form and substance satisfactory to Boral, acting reasonably having regard to the extent to which such information is publicly available) for the aforementioned offering documents and materials.

USG must promptly reimburse the Boral Group and the BAGL Group (as applicable) for all reasonable out-of-pocket costs and expenses incurred in providing co-operation at USG’s request under this clause 4.10.

4.11 Boral Australasia IP Licences

Boral must ensure that, before the Completion Date, the Boral Australasia IP Licences are executed by each Boral, Boral Seller and each BAGL Group Member which (in each case) is expressed to be a party to the relevant document.

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4.12 TOSAs

(a) Boral and USG will work together in good faith to agree detailed service schedules for inclusion in the Boral TOSA and the USG TOSA as soon as practicable following the date of this Agreement.

(b) Boral will before the Completion Date keep USG notified of Third Party Approvals obtained for the purposes of clause 5.1 of the Boral TOSA.

(c) USG will before the Completion Date keep Boral notified of Third Party Approvals obtained for the purposes of clause 5.1 of the USG TOSA.

4.13 Third Party consents – general

(a) Before Completion Boral must use reasonable endeavours to obtain consents from relevant counterparties (or meet other applicable contractual requirements) under ‘change of control’ or similar provisions in contracts or property leases to which any BAGL Group Member is party, to the extent such provisions would otherwise be triggered by the transactions contemplated by this Agreement, including without limitation Seeking consent from Port of Melbourne Corporation to change of control under the lease dated 26 May 2011 of the gypsum unloading facility at 26-27 South Wharf, Lorimer Street, Port Melbourne between Port of Melbourne Corporation and BAGL.

(b) Before Completion USG must use reasonable endeavours to obtain consents from relevant counterparties (or meet other applicable contractual requirements) under ‘change of control’ or similar provisions in contracts or property leases to which any USG Contributed Entity is party, to the extent such provisions would otherwise be triggered by the transactions contemplated by this Agreement, including without limitation:

(i) seeking consent from the relevant lessor to change of control under USG Australia’s lease of its office space in Melbourne; and

(ii) seeking consent from Goodman Nominee (NZ) Limited to change of control under the deed of lease between USG Interiors Pacific Limited and Goodman Nominee (NZ) Limited in relation to the manufacturing and production facility in Auckland, New Zealand.

(c) To the extent any consents referred to in clauses 4.13(a) or 4.13(b) are not obtained by Completion, Boral and USG will discuss in good faith how to address the situation having regard to the best interests of the Joint Venture Group going forward.

4.14 Safety

Boral and USG each acknowledge their respective commitments to ensuring safe workplaces. Boral and USG agree:

(a) to co-operate in good faith between the date of this Agreement and Completion to agree proposed measures to be implemented following Completion to improve work practices and safety at sites under the control of any of the Boral Joint Ventures consistent with safety practices of Boral and USG;

(b) to submit such agreed measures to the boards of BAGL and SingCo for approval as soon as practicable after Completion; and

(c) to exercise the Joint Venture Group’s rights in relation to the Boral Joint Ventures after Completion to implement such agreed measures to the extent it is within the Joint Venture Group’s power to do so.

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4.15 BAGL conversion

Boral must do everything within its reasonable control to ensure that BAGL has been registered as a proprietary company in accordance with the Corporations Act prior to Completion.

4.16 USG restructure

Before Completion, USG must ensure that each of the following actions occurs (without cost or liability to any USG Contributed Entity):

(a) CGC Inc. distributes its shares in USG ChinaLux S.à r.l., to the Acquirer;

(b) USG Latin America, LLC distributes its shares in USG Manufacturing Worldwide, Ltd. to the Acquirer;

(c) USG Interiors International, LLC distributes its interests in USG Interiors Pacific, Ltd, USG Interiors Australia Pty Limited, and USG Cayman Holdings Ltd. to the Acquirer;

(d) USG Interiors International, LLC is liquidated, distributing the shares in USG Asia Pacific Holdings Pte Ltd to the Acquirer;

(e) USG Corporation licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences;

(f) United States Gypsum Company licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences;

(g) USG Interiors, LLC licenses to USG Foreign Investments, Ltd, in exchange for preferred stock that is not section 351(g) stock, the Intellectual Property Rights to be licensed at Completion under the USG Australasia IP Licences and the USG Asia IP Licences; and

(h) the parties to the Share Contribution Agreement enter into that agreement with an effective date of the Completion Date.

4.17 Lease Term Sheets

USG and Boral will work together in good faith to agree the leases or subleases (as applicable), consistent with the terms of the Lease Term Sheets, for the properties referred to in the Lease Term Sheets as soon as practicable following the date of this Agreement and, to the extent the entry into a sublease is subject to landlord consent, Boral will use its reasonable commercial efforts to obtain that consent as soon as practicable after the date of this Agreement.

4.18 Share figures

If Boral and USG agree before Completion that there needs to be changes to any number of shares identified in this Agreement or the Asia Sale Agreement to be issued or transferred at Completion, the allocation of aggregate value between this Agreement and the Asia Sale Agreement (or both) they agree to work together in good faith to agree any consequential reallocation of the value of the USG contributed assets and the Boral contributed assets and any consequential changes to share numbers and the split of the aggregate initial purchase price across this Agreement and the Asia Sale Agreement (being US$500 million). For the avoidance of doubt any such changes will be an allocation exercise only and there is to be no change to the aggregate transaction value or to the aggregate purchase price.

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5. COMPLETION

5.1 Date and place

Completion must take place at 10.00 am at the offices of Jones Day, 88 Phillip Street, Sydney, NSW 2000, on the day which is:

(a) the last Business Day of the month during which the Condition Satisfaction Date falls; or

(b) if the Business Day determined under clause 5.1(a) would be less than 7 days after the Condition Satisfaction Date, the last Business Day of the following month,

or such other time or place as the parties may agree in writing.

5.2 Completion obligations

(a) On Completion (or before where the nature of the action permits it), each Party must carry out the Completion steps referable to it in accordance with Schedule 5.

(b) Subject to clause 5.4 Completion is taken to have occurred when each party has performed all its obligations under this clause 5.2 and Schedule 5.

5.3 Order of events at Completion

(a) Subject to clause 5.3(c) (and except to the extent Schedule 5 requires certain actions to be taken before Completion), the actions to take place as contemplated by clause 5.2 and Schedule 5 are interdependent and must take place, as nearly as possible, simultaneously, but so that they are taken to have occurred in the following sequence:

(i) first (to the extent not entered into before Completion as contemplated by clause 4.11 for any reason) the entry into the Boral Australasia IP Licences between Boral Seller and BAGL;

(ii) second, the entry into the USG Australasia IP Licences between Subscriber 1 and BAGL in exchange for BAGL’s issuance of the Subscription 1 Shares to Subscriber 1;

(iii) third, Subscriber 1’s contribution of the Subscription 1 Shares to Subscriber 2 in exchange for share premium of Subscriber 2;

(iv) fourth, BAGL’s issuance of the Subscription 2 Shares to Subscriber 2 in exchange for Subscriber 2’s contribution of the USG Contributed Shares to BAGL;

(v) fifth, the Acquirer (and the Boral Seller to the extent it holds any indirect interest in USG Interiors Pacific Limited at the relevant time) procuring that USG Interiors Pacific Limited takes all steps within its power to convert into an unlimited liability company; and

(vi) sixth, the transfer of the Sale Shares by the Boral Seller to the Acquirer and all other actions.

(b) If one action required by clause 5.2 and Schedule 5 does not take place, then without prejudice to any rights available to any party as a consequence:

(i) there is no obligation on any party to undertake or perform any of the other actions;

(ii) to the extent that such actions have already been undertaken, the parties must do everything reasonably required to reverse those actions; and

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(iii) each Party must return to the relevant other Party all documents delivered to it under clause 5.2 and Schedule 5 and must each repay to the relevant other Party all payments received by it under clause 5.2 and Schedule 5, without prejudice to any other rights any Party may have in respect of that failure.

(c) USG may, in its sole discretion, waive any or all of the actions that any Boral Group Member or BAGL Group Member is required to perform under Schedule 5 and Boral may, in its sole discretion, waive any or all of the actions that any USG Group Member is required to perform under Schedule 5.

5.4 Interdependency with Asia Completion

(a) Completion under this Agreement is interdependent with, and is to occur (as far as possible having regard to clause 5.3 and the equivalent provision of the Asia Sale Agreement) simultaneously with, Asia Completion under the Asia Sale Agreement.

(b) If Asia Completion under the Asia Sale Agreement does not occur for any reason, Completion under this Agreement will be taken not to have occurred (notwithstanding clause 5.2 and Schedule 5 having otherwise being complied with) and clause 5.3(b) will apply.

5.5 Notice to complete

(a) If a Party (Failing Party) fails to satisfy all of its obligations under clause 5.2 and Schedule 5 on the day and at the place and time for Completion determined under clause 5.1 then:

(i) if the Failing Party is a Boral Party or a BAGL Group Member, USG; or

(ii) if the Failing Party is a USG Party, Boral,

(in each case the Notifying Party) may give the Failing Party a notice requiring the Failing Party to satisfy those obligations on any Business Day within a period of 14 days from the date of the notice and declaring time to be of the essence.

(b) If the Failing Party fails to satisfy those obligations within those 14 days the Notifying Party may, without limitation to any other rights it may have, terminate this agreement with immediate effect by giving written notice to each other Party.

5.6 Post Completion actions

(a) From Completion until the Sale Shares are registered in the name of the Acquirer, Boral Seller must:

(i) appoint the Acquirer as its sole proxy as holder of Sale Shares to attend shareholders’ meetings and exercise the votes attaching to the Sale Shares;

(ii) not vote at any shareholders’ meetings of BAGL in respect of the Sale Shares;

(iii) take all other actions in the capacity of a registered holder of the Sale Shares as the Acquirer directs,

and the Acquirer indemnifies Boral Seller against all Loss suffered or incurred by it arising out of the implementation of any action taken in accordance with such proxy.

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(b) From Completion until the USG Contributed Shares are registered in the name of BAGL, Subscriber 2 must:

(iv) appoint BAGL as its sole proxy as holder of the relevant USG Contributed Shares to attend shareholders’ meetings and exercise the votes attaching to the USG Contributed Shares;

(v) not attend and vote at any shareholders’ meetings of any USG Contributed Entity;

(vi) take all other actions in the capacity of a registered holder of the USG Contributed Shares as BAGL directs,

and Boral indemnifies Subscriber 2 against all Loss suffered or incurred by it arising out of the implementation of any action taken in accordance with such proxy.

(c) As soon as practicable following Completion (and in any event within applicable statutory timeframes) Boral and USG must procure that all requisite forms and notifications are lodged with the appropriate Governmental Agency in respect of the actions undertaken at Completion.

(d) USG and Boral agree to procure that, as soon as practicable following Completion, a tax-transparent limited liability entity (for a specific nature to be agreed between Boral and USG in good faith) is interposed between BAGL and USG Interiors Pacific Limited (as the latter may be renamed following it conversion to an unlimited liability company).

5.7 Co-operation

(a) Following Completion, Boral agrees to cooperate with USG in good faith to ensure that the ownership of entities by the Joint Venture Group are structured to enable the USG Group to maintain the level of ownership required by section 902 of the Code.

(b) Boral acknowledges and agrees that the shares and assets owned by the following entities are subject to a gain recognition agreement filed with the U.S. government and that, from Completion, the Joint Venture Group will not sell or cause to be sold the shares or assets of these businesses prior to January 1, 2019:

(i) USG Manufacturing Worldwide Ltd;

(ii) USG ChinaLux S.a.r.l.;

(iii) Star-USG Building Materials Co., Ltd.

(iv) USG Asia Pacific Holdings Pte. Ltd.

(v) USG Interiors Pacific Ltd.;

(vi) USG Interiors Australia Pty Ltd; and

(vii) USG Cayman Holdings Ltd.

(c) Boral acknowledges and agrees that USG, as a U.S.-based multinational, is subject to various detailed reporting requirements (as amended from time to time) and that to comply with these reporting requirements the USG Group will require, and the Joint Venture Group will following Completion provide, detailed information regarding the computation of earnings and profits earned by each entity within the Joint Venture Group, and the nature of those earnings and will also need receipts evidencing foreign taxes paid by the entities within the Joint Venture Group.

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5.8 Long term incentive arrangements

(a) Boral and USG acknowledge that:

(i) certain employees and officers of the BAGL Group participate in the Boral Group’s long term incentive programs (Boral LTI); and

(ii) certain employees and officers of the USG Contributed Entities participate in the USG Group’s long term incentive programs (USG LTI).

(b) Boral and USG agree that:

(i) the Boral Group will be solely responsible for, and after Completion Boral will reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Member in respect of, long term incentive entitlements of BAGL Group employees and officers under the Boral LTI in respect of the Boral financial year ending 30 June 2014 (and for the avoidance of doubt in respect of all previous financial years); and

(ii) the USG Group will be solely responsible for, and after Completion USG will reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Member in respect of, long term incentive entitlements of USG Contributed Entity employees and officers under the USG LTI in respect of the USG financial year during which Completion occurs (and for the avoidance of doubt in respect of all previous financial years),

with the expectation that in respect of later periods the Joint Venture Group will establish its own standalone long term incentive arrangements.

(c) This clause 5.8 does not apply in relation to bonus entitlements or similar short term incentives to which employees or officers of the BAGL Group or any USG Contributed Entity (including participants in the Boral LTI or the USG LTI) may be entitled. Following Completion these entitlements will be the responsibility of the Joint Venture Group.

5.9 Expatriates

Boral and USG agree that the USG Group will be solely responsible for, and USG will after Completion reimburse the Joint Venture Group for any Loss suffered by any Joint Venture Group Company in respect of, all costs of repatriation and re-employment of expatriate employees seconded by the USG Group to the USG Contributed Entities as at Completion.

6. PURCHASE PRICE ADJUSTMENT

6.1 Definitions

The meanings of the terms used in this clause 6 are set out below.

BAGL Adjustment Amount has the meaning given in Part 1 of Schedule 9.

BAGL Completion Statement means a statement prepared under this clause 6, calculating the BAGL Adjustment Amount in the manner and format prescribed in Schedule 9 for the BAGL Group prepared as at close of business on the Completion Date.

Independent Expert has the meaning provided in clause 6.8(a).

Dispute Notice is defined in clause 6.5(b).

Review Period means the period of 30 days commencing on the later to occur of:

(a) USG delivering a draft USG Completion Statement under clause 6.4(a); and

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(b) Boral delivering a draft BAGL Completion Statement under clause 6.4(b).

Australasia USG Adjustment Amount has the meaning given in Part 1 of Schedule 10.

USG Completion Statement means a statement prepared under this clause 6, calculating the Australasia USG Adjustment Amount in the manner and format prescribed in Schedule 10 for the USG Contributed Entities prepared as at close of business on the Completion Date.

6.2 Purchase Price

The Initial Purchase Price will be adjusted:

(a) at Completion, in accordance with clause 6.3; and

(b) after Completion, in accordance with clauses 6.4 to 6.11.

6.3 Estimated positions at Completion

(a) No later than 7 days before the scheduled date for Completion under clause 5.1:

(i) USG must deliver to Boral a statement setting out USG’s estimate, prepared in good faith, of the Australasia USG Adjustment Amount as at that scheduled Completion date together with reasonable supporting workings; and

(ii) Boral must deliver to USG a statement setting out Boral’s estimate, prepared in good faith, of the BAGL Adjustment Amount as at that scheduled Completion date together with reasonable supporting workings.

(b) If either Boral or USG fails to deliver a statement complying with clause 6.3(a) by the date required by that clause, the relevant party will be taken to have delivered an estimated Australasia USG Adjustment Amount or estimated BAGL Adjustment Amount (as the case may be) of zero.

(c) The Initial Purchase Price payable at Completion will be adjusted so that:

(i) if the estimated BAGL Adjustment Amount is higher than the estimated Australasia USG Adjustment Amount, the Initial Purchase Price will be increased by an amount equal to 50% of the difference; and

(ii) if the BAGL Adjustment Amount is lower than the Australasia USG Adjustment Amount, the Initial Purchase Price will be decreased by an amount equal to 50% of the difference,

provided that no adjustment will be made if the required increase or decrease would be, when aggregated with the corresponding required increase or decrease under the Asia Sale Agreement, less than US$200,000.

(d) If Completion is delayed beyond the date for which the estimates were prepared, Boral and USG must consult in good faith regarding any material changes to their estimates (and if updated estimates are agreed the adjustments to the Initial Purchase Price under clause 6.3(c) will be made accordingly).

6.4 Post Completion – final adjustments

(a) USG must procure that a draft of the USG Completion Statement is prepared in accordance with this clause 6 and delivered to Boral by the date which is 90 days after the Completion Date (or such other date as Boral and USG agree in writing).

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(b) Boral must procure a draft of the BAGL Completion Statement is prepared in accordance with this clause 6 and delivered to USG by the date which is 90 days after the Completion Date (or such other date as Boral and USG agree in writing).

6.5 Review and dispute

(a) By no later than the end of the Review Period:

(i) Boral must give USG a written notice, which states that Boral either:

(A) accepts the draft USG Completion Statement; or

(B) disputes one or more items or the calculation of one or more items in the draft USG Completion Statement (in which case clause 6.5(b) will apply); and

(ii) USG must give Boral a written notice, which states that USG either:

(A) accepts the draft BAGL Completion Statement; or

(B) disputes one or more items or the calculation of one or more items in the draft BAGL Completion Statement (in which case clause 6.5(b) will apply).

(b) If Boral wishes to dispute any item or calculation of any item in the draft USG Completion Statement, or USG wishes to dispute any item or calculation of any item in the draft BAGL Completion Statement, then that Party must, before the end of the Review Period, also give a written notice (Dispute Notice) to the other which:

(i) sets out details of each item or calculation of each item that is in dispute;

(ii) sets out a separate dollar value for each of the disputed items; and

(iii) sets out full details of the reasons why each of the relevant items is in dispute.

(c) Boral may only give one Dispute Notice and USG may only give one Dispute Notice.

6.6 Acceptance and Deemed Acceptance

If either Boral or USG:

(a) gives a notice under clause 6.5(a)(i) or 6.5(a)(ii) (as the case may be) accepting the draft BAGL Completion Statement or the draft USG Completion Statement(as relevant); or

(b) notwithstanding the requirements of clause 6.5 fails to give the other a notice accepting or disputing the draft BAGL Completion Statement or the draft USG Completion Statement (as relevant) within the Review Period; or

(c) gives a notice to the other purporting to dispute the draft BAGL Completion Statement or the draft USG Completion Statement (as relevant) after expiry of the Review Period; or

(d) gives a notice to the other purporting to dispute the draft BAGL Completion Statement or the draft USG Completion Statement (as relevant) within the Review Period but fails to give a Dispute Notice within the Review Period,

then the draft BAGL Completion Statement or the draft USG Completion Statement (as relevant) in the form in which it was delivered under clause 6.4 will be taken to be the definitive “BAGL Completion Statement” or “USG Completion Statement” (as relevant) for the purposes of this Agreement, and will be final and binding on the Parties (including for the avoidance of doubt for the determination of the BAGL Adjustment Amount or the Australasia USG Adjustment Amount, as the case may be).

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6.7 Dispute Resolution Procedure

(a) If either Boral or USG gives a Dispute Notice within the Review Period pursuant to clause 6.5(b), then Boral and USG must, within 30 days after expiry of the Review Period, use their reasonable endeavours in good faith to:

(i) resolve the issues set out in the Dispute Notice or Dispute Notices; and

(ii) reflect any resolution regarding those issues in a written agreement.

(b) If any agreement reached under clause 6.7(a) resolves all outstanding issues in relation to the BAGL Completion Statement or the USG Completion Statement (as relevant), the parties must make any required changes that arise from that agreement to the draft BAGL Completion Statement or the draft USG Completion Statement (as relevant), and the resulting document will be taken to be the definitive “BAGL Completion Statement” or “USG Completion Statement” (as relevant) for the purposes of this Agreement, and will be final and binding on the Parties (including for the avoidance of doubt for the determination of the BAGL Adjustment Amount or the Australasia USG Adjustment Amount, as the case may be).

6.8 Referral to Independent Expert

(a) If USG and Boral have not been able to resolve the issues set out in a Dispute Notice given pursuant to clause 6.5(b) within 30 days of the expiry of the Review Period, then the unresolved matters must be referred for resolution to an independent person agreed between USG and Boral within a further 7 days. If USG and Boral cannot agree on who the independent person will be within that time period, the dispute must be referred to one of the following accounting firms (to be drawn by lot in the presence of a representative of USG and Boral):

(i) PwC Australia;

(ii) Deloitte Australia;

(iii) KPMG Australia;

(iv) Ernst & Young Australia,

and if each of the above firms refuse the appointment, then a firm shall be selected from the following list (to be drawn by lot in the presence of a representative of USG and Boral):

(v) BDO

(vi) Grant Thornton;

(vii) PKF,

and the Independent Expert for the purposes of this clause 6 will be the person agreed or selected under this clause 6.8(a). For the avoidance of doubt, if both the BAGL Completion Statement and the USG Completion Statement are in dispute, both disputes must be referred to the same Independent Expert at the same time.

(b) The Independent Expert must be instructed by USG and Boral:

(i) to determine only the unresolved issues in the Dispute Notice or Dispute Notices;

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(ii) to decide the procedures and timing to be followed in order to resolve the dispute (save as set out in this clause 6);

(iii) to provide a written determination to USG and Boral no later 30 days after receipt of the submissions contemplated by clause 6.8(c) setting out the Independent Expert’s determination as to:

(A) the unresolved issues;

(B) amendments (if any) required to be made to the BAGL Completion Statement, the USG Completion Statement, or both (as the case may be depending on the subject matter of the dispute or disputes);

(C) the BAGL Adjustment Amount, the Australasia USG Adjustment Amount, or both (as the case may be depending on the subject matter of the dispute or disputes); and

(D) the allocation of the Independent Expert’s costs.

(c) USG and Boral may make separate written submissions to the Independent Expert (to be delivered within 14 days after the Independent Expert is appointed) and may make a response to the submissions of the other.

(d) The Independent Expert will act as an expert and not as an arbitrator in determining the dispute. The Independent Expert’s decision in relation to the matters in its written determination will be final, conclusive and binding on the Parties (except in the case of manifest error).

(e) The Independent Expert must be instructed to, in reaching its determination:

(i) apply the requirements of this clause 6 (and Schedule 9 or Schedule 10 (as applicable)) insofar as they relate to financial and accounting matters and the format of the respective completion statements;

(ii) not take into account any other dispute that may be ongoing between the parties and unrelated to the Dispute Notice or Dispute Notices submitted to the Independent Expert; and

(iii) rely solely on the submissions by the Parties to the Independent Expert and not independent review.

(f) The Independent Expert must be instructed that, in resolving any disputed item, the Independent Expert may not assign a greater value to any such item than the greatest value for such item claimed by either USG or Boral in the written submissions to the Independent Expert or less than the lowest value for such item claimed by either USG or Boral in such submissions.

(g) Any written correspondence between the Independent Expert and any of the Parties must be copied to each of the other Parties at the same time as it is sent to the principal recipient.

(h) Each of the Parties must promptly provide the Independent Expert with any information, assistance and cooperation that the Independent Expert reasonably requests to assist in making his or her determination.

(i) The costs of the Independent Expert will be borne in the proportion determined by the Independent Expert having regard to the outcome of the dispute or disputes referred to the Independent Expert (and failing any cost allocation by the Independent Expert,

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equally between USG and Boral. In addition, at the time of appointing the Independent Expert Boral and USG must agree to any customary terms of engagement of the Independent Expert, including as to indemnities in favour of the Independent Expert

6.9 Access

(a) USG must ensure that each USG Group Member permits representatives of Boral and its advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the USG Contributed Entities for the period before Completion in their possession or control as Boral and its advisers reasonably request in relation to the review of, and agreement to, the USG Completion Statement.

(b) Boral must ensure that each Boral Group Member permits representatives of USG and its advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the BAGL Group for the period before Completion in their possession or control as USG and its advisers reasonably request in relation to:

(i) the preparation of, and agreement to, the USG Completion Statement; and

(ii) the review of, and agreement to, the BAGL Completion Statement.

(c) USG and Boral must use all reasonable endeavours to ensure (as ultimate shareholders in BAGL after Completion) that each BAGL Group Member permits representatives of USG, Boral and their respective advisers to have access to and take extracts from the books, correspondence, accounts or other records relating to the BAGL Group and the USG Contributed Entities for the period before Completion in their possession or control as USG, Boral and their respective advisers reasonably request in relation to the preparation and review of, and agreement to, the USG Completion Statement and the BAGL Completion Statement.

6.10 If Expert process fails

If this clause 6 requires any disputed matters to be referred to an Independent Expert for resolution but no Independent Expert determination on the relevant matters is possible because:

(a) USG and Boral do not agree on the Independent Expert and none of the firms selected as potential Independent Experts agrees to the accept the appointment;

(b) an Independent Expert is appointed but the Independent Expert subsequently withdraws or advises that it is for any reason unable to make a determination; or

(c) for any other reason,

and USG and Boral cannot within a further 14 days agree on the appointment of an alternative Independent Expert, then the Independent Expert process will be taken to have failed and any party may commence proceedings in a court of competent jurisdiction in relation to the resolution of the relevant disputed matters (on the basis that each party will for the avoidance of doubt still have an obligation to make the payments required by clause 6.11).

6.11 Payment of final adjustments

(a) If the BAGL Adjustment Amount finally agreed or determined in accordance with this clause 6 is higher than the Australasia USG Adjustment Amount finally agreed or determined in accordance with this clause 6, then subject to clause 6.11(c) on the Final Adjustment Date the Acquirer must pay to Boral Seller, as an increase to the Initial Purchase Price:

(i) an amount equal to 50% of the difference; less

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(ii) the amount (if any) by which the Initial Purchase Price paid at Completion was increased under clause 6.3(c),

provided that if the amount under clause 6.11(a)(i) above is smaller than the amount under clause 6.11(a)(ii) above so that the calculation results in a negative number (an Adjustment Shortfall):

(iii) the Acquirer will have no obligation to make a payment to Boral Seller under this clause 6.11(a); and

(iv) Boral Seller must instead pay to the Acquirer on the Final Adjustment Date an amount equal to the relevant Adjustment Shortfall.

(b) If the BAGL Adjustment Amount finally agreed or determined in accordance with this clause 6 is lower than the Australasia USG Adjustment Amount finally agreed or determined in accordance with this clause 6, then then subject to clause 6.11(c) on the Final Adjustment Date Boral Seller must pay to the Acquirer, as a reduction to the Initial Purchase Price:

(i) an amount equal to 50% of the difference; less

(ii) the amount (if any) by which the Initial Purchase Price paid at Completion was reduced under clause 6.3(c),

provided that if the amount under clause 6.11(b)(i) above is smaller than the amount under clause 6.11(b)(ii) above so that the calculation results in a negative number (an Adjustment Shortfall):

(iii) the Boral Seller will have no obligation to make a payment to the Acquirer under this clause 6.11(b); and

(iv) the Acquirer must instead pay to Boral Seller on the Final Adjustment Date an amount equal to the relevant Adjustment Shortfall.

(c) No amount will be payable by any Party (and no adjustment to the Initial Purchase Price will be made) under this clause 6.11 unless the amount determined under clause 6.11(a) or 6.11(b) would be, when aggregated with any amount payable by the Party (or any Related Body Corporate of the Party) under the corresponding provision under the Asia Sale Agreement, exceeds US$200,000.

6.12 Interaction with Asia Sale Agreement

If a dispute is referred to an Independent Expert under clause 6.8 in circumstances where:

(a) a ‘Dispute Notice’ has also been given under the corresponding provisions of the Asia Sale Agreement; and

(b) there are unresolved issues between the parties in relation to that Dispute Notice,

then both disputes must be referred to the same Independent Expert at the same time.

7. WARRANTIES

7.1 Boral Warranties, Boral JV Warranties and Boral Tax Warranties

Boral and Boral Seller warrant to USG, the Acquirer and the Subscribers that each of the Boral Warranties, the Boral JV Warranties and the Boral Tax Warranties is true and correct.

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7.2 USG Warranties and USG Tax Warranties

USG, the Acquirer and the Subscribers warrant to Boral and the Boral Seller that each of the USG Warranties, the USG Tax Warranties, the USG IP Warranties is true and correct.

7.3 Effective dates

(a) Subject to clause 7.3(b), the Warranties are given both as at the date of this Agreement and as at Completion.

(b) Where a Warranty is expressed to be made as at a date, it is given with respect to that date only.

(c) Where a Warranty is given as at Completion, that Warranty is given disregarding the change of ownership of the Sale Shares and the USG Contributed Shares that will occur upon Completion and the effect of that change of ownership.

7.4 Independent warranties

Each of the Warranties is to be construed independently of the others and is not limited by reference to any other Warranty.

7.5 Acknowledgment

(a) The Boral Parties acknowledge that the USG Parties have entered into this Agreement and will complete this Agreement in reliance on the Boral Warranties, the Boral JV Warranties and the Boral Tax Warranties.

(b) The USG Parties acknowledge that the Boral Parties have entered into this Agreement and will complete this Agreement in reliance on the USG Warranties, the USG Tax Warranties.

7.6 No merger

The Warranties are continuing and do not merge on Completion but remain in full force, subject to the limitations set forth in this Agreement.

7.7 Warranties personal

Any rights of a Party to make a Claim for breach of a Warranty are personal to that Party and may not be assigned to any other Person.

7.8 No other warranties

(a) Each of the Parties acknowledge that, except for the Warranties (and any express warranties in any other Transaction Document), no Party nor any of its Representatives makes any express or implied representation or warranty at all in relation to this Agreement and the transactions contemplated in this Agreement.

(b) Without limiting the foregoing, each Party acknowledges that:

(i) at no time has any Party or any of their respective Representatives made or given, nor has any Party relied on, any representation, warranty, promise, forward-looking statement, projection or forecast in connection with this Agreement except for the Warranties; and

(ii) to the full extent permitted by applicable law, every condition, guarantee, warranty, term, provision, representation or undertaking (whether express, implied, written, oral, collateral, statutory or otherwise) in relation to the transactions contemplated by this Agreement except the Warranties is excluded.

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(c) To the full extent permitted by law, each Party agrees not to make, and releases any right they may have to make, against any other Party or their respective Representatives any Claim based on Part 7.10 (including section 1041H) of the Corporations Act, Part 2 Division 2 (including section 12DA or 12DB) of the Australian Securities and Investments Commission Act 2001 (Cth), Parts 2-1, 2-2 or 3-1 (including sections 18, 20, 21, 22 and 29) of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) or on any corresponding provision of any State or Australian Territory legislation, or on a similar provision under any other applicable law, for any act or omission of another Party or for any statement or representation that is not expressly contained in this Agreement.

7.9 Mitigation of losses

Each Party must take, and must ensure each of its Related Corporations following Completion, takes, all reasonable action to mitigate any Loss suffered for which a Claim could be made against any Party pursuant to this Agreement. Nothing in this Agreement restricts or limits any general obligation at law to mitigate any Loss.

7.10 BAGL

(a) The Parties acknowledge and agree that:

(i) Boral Seller and the Acquirer will immediately following Completion each be 50% owners of the shares in BAGL;

(ii) it is the intent of the Parties that BAGL is a party to this Agreement only insofar as it is required to undertake specified actions (which may be the subject of a claim for specific performance) and that it is not intended that BAGL should have, and BAGL will not have:

(A) any liability in respect of any Claim by any other Party (except for specific performance of an obligation owed by it that is to be performed at or before Completion); or

(B) any right to bring any Claim against any other Party (except for specific performance of an obligation owed to it that is to be performed at or before Completion.

(b) To the extent this Agreement requires BAGL to do anything before or at Completion, Boral must procure that BAGL does the relevant thing in accordance with the relevant provisions of this Agreement. For the avoidance of doubt this does not apply to any matters after Completion.

(c) In relation to Claims by or against BAGL:

(i) each Party undertakes and agrees not to make any Claim against BAGL which is inconsistent with clause 7.10(a)(ii);

(ii) Boral undertakes and agrees to ensure that BAGL does not make any Claim against any other Party at any time before Completion (or if Completion does not occur) which is inconsistent with clause 7.10(a)(ii); and

(iii) BAGL undertakes and agrees (and Boral Seller and the Acquirer, as shareholders in BAGL, must ensure) that BAGL does not make any Claim against any other Party at any time after Completion which is inconsistent with clause 7.10(a)(ii).

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7.11 Claim to be reduction of Purchase Price

Any payment to a USG Party in respect of any Claim against a Boral Party is taken to be a reduction of the Purchase Price (and any Payment to a Boral Party in respect of any Claim against a USG Party is taken to be an increase in the Purchase Price).

8. LIMITATIONS OF LIABILITY

8.1 Disclosure

(a) None of Boral, the Boral Seller or BAGL is liable in respect of a Warranty Claim (other than a Claim arising from a breach of a Title Warranty) to the extent a fact, matter or circumstance giving rise to the Warranty Claim:

(i) is disclosed or described in any Transaction Document (in the form such document exists at the date of this Agreement); or

(ii) is fairly disclosed in the Data Room documents that are listed or referred to in the Boral Disclosure Schedule or in any narrative description in the Boral Disclosure Schedule (or both taken together) in circumstances where the relevant documents or narrative description (or both) are identified in the Boral Disclosure Schedule as being disclosed against:

(A) the particular Warranty to which the relevant Warranty Claim relates; or

(B) the group of Warranties (as classified by reference to the subject headings in the relevant Warranty schedule) in which that particular Warranty falls; or

(iii) is fairly disclosed:

(A) in the narrative of the Boral Q&A Responses; or

(B) in any document referred to in a Boral Q&A Response (but in this case only to the extent the relevant fact, matter or circumstance relates to the question to which the relevant Boral Q&A Response responds); or

(iv) is within the actual knowledge of Specified Executives of USG,

and each Party acknowledges that Boral, the Boral Seller and BAGL have disclosed or are deemed to have disclosed against the Boral Warranties, and the Boral JV Warranties (other than the Title Warranties) and each Party will be treated as having actual knowledge of) all facts, matters and circumstances that fall within any of clauses 8.1(a)(i) to 8.1(a)(iv) above.

(b) None of USG, the Acquirer or the Subscribers are liable in respect of a Warranty Claim (other than a Claim arising from a breach of a Title Warranty) to the extent a fact, matter or circumstance giving rise to the Warranty Claim:

(i) is disclosed or described in any Transaction Document (in the form such document exists at the date of this Agreement); or

(ii) is fairly disclosed in the Data Room documents that are listed or referred to in the USG Disclosure Schedule or in any narrative description in the USG Disclosure Schedule (or both taken together) where the relevant documents or narrative description (or both) are identified in the USG Disclosure Schedule as being disclosed against:

(A) the particular Warranty to which the relevant Warranty Claim relates; or

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(B) the group of Warranties (as classified by reference to the subject headings in the relevant Warranty schedule) in which that particular Warranty falls; or

(iii) is fairly disclosed:

(A) in the narrative of the USG Q&A Responses; or

(B) in any document referred to in a USG Q&A Response (but in this case only to the extent the relevant fact, matter or circumstance relates to the question to which the relevant USG Q&A Response responds); or

(iv) is within the actual knowledge of Specified Executives of Boral,

and each Party acknowledges that USG, the Acquirer and the Subscribers have disclosed or are deemed to have disclosed against the USG Warranties (other than the Title Warranties) and each Party will be treated as having actual knowledge of) all facts, matters and circumstances that fall within any of clauses 8.1(b)(i) to 8.1(b)(iv) above.

8.2 Fair disclosure and actual knowledge

(a) For the purposes of clause 8.1, a fact, matter or circumstance is fairly disclosed if sufficient information has been disclosed that a sophisticated investor, experienced in transactions of the nature of those contemplated by this Agreement, would be aware of the substance and significance of the information and would be aware of the nature and extent of the relevant breach of Warranty.

(b) For the purposes of clause 8.1, a fact, matter or circumstance is within the actual knowledge of a Specified Executive only if the fact, matter or circumstance is within the actual knowledge of that individual prior to the date of this Agreement and a sophisticated investor, experienced in transactions of the nature of those contemplated by this Agreement would be aware, prior to the date of this Agreement, of the substance and significance of that fact, matter or circumstance and the nature and extent of the relevant breach of Warranty.

8.3 Warranties not limited by inquiries or knowledge

(a) Except as expressly set out in this Agreement, no Boral Warranty, Boral JV Warranty or Boral Tax Warranty is excluded or limited by:

(i) any inquiry or investigation made by or on behalf of USG, the Acquirer or the Subscribers or any of their respective Representatives;

(ii) any actual or constructive knowledge of USG, the Acquirer, the Subscribers or any of their respective Representatives that any Boral Warranty, Boral JV Warranty or Boral Tax Warranty is or may be incorrect; or

(iii) any other act, matter or thing.

(b) Except as expressly set out in this Agreement, no USG Warranty or USG Tax Warranty is excluded or limited by:

(i) any inquiry or investigation made by or on behalf of Boral, BAGL or the Boral Seller or any of their respective Representatives;

(ii) any actual or constructive knowledge of Boral, BAGL or the Boral Seller or any of their respective Representatives that any USG Warranty or USG Tax Warranty is or may be incorrect; or

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(iii) any other act, matter or thing.

8.4 Time limits for Claims

A Party is not liable in respect of a Claim unless:

(a) it has received a Claim Notice in accordance with clause 11.1 of this Agreement by no later than:

(i) the date which is 6 years after the Completion Date in respect of a Claim arising from a breach of a Title Warranty;

(ii) the end of any applicable statute of limitations with respect to a Tax Claim; and

(iii) the date which is the earlier of:

(A) 2 years after the Completion Date; and

(B) 6 months after the completion of the audit of each of the Joint Venture Companies in respect of the first full financial year which occurs after the Completion Date,

in respect of any other Claim; and

(b) within 6 months (or such longer period as may be agreed) after receipt of the Claim Notice:

(i) the Claim has been agreed, compromised or settled; or

(ii) the Party that gave the Claim Notice (or another member of the same Claim Group) has issued and served legal proceedings against the relevant Party (or another member of its Claim Group) in respect of the Claim,

provided that:

(iii) if at the time the Claim Notice is given sufficient Claims have not been made that, in aggregate, exceed any relevant threshold referred to in clause 8.6, the 6 month period referred to in this clause 8.4(b) will commence from the earlier of the date the threshold is exceeded and the date the time period for Claims of the relevant type under clause 8.4(a) above expires; and

(iv) if the Claim Notice relates to a liability that is a contingent liability, then provided always that:

(A) clause 11.1 has been complied with in relation to the Claim; and

(B) the events, matters or circumstances detailed in the relevant Claim Notice as the basis of the Claim occurred before the expiry of the applicable period under clause 8.4(a),

the 6 month period referred to in clause 8.4(b) above will commence from the earlier of the date the contingent becomes an actual liability and is due and payable and the date which is 6 years after the date of the Claim Notice.

8.5 Minimum amount for Claims

(a) None of Boral, the Boral Seller or BAGL is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim and all other Claims by members of the same Claim Group arising from the same or similar facts, matters or circumstances is at least US$400,000.

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(b) None of USG, the Acquirer or the Subscribers is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim and all other Claims by members of the same Claim Group arising from the same or similar facts, matters or circumstances is at least US$400,000.

8.6 Threshold for Claims

(a) None of Boral, the Boral Seller or BAGL is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim either alone or together with the amount finally agreed or adjudicated to be payable in respect of other Claims and Asia Sale Agreement Claims by members of the USG Group that satisfy clause 8.5(a) (or the corresponding provision of the Asia Sale Agreement) is at least US$4 million, in which event Boral, the Boral Seller or BAGL (as relevant) is liable for the whole of that amount and not merely the excess.

(b) None of USG, the Acquirer or the Subscribers is liable in respect of a Claim (other than a Tax Claim or a Claim arising from a breach of a Title Warranty) unless the aggregate amount finally agreed or adjudicated to be payable in respect of that Claim either alone or together with the amount finally agreed or adjudicated to be payable in respect of other Claims and Asia Sale Agreement Claims by members of the Boral Group that satisfy clause 8.5(b) (or the corresponding provision of the Asia Sale Agreement) is at least US$4 million, in which event USG, the Acquirer or the relevant Subscriber (as relevant) is liable for the whole of that amount and not merely the excess.

8.7 Maximum recovery

(a) The maximum aggregate amount recoverable by the Boral Claim Group in relation to:

(i) all Claims under this Agreement and all Asia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties and Environmental Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Asia Sale Agreement and Asia Sale Agreement Claims arising from breaches of ‘Title Warranties’ and ‘Environmental Warranties’ as defined in the Asia Sale Agreement,

is an amount equal to US$30 million;

(ii) without limiting (i) above in relation to Claims to which it applies, all Claims under this Agreement and all Asia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Asia Sale Agreement and Asia Sale Agreement Claims arising from breaches of ‘Title Warranties’ as defined in the Asia Sale Agreement,

but for the avoidance of doubt including all other Claims and Asia Sale Agreement Claims (including Claims arising from breaches of Environmental Warranties and Asia Sale Agreement Claims arising from breaches of ‘Environmental Warranties’ as defined in the Asia Sale Agreement) is an amount equal to US$60 million; and

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(iii) all Claims under this Agreement and all Asia Sale Agreement Claims (including Claims excluded from paragraphs (i) and (ii) above) is an amount equal toUS$150 million.

(b) The maximum aggregate amount recoverable by the USG Claim Group in relation to:

(i) all Claims under this Agreement and all Asia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties and Environmental Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Asia Sale Agreement and Asia Sale Agreement Claims arising from breaches of ‘Title Warranties’ and ‘Environmental Warranties’ as defined in the Asia Sale Agreement,

is an amount equal to US$135 million;

(ii) without limiting (i) above in relation to Claims to which it applies, all Claims under this Agreement and all Asia Sale Agreement Claims:

(A) excluding Tax Claims and Claims arising from breaches of Title Warranties; and

(B) excluding ‘Tax Claims’ as defined in the Asia Sale Agreement and Asia Sale Agreement Claims arising from breaches of ‘Title Warranties’ as defined in the Asia Sale Agreement,

but for the avoidance of doubt including all other Claims and Asia Sale Agreement Claims (including Claims arising from breaches of Environmental Warranties and Asia Sale Agreement Claims arising from breaches of ‘Environmental Warranties’ as defined in the Asia Sale Agreement) is an amount equal to US$270 million; and

(iii) all Claims under this Agreement and all Asia Sale Agreement Claims (including Claims excluded from paragraphs (i) and (ii) above) is an amount equal to US$675 million.

8.8 No double recovery

(a) A Party is not liable in respect of any Claim for any Loss to the extent that:

(i) in respect to USG Claims, the Loss is recovered by any member of the USG Group under another Claim or an Asia Sale Agreement Claim or is made good or otherwise compensated for without material cost to the USG Group (including recovery under a policy of insurance) (and USG must ensure that any available insurance claims are pursued expeditiously and in good faith);

(ii) in respect to Boral Claims, the Loss is recovered by any member of the Boral Group under another Claim or an Asia Sale Agreement Claim or is made good or otherwise compensated for without material cost to the Boral Group (including recovery under a policy of insurance) (and Boral must ensure that any available insurance claims are pursued expeditiously and in good faith);

(b) If, after a Party has made a payment in respect of a Claim, the relevant recipient (or any other member of the same Claim Group) recovers, or is compensated for by any other means, any Loss to which that payment related, the relevant recipient must as soon as practicable pay to the Party who made the payment the amount of the Loss that was recovered or compensated for, less costs and expenses.

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8.9 Other limitations of liability

A Party is not liable in respect of any Claim (other than a Claim under clause 9.1(a) or 9.2(a)) for any Loss to the extent that:

(a) the Loss arises out of anything done or omitted to be done in accordance with the terms of any Transaction Document or with the prior written approval of:

(i) in respect to USG Claims, USG; or

(ii) in respect to Boral Claims, Boral; or

(b) the Loss arises from any of the following after the date of this Agreement;

(i) the enactment or amendment of any legislation, regulations or other Legal Requirement;

(ii) a change in the judicial or administrative interpretation of any Legal Requirement; or

(iii) a change in the practice or policy of any Regulatory Authority;

(c) the Loss would not have arisen but for a change after Completion in any accounting policy or practice of any member of the Joint Venture Group, any USG Contributed Entity, any Boral Joint Venture or:

(i) in the case of USG Claims, any member of the USG Group; and

(ii) in the case of Boral Claims, and member of the Boral Group,

that (in each case) applied before Completion;

(d) the Loss is remediable, provided that:

(i) in the case of USG Claims, it is remedied at the cost of the Boral Group to the satisfaction of USG, acting reasonably, within 60 days after the relevant Claimant Party gives written notice of the Claim under clause 11.1; and

(ii) in the case of Boral Claims, it is remedied at the cost of the USG Group to the satisfaction of Boral, acting reasonably, within 60 days after the relevant Claimant Party gives written notice of the Claim under clause 11.1; or

(e) the Loss is Consequential Loss, provided that this will not prevent recovery of Loss by the Claimant Party to the extent such Loss comprises costs associated with monitoring and ensuring compliance with anti-corruption or anti-bribery measures as required by any applicable law, regulation or regulator (including for avoidance of doubt the United States Foreign Corrupt Practices Act 1977 and the Securities and Exchange Commission) resulting from the matter giving rise to the relevant Claim.

8.10 Accounting provisions

(a) A Party is not liable in respect of any Claim (including a Tax Claim) for any Loss to the extent of any amount that has been included as a provision, allowance, reserve or accrual that caters for the matter giving rise to the Claim:

(i) in the case of a USG Claim, in the BAGL Completion Statement; or

(ii) in the case of a Boral Claim, in the USG Completion Statement,

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up to a maximum reduction in liability of an amount equal to the amount of the relevant provision, allowance, reserve or accrual multiplied by:

(iii) in the case of a USG Claim, USG’s Shareholding Percentage at the relevant time; or

(iv) in the case of a Boral Claim, Boral’s Shareholding Percentage at the relevant time.

(b) A Party is not liable in respect of any Claim under clause 9.1(a) or 9.2(a) in respect of Taxes relating to any period before Completion to the extent the liability of the BAGL Group or the USG Contributed Entities (as the case may be) is offset by Tax Attributes that relate to a financial year before Completion (with the intention that the relevant Party’s liability will be determined by reference to the net overall Tax liabilities of the relevant entities in respect of the period before Completion) provided that those Tax Attributes were not generated post Completion and carried back into a period ending on or prior to Completion and to the extent those Tax Attributes are not reflected as assets in the applicable Completion Statement.

(c) If:

(i) an accrual, allowance, provision or reserve in the BAGL Completion Statement in respect of a Tax exceeds the actual liability in respect of that Tax and that liability has been finally satisfied; or

(ii) an entitlement to any Tax relief that is shown as an asset in the BAGL Completion Statement is understated and the amount of the understatement has been actually received by a member of the BAGL Group,

then the liability of the Boral Group in respect of any Claims (including Tax Claims) will be reduced by the amount of the actual excess or actual understatement (as applicable).

(d) If:

(i) an accrual, allowance, provision or reserve in the USG Completion Statement in respect of a Tax exceeds the actual liability in respect of that Tax and that liability has been finally satisfied; or

(ii) an entitlement to any Tax relief that is shown as an asset in the USG Completion Statement is understated and the amount of the understatement has been actually received by a USG Contributed Entity,

then the liability of the USG Group in respect of any Claims (including Tax Claims) will be reduced by the amount of the actual excess or actual understatement (as applicable).

8.11 Opinions, estimates and forecasts

(a) The parties acknowledge that no member of the Boral Group, the BAGL Group or the BGA Group is under any obligation to provide any member of the USG Group or its advisers with any information on the future financial performance or prospects of any member of the BAGL Group or the BGA Group or any Boral Joint Venture. If a member of the USG Group has received (including in the Boral Q&A Responses) opinions, estimates, projections, business plans, budget information or other forecasts in respect of any member or member of the BAGL Group or the BGA Group or any Boral Joint Venture, each USG Claim Group Member acknowledges and agrees that:

(i) there are uncertainties inherent in attempting to make these estimates, projections, business plans, budgets and forecasts and the USG Claim Group is familiar with these uncertainties;

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(ii) the USG Claim Group is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections, business plans, budgets and forecasts furnished to it; and

(iii) none of Boral, the Boral Seller or BAGL is liable in respect of a Claim arising out of or relating to any opinions, estimates, projections, business plans, budgets or forecasts in respect of any member or members of the BAGL Group or the BGA Group or any Boral Joint Venture.

(b) The parties acknowledge that no member of the USG Group is under any obligation to provide any member of the Boral Group or its advisers with any information on the future financial performance or prospects of any of the USG Contributed Entities. If a member of the Boral Group has received (including in the USG Q&A Responses) opinions, estimates, projections, business plans, budget information or other forecasts in respect of any of the USG Contributed Entities, each Boral Claim Group Member acknowledges and agrees that:

(i) there are uncertainties inherent in attempting to make these estimates, projections, business plans, budgets and forecasts and the Boral Claim Group is familiar with these uncertainties;

(ii) the Boral Claim Group is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections, business plans, budgets and forecasts furnished to it; and

(iv) none of USG, the Acquirer or any of the Subscribers is liable in respect of a Claim arising out of or relating to any opinions, estimates, projections, business plans, budgets or forecasts in respect of any USG Contributed Entity.

(c) Nothing in this clause 8.11 qualifies or limits the express rights and obligations of the parties in respect of the Earn-Out Amounts under clause 2.3(d) and Schedule 8.

8.12 Circumstances where limitations not to apply

(a) Notwithstanding the foregoing, none of the limitations in the preceding clauses 8.1 to 8.10 (inclusive) apply to any Losses relating to or Claims brought by a Party:

(i) for payment of any part of the Purchase Price (including the Earn-Out Amounts);

(ii) for payment of any adjustment to the Purchase Price under clause 6.11; or

(b) Notwithstanding the foregoing, none of the limitations in the preceding clauses 8.1 to 8.10 (inclusive) apply to any Losses in respect of a Claim to the extent that:

(i) the Claim relates to a breach of Warranty given by a Party and the relevant Warranty was given dishonestly or fraudulently by that Party; or

(ii) in the case of any other Claim, the Loss is a result of or arises from any fraud or dishonesty on the part of another Party.

8.13 No action against Representatives

(a) The Parties waive, and Boral and USG must procure that each Boral Group Member and each USG Group Member waives, all rights and claims that they may have against current or former Representatives in relation to any matter arising directly or indirectly in connection with this Agreement except to the extent that such rights or claims arise out of the fraud, wilful misconduct, wilful concealment or wilful default of such person.

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(b) The Parties acknowledge and agree that:

(i) each Party has sought and obtained this waiver as agent for and on behalf of each of their respective current and former Representatives and holds the benefit of this clause 8.13 as trustee for them; and

(ii) the provisions of this clause 8.13 may be enforced by a Party on behalf of and for the benefit of any of their respective current and former Representatives and those persons may plead this clause 8.13 in answer to any claim made by any Party against them.

9. INDEMNITIES

9.1 Indemnities in favour of USG

(a) After Completion Boral must pay to USG an amount equal to USG’s Shareholding Percentage at the relevant time (or in the case of any Tax or Tax Costs payable or incurred by a Boral Joint Venture or any Subsidiary of a Boral Joint Venture, USG’s Shareholding Percentage multiplied by the Joint Venture Group’s percentage holding in the Boral Joint Venture at the relevant time) of:

(i) the amount of any Tax payable by a BAGL Group Member or by a Boral Joint Venture or any Subsidiary of a Boral Joint Venture to the extent that Tax relates to any period, or part period, up to and including Completion; and

(ii) Tax Costs incurred by or on behalf of a BAGL Group Member or a Boral Joint Venture or any Subsidiary of a Boral Joint Venture to the extent those Tax Costs arise from or relate to any of the matters for which Boral may be liable under clause 9.1(a)(i),

except to the extent that Boral’s liability is limited or qualified under clause 8.

(b) For the purpose of clause 9.1(a):

(i) Taxes imposed on revenues, income or gain shall be apportioned to periods ending on or prior to the Completion Date based on a hypothetical closing of the books method; and

(ii) Taxes imposed on the value of an item for a period shall be apportioned to periods ending on or prior to the Completion Date on a pro rata basis determined by multiplying the Taxes by a fraction, the numerator of which is the number of days in the period falling on or before the Completion Date, and the denominator of which is the total number of days in the period for which the Tax is imposed.

(c) If any Joint Venture Group Member suffers any Loss (other than to another Joint Venture Group Member) after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Joint Venture Group Member in connection with:

(i) any breach or alleged breach before Completion by any BAGL Group Member, any Boral Joint Venture or any Subsidiary of a Boral Joint Venture (Relevant Entity) of any Anti-Corruption Law applicable to the Relevant Entity;

(ii) any conduct before Completion by a Relevant Entity or any of their employees or agents (in the case of agents, in the relevant agent’s work for the Relevant Entity as opposed to for other clients) of a type listed in Warranty 18.2(a); or

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(iii) any breach or alleged breach before Completion by any Relevant Entity of any International Trade Law applicable to the Relevant Entity which is in the nature of a sanction or embargo,

(each a Relevant Event) then Boral must promptly pay to USG an amount equal to the relevant Loss multiplied by USG’s Shareholding Percentage at the relevant time.

(d) In addition (except to the extent compensated under clause 9.1(c)) if any USG Group Member suffers any Loss after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the USG Group Member in connection with any Relevant Event (as defined in clause 9.1(c))) then Boral indemnifies the relevant USG Group Member in respect of such Loss. USG holds the benefit of this indemnity on trust for each other USG Group Member which is not a party to this Agreement.

(e) If any Joint Venture Group Member is required to pay any amount to any Person or otherwise suffers any Loss (other than, in either case to another Joint Venture Group Member) after Completion as a result of any liability it has incurred which is in respect of environmental law breaches or costs of remediation to the Camellia site at 3 Thackeray Street, Camellia, NSW, Australia (any such payment or Loss a Camellia Payment) then Boral must promptly pay to USG an amount equal to the Camellia Payment multiplied by USG’s Shareholding Percentage at the relevant time. Boral and USG will as soon as practicable after the date of this Agreement commission the preparation and delivery of a Phase II Environmental Site Assessment in respect of the site (with a scope to be agreed between Boral and USG, acting reasonably and in good faith) with a view to establishing a ‘baseline’ as at a date as close as possible to the Completion Date for the purposes of the indemnity given in this clause 9.1(e). The costs of the Phase II Environmental Site Assessment shall be borne by Boral and USG in accordance with clause 16.2(a)(iii).

(f) If any Joint Venture Group Member is required to pay any amount to any Person or otherwise suffers any Loss (other than, in either case to another Joint Venture Group Member) after Completion as a result of the surrender of mining leases held at the date of this Agreement by Waratah Gypsum Pty Limited then Boral must promptly pay to USG an amount equal to the relevant payment or Loss multiplied by USG’s Shareholding Percentage at the relevant time.

(g) If each of the following applies:

(i) any Joint Venture Group Member is required to pay any amount to any Person or suffers any Loss (other than, in either case to another Joint Venture Group Member) after Completion in respect of BAGL’s obligations in relation to removal of the mill structure from the Northgate site at 733 Nudgee Road, Northgate QLD under the Mill Deed dated in or about 2007 between BAGL, Gateway Central (QLD) Pty Ltd and Allen Taylor & Company Limited (Northgate Remediation Costs); and

(ii) the aggregate amount of the Northgate Remediation Costs exceeds the amount provided in respect of the Northgate Remediation Costs in the BAGL Completion Statement,

then Boral must promptly pay to USG an amount equal to the excess multiplied by USG’s Shareholding Percentage at the relevant time.

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9.2 Indemnities in favour of Boral

(a) After Completion USG must pay to Boral an amount equal to Boral’s Shareholding Percentage at the relevant time of:

(i) the amount of any Tax payable by a USG Contributed Entity to the extent that Tax relates to any period, or part period, up to and including Completion; and

(ii) Tax Costs incurred by or on behalf of USG Contributed Entity to the extent those Tax Costs arise from or relate to any of the matters for which USG may be liable under clause 9.2(a)(i),

except to the extent that USG’s liability is limited or qualified under clause 8.

(b) For the purpose of clause 9.2(a):

(i) Taxes imposed on revenues, income or gain shall be apportioned to periods ending on or prior to the Completion Date based on a hypothetical closing of the books method; and

(ii) Taxes imposed on the value of an item for a period shall be apportioned to periods ending on or prior to the Completion Date on a pro rata basis determined by multiplying the Taxes by a fraction, the numerator of which is the number of days in the period falling on or before the Completion Date, and the denominator of which is the total number of days in the period for which the Tax is imposed;

(c) If any Joint Venture Group Member suffers any Loss (other than, in either case to another Joint Venture Group Member) after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Joint Venture Group Member in connection with:

(i) any breach or alleged breach before Completion by any USG Contributed Entity (Relevant Entity) of any Anti-Corruption Law applicable to the Relevant Entity;

(ii) any conduct before Completion by a Relevant Entity or any of their employees or agents (in the case of agents, in the relevant agent’s work for the Relevant Entity as opposed to for other clients) of a type listed in Warranty 18.2(a); or

(iii) any breach or alleged breach before Completion by any Relevant Entity of any International Trade Law applicable to the Relevant Entity which is in the nature of a sanction or embargo,

(each a Relevant Event) then USG must promptly pay to Boral an amount equal to the relevant Loss multiplied by Boral’s Shareholding Percentage at the relevant time.

(d) In addition (except to the extent compensated under clause 9.2(d)) if any Boral Group Member suffers any Loss after Completion as a result of any Third Party Claim (including any prosecution or regulatory investigation) against the Boral Group Member in connection with any Relevant Event (as defined in clause 9.2(d)) then USG indemnifies the relevant Boral Group Member in respect of such Loss. Boral holds the benefit of this indemnity on trust for each other Boral Group Member which is not a party to this Agreement.

9.3 Claim Procedure

For the avoidance of doubt, any Claims brought by a Party pursuant to this clause 9 shall be subject to clause 11.

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10. THIRD PARTY CLAIMS AND TAX DEMANDS

10.1 Notice

Without limiting any other rights of a Party under this Agreement:

(a) if after Completion a Boral Party becomes aware of a Third Party Claim or Tax Demand which may give rise to a Boral Claim against a USG Group Member or a USG Claim against a Boral Group Member, Boral must promptly give notice to USG of that Third Party Claim or Tax Demand, copying each other Party under this agreement; and

(b) if after Completion a USG Party becomes aware of a Third Party Claim or Tax Demand which may give rise to a USG Claim against a Boral Group Member or a Boral Claim against a USG Group Member, USG must promptly give notice to Boral of that Third Party Claim or Tax Demand, copying each other Party under this agreement.

Any notice under clause 10.1(a) or clause 10.1(b) must include reasonable details of the facts, matters or circumstances giving rise to the Third Party Claim or Tax Demand, the basis of the Third Party Claim or Tax Demand, copies of any relevant documentation and (if possible in the circumstances) an estimate of the amount of the Third Party Claim or Tax Demand.

10.2 Obligations not to Settle

(a) This clause 10.2(a) applies in relation to any Third Party Claim or Tax Demand (whether or not notified under clause 10.1) that may lead to liability on the part of any USG Group Member under a Boral Claim. Where this clause 10.2(a) applies in relation to a Third Party Claim or Tax Demand:

(i) Boral must not Settle, and must ensure that no Boral Group Member Settles; and

(ii) Boral Seller and the Acquirer must each do everything within their control as shareholders in BAGL to procure that no Joint Venture Group Member Settles,

the relevant Third Party Claim or Tax Demand without USG’s prior written consent, which shall not be unreasonably withheld or delayed. However, a Boral Group Member or Joint Venture Group Member may pay any Tax to a Taxing Authority by the due date for payment without affecting any Boral Group Member’s rights under this Agreement. For the avoidance of doubt, any Settlement effected without the prior written consent of USG (whether or not unreasonably withheld or delayed) shall in no event be determinative of the validity of any Boral Claim against, or the amount of any Losses alleged to be the responsibility of, any USG Group Member.

(b) This clause 10.2(b) applies in relation to any Third Party Claim or Tax Demand (whether or not notified under clause 10.1) that may lead to liability on the part of any Boral Group Member under a USG Claim. Where this clause 10.2(b) applies in relation to a Third Party Claim or Tax Demand:

(i) USG must not Settle, and must ensure that no USG Group Member Settles; and

(ii) Boral Seller and the Acquirer must each do everything within their control as shareholders in BAGL to procure that no Joint Venture Group Member Settles,

the relevant Third Party Claim or Tax Demand without Boral’s prior written consent, which shall not be unreasonably withheld or delayed. However, a USG Group Member or Joint Venture Group Member may pay any Tax to a Taxing Authority by the due date for payment without affecting any USG Group Member’s rights under this Agreement. For the avoidance of doubt, any Settlement effected without the prior written consent of Boral (whether or not unreasonably withheld or delayed) shall in no event be determinative of the validity of any USG Claim against, or the amount of any Losses alleged to be the responsibility of, any Boral Group Member

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10.3 Conduct of dispute

(a) Following receipt of a notice under clause 10.1 (or equivalent information in a notice under clause 11, if not previously notified under clause 10.1), the Accepting Party may, by giving written notice to the Notifying Party, assume the conduct of the defence of the Third Party Claim or elect to contest the Tax Demand (as the case may be).

(b) If the Accepting Party advises the Notifying Party that it wishes to assume the conduct of the defence of the Third Party Claim or to contest the Tax Demand:

(i) provided that the Accepting Party provides the Notifying Party with an indemnity against all Loss which may result from such action, the Notifying Party must promptly take, and must procure that each other Boral Group Member or USG Group Member (as applicable) takes, all action reasonably requested by the Accepting Party to avoid, contest, compromise or defend the Third Party Claim, or to conduct Disputing Action in respect of the Tax Demand, including using professional advisers nominated by the Accepting Party and approved by the Accepting Party for this purpose;

(ii) the Notifying Party must provide the Accepting Party with all reasonable assistance requested by it in relation to the Third Party Claim or Tax Demand, including:

(A) reasonable access to such employees, witnesses and records of the Party as are required in connection with the Third Party Claim or Tax Demand; and

(B) use all reasonable endeavours (including the reimbursement of all reasonable out of pocket expenses) to procure that employees and officers provide such witness statements and other evidence that is required to avoid, dispute, resist, defend, appeal, compromise or mitigate the Third Party Claim or to conduct Disputing Action in relation to the Tax Demand;

(iii) in conducting any proceedings or actions in respect of the Third Party Claim or Tax Demand, the Accepting Party must:

(A) act in good faith;

(B) liaise with the Notifying Party in relation to the defence of the Third Party Claim or the conduct of Disputing Action in relation to the Tax Demand; and

(C) provide the Notifying Party with reasonable access to a copy of any notice, correspondence or other document relating to the Third Party Claim or Tax Demand.

(c) If the Accepting Party advises the Notifying Party that it does not wish to assume the conduct of the defence of the Third Party Claim (or to contest the Tax Demand, as the case may be), then the Notifying Party must procure that it and each other Boral Group Member or USG Group Member (as applicable) conducting any proceedings or actions in respect of that Third Party Claim or Tax Demand:

(i) acts in good faith;

(ii) liaises with the Accepting Party in relation to the defence of the Third Party Claim or contesting (or otherwise) of the Tax Demand as the case may be; and

(iii) provide the Accepting Party with reasonable access to a copy of any notice, correspondence or other document relating to the Third Party Claim or Tax Demand.

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For the avoidance of doubt this clause 10 does not apply in relation to a Boral Claim in relation to any Earn-Out Amount.

11. CLAIMS

11.1 Written notice of Claims

Subject to clause 7.10 and clause 11.4, if a Party (Claimant Party) decides to make a Claim against another Party to this Agreement, then the Claimant Party must promptly give a written notice to the relevant Receiving Party setting out the details of the Claim, including:

(a) reasonable details of the events, matters or circumstances that give rise to the Claim, to the extent available to the Claimant Party at the time of the notice (but so that in any event the basis of the Claim is identified with reasonable specificity), and copies of any Third Party Claim or Tax Demand giving rise to the Claim;

(b) the nature of the Claim;

(c) the estimated amount of Loss claimed (Claim Amount); and

(d) how the Claim Amount is calculated;

(Claim Notice), provided that (subject always to clause 8.4) clauses 11.1(c) and 11.1(d) do not limit a Party’s right to notify a Claim which relates to a contingent liability that is identified but has not yet become an actual liability or is not yet due and payable during the time periods identified above, provided the other required details are included and the omitted information is provided promptly upon the Claimant Party being reasonably able to provide it.

If the Claimant Party does not fully comply with this clause 11.1 in respect of a Claim, the Party against whom the Claim is made is not liable under the Claim to the extent that the non-compliance has increased the amount of the Claim.

11.2 Dealing with Claims

(a) On receipt of a Claim Notice under clause 11.1, the Receiving Party will have 45 days (Consideration Period) to evaluate the Claim and the circumstances around it.

(b) The Receiving Party must give the Claimant Party a written notice before the end of the Consideration Period if it disputes the Claim setting out:

(i) in reasonable detail the reason why the Receiving Party disputes the Claim Notice; and

(ii) the monetary amount (if any) admitted by the Receiving Party as owing to the Claimant Party for the Loss incurred or estimated to be incurred in respect of that Claim,

(Claim Dispute Notice).

(c) If the Receiving Party does not give the Claimant Party a Claim Dispute Notice within the Consideration Period, then the Receiving Party (and any other Boral Group Member or USG Group Member, as the case may be, against which the relevant Claim has been made) will be taken to have admitted the full Claim Amount that is the subject of the Claim Notice.

(d) If the Receiving Party gives the Claimant Party a Claim Dispute Notice within the Consideration Period that disputes the whole or part of the Claim Amount, then clause 11.3 applies.

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(e) The Receiving Party (and any other Boral Group Member or USG Group Member, as the case may be, against which the relevant Claim has been made) is taken to have admitted any part (or the entirety) of the Claim Amount that is not disputed in the Claim Notice.

11.3 Lesser or no Claim Amount admitted

(a) If a Claim Dispute Notice has been given under clause 11.2(b), the Claimant Party and the Receiving Party must seek to resolve the dispute through negotiations.

(b) If the Claimant Party and the Receiving Party fail to reach agreement as to the amount (if any) to which the Receiving Party is entitled in relation to that Claim within a further 30 days, or if a party to the dispute refuses to participate in such negotiations, then any party to the dispute will be entitled to commence proceedings in relation to the Claim, and the part of the Claim Amount that is not admitted pursuant to clause 11.2(c) or clause 11.2(e), to proceedings.

11.4 Exclusion

This clause 11 does not limit or restrict the ability of a Party to bring a Claim for specific performance of this Agreement or to seek urgent injunctive or similar relief, and does not apply in respect to Claims relating to the adjustment of the Purchase Price pursuant to clause 6.11 or the calculation or payment of the Earn-Out Amount (if any) pursuant to clause 2.3(d) and Schedule 8.

11.5 Payment

To the extent a Party admits (or is taken to have admitted) liability for the whole or part of a Claim Amount pursuant to clause 11.2(c) or clause 11.2(e) (Admitted Claim Amount), then that Party must pay the Claimant Party the Admitted Claim Amount within 14 days of the end of the Consideration Period.

12. TAX

12.1 GST

(a) Words used in this clause 12.1 that have a defined meaning in the GST Law have the same meaning as in the GST Law unless the context indicates otherwise.

(b) Unless expressly included, the consideration for any supply under or in connection with this Agreement does not include GST.

(c) To the extent that any supply made under or in connection with this Agreement is a taxable supply (other than any supply made under another agreement that contains a specific provision dealing with GST), the recipient must pay, in addition to the consideration provided under this agreement for that supply (unless it expressly includes GST) an amount (additional amount) equal to the amount of that consideration (or its GST exclusive market value) multiplied by the rate at which GST is imposed in respect of the supply. The recipient must pay the additional amount at the same time as the consideration to which it is referable.

(d) Whenever an adjustment event occurs in relation to any taxable supply to which clause 12.1(c) applies:

(i) the supplier must determine the amount of the GST component of the consideration payable; and

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(ii) if the GST component of that consideration differs from the amount previously paid, the amount of the difference must be paid by, refunded to or credited to the recipient, as applicable.

(e) The supplier must issue a Tax Invoice to the recipient of a taxable supply to which any of clauses 12.1(b) to 12.1(d) applies no later than 7 days following payment of the GST inclusive consideration for that supply under that clause.

(f) If a Party is entitled under this agreement to be reimbursed or indemnified by another Party for a cost or expense incurred in connection with this Agreement, the reimbursement or indemnity payment must not include any GST component of the cost or expense to the extent that the cost or expense is the consideration for a creditable acquisition made by the Party being reimbursed or indemnified, or by its representative member.

(g) After Completion:

(i) the Acquirer and Boral Seller (as shareholders of BAGL) must procure that each BAGL Group Member (and where applicable each USG Contributed Entity) gives the representative member of the GST Group to which it belongs (Boral GST Group) on a timely basis, all information that the relevant entity holds that is needed to lodge any GST return for any period prior to Completion; and

(ii) Boral must ensure that the representative member of the Boral GST Group:

(A) applies to the Commissioner of Taxation to revoke the approval of each BAGL Group Member as a member of the Boral GST Group; and

(B) lodges the GST returns for the final period in which the relevant BAGL Group Member was a member of the Boral’s GST Group and remits all amounts in respect of GST for that period to the Commissioner of Taxation as and when required by the GST Law.

(h) If:

(i) before Completion a BAGL Group Member is a member of the Boral GST Group;

(ii) the relevant BAGL Group Member has made a supply to, or has been the recipient of a supply made by, another member of the Boral GST Group;

(iii) due to Completion the relevant BAGL Group Member ceases to be eligible to be a member of the Boral GST Group and as a consequence, the supply referred to in clause 12.1(h)(ii) above becomes a taxable supply;

(iv) because the supply would have been to another member of the Boral GST Group, the supply would not have been treated as a taxable supply if it had been made while the relevant BAGL Group Member was a member of the Boral GST Group;

(v) the supply is pursuant to an agreement made before Completion;

(vi) that agreement does not contain a provision requiring the recipient to pay to the supplier any amount in respect of GST in addition to the consideration otherwise payable for the supply; and

(vii) the consideration negotiated by the parties for the supply was not calculated to include GST,

then after Completion, Boral must ensure (if the recipient of a taxable supply is not the relevant BAGL Group Member), or the Acquirer and Boral Seller (as shareholders of

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BAGL) must ensure if the recipient of the taxable supply is BAGL or a BAGL Group Member) that the recipient of the taxable supply indemnifies the supplier of a taxable supply for any GST payable in respect of the supply and pays the amount of that GST in addition to the consideration for the supply.

12.2 Pre Completion tax returns

(a) The parties will co-operate in connection with the preparation and filing of any Tax return or Tax statement of a BAGL Group Member or a USG Contributed Entity with respect to a period or part period before the Completion Date and any administrative proceeding involving any such Tax return or Tax statement.

(b) Boral will, at its own cost and expense, have the sole conduct and control of the preparation and filing of all Tax returns, forms or statements of each BAGL Group Member to the extent they relate to any periods (or part periods) ending on or before the Completion Date.

(c) USG will, at its own cost and expense, have the sole conduct and control of the preparation and filing of all Tax returns, forms or statements of each USG Contributed Entity to the extent they relate to any periods (or part periods) ending on or before the Completion Date.

(d) The Joint Venture Group will, at its own cost and expense, have the sole control of the preparation and filing of all Tax returns, forms or statements of each BAGL Group Member and each USG Contributed Entity for any period that includes, but does not end on or before the Completion Date (Straddle Returns).

(e) The Acquirer and Boral Seller (as shareholders of BAGL after Completion) must severally procure that each Straddle Return is prepared in a manner consistent with the requirements of any Tax Law and that each Straddle Return is delivered to:

(i) Boral (in the case of a return relating to BAGL Group Members); or

(ii) USG (in the case of a return relating to a USG Contributed Entity),

as soon as it is available but no later than 30 days before it is due to be filed for the relevant Party’s review and comment.

12.3 No Inconsistent Position

The Parties hereby covenant and agree that the Boral Australasia IP Licences are estimated to be worth at least US$6 million to BAGL and no Party will take any action or position that is inconsistent with that valuation.

13. TERMINATION

13.1 Termination for breach of Agreement

(a) Boral may terminate this Agreement at any time before Completion by notice in writing to the other Parties if any USG Party:

(i) is in breach of any material provision of this Agreement (excluding a breach of Warranty) and does not effectively remedy that breach to the satisfaction of Boral (acting reasonably) within 21 days from the receipt of a written notice from Boral to the Party in default identifying the breach and requiring that the breach be remedied (or before the scheduled date for Completion under clause 5.1, if earlier); or

Page 56

(ii) commits a breach of an essential term of this Agreement (excluding a breach of Warranty) which is incapable of remedy.

(b) USG may terminate this Agreement at any time before Completion by notice in writing to the other Parties if any Boral Party or BAGL:

(i) is in breach of any material provision of this Agreement (excluding a breach of Warranty) and does not effectively remedy that breach to the satisfaction of USG (acting reasonably) within 21 days from the receipt of a written notice from USG to the Party in default identifying the breach and requiring that the breach be remedied (or before the scheduled date for Completion under clause 5.1, if earlier); or

(ii) commits a breach of an essential term of this Agreement (excluding a breach of Warranty) which is incapable of remedy

13.2 Termination for breach of warranty / Material Adverse Change

Without limiting any other rights or remedies available to a Party under this Agreement, at any time prior to Completion:

(a) USG may terminate this Agreement by notice in writing to the other Parties if:

(i) there is a breach or breaches of the Boral Warranties, the Boral JV Warranties or the Boral Tax Warranties in circumstances that would be reasonably likely to result in an aggregate Loss claimable by the USG Claim Group in excess of US$40 million; or

(ii) a Material Adverse Change occurs in relation to Boral; or

(iii) any Boral Group Member, or any of their officers, employees, agents or advisers has engaged in fraud or dishonesty in relation to the entry by a USG Party into a Transaction Document.

(b) Boral may terminate this Agreement by notice in writing to the other Parties if:

(i) there is a breach or breaches of the USG Warranties, or the USG Tax Warranties in circumstances that would be reasonably likely to result in an aggregate Loss claimable by the Boral Claim Group in excess of US$40 million;

(ii) there is a breach or breaches of the USG IP Warranties (on the assumption they were given at the date of this Agreement) that, in the reasonable and good faith opinion of Boral, would result in the loss in value of the intellectual property to be licensed under the USG Australasia IP Licences and the USG Asia IP Licences of US$20 million or more;

(iii) any USG Group Member, or any of their officers, employees agents or advisers has engaged in fraud or dishonesty in relation to the entry by a Boral Party into a Transaction Document; or

(iv) a Material Adverse Change occurs in relation to USG.

13.3 Termination for insolvency

(a) USG may terminate this Agreement at any time before Completion by notice in writing to the other Parties if an Insolvency Event (other than one that is or forms part of a solvent restructuring to which the entity in question is party) occurs in relation to:

(i) any BAGL Group Member; or

Page 57

(ii) any Boral Party or any other Boral Group Member which is (or will at Completion become) a party to any Transaction Document.

(b) Boral may terminate this Agreement at any time before Completion by notice in writing to the other Parties if an Insolvency Event (other than one that is or forms part of a solvent restructuring to which the entity in question is party) occurs in relation to:

(i) any USG Contributed Entity

(ii) any USG Party or any other USG Group Member which is (or will at Completion become) a party to any Transaction Document.

13.4 Definition of Insolvency Event

For the purposes of clause 13.3 an Insolvency Event occurs in relation to a person or entity (the Relevant Person) if any of the following occurs:

(a) controller: any of the following occur:

(i) a controller (as defined in section 9 of the Corporations Act) is appointed; or

(ii) a resolution to appoint controller is passed,

to the Relevant Person or over an asset of the Relevant Person unless, in the case of an appointment, Boral or USG (being the Party with the potential right to terminate as the case may be) is satisfied that the appointment of the controller is capable of being set aside, and it is set aside, within 7 days of the appointment being made;

(b) winding up: any of the following occur:

(i) an order is made; or

(ii) a resolution is passed,

for the winding up of the Relevant Person;

(c) administration: any of the following occur:

(i) an administrator is appointed to the Relevant Person; or

(ii) a resolution to appoint an administrator to the Relevant Person is passed;

(d) deregistration: the Relevant Person is deregistered;

(e) suspends payment: the Relevant Person suspends payment of its debts generally;

(f) insolvency: the Relevant Person is:

(i) unable to pay its debts when they are due; or

(ii) presumed to be insolvent under the Corporations Act;

(g) arrangements: the Relevant Person enters into or resolves to enter into any arrangement, composition or compromise with, or assignment for the benefit of, any of its creditors;

(h) ceasing business: the Relevant Person ceases to carry on business; or

(i) analogous event: anything analogous to or having a substantially similar effect to any of the events specified in clauses 13.4(a) to 13.4(h) above happens in relation to the Relevant Person under the laws of any jurisdiction.

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13.5 Termination with Mutual Consent

This Agreement may be terminated at any time with the mutual consent in writing of Boral and USG.

13.6 Cross termination

This Agreement will terminate with immediate effect without the requirement for action by any Party if the Asia Sale Agreement terminates for any reason before Completion occurs.

13.7 Effect of termination

If this agreement is terminated under clause 3.5, clause 5.5 or this clause 13, then:

(a) the Parties must procure that each Transaction Document (if permitted by the terms of that contract) that has already been executed is terminated in accordance with its terms;

(b) each Party is released from its obligations to further perform its obligations under this Agreement and the Transaction Documents, except those expressed to survive termination;

(c) each Party retains the rights it has against any other Party in respect of any breach of this Agreement occurring before termination;

(d) the rights and obligations of each Party under each of the following provisions will (subject to the terms of each of those provisions) continue independently from the other obligations of the Parties and survive termination of this Agreement:

(i) clause 1 (Interpretation);

(ii) clause 12.1 (GST);

(iii) clause 14 (Confidentiality and announcements);

(iv) clause 15 (Exclusivity)

(v) clause 16 (Duties, costs and expenses);

(vi) clause 17 (Guarantees); and

(vii) clause 19 (General).

13.8 No other right to terminate or rescind

No Party may terminate or rescind this Agreement (including on the grounds of any breach of Warranty or misrepresentation that occurs or becomes apparent before Completion) except as permitted under clause 3.5, clause 5.5 or this clause 13.

14. CONFIDENTIALITY AND ANNOUNCEMENTS

14.1 Agreed announcement

A Party may not make any public announcement relating to this Agreement or a Transaction Document (including the fact that the parties have executed this Agreement or any Transaction Document) unless the other party has consented to the announcement, including the timing, form and content of that disclosure, or unless the announcement would be permitted under an exemption in clauses 14.2(a)(i), 14.2(a)(ii) or 14.2(a)(iii).

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14.2 Confidentiality

(a) Each Party (recipient) must keep secret and confidential, and must not divulge or disclose any information relating to another Party or its business (which has been or which is disclosed to the recipient by the other Party or its Representatives), or the terms of this Agreement or any Transaction Document other than to the extent that:

(i) the information is in the public domain as at the date of this agreement (or subsequently becomes in the public domain other than by breach of any obligation of confidentiality binding on the recipient);

(ii) the recipient is required to disclose the information by applicable law or regulation or the rules of any recognised stock exchange on which its shares or the shares of any of its Related Corporations are listed, provided that the recipient has to the extent possible having regard to the required timing of the disclosure consulted with the provider of the information as to the form and content of the disclosure;

(iii) the disclosure is expressly permitted under any Transaction Document;

(iv) the disclosure is necessary to seek satisfaction of any of the Conditions provided that the relevant recipient is made aware of the confidential nature of the information and (except in the case of a Regulatory Authority has agreed for the benefit of both Boral and USG to maintain the confidentiality of the information disclosed);

(v) the disclosure is required for use in legal proceedings regarding this Agreement or the transactions contemplated by it; or

(vi) the Party to whom the information relates has consented in writing before the disclosure.

(b) Each Party must ensure that its directors, officers, employees, agents, representatives and Related Corporations comply in all respects with the Party’s obligations as a recipient under this clause 14.2.

15. EXCLUSIVITY

(a) During the Exclusivity Period, USG must not, and must ensure that no member or Representative of the USG Group and no USG Contributed Entity or Representative of any USG Contributed Entity:

(i) solicits, invites, initiates, encourages or accepts any Competing Proposal - USG;

(ii) participates in any discussions, conversations, negotiations or communications with, or otherwise provides information to, any Third Party in relation to a Competing Proposal - USG; or

(iii) otherwise facilitates, assists or participates in a Competing Proposal - USG.

(b) During the Exclusivity Period, Boral must not, and must ensure that (no member or Representative of the Boral Group or the BAGL Group:

(i) solicits, invites, initiates, encourages or accepts any Competing Proposal - Boral;

(ii) participates in any discussions, conversations, negotiations or communications with, or otherwise provides information to, any Third Party in relation to a Competing Proposal - Boral; or

(iii) otherwise facilitates, assists or participates in a Competing Proposal - Boral.

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(c) For the avoidance of doubt, Boral and USG must immediately cease and cause to be immediately terminated any existing discussions, conversations, negotiations, or other communications with respect to a Competing Proposal – Boral or a Competing Proposal - USG.

16. DUTIES, COSTS AND EXPENSES

16.1 Duties

(a) The Acquirer must pay all Duty in respect of the execution, delivery and performance of this Agreement and any agreement or document entered into or signed under this Agreement, to the extent it relates to the subscription and issue of the Subscription Shares, the entry into the USG Australasia IP Licences or to the sale and transfer of the Sale Shares (and must satisfy any obligation of BAGL to pay any such Duty on BAGL’s behalf without recourse to BAGL).

(b) Boral must pay all Duty in respect of the execution, delivery and performance of this Agreement and any agreement or document entered into or signed under this Agreement, to the extent it relates to the sale and transfer of the USG Contributed Shares to BAGL or the entry into the Boral Australasia IP Licences (and must satisfy any obligation of BAGL to pay any such Duty on BAGL’s behalf, without recourse to BAGL).

16.2 Costs and expenses

(a) Unless otherwise provided for in this Agreement or any Transaction Document:

(i) Boral must pay its own costs and expenses and the costs and expenses of each relevant Boral Group Member and each BAGL Group Member in respect of the negotiation, preparation, execution, delivery and registration of this Agreement and any other agreement or document entered into or signed under this Agreement (including each Transaction Document); and

(ii) USG must pay its own costs and expenses and the costs and expenses of each relevant USG Group Member and each of the USG Contributed Entities in respect of the negotiation, preparation, execution, delivery and registration of this Agreement and any other agreement or document entered into or signed under this Agreement (including each Transaction Document); and

(iii) Boral and USG must share equally the costs payable to the relevant provider of the Phase II Environmental Assessment referred to in clause 9.1(e).

(b) Any action to be taken by any Party in performing its obligations under this Agreement or under any Transaction Document must be taken at its own cost and expense unless otherwise provided in this Agreement or any Transaction Document.

17. GUARANTEES

17.1 Boral guarantee

(a) Boral:

(i) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of each other Boral Party’s obligations under this Agreement; and

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(ii) as a separate and additional liability, indemnifies each USG Party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the Party arising from any default or delay in the due and punctual performance of a Boral Party’s obligations under this Agreement.

(b) The liability of Boral under this clause 17.1 is not affected by anything which, but for this clause 17.1, might operate to release or exonerate Boral in whole or in part from its obligations including any of the following, whether with or without the consent of Boral:

(i) the grant to Boral, any other Boral Party or any other person of any time, waiver or other indulgence, or the discharge or release of Boral, any other Boral Party or any other person from any liability or obligation;

(ii) any transaction or arrangement that may take place between any Party, any Related Corporation of a Party, Boral or any other person;

(iii) any other Party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against Boral, any other Boral Party or any other person;

(iv) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any Party or any Related Corporation of a Party from Boral, any other Boral Party or any other person or by the taking of or failure to take any security;

(v) the failure or omission or any delay by any Party to give notice to Boral of any default by any Boral Party or any other person under this Agreement; and

(vi) any legal limitation, disability, incapacity or other circumstances related to Boral, any other Boral Party or any other person.

(c) This clause 17.1 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this Agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 17.1 is a continuing obligation of Boral, and remains in full force and effect for so long as any Boral Party has any liability or obligation to any other Party under this Agreement and until all of those liabilities or obligations have been fully discharged.

(e) Boral must make all payments which become due under this clause 17.1, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If Boral is compelled by law to deduct any withholding, then, in addition to any payment under this clause 17.1, it must pay to the relevant beneficiary Party such amount as is necessary to ensure that the net amount received by that Party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

(f) Boral must pay all moneys that it becomes liable to pay under this clause 17.1 in the currency in which they are payable under this Agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

(g) Boral has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 17.1, against any moneys that any other Party may be, or become, liable to pay to a Boral Group Member whether under this Agreement or otherwise.

(h) Boral’s liability under this clause 17.1 in respect of any Claim against any Boral Party will not exceed the relevant Boral Party’s liability in respect of that Claim.

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17.2 USG guarantee

(a) USG:

(i) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of each other USG Party’s obligations under this Agreement; and

(ii) as a separate and additional liability, indemnifies each Boral Party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the Party arising from any default or delay in the due and punctual performance of a USG Party’s obligations under this Agreement.

(b) The liability of USG under this clause 17.2 is not affected by anything which, but for this clause 17.2, might operate to release or exonerate USG in whole or in part from its obligations including any of the following, whether with or without the consent of USG:

(i) the grant to USG, any other USG Party or any other person of any time, waiver or other indulgence, or the discharge or release of USG, any other USG Party or any other person from any liability or obligation;

(ii) any transaction or arrangement that may take place between any Party, any Related Corporation of a Party, USG or any other person;

(iii) any other Party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against USG, any other USG Party or any other person;

(iv) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any Party or any Related Corporation of a Party from USG, any other USG Party or any other person or by the taking of or failure to take any security;

(v) the failure or omission or any delay by any Party to give notice to USG of any default by any USG Party or any other person under this Agreement; and

(vi) any legal limitation, disability, incapacity or other circumstances related to USG, any other USG Party or any other person.

(c) This clause 17.2 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this Agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 17.2 is a continuing obligation of Boral, and remains in full force and effect for so long as any USG Party has any liability or obligation to any other Party under this Agreement and until all of those liabilities or obligations have been fully discharged.

(e) USG must make all payments which become due under this clause 17.2, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If USG is compelled by law to deduct any withholding, then, in addition to any payment under this clause 17.2, it must pay to the relevant beneficiary Party such amount as is necessary to ensure that the net amount received by that Party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

(f) USG must pay all moneys that it becomes liable to pay under this clause 17.2 in the currency in which they are payable under this Agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

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(g) USG has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 17.2, against any moneys that any other Party may be, or become, liable to pay to a USG Group Member whether under this Agreement or otherwise.

(i) USG’s liability under this clause 17.2 in respect of any Claim against any USG Party will not exceed the relevant USG Party’s liability in respect of that Claim.

18. NOTICES

18.1 Form of Notice

A notice or other communication to a Party under this Agreement (Notice) must be:

(a) in writing and in English and signed on behalf of the sending Party; and

(b) addressed to that Party in accordance with the details nominated in Schedule 19 (or any alternative details nominated to the sending Party by Notice).

18.2 How Notice must be given and when Notice is received

(a) A Notice must be given by one of the methods set out in the table below.

(b) A Notice is regarded as given and received at the time set out in the table below.

However, if this means the Notice would be regarded as given and received outside the period between 9.00am and 5.00pm (addressee’s time) on a Business Day (Business Hours Period), then the Notice will instead be regarded as given and received at the start of the following Business Hours Period.

Method of giving Notice	When Notice is regarded as given and received
By hand to the nominated address	When delivered to the nominated address
By a globally recognized courier to the nominated address	When confirmed delivered by the courier: 1  by 5.00 pm (local time in the place of receipt) on a Business Day – on that day; or 2  after 5.00 pm (local time in the place of receipt) on a Business Day, or on a day that is not a Business Day – on the next Business Day.
By email to the nominated email address	When the email (including any attachment) comes to the attention of the recipient party or a person acting on its behalf.

18.3 Notice must not be given by electronic communication

A Notice must not be given by electronic means of communication (other than email as permitted in clause 18.2).

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19. GENERAL

19.1 Governing law and jurisdiction

(a) This Agreement is governed by the law in force in New South Wales.

(b) Each party irrevocably submits to the (non-exclusive, as between the two) jurisdiction of:

(i) courts exercising jurisdiction in New South Wales, Australia and courts of appeal from them; and

(ii) courts exercising jurisdiction in Illinois, United States of America, and courts of appeal from them,

in relation to any proceedings arising out of or in connection with this Agreement, and no party submits to the jurisdiction of any other courts in relation to any such proceedings.

19.2 Service of process

Without preventing any other mode of service, any document in an action (including, any writ of summons or other originating process or any third or other party notice) may be served on any party by being delivered to or left for that party at its address for service of Notices under clause 18.

19.3 Invalidity and enforceability

(a) If any provision of this agreement is invalid under the law of any jurisdiction the provision is enforceable in that jurisdiction to the extent that it is not invalid, whether it is in severable terms or not.

(b) Clause 19.3(a) does not apply where enforcement of the provision of this Agreement in accordance with clause 19.3(a) would materially affect the nature or effect of the parties’ obligations under this Agreement.

19.4 Waiver

(a) No Party to this agreement may rely on the words or conduct of any other party as a waiver of any right unless the waiver is in writing and signed by the party granting the waiver.

(b) In this clause 19.4:

(i) conduct includes delay in the exercise of a right;

(ii) right means any right arising under or in connection with this Agreement and includes the right to rely on this clause; and

(iii) waiver includes an election between rights and remedies, and conduct which might otherwise give rise to an estoppel.

(c) A provision of, or a right, discretion or authority created under, this Agreement may not be:

(i) waived except in writing signed by the Party granting the waiver; and

(ii) varied except in writing signed by the Parties.

(d) A failure or delay in exercise, or partial exercise, of a power, right, authority, discretion or remedy arising from a breach of, or default under this Agreement does not result in a waiver of that right, power, authority, discretion or remedy.

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19.5 Assignment

Rights arising out of or under this Agreement are not assignable by a Party without the prior written consent of the other Parties.

19.6 Further action to be taken at each party’s own expense

Subject to clause 15, each Party must, at its own expense, do all things and execute all documents necessary to give full effect to this Agreement and the transactions contemplated by it.

19.7 Relationship of the Parties

(a) Nothing in this Agreement gives a Party authority to bind any other Party in any way.

(b) Nothing in this Agreement imposes any fiduciary duties on a Party in relation to any other Party.

19.8 Exercise of rights

(a) Unless expressly required by the terms of this Agreement, a Party is not required to act reasonably in giving or withholding any consent or approval or exercising any other right, power, authority, discretion or remedy, under or in connection with this Agreement.

(b) A Party may (without any requirement to act reasonably) impose conditions on the grant by it of any consent or approval, or any waiver of any right, power, authority, discretion or remedy, under or in connection with this Agreement. Any conditions must be complied with by the party relying on the consent, approval or waiver.

19.9 Remedies cumulative

Except as provided in this Agreement and permitted by law, the rights, powers and remedies provided in this Agreement are cumulative with and not exclusive to the rights, powers or remedies provided by law independently of this Agreement.

19.10  Counterparts

(a) This Agreement may be executed in any number of counterparts.

(b) All counterparts, taken together, constitute one instrument.

(c) A Party may execute this agreement by signing any counterpart.

19.11  Entire Agreement

This Agreement and the Transaction Documents state all the express terms of the agreement between the parties in respect of their subject matter. They supersede all prior discussions, negotiations, understandings and agreements in respect of their subject matter.

19.12  Default Interest

(a) If a Party fails to pay any amount payable under this Agreement on the due date for payment, that Party must in addition to a continuing liability to pay the amount unpaid pay interest on the amount unpaid at the higher of:

(i) the daily 11.00am cash rate quoted on Reuters page RBA30, plus 3% per annum; or

(ii) the rate (if any) fixed or payable under any judgment or other thing into which the liability to pay the amount becomes merged.

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(b) The interest payable under clause 19.12(a):

(i) accrues from day to day from and including the due date for payment up to and including the actual date of payment, before and, as an additional and independent obligation, after any judgment or other thing into which the liability to pay the amount becomes merged; and

(ii) may be capitalised by the person to whom it is payable at monthly intervals on the basis of a 360 day year.

(c) The right to require payment of interest under this clause 19.12 is without prejudice to any other rights the non-defaulting Party may have against the defaulting Party at law or in equity.

(d) A failure to pay any amount under this agreement is not remedied until both the amount unpaid and any interest payable under this clause 19.12 have been paid in full.

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SIGNING PAGES

EXECUTED as an agreement

Executed for Boral Limited ACN 008 421 761 by its attorneys
/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney		Signature of attorney
Michael Patrick Kane		Dominic Millgate
Name of attorney (print)		Name of attorney (print)

Executed for Boral Australian Gypsum Limited ACN 004 231 976 by it attorneys
/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney		Signature of attorney
Michael Patrick Kane		Dominic Millgate
Name of attorney (print)		Name of attorney (print)

Executed by Boral Building Materials Pty Limited ACN 090 736 888 by its attorneys
/s/ Michael Patrick Kane	¬	/s/ Dominic Millgate	¬
Signature of attorney		Signature of attorney
Michael Patrick Kane		Dominic Millgate
Name of attorney (print)		Name of attorney (print)

Page 68

Executed by USG Foreign Investments, Ltd.
/s/ Stanley L. Ferguson	¬
Signature of authorised signatory
Stanley L. Ferguson
Name of authorised signatory (print)

Executed by USG Netherlands Global Holdings B.V. By: USG Foreign Investments, Ltd. Its: Managing Director
/s/ Stanley L. Ferguson	¬
Signature of authorised signatory
Stanley L. Ferguson
Name of authorised signatory (print)

Executed by USG Corporation
/s/ Stanley L. Ferguson	¬
Signature of authorised signatory
Stanley L. Ferguson
Name of authorised signatory (print)

Page 69

EX-10.1

Exhibit 10.1

Deed

Project Lake

Shareholders agreement

ANZ Tower 161 Castlereagh Street Sydney NSW 2000 Australia GPO Box 4227 Sydney NSW 2001 Australia T +61 2 9225 5000 F +61 2 9322 4000 herbertsmithfreehills.com DX 361 Sydney

Contents

	Table of contents
1	Introduction		3
	1.1	Objectives of agreement	3
	1.2	Business	3
	1.3	Territory	4
	1.4	Compliance with agreement	4
2	Structure of agreement		5
3	Definitions and interpretation		6
	3.1	Definitions and interpretation	6
	3.2	Agreement components	6
	3.3	Inclusive expressions	6
	3.4	Business Day	6
4	Consistency		6
5	Board and senior management		8
	5.1	Board composition	8
	5.2	Appointment and removal of directors	8
	5.3	No alternate directors	10
	5.4	Chair	10
	5.5	Remuneration and expenses	10
	5.6	Committees	10
	5.7	Executives	11
6	Board and Shareholder decision making		12
	6.1	Board quorum	12
	6.2	Notice of Board meetings	13
	6.3	Frequency and conduct of Board meetings	13
	6.4	Voting entitlements	14
	6.5	Circulating resolutions of directors	15
	6.6	Board resolutions - general	16
	6.7	Shareholder approval matters	16
	6.8	Shareholder meetings	18
	6.9	Voting at Shareholder meetings	19
	6.10	Related party dealings	19
	6.11	Delegation	21
	6.12	Subsidiaries	21
	6.13	De minimis Shareholder	21
7	Deadlock		22
	7.1	Deadlock	22
	7.2	Escalation process	23
	7.3	Sale process	24
	7.4	Appointment of investment bank	24
	7.5	Acceptance of Best Offer	26
	7.6	Support to Sale Agent	27
	7.7	Failure of process	28

Shareholders agreement Contents 1

Contents

8	Conduct of business		30
	8.1	Strategic Plan and Budget	30
	8.2	Conduct of business	30
	8.3	Tax	31
	8.4	Periodic reports	32
	8.5	Access to information	33
	8.6	Auditor	33
	8.7	Dividends	34
	8.8	Insurance	34
	8.9	Further funding	35
	8.10	Anti-dilution	37
	8.11	Guarantees	38
	8.12	Related party dealings	38
9	Branding and IP		38
	9.1	Branding	38
	9.2	IP Licence Agreements	39
	9.3	Protection of JV IP	39
10	Exclusivity and commitment		39
	10.1	Parties	39
	10.2	Definitions	40
	10.3	Restrictive covenants	41
	10.4	Permitted Activities	43
	10.5	No restriction on USG or Boral conducting businesses outside the Territory	44
	10.7	Acknowledgment	44
11	Disposal - general		46
	11.1	Standstill Period	46
	11.2	Disposals following Standstill Period	46
	11.3	Security Interests over JV Shares	47
	11.4	Intra-group transfers	47
	11.5	No avoidance	48
	11.6	Adherence Deed and registration of transfers	48
12	Pre-emptive provisions		49
	12.1	General	49
	12.2	Notice of Sale	49
	12.3	Offer to purchase Sale Shares	49
	12.4	Recipient does not offer to purchase	50
	12.5	Recipient offers to purchase	51
	12.6	Offer is accepted	51
	12.7	Offer is rejected	51
	12.8	Last Right	52
	12.9	Tag Right	53
	12.10	Time periods	54
13	Events of Default		54
	13.1	Events of Default	54
	13.2	Change of Control	55
	13.3	Insolvency Events	57
	13.4	Notice	57

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Contents

14	Effect of Events of Default		58
	14.1	Call Option	58
	14.2	Assessment of Fair Market Value – initial phase	58
	14.3	Binding determination of Fair Market Value	59
	14.4	Failure of expert process	60
	14.5	Exercise of options	61
	14.6	Time periods	62
15	Completion of transfer of JV Shares between Shareholders		62
	15.1	Definitions	62
	15.2	Contract for sale and purchase	62
	15.3	Transfer	63
	15.4	Transferee Shareholder to assume guarantees	64
16	Termination		64
	16.2	Survival	65
17	Operations of Shareholders		67
	17.1	Definitions	67
	17.2	Restrictions on USG	67
18	Confidentiality and publicity		67
	18.1	Definition	67
	18.2	Confidentiality	68
	18.3	Permitted disclosure	68
	18.4	Disclosure to a prospective purchaser	69
	18.5	USG Confidential Information	69
	18.6	Boral Confidential Information	71
	18.7	Third Party IP	72
19	Stapling		72
	19.1	JVC 1 Shares and JVC 2 Shares are Stapled	72
	19.2	Restrictions on dealings in JVC 1 Shares	72
	19.3	Restrictions on dealings in JVC 2 Shares	73
	19.4	Transfers	73
	19.5	Boral Holders – special provisions	73
	19.6	Administrative matters	73
	19.7	Allocation of subscription amounts	74
	19.8	Saving	74
20	Guarantor provisions		74
	20.1	Boral guarantee	74
	20.2	USG guarantee	76
21	Representations and warranties		77
	21.1	Warranties	77
	21.2	Notification of breach	77
22	Rights and obligations of Boral Holders		78
	22.1	Joint and several parties	78
	22.2	Holdings to be aggregated	78
	22.3	Operation of pre-emptive provisions	78
	22.4	Operation of default provisions	79

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Contents

	22.5	Operation of Deadlock provisions	79
	22.6	Issues of securities	80
	22.7	Operation limited to this agreement	80
23	Notices		80
	23.2	How Notice must be given and when Notice is received	80
	23.3	Notice must not be given by electronic communication	81
24	General		81
	24.1	Costs and expenses	81
	24.2	Entire agreement	81
	24.3	Assignment of rights	82
	24.4	Governing law and jurisdiction	82
	24.5	Service of process	82
	24.6	Waivers	82
	24.7	Variation	82
	24.8	Counterparts	82
	24.9	Further assurances	83
	24.10	Prohibition and enforceability	83
	24.11	Relationship of parties	83
	24.12	Exercise of rights	83
	24.13	Remedies cumulative	83
	24.14	Survival of clauses	83
	Schedules
	Schedule 1
	Definitions and interpretation		84
	Schedule 2
	Director Appointment Forms
	Schedule 3
	Board and Shareholder meeting schedule
	Schedule 4
	Board Fundamental Matters
	Schedule 5
	Major Fundamental Matters
	Schedule 6
	Minor Fundamental Matters

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Contents

Schedule 7

Expert valuation procedures

Schedule 8

High Risk Jurisdictions

Schedule 9

Committee charters

Schedule 10

Third party arrangements

Schedule 11

Loan Terms

Schedule 12

Adherence Deed

Schedule 13

Notice details

Signing page

Attachment 1

Shareholders agreement Contents 5

Shareholders agreement

Date  u

Between the parties

Boral	Boral International Pty Limited ACN 000 341 239 of Level 39, 50 Bridge Street Sydney, NSW 2000 Australia (Boral Holder 1) Boral Building Materials Pty Limited ACN 090 736 888 of Level 39, 50 Bridge Street Sydney, NSW 2000 Australia (Boral Holder 2)
USG	USG Netherlands Global Holdings B.V. Commercial Register No. 58458670, Muiderstraat 9, 1011PZ Amsterdam (USG)
Companies	[USG Boral Building Products Pte Limited] A company incorporated under the laws of Singapore [to insert registration details of new holdco] (JVC 1) [USG Boral Building Products Pty Limited] (formerly Boral Australian Gypsum [Pty] Limited) ACN 004 231 976 of Level 39, 50 Bridge Street Sydney, NSW 2000 Australia (JVC 2)
Boral Guarantor	Boral Limited ACN 008 421 761 of Level 39, 50 Bridge Street Sydney, NSW 2000 Australia (Boral Guarantor)
USG Guarantor	USG Corporation of 550 West Adams Street, Chicago Illinois 60661, United States of America (USG Guarantor)

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Recitals 1       Boral and USG wish to establish and operate a joint venture through the Companies to conduct the Business.   2       The parties wish to set out in this agreement the terms that will govern the relationship of Boral and USG as shareholders of the Companies, their relationship to the Companies and the terms on which the joint venture will be managed.   3       Boral Guarantor has agreed to guarantee the obligations of Boral under this agreement and USG Guarantor has agreed to guarantee the obligations of USG under this agreement.   4       The Companies have agreed to be bound by, and to comply with, all of the provisions of this agreement which relate to the Companies.   5       At the date of this Agreement, each of Boral Holder 1 and USG hold 50% of the JVC 1 Shares and each of Boral Holder 2 and USG hold 50% of the JVC 2 Shares, such that Boral’s Shareholding Percentage is 50% and USG’s Shareholding Percentage is 50%.   6       Each JVC 1 Share and each JVC 2 Share on issue at the date of this Agreement is Stapled on the terms set out in this agreement.

This deed witnesses as follows:

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1 Introduction

1.1 Objectives of agreement

This agreement regulates the relationship of the Shareholders and sets out the arrangements between the Shareholders, and where applicable between the Shareholders and the Companies, for the ownership, governance and operation of the Companies (and the broader JV Group) and the conduct of the business and the affairs of the Companies (and the broader JV Group).

1.2 Business

(a) The Business is to:

(1) manufacture, distribute and sell the Products, to mine raw gypsum and to purchase and sell natural and synthetic gypsum (in each case in the Territory); and

(2) undertake such other activities and operations as the Shareholders determine from time to time in accordance with this agreement.

(b) Specifically, but without limiting clause 1.2(a), it is contemplated that the JV Group will (consistently with this agreement):

(1) enter into long term contracts for the supply of raw materials and invest in and own associated assets, including gypsum quarries;

(2) operate existing product manufacturing and distribution facilities and acquire or develop new product manufacturing and distribution facilities;

(3) develop and implement a brand and trademark strategy;

(4) create new products, systems and services to develop markets for the JV Group’s products;

(5) undertake various distribution structures including wholly-owned, franchised or partly-owned structures in partnership with third parties;

(6) develop product and wall and ceiling system specification skills and construction quality assurance skills;

(7) implement the technology licensed to the JV Group by the Boral Group and the USG Group; and

(8) develop the ability to inspect site installation and to accept performance liability for systems constructed in accordance with the JV Group’s specifications.

(c) The Business will not include the JV Group undertaking installation work except to the extent that the Shareholders pass a Unanimous Resolution that this is necessary to develop a particular market, provided that this does not apply to restrict operations in Australia consistent with the business conducted by JVC 2 and its Subsidiaries prior to the date of this agreement.

(d) The Business will be conducted in the best interests of the JV Group in accordance with sound commercial profit making principles and with the aim of generating the maximum achievable sustainable profitability.

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(e) Despite the foregoing, the parties agree that the Business will not include the JV Group doing anything (and the Companies must not do anything) contrary to the undertakings in relation to the JV Group in clause 10.3(c).

1.3 Territory

(a) The initial Territory for the purposes of this agreement will be the following countries and regions (on the basis that a reference to any country or region listed in this clause 1.3(a) includes any successor jurisdiction or jurisdictions encompassing all or part of the same geographical area): Afghanistan, Australia, Bangladesh, Bahrain, Bhutan, Brunei, Cambodia, China, East Timor, Egypt, Hong Kong, India, Indonesia, Iraq, Israel, Japan, Jordan, Kuwait, Laos, Lebanon, Macau, Malaysia, Maldives, Mongolia, Myanmar, Nepal, New Zealand, Oman, Pakistan, Papua New Guinea, Philippines, the Primorsky Krai region of Russia, Qatar, Saudi Arabia, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Vietnam, United Arab Emirates and other South West Pacific jurisdictions.

(b) The Shareholders may amend or supplement the list of countries and regions in clause 1.3(a) by agreement at any time and from time to time by giving written notice to the Companies (signed on behalf of both Shareholders) stating the agreed changes to be made. Any such notice will (despite clause 24.7) be taken to vary clause 1.3(a) accordingly with immediate effect.

(c) The parties acknowledge that. as at the date of this agreement, the Boral Group and the USG Group each have existing arrangements with third parties relevant to the Territory, all of which are listed in Schedule 10.

(d) Unless the Shareholders agree otherwise in writing in a particular instance:

(1) the JV Group may not manufacture, distribute or sell Products (or otherwise export Products) directly, or indirectly through another person, outside the Territory or distribute or sell Products in the Territory with the knowledge or having reason to believe that those Products will be sold outside the Territory;

(2) damages alone may not be adequate to compensate a Shareholder for any breach by a JV Group Member of clause 1.3(d)(1);

(3) without limiting the relief that a Shareholder is entitled to seek or any right it may have under this agreement, a Shareholder may seek an injunction if a JV Group Member is in breach of or threatens to breach, or if a Shareholder reasonably believes that a JV Group Member will breach, the provisions of clause 1.3(d)(1); and

(4) no JV Group Member will make any submission or contention in any proceeding at which a Shareholder seeks an injunction in relation to any breach, or any alleged, threatened or apprehended breach, of clause 1.3(d)(1) to the effect that granting an injunction is not appropriate because the payment of damages alone would be adequate to compensate the Shareholder or Shareholders.

1.4 Compliance with agreement

(a) Each Shareholder, acknowledging its commitment to the Business, will comply with this agreement and, to the extent within its power, procure that:

(1) each Company complies with this agreement; and

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(2) each director the Shareholder appoints to either Board exercises his or her voting rights so as to ensure that each Company complies with this agreement.

(b) Each Company will comply with this agreement and will procure that each JV Group Member complies with this agreement. To the extent (if any) that any obligation on either Company is invalid as a fetter on that Company’s statutory powers, clause 1.4(a) will apply to require the Shareholders to procure (in the manner contemplated by that clause) the relevant Company does the things it is stated in this agreement to be required to do.

(c) In the event of any future change to any Legal Requirement which changes or imposes residency or similar requirements in relation to who can be appointed as a director of either Company (for example any change to the requirement referred to in clause 5.1(b)), the parties will agree in good faith how to satisfy those changed requirements, on the principle that the burden of satisfying them should be borne consistently with the principle adopted in clause 5.1(b).

2 Structure of agreement

This agreement regulates the relationship of the Shareholders and sets out the arrangements between the Shareholders for the ownership, governance and operation of the Companies and the conduct of the businesses and affairs of the Companies. This agreement is divided into the following parts:

Part A	Governance	The governance structure of the JV Group including such things as Board composition and decision-making, as well as deadlock provisions.
Part B	Business operations	Key terms for the commercial operation of the Business including planning and reporting, intellectual property issues and exclusivity provisions.
Part C	Shareholder exit and default provisions	Restrictions on Disposal, pre-emptive provisions, and a default regime.
Part D	Miscellaneous	General provisions in relation to the joint venture and the operation of this agreement.
Schedules and Attachment	Various	Contain further details of processes, procedures and arrangements relating to the JV Group which are described throughout the body of the agreement

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3 Definitions and interpretation

3.1 Definitions and interpretation

(a) In this agreement, capitalised expressions have the meanings set out in Schedule 1. This agreement must be interpreted in accordance with Schedule 1.

(b) This document is intended to take effect as a deed and a reference to ‘this agreement’ is a reference to ‘this deed’.

3.2 Agreement components

This agreement includes any schedule and any attachment which is not itself an agreement.

3.3 Inclusive expressions

Specifying anything in this agreement after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included.

3.4 Business Day

Where the day on or by which any thing is to be done is not a Business Day, that thing must be done by the following Business Day.

4 Consistency

(a) If there is an inconsistency between this agreement and either or both of the Constitutions, the parties intend that this agreement prevails to the extent of the inconsistency.

(b) On receipt of a request in writing from another party, each party must take all necessary steps (including each Shareholder exercising its voting rights as a Shareholder) to amend any provision or provisions of a Constitution that is inconsistent with this agreement so as to remove the inconsistency and ensure that the terms of this agreement prevail.

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Part A – Governance

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5 Board and senior management

5.1 Board composition

(a) Each Shareholder:

(1) has the right to appoint one director to the JVC 1 Board for every 12.5% of the Shareholder’s Shareholding Percentage at any one time; and

(2) has the right to appoint one director to the JVC 2 Board for every 12.5% of the Shareholder’s Shareholding Percentage at any one time.

(b) The Shareholders acknowledge that Singapore law requires at least one director of JVC 1 to be ordinarily resident in Singapore (and subject to this clause 5.1(b) the Shareholders agree that both will appoint such directors, so that the burden of satisfying the relevant legal requirement is shared). Each Major Shareholder must ensure that it appoints an additional director to the JVC 1 Board (in addition to those it is entitled to appoint under clause 5.1(a)) who satisfies the applicable residency requirement (such additional director being the Shareholder’s Singapore Nominee). During any period in which a Shareholder is a Minor Shareholder, such Shareholder may but is not obliged to appoint a Singapore Nominee in addition to the directors it is entitled to appoint under clause 5.1(a).

(c) For the avoidance of doubt a Shareholder will not be entitled to appoint a director to either Board (including any Singapore Nominee) at any time during which that Shareholder’s Shareholding Percentage is less than 12.5%.

(d) A director may (other than to the extent prohibited by applicable law from time to time), have an interest arising from any duty he or she may owe (whether at law or otherwise) to, or any economic interest from or in, the Shareholder who appointed him or her as a director, or any Affiliate or Parent of that Shareholder (as applicable).

(e) To the extent permitted by applicable law a director:

(1) who has an interest in a matter and who declares that interest to the relevant Board may vote in respect of that matter if it comes before the relevant Board and be counted as part of the quorum;

(2) may enter into contracts with, or otherwise have dealings with, any member of the JV Group; and

(3) may hold offices in any member of the JV Group.

(f) To the extent permitted by applicable law, a director may consider, and act in, the interests of the Shareholder that appointed the director (or, without limiting the foregoing, in the interests of the other Company) in performing his or her duties or exercising any power, right or discretion as a director of either of the Companies.

5.2 Appointment and removal of directors

(a) A Shareholder entitled to make an appointment pursuant to clause 5.1(a) or obliged to make an appointment under clause 5.1(b) may appoint a director by written notice to the relevant Company in the form set out in Part 1 of Schedule 2 specifying the identity of the person to be

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appointed as a director. A Shareholder who appoints an individual as a director of JVC 1 must also concurrently appoint the same individual as a director of JVC 2, except in the case of a Singapore Nominee (who will only be appointed as a director of JVC 1).

(b) Subject to the Constitutions and any applicable laws, the appointment takes effect on the later of:

(1) receipt of such notice by the relevant Company; and

(2) receipt by each of JVC 1 and JVC 2 (or in the case of a Singapore Nominee, JVC 1 only) of a consent to act as a director of the relevant Company (in the form set out in Part 2 of Schedule 2, as amended from time to time to the extent necessary to conform with any applicable Legal Requirements in relation to any such consent, and in the case of JVC 1 in the form of Singapore Form 45 or such other applicable form from time to time) signed by the appointee director,

provided always that (except in the case of a Singapore Nominee) an individual’s appointment as a director of one of the Companies will not take effect unless and until he or she is effectively appointed as a director of the other Company.

(c) A Shareholder may at any time remove a director that the Shareholder has appointed to either Board (including a Singapore Nominee, provided that if a Major Shareholder removes its Singapore Nominee that Major Shareholder must immediately appoint another Singapore Nominee in accordance with clause 5.1(b)) by written notice to the relevant Company specifying the identity of the director to be removed. A Shareholder who removes an individual as a director of JVC 1 must also concurrently remove the same individual as a director of JVC 2, except in the case of a Singapore Nominee (who will only be removed as a director of JVC 1). For the avoidance of doubt a notice of removal may be accompanied by notice of appointment of a replacement director in accordance with clause 5.2(a) (and may be given subject to the replacement appointment taking effect).

(d) A director appointed by a Shareholder may only be replaced or removed by that Shareholder, except that if the number of directors on either Board appointed by a Shareholder exceeds the number of directors which that Shareholder is entitled to appoint at any given time under clause 5.1 for more than 2 consecutive Business Days the other Shareholder may on the next Business Day following that period remove the excess director or directors with immediate effect by written notice to the relevant Company, which selects the director or directors to be removed (provided that the other Shareholder’s Singapore Nominee may not be removed in this way).

(e) Any removal of a director or directors pursuant to clause 5.2(d) is without limitation to a Shareholder’s right to appoint, remove or replace any individual as a director in accordance with clause 5.1 and 5.2.

(f) If at any time a Shareholder transfers all of its JV Shares to the other Shareholder or to a third party in accordance with this agreement, then without limiting any other term of this agreement, that Shareholder must procure that its appointed directors resign or are removed immediately.

(g) A Shareholder who is entitled to make an appointment, removal or replacement of a director pursuant to this clause may, to the extent such action requires the approval of a Company’s members under applicable law, at any time convene a general meeting of the Companies (or either of them as the case may be) to approve that appointment, removal or replacement by ordinary resolution and each other Shareholder must vote in favour of that resolution at that meeting.

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5.3 No alternate directors

Directors may not appoint alternate directors.

5.4 Chair

(a) Subject to clause 5.4(b):

(1) USG has the right to appoint the Chair of each Board for the period until 31 December 2015; and

(2) the right to appoint one of its nominee directors as Chair of each Board will thereafter alternate between the Shareholders every 2 years,

(but so that the same person will act as Chair of both Boards).

(b) During any period that a Shareholder’s Shareholding Percentage is more than 50%, that Shareholder will have the sole right to appoint the Chair of both Boards.

(c) The initial Chair will be Jennifer Scanlon or such other USG Director who is notified by USG to Boral prior to entry into this agreement (who will be taken to have been duly appointed in accordance with this clause 5.4).

(d) The Shareholder having the right to appoint the Chair at any given time under this clause 5.4 must appoint, and may replace, the Chair by written notice to the Companies specifying the director to be appointed as Chair (or, as applicable, replace the current Chair). Subject to the Constitutions and any applicable laws, the appointment or, as applicable, replacement of the Chair takes effect immediately on receipt of the relevant notice by the Companies.

(e) The Chair will not have a casting vote at meetings of either Board (or in respect of circulating resolutions of the directors).

(f) If the Chair is absent from a meeting of either Board, or is unwilling act, the directors at the meeting appointed by the same Shareholder who appointed the Chair may nominate any director present to act as Chair of the meeting.

5.5 Remuneration and expenses

(a) The Companies must reimburse each director’s reasonable costs associated with travelling to and attending Board meetings.

(b) Clause 8.8(a) will apply in relation to insurance cover for directors.

(c) Directors will not be entitled to any fees from the JV Group for serving as a director.

5.6 Committees

(a) The parties agree that the JV Group will establish a Finance Committee and a Technical Committee to provide additional oversight and assistance to management of the JV Group. The initial charters for these committees will be as set out in Schedule 9.

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(b) The Finance Committee will comprise up to eight members, with each Shareholder having the right to appoint and remove four members, and so that the members appointed will collectively have expertise in the areas of accounting, treasury, financial analysis and tax. The appointment proportions will be adjusted equitably (on the same principle as applies to appointment of directors under clause 5.1(a)) if the parties’ Shareholding Percentages cease to be 50/50.

(c) The Technical Committee will be comprise up to six members (plus an ex officio chair as contemplated by the charter for the Technical Committee), with each Shareholder having the right to appoint and remove three members and so that the members appointed will collectively have expertise and responsibility in the technology areas of manufacturing, engineering, research, product development, and intellectual property. The appointment proportions will be adjusted equitably (on the same principle as applies to appointment of directors under clause 5.1(a)) if the parties’ Shareholding Percentages cease to be 50/50.

(d) The members appointed to the Finance Committee or the Technical Committee may, but need not be, directors of the Companies. However the members appointed to the Finance Committee must not be employees of the JV Group.

(e) The Boards may by Super Resolution of both Boards disband the Finance Committee or the Technical Committee at any time after the third anniversary of the date of this agreement if it considers that performance of either of those committee’s functions is no longer required by the JV Group.

(f) Each Board may establish (and disband) other committees from time to time as it sees fit.

5.7 Executives

(a) The Companies must appoint:

(1) Frederic de Rougemont as the initial chief executive officer of the JV Group;

(2) Paul Monzella as the initial chief financial officer of the JV Group;

in each case on the appointment terms agreed between the Shareholders before the date of this agreement.

(b) The Shareholders agree that the chief executive officer will report to and serve under the direction of both Boards, and be responsible for:

(1) the day to day management of the Business and affairs of the JV Group in accordance with this agreement, the Strategic Plan, the Budget and policies approved by both Boards; and

(2) the selection and appointment of all other officers and employees of the JV Group as necessary for the proper administration of the Business (other than the chief financial officer, the Senior Vice President-Technology, the Vice President -Product Adjacencies and the members of the Finance Committee or the Technical Committee),

subject always (where relevant) to clause 6.6 and clause 6.7 and to limits of authority approved by both Boards from time to time.

(c) The Shareholders agree that the chief financial officer will report to and serve under the direction of the chief executive officer, and be responsible for managing the financial affairs of the JV Group on a day to day basis in accordance with this agreement, the Strategic Plan, the Budget and policies approved by both Boards, subject always (where relevant) to clause 6.6 and clause 6.7 and to limits of authority approved by both Boards from time to time.

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(d) At any time (and from time to time) after expiry of the 18 month period commencing on the date of this agreement either Shareholder may serve written notice on the Companies and the other Shareholder stating that it requires the chief executive officer or the chief financial officer to be dismissed (a Dismissal Notice). A Dismissal Notice must state the desired date for the dismissal to take effect, which must not be less than 3 months after the date of the Dismissal Notice unless both Shareholders agree in writing to an earlier date.

(e) On receipt of a Dismissal Notice, the parties must ensure that the services of the chief executive officer or the chief financial officer (as applicable) are terminated from the date specified in the Dismissal Notice provided that nothing in this clause is intended to require the Companies to act in breach of the employment contract of the relevant executive or applicable Legal Requirements (including as to required contractual notice periods).

(f) Where the Chief Executive Officer or Chief Financial Officer is removed under this clause 5.7, or his or her employment is otherwise terminated, both Shareholders may nominate a replacement candidate or candidates for consideration by the Boards. For the avoidance of doubt any new appointment requires approval by both Boards as a Board Fundamental Matter in accordance with clause 6.6.

(g) The Companies must also appoint:

(1) Joseph Holmes as the initial Senior Vice President-Technology of the JV Group; and

(2) William Hogan as the initial Vice President -Product Adjacencies of the JV Group,

in each case on the appointment terms agreed between the Shareholders before the date of this agreement. Any replacement appointments to either role must be of individuals with the requisite skills and experience for their respective roles nominated by USG and approved by both Boards. At any time after the fourth anniversary of this agreement, the Boards may by Super Resolution of both Boards dispense with the Senior Vice President-Technology and the Vice President -Product Adjacencies roles if the Boards consider they are no longer required by the JV Group.

6 Board and Shareholder decision making

6.1 Board quorum

(a) No matter or business may be transacted at a meeting of directors of either Company unless a quorum of directors is present at the time the matter or business is dealt with (including, for the avoidance of doubt, at the time the relevant Board votes on any resolution proposed in respect to that matter or business).

(b) Subject to clause 6.10, the quorum for a meeting of either Board is at least one director appointed by each Major Shareholder (who is not a Singapore Nominee) present in person or by any telephonic or electronic means permitted by the Constitutions.

(c) If a quorum is not present at a Board meeting within 2 hours of the time appointed for that Board meeting, the relevant meeting must be adjourned for a period of at least 24 hours (First Adjourned Board Meeting), with notice to be

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given immediately (and in any event at least 24 hours before the scheduled time) to all directors of the time and place for the First Adjourned Board Meeting.

(d) If a quorum is not present at the First Adjourned Board Meeting, the First Adjourned Board Meeting must be adjourned until the next Business Day following a period of at least 10 days (Second Adjourned Board Meeting). At least 10 days’ notice must be given to all directors of the time and place for the Second Adjourned Board Meeting.

(e) If a quorum is not present at the Second Adjourned Board Meeting, without limiting a party’s rights under any other provision of this agreement, the Board will reconvene at the next scheduled Board meeting or as otherwise agreed.

(f) For the avoidance of doubt, in no circumstances may the Board pass a Super Resolution unless a quorum meeting the requirements in clause 6.1(b) (as modified where applicable by clause 6.10) is present.

6.2 Notice of Board meetings

(a) Subject to clause 6.2(b), unless all the directors agree otherwise:

(1) directors must receive at least 21 days’ notice in writing of a meeting of either Board that specifies the date, time and place of meeting, the agenda specifying in reasonable detail the matters to be discussed at the meeting and the resolutions to be considered (attaching all documents to be tabled at that meeting); and

(2) a Board cannot pass a resolution or transact any business unless the subject of that resolution or that business was specifically described in the notice of meeting or unless approved by Super Resolution of the relevant Board.

(b) Where a matter is urgent, a meeting of a Board may be convened on less than 21 days’ notice if:

(1) a majority of directors including at least one director (who is not a Singapore Nominee) appointed by each Major Shareholder and one director (who is not a Singapore Nominee) appointed by each Minor Shareholder (if any) have agreed to the shorter notice; and

(2) the requirements of clause 6.2(a) are otherwise satisfied,

provided that this does not apply to notice of an adjourned meeting under clause 6.1(c) or clause 6.1(d).

6.3 Frequency and conduct of Board meetings

(a) Unless all Shareholders who have appointed one or more directors to either Board agree in writing in any given case, JVC 1 Board meetings and JVC 2 Board meetings must be convened so that they take place concurrently at the same time and the same place. Singapore Nominees are permitted to attend JVC 2 Board meetings to the extent they are held concurrently with JVC 1 Board meetings.

(b) The Boards must meet at least six times in each Financial Year in accordance with:

(1) for the first 12 months after the date of this agreement, the meeting schedule in Schedule 3; and

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(2) for each year thereafter in accordance with a schedule approved by the Boards 3 months prior to the end of the previous year.

(c) Additional Board meetings must be scheduled if:

(1) agreed by a majority of both Boards; or

(2) requested by either Shareholder by notice in writing to the Companies.

(d) A matter may at any time be referred for consideration of the relevant Board by any director (provided that, for the avoidance of doubt, all Board Fundamental Matters must be referred for consideration by both Boards at the same time), in which event the directors must ensure that it is included in the agenda for the next scheduled Board meeting (provided the referral has been made at least 7 days before the notices and agendas in respect of that meeting are scheduled for despatch to the directors).

(e) A meeting of either Board may be convened at any time by any director by giving notice in accordance with clause 6.2 (provided always that clause 6.3(a) is complied with).

(f) Meetings will be held in such locations as approved by both Boards. Subject to any applicable Legal Requirements directors may participate in Board meetings in person or via telephone, videoconference or similar telephonic or electronic means.

(g) Board meetings will be conducted in English and minutes of the meetings will be kept in English (in addition to any other language required by applicable law from time to time).

(h) Within 21 days after each meeting, the chair must give each director a copy of the meeting’s minutes.

(i) Subject to clause 6.1(c) or clause 6.1(d) or otherwise as expressly permitted in this agreement (or required by applicable law), a meeting of either Board at which a quorum is present in accordance with this agreement cannot be adjourned unless approved by Super Resolution.

6.4 Voting entitlements

(a) For the purposes of this clause 6.4:

(1) a Boral Director is an Eligible Boral Director for the purposes of any resolution unless this agreement or any applicable law does not permit the director to vote on the resolution; and

(2) a USG Director is an Eligible USG Director for the purposes of any Board resolution unless this agreement or any applicable law does not permit the director to vote on the resolution.

(b) At any meeting of the JVC 1 Board, each Boral Director appointed to the JVC 1 Board who is present and is an Eligible Boral Director for the purposes of a resolution before the JVC 1 Board can exercise in relation to that resolution a number of votes equal to:

(1) the maximum number of Boral Directors which Boral is entitled to appoint to the JVC 1 Board at the relevant time under clause 5.1 including the Singapore Nominee (whether or not that number of Boral Directors is in fact in office);

(2) divided by the number of Boral Directors actually present who are Eligible Boral Directors for the purposes of the relevant resolution.

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(c) At any meeting of the JVC 1 Board, each USG Director who is present and is an Eligible USG Director for the purposes of a resolution before the JVC 1 Board can exercise in relation to that resolution a number of votes equal to:

(1) the maximum number of USG Directors which USG is entitled to appoint to the JVC 1 Board at the relevant time under clause 5.1(a) including the Singapore Nominee (whether or not that number of USG Directors is in fact in office);

(2) divided by the number of USG Directors actually present who are Eligible USG Directors for the purposes of the relevant resolution.

(d) At any meeting of the JVC 2 Board, each Boral Director appointed to the JVC 2 Board who is present and is an Eligible Boral Director for the purposes of a resolution before the JVC 2 Board can exercise in relation to that resolution a number of votes equal to:

(1) the maximum number of Boral Directors which Boral is entitled to appoint to the JVC 2 Board at the relevant time under clause 5.1 (whether or not that number of Boral Directors is in fact in office);

(2) divided by the number of Boral Directors actually present who are Eligible Boral Directors for the purposes of the relevant resolution.

(e) At any meeting of the JVC 2 Board, each USG Director who is present and is an Eligible USG Director for the purposes of a resolution before the JVC 2 Board can exercise in relation to that resolution a number of votes equal to:

(1) the maximum number of USG Directors which USG is entitled to appoint to the JVC 2 Board at the relevant time under clause 5.1(a) (whether or not that number of USG Directors is in fact in office);

(2) divided by the number of USG Directors actually present who are Eligible USG Directors for the purposes of the relevant resolution.

(f) Fractional votes must be counted.

(g) The preceding provisions of this clause 6.4 do not apply to circulating resolutions of a Board under clause 6.5, where each Boral Director of the relevant Company in office at the relevant time will be taken to have one vote and each USG Director of the relevant Company in office at the relevant time will be taken to have one vote.

6.5 Circulating resolutions of directors

(a) A Board will validly pass a resolution as a circulating resolution if:

(1) a notice containing the resolution is sent to each director of the relevant Company; and

(2) the notice states that a response is required within a specified period, which unless the directors otherwise consent may not be less than 21 days after the notice is received (or deemed received under the Constitutions); and

(3) directors of the relevant Company holding the requisite majority (being the majority that would be required under clause 6.6 at a Board meeting at which all directors were present, and excluding for the avoidance of doubt directors who would not be entitled to vote on the relevant resolution under this agreement or any applicable law) signify their assent to the resolution,

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and a single document can for these purposes constitute a circulating resolution of both Boards if signed by the requisite majority of directors of both Companies.

(b) A director who does not signify his or her assent to the relevant resolution by the date specified in the notice is taken to have voted against it.

(c) If the required number of the directors assent to the resolution, the resolution is passed on the last day and at the last time at which the document was assented to by a director so that the requisite majority was satisfied.

6.6 Board resolutions - general

(a) Despite any contrary provision in this agreement, a decision in relation to any of the Board Fundamental Matters may be made only by Super Resolution of both Boards (provided that this applies subject to any applicable legal requirements, so that if a decision in relation to any Board Fundamental Matter requires any higher majority to be obtained (or any additional requirement to be met, including a requirement for shareholder approval) to be valid under any applicable law that requirement must be satisfied in addition to a Super Resolution of both Boards).

(b) Except for:

(1) Board Fundamental Matters;

(2) where otherwise provided expressly in this agreement; and

(3) matters where a greater majority is required under any law to which either of the Companies is subject,

a resolution of a Board is passed at a Board meeting if a simple majority of the votes that may be cast on the resolution (excluding votes of directors that this agreement or any applicable law does not permit to vote on the resolution) are cast in favour of it.

(c) For the avoidance of doubt, if a director other than a Singapore Nominee is not permitted to vote on a resolution under any law applying to one of the Companies, he or she will be taken to be not permitted to vote on the resolution in relation to either of the Companies.

(d) Without limiting clause 6.7, if a resolution of the shareholders of JVC 1 or JVC 2 (or both) is required under an applicable law to give effect to (or to cause either or both of the Companies to give effect to) a resolution passed by the Board of the relevant Company, each Shareholder must:

(1) attend any shareholders’ meeting that is convened to consider any such shareholders resolution; and

(2) vote in favour of that resolution.

6.7 Shareholder approval matters

(a) Subject to clauses 6.7(b) and 6.13, but otherwise despite any contrary provision in this agreement, the Major Fundamental Matters are reserved to the Major Shareholders and the Minor Fundamental Matters are reserved to the Major Shareholders and the Minor Shareholders (if any). Subject to clauses 6.7(b) and 6.13 a decision in relation to any of the Fundamental Matters may be made only by Unanimous Resolution of Shareholders in accordance with:

(1) clause 6.7(e) and 6.7(f); or

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(2) clause 6.7(g),

and the Companies must (and each Shareholder, to the extent within its power, must procure that the Companies) comply with any such decision in relation to any Fundamental Matter.

(b) Clause 6.7(a) applies subject to any applicable legal requirements and so that if a resolution in relation to any Fundamental Matter requires any higher shareholder majority to be obtained (or any additional requirement to be met) to be valid under any applicable law that requirement must be satisfied in addition to the requirements in clause 6.7(a).

(c) A Board may propose a resolution in relation to any of the Fundamental Matters by written notice to the Shareholders (whether pursuant to clause 6.7(e)(1) or clause 6.8(b)(1)) and must do so where requested by either of the Shareholders.

(d) The Companies and the Boards must not take, and must procure that no JV Group Member takes, any action or decision or enter into any transaction which would constitute a Fundamental Matter without an Unanimous Resolution of the Shareholders being passed in accordance with this agreement approving such action or decision or the entry into such transaction.

(e) A Unanimous Resolution of Shareholders will be passed where:

(1) a notice containing the resolution is sent to each Shareholder by the Companies stating that a response is required within a specified period (which unless the Shareholders agree otherwise in writing may not be less than 21 days after the notice is received (or deemed received under the Constitutions)); and

(2) it is in respect to a Major Fundamental Matter and all Major Shareholders (or where required by applicable law for the relevant resolution to be effective, all Shareholders) signify their assent to the resolution by signing and returning it to the Companies (provided that a Shareholder which does not signify its assent to the relevant resolution by the date specified in the notice is taken to have voted against it); or

(3) it is in respect to a Minor Fundamental Matter and all Major Shareholders and all Minor Shareholders (if any) (or where required by applicable law for the relevant resolution to be effective, all Shareholders) signify their assent to the resolution by signing and returning it to the Companies (provided that a Shareholder which does not signify its assent to the relevant resolution by the date specified in the notice is taken to have voted against it).

(f) If the required number of Shareholders assent to a resolution in accordance with clause 6.7(e)(2) or 6.7(e)(3) (as the case may be) that resolution is passed as a Unanimous Resolution on the last day and at the last time at which the document was assented to by a Shareholder so that the requisite number of supporting Shareholders was satisfied.

(g) Without limiting the foregoing, a Unanimous Resolution of Shareholders will be passed where the resolution is proposed at a meeting of Shareholders convened in accordance with clause 6.8 and:

(1) where it is in respect to any matter other than a Minor Fundamental Matter, all Major Shareholders vote in favour of such resolution; or

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(2) where it is in respect to a Minor Fundamental Matter, all Major Shareholders and Minor Shareholders (if any) vote in favour of such resolution.

(h) For the avoidance of doubt, to the extent any Board Fundamental Matters include or relate to Fundamental Matters, these will require approval by the Unanimous Resolution of Shareholders.

6.8 Shareholder meetings

(a) Unless there are no Fundamental Matters requiring consideration by the Shareholders, whenever a Board meeting has been convened a meeting of the Shareholders must also be convened in accordance with this clause 6.8 for the time immediately following the relevant Board meeting (and in the same place as the Board meeting). Additional Shareholder meetings must be convened in accordance with this clause 6.8 if:

(1) agreed by a majority of both Boards; or

(2) requested by either Shareholder by notice in writing to the Companies.

(b) Unless all the Shareholders agree otherwise in writing:

(1) the Shareholders must receive at least 21 days’ notice in writing of a meeting of the Shareholders that specifies the date, time and place of meeting, the agenda specifying in reasonable detail the matters to be discussed at the meeting and the resolutions to be proposed (including in respect to any Fundamental Matters) and attaching all documents to be tabled at that meeting;

(2) the Shareholders cannot pass a resolution or transact any business unless the subject of that resolution or that business was specifically described in the notice of meeting.

(c) Meetings of the Shareholders will constitute general meetings of the members of each Company, which will be held concurrently with each other.

(d) No matter or business may be transacted at a meeting of Shareholders unless a quorum of Shareholders is present at the time the matter or business is dealt with (including, for the avoidance of doubt, at the time the Shareholders vote on any resolution proposed in respect to that matter or business).

(e) A quorum for a Shareholders’ meeting is constituted by the attendance (in person or by proxy) of each Major Shareholder and (to the extent the business of the meeting includes any Minor Fundamental Matter) each Minor Shareholder.

(f) If a quorum is not present, the scheduled Shareholders’ meeting must be adjourned in accordance with the procedure for adjournment of directors meetings specified in clauses 6.1(c), 6.1(d), and 6.1(e).

(g) For the avoidance of doubt, in no circumstances may the Shareholders pass an Unanimous Resolution unless a quorum meeting the requirements in clause 6.8(e) is present.

(h) A Shareholder may appoint a person (including any director it has appointed to either Board) as a proxy to attend and vote for the Shareholder at any Shareholders meeting by submitting a written appointment to the Companies that is signed by the Shareholder and contains the following information:

(1) the Shareholder’s name and address;

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(2) the Companies’ names;

(3) the proxy’s name or the name of the office held by the proxy;

(4) the meetings at which the appointment may be used (provided that the appointment may be a standing one).

(i) Shareholder meetings will be conducted in English and minutes of the meetings will be kept in English (in addition to any other language required by applicable law from time to time). The secretary of each meeting must distribute a copy of such minutes to each Shareholder as soon as practicable after the meeting

6.9 Voting at Shareholder meetings

(a) Each Shareholder is entitled to that number of votes at a meeting of each Company that is equivalent to its JVC 1 Percentage or its JVC 2 Percentage (as applicable).

(b) Except for Fundamental Matters or where otherwise expressly provided in this agreement, and subject to any applicable law requiring a greater majority in respect to a particular matter, approval of any matter by the Shareholders requires a simple majority of votes cast on the resolution.

6.10 Related party dealings

(a) For any matter before either Board that requires the Board to determine whether any JV Group Member should bring a Company Claim against a Boral Respondent:

(1) provided that USG’s Shareholding Percentage at the relevant time is at least 12.5%, the USG Directors have the power to cause the relevant JV Group Member to bring that Company Claim (and may pass a Super Resolution of the Board in relation to the relevant matter to the extent required by this agreement);

(2) the quorum for any relevant Board meeting, while considering that matter, will be the presence of at least one USG Director only (other than in the case of JVC 1 a Singapore Nominee); and

(3) the Boral Directors may not be present while that matter is considered and may not vote on that matter.

(b) For any matter before either Board that requires the Board to determine whether any JV Group Member should bring a Company Claim against a USG Respondent:

(1) provided that Boral’s Shareholding Percentage at the relevant time is at least 12.5%, the Boral Directors have the power to cause the relevant JV Group Member to bring that Company Claim (and may for the avoidance of doubt pass a Super Resolution of the Board in relation to the relevant matter to the extent required by this agreement);

(2) the quorum for any relevant Board meeting, while considering that matter, will be the presence of at least one Boral Director only (other than in the case of JVC 1 a Singapore Nominee); and

(3) the USG Directors may not be present while that matter is considered and may not vote on that matter.

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(c) Any Shareholder whose nominated directors cause a JV Group Member to bring a Company Claim under this clause 6.10 must indemnify that Company against any cost or loss incurred by that Company to the extent that such cost or loss arises as a direct result of the Company not succeeding in such Company Claim.

(d) Clauses 6.10(a) and 6.10(b) also apply (as applicable, depending on whether the seller of the relevant Sale Business is a Boral Respondent or a USG Respondent) in relation to:

(1) any decision by either Board whether, and if so on what terms, the Companies (or any other JV Group Member) should make an offer to buy the relevant Sale Business in the circumstances contemplated by clauses 10.4(b) and 10.4(c), including any decision approving a final binding offer; and

(2) any decision by either Board in relation to any associated matters, including conduct of due diligence in relation to the relevant Sale Business and all matters relating to the implementation and completion of any acquisition transaction,

as if references to a Company Claim in clauses 6.10(a) and 6.10(b) were references to the relevant matter.

(e) In relation to any Boral IP Option Matter:

(1) provided that Boral’s Shareholding Percentage at the relevant time is at least 12.5%, the Boral Directors have the power to take all relevant decisions of either Board in relation to the Boral IP Option Matter (and may for the avoidance of doubt pass a Super Resolution of the Board in relation to the relevant matter to the extent required by this agreement);

(2) the quorum for any relevant Board meeting, while considering any Boral IP Option Matter, will be the presence of at least one Boral Director only (other than in the case of JVC 1 a Singapore Nominee); and

(3) the USG Directors may not be present while that matter is considered and may not vote on that matter,

(provided that for the avoidance of doubt nothing in this clause 6.10(e) is intended to fetter the rights of any relevant USG Group Member to conduct negotiations as the counterparty in respect of the relevant Boral IP Option Matter).

(f) In relation to any USG IP Option Matter:

(1) provided that USG’s Shareholding Percentage at the relevant time is at least 12.5%, the USG Directors have the power to take all relevant decisions of either Board in relation to the USG IP Option Matter (and may for the avoidance of doubt pass a Super Resolution of the Board in relation to the relevant matter to the extent required by this agreement);

(2) the quorum for any relevant Board meeting, while considering any USG IP Option Matter, will be the presence of at least one USG Director only (other than in the case of JVC 1 a Singapore Nominee); and

(3) the Boral Directors may not be present while that matter is considered and may not vote on that matter,

(provided that for the avoidance of doubt nothing in this clause 6.10(f) is intended to fetter the rights of any relevant Boral Group Member to conduct negotiations as the counterparty in respect of the relevant USG IP Option Matter).

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(g) For clarity:

(1) this clause 6.10 will not restrict involvement by a Shareholder’s appointed directors in the ordinary day-to-day management of the Companies to the extent permitted by this agreement; and

(2) clauses 6.10(d), 6.10(e) and 6.10(f) do not permit the directors appointed by a Shareholder to commit the Companies to expenditure or conduct that would be a Fundamental Matter without the approval of the requisite Unanimous Resolution of Shareholders.

6.11 Delegation

(a) Subject to clause 6.11(b) the directors may delegate any of their powers to a committee of directors or executives of the JV Group as they think fit.

(b) Decisions requiring Super Resolution of a Board must be approved by the relevant Board and cannot be delegated.

6.12 Subsidiaries

Each party agrees, and must do all things reasonably necessary and within their power to ensure, that (except as otherwise agreed by the Shareholders in writing, and subject to any applicable shareholders agreements or similar obligations to third parties where the relevant JV Group Member is itself a joint venture entity):

(a) the board and operation of each JV Group Member operate consistently with the decisions of the Boards and the Shareholders; and

(b) each JV Group Member must not effect any matter which would be a:

(1) Board Fundamental Matter unless both Boards have passed the appropriate resolution in accordance with clause 6.6; or

(2) Fundamental Matter unless the Shareholders have passed the appropriate resolution in accordance with clause 6.7.

6.13 De minimis Shareholder

Notwithstanding any other provision of this agreement, during any period in which a Shareholder’s Shareholding Percentage is less than 12.5% (so that the other Shareholder’s Shareholding Percentage is more than 87.5%), all Fundamental Matters will be treated as Board Fundamental Matters so that:

(a) clause 6.6(a) will apply to all decisions in relation to such matters for the duration of that period; and

(b) clause 6.7(a) will not apply to decisions in relation to such matters for the duration of that period.

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7 Deadlock

7.1 Deadlock

For the purposes of this clause 7 a Deadlock will occur if any of (a), (b) or (c) below applies:

(a) Both Boards or the Shareholders (as relevant having regard to the nature of the relevant matter) fail to pass a resolution for or against a particular matter by the requisite majority required by this agreement either:

(1) at 3 or more consecutive Board or Shareholder meetings (as relevant) at which the particular matter is the subject of a resolution proposed in accordance with this agreement (and for the avoidance of doubt any adjournments of a Board or Shareholder meeting will count for these purposes as forming part of the original meeting); or

(2) within 6 months after the relevant matter is first the subject of a resolution proposed to both Boards or Shareholders (unless withdrawn within that period by the proponent party or director),

and, in either case, in the reasonable opinion of either Shareholder (acting in good faith) doing, or not doing, the thing or things with which the relevant matter is concerned:

(3) would or may have a material adverse effect on the consolidated earnings before interest, tax, depreciations and amortisation of the JV Group (determined in accordance with the JV Group’s usual accounting policies at the relevant time) for any Financial Year of more than US$40 million or 20% of the previous year, whichever is higher;

(4) would involve a material change in the overall nature of the Business; or

(5) would or may have a material adverse impact on the reputation of any JV Group Member or of either Shareholder (or a Parent or any Related Corporation of a Shareholder) in any jurisdiction in which the relevant entity is registered or conducts material operations.

(b) Each of the following applies:

(1) a decision or action in relation to a Board Fundamental Matter or a Fundamental Matter has been taken by a JV Group Member without the Unanimous Resolution of Shareholders or a Super Resolution of both Boards (as relevant);

(2) the relevant decision or action is reasonably capable of reversal or remedy; and

(3) within 45 days after the matter is first brought before both Boards or the Shareholders (as relevant):

(A) the decision or action has not been ratified by Super Resolution of both Boards or Unanimous Resolution of the Shareholders (as relevant);

(B) no resolution has been passed by Super Resolution of both Boards or Unanimous Resolution of the Shareholders (as relevant) in relation to the action to be taken to reverse or

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remedy the relevant decision or action (or to the effect that the Boards or Shareholders (as relevant) consider that no such action is required in the circumstances); and

(C) the relevant decision or action has not otherwise been reversed or remedied to the reasonable satisfaction of both Shareholders.

(c) Each of the following applies:

(1) a JV Group Member has breached clause 1.3(d)(1) of this agreement, clause 8.2(e) of this agreement or any IP Licence Agreement (in each case) in any material respect;

(2) the relevant breach is reasonably capable of reversal or remedy; and

(3) within 45 days after the matter is first brought to the attention of the Shareholders (which must by written notice from one Shareholder to the other, or by the Companies to the Shareholders, specifying that the notice is for the purposes of this clause 7.1(c)):

(A) the Shareholders have not agreed in writing to the action to be taken to reverse or remedy the breach (or to the effect that the Shareholders consider that no such action is required in the circumstances); and

(B) the relevant breach has not otherwise been reversed or remedied to the reasonable satisfaction of both Shareholders.

7.2 Escalation process

(a) If a Deadlock occurs, without limiting any other right a Shareholder may have under this agreement and subject to clause 7.2(e), either Shareholder may give the other Shareholder a written notice (Deadlock Notice) setting out the matter in question (the Disputed Matter), its position on the matter and its reasons for adoption of such position.

(b) Following the issue of a Deadlock Notice, the parties must procure that the Chief Executive Officers of Boral Guarantor and USG Guarantor meet and use all reasonable endeavours in good faith to resolve the Disputed Matter as soon as possible.

(c) If the Disputed Matter remains unresolved within 21 days’ after the date of the Deadlock Notice, the parties must procure that the matter is referred to a ‘panel’ comprising the Chief Executive Officer and the lead independent director of USG Guarantor on the USG side and the Chief Executive Officer and the chairman of Boral Guarantor on the Boral side (or such other persons as the Shareholders may agree) and that the ‘panel’ meets and uses all reasonable endeavours in good faith to resolve the Disputed Matter as soon as possible.

(d) If the Disputed Matter remains unresolved by the date (the Submission Date) which is 21 days’ after referral to the ‘panel’ contemplated by clause 7.2(c), the dispute must be submitted to mediation, on the following basis:

(1) the mediation must be conducted in Sydney, Australia in accordance with, and subject to, The Institute of Arbitrators & Mediators Australia Mediation Rules (at the date of this agreement), except where those rules conflict with this clause 7.1(b);

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(2) if the Shareholders have not agreed upon the mediator within 7 days’ after the Submission Date the mediator is a person nominated by The Institute of Arbitrators & Mediators Australia acting on the request of either Shareholder (and multiple nominations may be requested to the extent necessary to identify a mediator willing to act on the matter); and

(3) the Shareholders must pay the mediator’s remuneration in equal shares. Each party must pay its own costs of the mediation.

(e) In the event a Deadlock also constitutes an Event of Default and a Non-Defaulting Shareholder issues a Default Notice in accordance with clause 14.2(a), then the Default Notice and the provisions of clause 14 will prevail over this clause 7 and the Deadlock procedure contemplated by this clause 7.1(b) and the remainder of clause 7 will immediately cease.

7.3 Sale process

If clause 7.2(d) requires the disputed matter to be submitted to mediation and either:

(a) the Disputed Matter remains unresolved by the date which is 6 weeks after the matter is first referred to a mediator agreed or nominated under clause 7.2(d); or

(b) the Shareholders agree in writing that the mediation will not be successful in resolving the dispute,

then, at any time during the period of 14 days’ following the date referred to in clause 7.3(a) (or, if earlier, the agreement in writing referred to in clause 7.3(b)), either Shareholder may, provided it is a Major Shareholder or a Minor Shareholder at the relevant time, serve a written notice (Sale Notice) on the other parties which states that the Shareholder requires a sale process to be undertaken in accordance with the remaining provisions of this clause 7.

7.4 Appointment of investment bank

(a) If a Shareholder issues a Sale Notice in accordance with clause 7.3, the Shareholders and (unless the Shareholders agree that there will be no sale of the Business) the Companies (the applicable parties being, in this clause, the Appointing Parties) must use their best endeavours to appoint an investment bank of international standing (Sale Agent) to conduct a trade sale process as contemplated below.

(b) If the Shareholders cannot agree on the identity of the Sale Agent within 14 days after the date of service of the Sale Notice, the Sale Agent will be an investment bank drawn by lot from the following list by the Chair of the Boards for the time being:

(1) Goldman Sachs (or its successor entity)

(2) Citi (or its successor entity)

(3) Credit Suisse (or its successor entity)

(4) UBS (or its successor entity)

(5) Deutsche Bank (or its successor entity)

(6) JP Morgan (or its successor entity)

(7) Bank of America (or its successor entity)

(8) Morgan Stanley (or its successor entity)

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and so that if the selected bank is unable or unwilling to accept the appointment, another name will be drawn by lot by the Chair until a bank accepts the appointment (and each party authorises the Chair for the time being to act accordingly).

(c) Subject always to clause 7.4(e), the Appointing Parties must execute an engagement letter on reasonable market terms with the Sale Agent selected in accordance with the preceding clauses and instruct and authorise the Sale Agent to conduct a trade sale process seeking binding offers to buy:

(1) all or substantially all of the Business; or

(2) all of the JV Shares on issue at the relevant time,

(the JV Enterprise).

(d) Subject always to clause 7.4(e), the Appointing Parties must instruct and authorise the Sale Agent to conduct the trade sale process so as to maximise the value received for the JV Enterprise. Without limiting the foregoing, the Appointing Parties must instruct the Sale Agent to:

(1) adopt a competitive tender process which is consistent with market practice for the sale of companies or businesses of a similar size as the JV Group and its Business, and which operate in similar industries;

(2) solicit and initiate negotiations with potential offerors who may include the Shareholders, the Parents or their respective Affiliates;

(3) use all reasonable endeavours to obtain the maximum possible offer price for the JV Enterprise within 180 days after the date of the Sale Notice (provided that an offer from an existing Shareholder will be considered on the basis that that Shareholder is only required to purchase the part of the JV Enterprise it does not already own and that the price offered would be reduced proportionately);

(4) prepare commercially reasonable terms of sale for the JV Enterprise (having regard to market practice) and negotiate and agree, as necessary, any amendment to those terms requested by potential offerors to the extent that the Sale Agent considers that the amendment is commercially reasonable and consistent with market practice for commercial transactions of substantially similar nature and complexity (provided that the terms must be such as to allow termination without liability to the vendors in the circumstances contemplated by clause 7.7(a)(5));

(5) use all reasonable endeavours to ensure that potential purchasers deal exclusively with the Sale Agent in respect of the sale of the JV Enterprise (and not the Shareholders or any JV Group Members);

(6) ensure that potential offerors (other than the Shareholders, their Parents or Affiliates) are not given access to JV Information or Shareholder Information in relation to any Shareholder unless the relevant person first enters into a deed poll in favour of the parties to this agreement whereby it agrees to comply with provisions substantially similar to those contained in clause 18; and

(7) act in the best interests of each Shareholder in performing the functions in this clause 7.4 and clause 7.5, and not prefer the interests of one Shareholder over the other.

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(e) The Appointing Parties must instruct the Sale Agent as follows:

(1) if the Shareholders provide warranties or indemnities to a purchaser of the JV Enterprise in respect of the Companies or the Business, the Sale Agent must ensure that the liability of the Shareholders under any such warranty or indemnity is apportioned between the Shareholders in proportion to their Shareholding Percentages;

(2) the Sale Agent must have regard to the terms of the Share Sale and Subscription Agreements at the completion of which this agreement was entered into (the Sale Agreements) and so that:

(A) the liability regime governing the liability of the Companies (in the case of a sale of the Business) or a Shareholder (in the case of a sale of the JV Shares) to a purchaser of the JV Enterprise (both in terms of financial thresholds and caps as a percentage of purchase price, and general limitations and exclusions) must not be materially more onerous than the corresponding regime applicable to the parties under the Sale Agreements; and

(B) a Shareholder must not without its prior written consent be bound by any material undertaking or obligation in relation to the transaction unless a reasonably corresponding provision was applicable in relation to vendor parties under the Sale Agreements;

(3) the sale documents agreed with the potential purchaser will include an enforceable regime limiting the operations of the JV Group and the conduct of its Business to the Territory (provided that this is not intended to limit any party’s obligations under clause 10 of this agreement); and

(4) a Shareholder must not, without its prior written consent, be bound by any undertaking or obligation which would restrict the Shareholder (or its Parent or Affiliates) from carrying on or otherwise having an interest in, or engaging in, any business (provided that this is not intended to limit any party’s obligations under clause 10 of this agreement).

(f) The Appointing Parties must instruct and authorise the Sale Agent to report to the Appointing Parties at the conclusion of the sale process detailing:

(1) the binding offers received for the JV Enterprise;

(2) the offer (including identity of the offeror, the price and full terms of sale and purchase) which in the Sale Agent’s opinion represents the highest value for the JV Enterprise in all the circumstances, including having regard to conditionality and the ability of the offeror to conclude the transaction (the Best Offer),

provided that the Sale Agent may only nominate an offer as the Best Offer if the Sale Agent is satisfied the terms of the offer are consistent with the requirements of clause 7.4(d)(4) and if clause 7.4(e) is complied with in relation to the offer.

7.5 Acceptance of Best Offer

(a) Either Shareholder may within 14 days of receipt of the Sale Agent’s nomination of the Best Offer (the First Response Period) give written notice to the other Shareholder and the Companies to the effect that it requires the Best Offer to be accepted (an Execution Notice).

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(b) If neither Shareholder gives an Execution Notice within the First Response Period, clause 7.7 will apply.

(c) If a Shareholder gives an Execution Notice within the First Response Period, the other Shareholder will have the right (Call Right) by notice to the first Shareholder and the Companies within a further 14 days after receipt of the Execution Notice (the Second Response Period) to purchase the JV Enterprise on the terms of the Best Offer in accordance with the remaining provisions of this clause 7.5. If both Shareholders give an Execution Notice within the First Response Period only the first notice issued (measured by time of receipt by the Companies) will be valid for the purposes of this clause 7.5.

(d) If a Shareholder exercises it Call Right within the Second Response Period (Exercising Shareholder), the relevant parties must within 45 days after exercise enter into a binding agreement for the sale of the JV Enterprise to the Exercising Shareholder at the price and on the terms of the Best Offer (or on such other terms as the Shareholders may agree in writing), provided that:

(1) if the Best Offer contemplates the acquisition of all JV Shares (as opposed to the Business) the terms will be amended to the extent reasonably required to ensure that the Exercising Shareholder is only required to purchase the JV Shares it does not already own (and the price will be reduced proportionately); and

(2) the terms will be amended to include conditions precedent in relation to material Consents identified by the Exercising Shareholder.

(e) Where an agreement is entered into pursuant to clause 7.5(d) but terminates before closing of the sale as a result of failure to obtain any Consent identified by the Exercising Shareholder, then to the extent the Best Offer remains open for acceptance the Appointing Parties must instruct and authorise the Sale Agent to accept the Best Offer on their behalf within 60 days from the termination, to execute the transaction on their behalf in accordance with the terms of the Best Offer, and to remit the proceeds to the Shareholders or the Companies (as applicable including in light of whether a Shareholder submitted the Best Offer).

(f) If a Shareholder gives an Execution Notice within the First Response Period and the other Shareholder does not exercise its Call Right within the Second Response Period, the Appointing Parties must instruct and authorise the Sale Agent to accept the Best Offer on their behalf, to execute the transaction on their behalf in accordance with the terms of the Best Offer, and to remit the proceeds to the Shareholders or the Companies (as applicable including in light of whether a Shareholder submitted the Best Offer).

(g) If the sale of the JV Enterprise under this clause 7.5 involves the sale of all or substantially all of the Business, the parties must take all reasonable steps to ensure that the net proceeds of the sale are returned to Shareholders in proportion with their respective Shareholding Percentages as soon as reasonably possible.

7.6 Support to Sale Agent

(a) Each Appointing Party must appoint the Sale Agent as its agent to perform the functions specified in clauses 7.4 and 7.5, and must do all things reasonably necessary to authorise the Sale Agent to perform those functions (and do all other things which the Sale Agent considers necessary or incidental to those functions) on its behalf, including executing any document reasonably requested by the Sale Agent for the purpose of providing such authority.

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(b) Each party must cooperate with, and provide all reasonable access and assistance required by the Sale Agent and potential purchasers in relation to the sale of the JV Enterprise, including access to due diligence materials and personnel involved in the management of the JV Group and the Business.

(c) The Shareholders must bear the fees and disbursements charged by the Sale Agent in respect of the sale of the JV Enterprise (and any indemnities under the Sale Agent’s customary engagement terms) in proportion to their Shareholding Percentages.

7.7 Failure of process

(a) This clause 7.7 will apply if a Shareholder issues a Sale Notice in accordance with clause 7.3 but any of the following occurs (each a Failure Event):

(1) the parties do not agree on a Sale Agent and no investment bank specified in clause 7.4(b) is willing or able to accept the appointment;

(2) a Sale Agent is appointed but no credible offers for the JV Enterprise are received within 180 days after the Sale Agent’s appointment or the Sale Agent is unwilling or unable to identify a Best Offer which meets the requirements of clause 7.4(f) within 180 days after the Sale Agent’s appointment;

(3) a Best Offer is identified but neither Shareholder gives an Execution Notice within the First Response Period;

(4) clause 7.5(e) applies, but the Best Offer is withdrawn, the relevant counterparty defaults or the transaction is otherwise not concluded on the Best Offer terms within the timeframe required by that clause;

(5) the JV Enterprise otherwise remains unsold 12 months after the date of the Sale Notice (whether because an agreement to sell the JV Enterprise has been entered into but fails to close within that timeframe or for any other reason).

(b) If this clause 7.7 applies in respect of a Sale Notice no party will have any further right or obligation in relation to the sale of the JV Enterprise after the relevant Failure Event unless a further Sale Notice is given in respect of a Deadlock in accordance with this agreement. However this does not prevent either Shareholder subsequently serving a Deadlock Notice (or by extension a Sale Notice) on the other in respect of the Deadlock that gave rise to the original Sale Notice to the extent that:

(1) if that Deadlock occurred under clause 7.1(a), both Boards or the Shareholders (as relevant having regard to the nature of the relevant matter) have not by the time of the Failure Event passed a resolution for or against a particular matter by the requisite majority required by this agreement

(2) if that Deadlock occurred under clause 7.1(b), clauses 7.1(b)(3)(A), (B) and (C) continue to apply in relation to the relevant decision or action at the time of the Failure Event; and

(3) if that Deadlock occurred under clause 7.1(c), clauses 7.1(c)(3)(A) continue to apply in relation to the relevant decision or action at the time of the Failure Event.

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Part B – Business operations

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8 Conduct of business

8.1 Strategic Plan and Budget

(a) The agreed initial Strategic Plan for the period to 30 June 2018 is attached to this agreement as Attachment 1.

(b) The parties must use their respective best endeavours to ensure that no later than 2 months before the commencement of:

(1) each Financial Year the Boards are in a position to consider, and if thought fit, resolve to adopt under clause 6.6 an annual Budget for the following Financial Year and a rolling 5 year Strategic Plan for the following 5 Financial Years; and

(2) each calendar year the Boards are in a position to consider and if thought fit, resolve to adopt under clause 6.6 an annual Budget for the following calendar year.

(c) The Strategic Plan or Budget (or both) may be amended or replaced at any time and from time to time as a Board Fundamental Matter.

(d) The Shareholders must use all reasonable endeavours to ensure that the JV Group conducts the Business in accordance with the Strategic Plan and Budget from time to time (but this does not oblige any Shareholder to provide any form of funding or financial assistance).

8.2 Conduct of business

Each of the Companies must ensure that, and each party must use its reasonable endeavours to ensure that:

(a) books and records: each JV Group Member keeps books of account and make true and complete entries in them of all its dealings and transactions, and ensure that such books of account and other records of the relevant entity are maintained in accordance with applicable laws;

(b) government requirements: each JV Group Member complies with the requirements of any Government Agency relating to the conduct of the Business and its assets;

(c) complies with law and Transaction Documents: each JV Group Member complies with all applicable Legal Requirements and with the terms of each Transaction Document to which it is party;

(d) complies with sanctions: each JV Group Member complies with any sanction, embargo or other trade restriction or disclosure requirement imposed by virtue of the involvement of either Shareholder as holders of JV Shares or parties to this agreement (provided such matters have been advised to the Companies by the affected Shareholder);

(e) anti bribery: without limiting the foregoing:

(1) each JV Group Member at all times conducts its business, and is otherwise, in compliance with:

(A) all Anti-Corruption Laws to which the JV Group Member is subject from time to time; and,

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(B) without limiting the foregoing and during any period which a USG Group Member’s Shareholding Percentage is 37.5% or more, the United States Foreign Corrupt Practices Act 1977;

(2) no JV Group Member nor any of their Representatives nor any other person acting on their behalf:

(A) takes any action directly or indirectly that would result in a violation of any applicable Anti-Corruption Law (including anti-money laundering laws);

(B) comes under administrative, regulatory, civil or criminal investigation, indictment, audit or internal investigation with respect to any suspected, alleged or actual violation of any Anti-Corruption Law;

(C) makes any offer, payment or promise or authorises the payment of any money, or other property, gift, promise to give, or authorisation of the giving of, anything of value, directly or indirectly, to: (i) any Government Official; (ii) any person while having reason to believe that all or a portion of such money or thing of value will be offered, given, or promised, directly or indirectly, to a Government Official; or (iii) any other person if, in any such case, such payment or transfer would violate the laws of the country in which it is made or the laws of any other relevant jurisdiction; or

(D) accepts or receives any improper or unlawful contributions, payments, gifts, or expenditures in connection with the operation of their businesses;

(3) no payments or transfers of value are made directly or indirectly by any JV Group Member, their respective Representatives or any other person or entity acting on behalf of any of them, having the purpose or effect of public or commercial bribery, acceptance of or acquiescence in extortion, kickbacks, or other unlawful or improper means of obtaining or retaining business or securing improper business advantage.

(f) codes of conduct: complies with any codes of conduct or policies approved by the Boards as a Super Resolution;

(g) safety: complies with industry best practice in relation to safety issues in the conduct of its operations; and

(h) corporate existence: maintains its corporate existence (except in the case of a winding up or deregistration approved in accordance with this agreement).

8.3 Tax

Each party to this agreement acknowledges and agrees:

(a) to cooperate with the USG Group in good faith to ensure that the ownership of entities by the JV Group are structured to enable the USG Group to maintain the level of ownership required by section 902 of the Code;

(b) that the shares and assets owned by the following entities are subject to a gain recognition agreement filed with the U.S. government and that the JV Group will not sell or cause to be sold the shares or assets of these businesses prior to January 1, 2019:

(1) USG Manufacturing Worldwide Ltd;

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(2) USG ChinaLux S.a.r.l.;

(3) Star-USG Building Materials Co., Ltd;

(4) USG Asia Pacific Holdings Pte. Ltd;·

(5) USG Interiors Pacific Ltd;

(6) USG Interiors Australia Pty Ltd; and·

(7) USG Cayman Holdings Ltd;

(c) that the USG Guarantor, as a US-based multinational, is subject to various detailed reporting requirements (as amended from time to time) and to comply with these reporting requirements the USG Group will require, and the Companies will provide (and will procure that each JV Group Member provides):

(1) detailed information regarding the computation of earnings and profits of each JV Group Member and the nature of those earnings;

(2) receipts evidencing foreign taxes paid by each JV Group Member; and

(3) any other information the USG Group requires in respect to the JV Group in order to comply with its reporting obligations to a Government Agency;

(d) that the Boral Guarantor, as an Australian-based multinational, is subject to various detailed reporting requirements (as amended from time to time) and to comply with these reporting requirements the Boral Group will require, and the Companies will provide (and will procure that each JV Group Member provides) any information the Boral Group requires in respect to the JV Group in order to comply with its reporting obligations to a Government Agency;

(e) that the JV Group will make any tax election with respect to any matters relating to taxation in the United States of America that a USG Group Member reasonably requests provided it does not create any detrimental effect to the entity making the election or to the JV Group or the Boral Group.

8.4 Periodic reports

Without limiting clause 8.3, the Companies must ensure that, and each Shareholder must use its reasonable endeavours to ensure that, the Companies provide reasonable information and updates to Shareholders in relation to the operations and performance of the JV Group, including:

(a) as soon as practicable after the end of each quarter of a Financial Year, but no later than 7 days after the end of that quarter:

(1) a profit and loss statement and quarterly cash flow statement for the quarter and for the current Financial Year to date; and

(2) a balance sheet as at the end of the quarter,

each prepared in accordance with IFRS (reconciled with US GAAP) and a quarterly review will be completed and provided to Deloitte Chicago in accordance with its specified processes no later than 12 business days (based on business days in Chicago) after the end of the quarter;

(b) as soon as practicable following the end of each Financial Year, an audited profit and loss statement, cash flow statement and balance sheet for that Financial Year, prepared in accordance with IFRS (reconciled with US GAAP);

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(c) as soon as practicable following 31 December in each calendar year (and in any event no later than 25 days after 31 December), an audited profit and loss statement, cash flow statement and balance sheet for the 12 month period ending on that date, prepared in accordance with IFRS (reconciled with US GAAP);

(d) as soon as practicable (and in any event no later than 7 days) after the end of each calendar month, unaudited management accounts, which must include a detailed statement of financial performance, statement of financial position and cash-flow statement and an analysis of sales and other revenues; and

(e) any other information reasonably requested by any Shareholder (at its cost) to satisfy any local or overseas reporting requirement to any Government Agency or regulatory body which has jurisdiction over the Shareholder,

and that, without limiting any of the time periods specified above, so far as practicable the timing of delivery of such information takes into account the reporting obligations of each Shareholder (and their respective Parents).

8.5 Access to information

(a) Subject to clause 18, each Shareholder may, at its own expense (but subject to providing reasonable advance notice of at least 2 Business Days and not unduly interfering with the operations of the Business):

(1) inspect and make copies of all Records; and

(2) have access to personnel, assets and operations of each JV Group Member,

including for the purposes of a Shareholder conducting an external audit of the JV Group.

(b) The Companies must (and must procure that each JV Group Member) co-operates fully in any such inspection, including by providing appropriate and secure office facilities in the relevant premises, providing copies of any Records and making appropriate personnel available to answer questions.

(c) Each director may provide its appointing Shareholder with any information acquired by the director in his or her capacity as a director of either of the Companies (or of any other JV Group Member). For the avoidance of doubt clauses 10 and 18 apply in relation to use and disclosure of such information by the Shareholders.

8.6 Auditor

(a) The parties agree that the JV Group will appoint:

(1) KPMG as auditor in respect of JVC 2 and its Subsidiaries for the Financial Year ending 30 June 2014;

(2) Deloitte as auditor in respect of JVC 1 and its Subsidiaries for the Financial Year ending 30 June 2014.

(b) In respect of subsequent Financial Years Deloitte must be appointed as sole auditor for the JV Group unless otherwise agreed as a Major Fundamental Matter by Unanimous Resolution of the Shareholders.

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(c) Audits must be conducted in accordance with:

(1) the standards of the Public Company Accounting Oversight Board (United States) and the U.S. Securities and Exchange Commission; and

(2) the Corporations Act 2001, Australian Accounting Standards and the Corporations Regulations 2001 (Cth),

provided that, in the event of any inconsistency, the Shareholders will discuss in good faith an appropriate solution.

8.7 Dividends

(a) The Companies’ Dividend policy will be to target distribution of 50% of the combined after tax profit of the JV Group to Shareholders (in proportion to each Shareholders’ Shareholding Percentage at the relevant time), with the balance to be retained for reinvestment into the business, unless the Shareholders decide to adopt a different policy by Unanimous Resolution.

(b) Despite clause 8.7(a) (and subject to clause 8.7(c)), profits of the JV Group must not be distributed and must be retained to the extent necessary:

(1) to ensure that the financing facilities of the JV Group from time to time are complied with;

(2) to ensure that a sufficient amount has been set aside for working capital, investment and expansion as specified in the Strategic Plan for the relevant period;

(3) to ensure that any distribution by a Company does not exceed the amount legally available for distribution by that Company; and

(4) to ensure that the each JV Group Member is able meet any capital adequacy or solvency requirements, and is able to pay its debts as and when they fall due.

(c) If JVC 2:

(1) has profits that may be paid as fully franked dividends consistently with the Dividend policy in force at the relevant time; but

(2) is not permitted to distribute those profits under clause 8.7(b),

JVC 2 may distribute those profits as fully franked dividends on condition that each Shareholder agrees to forthwith subscribe an equivalent amount for new JV Shares on a pro-rata basis proportionate to its Shareholding Percentage at the time (and the Boards may determine the respective subscription prices per JVC 1 Share and JVC 2 Share on the basis that they need not be the same).

(d) The Boards may by Super Resolution of both Boards cause either or both Companies to declare and pay a Dividend subject to and in accordance with clauses 8.7(a) to 8.7(c).

8.8 Insurance

(a) Unless otherwise agreed by the Shareholders, each Shareholder must independently purchase and maintain customary insurance for each of their nominee directors on either Board for any liability incurred by the director as a director of either of the Companies (or of any other JV Group Member).

(b) Subject to clause 8.8(a), the Companies must ensure that, and each Shareholder must use its reasonable endeavours to ensure that, the JV Group maintains such customary insurances for such amounts as are generally maintained by companies undertaking similar business to that of the JV Group.

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8.9 Further funding

(a) In the event that the JV Group requires additional funding, the parties agree that such funding should be sourced in the following order of preference:

(1) first from operating cash flows of the JV Group;

(2) second, from third party financiers utilising the JV Group’s borrowing capacity; and

(3) third, from capital calls to Shareholders in accordance with the remaining provisions of this clause 8.9.

(b) The Shareholders agree that the Companies will not call for any capital from the Shareholders unless the Companies have used all reasonable endeavours to raise sufficient funds from third party financiers (to the extent operating cash flows are insufficient) and there remains a funding shortfall.

(c) Unless the Shareholders agree otherwise in relation to any individual call, the parties must ensure that any call for capital:

(1) is approved by Unanimous Resolution of the Shareholders as a Major Fundamental Matter;

(2) is limited to the amount required to fund the relevant shortfall (as referred to in clause 8.9(b));

(3) (subject always to clause 8.9(f)) specifies the form in which capital is to be provided (being JV Shares, other securities or debt) and the key terms of such provision;

(4) is offered to each Shareholder on a pro-rata basis proportionate to its Shareholding Percentage and on the same terms; and

(5) specifies an agreed valuation basis for the purposes of any dilution of a Shareholder’s Shareholding Percentage in the circumstances contemplated by clause 8.10,

or is made in accordance with clause 8.9(h).

(d) A call for capital must be made by notice in writing from the Companies to each Shareholder (given no later than 21 days after the date of approval of the relevant call, or in accordance with clause 8.9(h) where applicable) which confirms the details in clauses 8.9(c)(1) to 8.9(c)(5) above (or clauses 8.9(h)(3) to 8.9(h)(6) in the case of a call made under clause 8.9(h)) and specifies the date by which the capital call is to be satisfied, which shall be:

(1) no earlier than 30 days after the date of the notice; and

(2) a Business Day,

(such a notice being a Valid Funding Notice)

(e) For the avoidance of doubt, no Shareholder has any obligation to fund in response to a Valid Funding Notice or other capital call. Where the Companies issue a Valid Funding Notice:

(1) to the extent either Shareholder contributes capital in response to the call within the time period specified in the Valid Funding Notice, the Companies must issue JV Shares to that Shareholder (in accordance with clause 19) or otherwise comply with the terms of the Valid Funding Notice; and

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(2) if one Shareholder contributes in full its Shareholding Percentage of the call in the time period specified in the Valid Funding Notice but there is a shortfall in capital provided in response to the Valid Funding Notice because the other Shareholder (the Non-Funding Shareholder) has not contributed in full (or at all) its Shareholding Percentage of the call in the time period specified in the Valid Funding Notice (with the unpaid amount being the Shortfall Capital) then the Companies must immediately notify the other Shareholder and the other Shareholder may elect to contribute all (but not some only) of the Shortfall Capital in accordance with clause 8.9(f),

and for the avoidance of doubt if there is a funding shortfall because neither Shareholder has satisfied the call in proportion to its Shareholding Percentage (whether or not either has funded a portion) neither party will be entitled to fund the other’s shortfall.

(f) If a Shareholder elects to contribute all of the Shortfall Capital under clause 8.9(e)(2) that Shareholder must contribute the relevant amount within 7 days after the Shareholder is notified of the Shortfall Capital by the relevant Company (and otherwise it will be taken to have elected not to contribute the relevant funds). Any such contribution will be:

(1) to the extent that the terms set out in the Valid Funding Notice did not include subscription and issue of JV Shares (that is the funding is not dilutive to any Shareholder’s Shareholding Percentage), on the terms set out in the Valid Funding Notice; and

(2) subject to clause 8.9(g), otherwise on the terms below:

(A) the Shortfall Capital will initially be contributed as separate unsecured loans to the Companies (in proportion to the relative amounts required to be subscribed for JVC 1 Shares and JVC 2 Shares under the Valid Funding Notice), each on the Loan Terms or on such other terms as the Shareholders may agree in the circumstances (each a Shortfall Loan);

(B) if the Non-Funding Shareholder contributes the relevant Restoration Amount within the Catch-Up Period pursuant to clause 8.10, the proceeds of such contribution must immediately be applied in satisfaction of the Shortfall Loans; and

(C) if the Non-Funding Shareholder fails to contribute the relevant Restoration Amount within the Catch-Up Period pursuant to clause 8.10, the outstanding amounts of the Shortfall Loans (including accrued interest) must be satisfied by applying them so that the Shareholder that elected to contribute all of the Shortfall Capital subscribes for and is issued JV Shares at the price per share set out in the Valid Funding Notice (and otherwise on the terms set out in the Valid Funding Notice, to the extent applicable in the circumstances).

(g) If the Shortfall Capital is less than US$25 million (or its equivalent in any other currency), unless all Major Shareholders agree in writing, irrespective of the terms of the relevant Valid Funding Notice, any contribution of Shortfall Capital by a Shareholder must take the form of loan finance, to be provided on arm’s length market terms (with no subscription for equity).

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(h) Notwithstanding the foregoing, if during any period in which there are two Major Shareholders:

(1) a proposed capital call on Shareholders has been put forward for approval and an Unanimous Resolution approving such capital call has not been passed within 30 days (in circumstances where clause 8.9(b) has been complied with); and

(2) in the reasonable opinion of a Major Shareholder (acting in good faith), either Company is likely to suffer an Insolvency Event within 60 days if funding is not provided,

that Major Shareholder may, acting in good faith, by notice to the Companies and the other Shareholders require the Companies to issue a funding notice on terms specified by that Major Shareholder provided that such terms must:

(3) be limited to the amount of funding required to avoid the apprehended Insolvency Event;

(4) specify the form in which the funding is to be provided (being JV Shares, other securities or debt) and the key terms of such provision;

(5) be offered to each Shareholder on a pro-rata basis proportionate to its Shareholding Percentage and on the same terms;

(6) specify a valuation basis for the purposes of any dilution of a Shareholder’s Shareholding Percentage in the circumstances contemplated by clause 8.10, which is based on a good faith valuation of each of the Companies at the relevant time,

and the Companies must comply with such a request within 10 days (in which case the relevant funding notice will constitute a Valid Funding Notice for the purposes of this clause 8.9).

(i) For the avoidance of doubt where a Valid Funding Notice has been issued in accordance with this agreement, any further issues of securities or entry into loan arrangements required under this clause 8.9 or clause 8.10 will not require further approval as a Board Fundamental Matter or Fundamental Matter.

8.10 Anti-dilution

(a) This clause 8.10 applies in circumstances where:

(1) the relevant Valid Funding Notice required capital to be contributed in the form of subscription for JV Shares; and

(2) there is a Non-Funding Shareholder and the other Shareholder is entitled to, and does, contribute all of the Shortfall Capital under clause 8.9(e)(2).

(b) Where this clause 8.10 applies, the Non-Funding Shareholder will have 90 days from the date of contribution of the Shortfall Capital (Catch-Up Period) during which it may contribute, by way of subscription for JV Shares all (but not less than) the amount (the Restoration Amount) equal to:

(1) the amount of the Shortfall Capital; plus

(2) the amount of accrued interest under the relevant Shortfall Loans as at the relevant date.

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(c) If the Non-Funding Shareholder contributes the Restoration Amount in full within the relevant period, the Companies must allot and issue JV Shares (in accordance with clause 18.6(b)) to the Non-Funding Shareholder on the basis that:

(1) the same number of JV Shares will be issued as would have been issued to the Non-Funding Shareholder had the Non-Funding Shareholder contributed in full its Shareholding Percentage of the relevant call in the time period specified in the original Valid Funding Notice; but

(2) the subscription price per share in each Company will be increased (so that the effective price per share in each Company is the relevant proportion of the Restoration Amount divided by the number of shares issued to the Non-Funding Shareholder, rather than the price per share specified in the original Valid Funding Notice).

(d) The above will apply with appropriate modifications to the extent that only a portion of the Valid Funding Notice related to subscription for JV Shares (such that only the relevant portion of the overall amount of the Shortfall Capital was contributed under clause 8.9(e)(2)).

8.11 Guarantees

(a) Neither Shareholder (and neither Shareholder’s Parent or Affiliates) will have any obligation to guarantee or provide similar surety or credit support in relation to the obligations of any JV Group Member.

(b) If any such guarantees are agreed to be given, they will (unless otherwise agreed between all Shareholders in writing) be on a several basis pro rata to the Shareholders’ respective Shareholding Percentages, with appropriate cross indemnity arrangements.

8.12 Related party dealings

Each Shareholder must ensure that any arrangement or transaction between the JV Group and that Shareholder or an Affiliate of that Shareholder is:

(a) on commercial terms and on an arm’s length basis; and

(b) terms that are otherwise not unfairly prejudicial to the interests of the JV Group or either Shareholder (or its Affiliates).

9 Branding and IP

9.1 Branding

(a) The Shareholders must procure that (unless the Shareholders agree otherwise):

(1) the Companies trade as ‘USG-Boral Building Products’; and

(2) that the name ‘USG-Boral Building Products’ or another trade mark forming part of the JV IP appears on all products manufactured or sold by the JV Group.

(b) The brand and trademark strategy (and any changes to the brand and trademark strategy) developed and implemented by the JV Group is a Major Fundamental Matter.

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(c) Each JV Group Member will ensure that all products manufactured or sold by the JV Group in the Territory will be sold on the condition that such products are for sale and use only within the Territory and shall not to be sold, offered for sale, supplied for or used outside the Territory.

9.2 IP Licence Agreements

The parties acknowledge that certain Related Corporations of the Shareholders have entered into the IP Licence Agreements licensing certain Intellectual Property Rights to the Companies and establishing other obligations and rights among the parties to those agreements in relation to the relevant Intellectual Property Rights.

9.3 Protection of JV IP

(a) Schedule 8 sets out:

(1) in Part 1, the initial list of High Risk Jurisdictions for the purposes of clause 14.2(a) of each of the Boral Umbrella Intellectual Property Licence Agreements and the USG Umbrella Intellectual Property Licence Agreements as at the date of this agreement; and

(2) in Part 2, the initial High Risk Procedures for the purposes of clause 14.2(b) of each of the Boral Umbrella Intellectual Property Licence Agreements and the USG Umbrella Intellectual Property Licence Agreements as at the date of this agreement.

(b) Jurisdictions may be added to or removed from the list of High Risk Jurisdictions in Part 1 of Schedule 8 at any time and from time to time by Unanimous Resolution of Shareholders (as Minor Fundamental Matter).

(c) The High Risk Procedures in Part 2 of Schedule 8 may be modified at any time and from time to time by Unanimous Resolution of Shareholders (as Minor Fundamental Matter).

10 Exclusivity and commitment

10.1 Parties

This clause 10 applies only as between USG Guarantor and Boral Guarantor. It is not intended that any other person named as a party to this agreement will have any rights, powers, obligations or liabilities under this clause 10.

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10.2 Definitions

The meanings of the terms used in this clause 10 are set out below:

Term	Meaning
Group	in relation to a party to this clause 10: •  where the party is Boral Guarantor, the Boral Group; and •  where the party is USG Guarantor, the USG Group.
JV Restricted Business	as at any given date, any business or undertaking comprising or forming part of the Parent Businesses at that date.
JV Restricted Period	any period while USG and Boral both hold any interest in JV Shares.
JV Restricted Territory	each of the following (it being recognised that in some circumstances these areas may overlap or be concurrent with each other): 1       each country or region outside the Territory for the purposes of this agreement at any relevant time; 2       North America; 3       Central America; 4       South America; 5       Europe; 6       Africa (except for jurisdictions and regions falling within the Territory for the purposes of this agreement at the relevant time); 7       the United States of America; 8       Mexico; 9       Canada.
Parent Businesses	means the businesses of manufacturing, distributing and selling the Products which are conducted by either the USG Group or the Boral Group in any geographical area outside the Territory.
Restricted Business	as at any given date, any business or undertaking comprising or forming part of the Business at that date.
Restricted Employee	an employee, director or officer of any JV Group Member or of a Boral Group Member or a USG Group Member.

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Term	Meaning
Restricted Period	in respect of a Guarantor, each of the following (it being recognised that in some circumstances these periods may overlap or be concurrent with each other): 1       any period while a member of that Guarantor’s Group holds any interest in JV Shares; 2       the period from the date of this agreement until the 10th anniversary of the date of this agreement; 3       the period from the date of this agreement until the 9th anniversary of the date of this agreement; 4       the period from the date of this agreement until the 8th anniversary of the date of this agreement; 5       the period from the date of this agreement until the 7th anniversary of the date of this agreement; 6       the period from the date of this agreement until the 6th anniversary of the date of this agreement; 7       the period from the date of this agreement until the 5th anniversary of the date of this agreement; 8       the period from the date of this agreement until the 4th anniversary of the date of this agreement; 9       the period from the date of this agreement until the date which is 3 years from the date on which that Guarantor’s Group ceases to hold any interest in JV Shares; 10     the period from the date of this agreement until the date which is 2 years from the date on which that Guarantor’s Group ceases to hold any interest in JV Shares; 11     the period from the date of this agreement until the date which is 1 year from the date on which that Guarantor’s Group ceases to hold any interest in JV Shares; 12     the period from the date of this agreement until the date which is 6 months from the date on which that Guarantor’s Group ceases to hold any interest in JV Shares.
Restricted Persons	1       in relation to Boral Guarantor, each Affiliate of Boral Guarantor from time to time; 2       in relation to USG Guarantor, each Affiliate of USG Guarantor from time to time; and 3       in relation to the Companies, their respective Subsidiaries from time to time.
Restricted Territory	each country or region forming part of the Territory for the purposes of this agreement at the relevant time.

10.3 Restrictive covenants

(a) Subject to the third party arrangements in place at the date of this agreement that are listed in Schedule 10, USG Guarantor and Boral Guarantor agree that the JV Group will have the exclusive right (as against USG Guarantor, Boral Guarantor and their respective Restricted Persons) to conduct the Business in the Territory, on the terms set out in this clause 10.

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(b) Boral Guarantor must not, and must procure that its Restricted Persons will not, during any period which is a Restricted Period in respect of Boral, and USG Guarantor must not, and must procure that its Restricted Persons do not, during any period which is a Restricted Period in respect of USG, do, or attempt to do any of the following within any Restricted Territory without the prior written consent of both USG Guarantor and Boral Guarantor:

(1) No competing business: directly or indirectly carry on or otherwise have an interest in, or be engaged in any business that is the same as or substantially similar to or that competes with a Restricted Business (including by manufacturing, distributing, supplying or otherwise providing the same or similar products or services) (except, for the avoidance of doubt, to the extent contemplated by Schedule 10);

(2) No poaching customers: solicit or persuade any person who the relevant Guarantor (or its relevant Restricted Person, as the case maybe) is aware is a customer or client of a Restricted Business in the Territory, to cease doing such business with any JV Group Member or reduce the amount of business that the customer or client would normally do or otherwise have done with any JV Group Member in the Territory; or

(3) No poaching staff: solicit, entice or persuade, or attempt to solicit, entice or persuade any person who the relevant Guarantor (or its relevant Restricted Person, as the case may be) is aware is a Restricted Employee to terminate his or her employment with his or her employer, whether or not that person would breach his or her service agreement. For clarity, this will not prohibit a person from employing a Restricted Employee who responds to a bona fide public advertisement concerning a vacant position that is not targeted specifically at that Restricted Employee.

(c) USG Guarantor and Boral Guarantor must, to the extent within their respective power, procure that the Companies do not, and that the Companies procure that their respective Restricted Persons will not, during the JV Restricted Period do, or attempt to do any of the following:

(1) No competing business: directly or indirectly carry on or otherwise have an interest in, or be engaged in any business that is the same or is substantially similar to or that competes with a JV Restricted Business (including by manufacturing, distributing, supplying or otherwise providing the same or similar products or services as the Business but outside the Territory);

(2) No poaching customers: solicit or persuade any person who the Companies (or their relevant Restricted Persons, as the case may be) are aware is a customer or client of a Parent Business outside the Territory, to cease doing business with any Boral Group Member or USG Group Member or reduce the amount of business that the customer or client would normally do or otherwise have done with any Boral Group Member or USG Group Member outside the Territory; or

(3) No poaching staff: solicit, entice or persuade, or attempt to solicit, entice or persuade any person who the Companies (or their relevant Restricted Person, as the case may be) is aware is a Restricted Employee to terminate his or her employment with his or her employer, whether or not that person would breach his or her service agreement. For clarity, this will not prohibit a person from employing a Restricted Employee who responds to a bona fide public advertisement concerning a vacant position that is not targeted specifically at that Restricted Employee.

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(d) USG Guarantor and Boral Guarantor agree that for these purposes the Restricted Periods are intended to operate separately in relation to each Restricted Territory, and the JV Restricted Periods are intended to operate separately in relation to each JV Restricted Territory, so that if any Restricted Period is held to be unenforceable in relation to activities in any particular Restricted Territory, or any JV Restricted Period is held to be unenforceable in relation to activities in any particular JV Restricted Territory, it is not intended to affect the application of the Restricted Period in relation to any other Restricted Territory or the JV Restricted Period in relation to any other JV Restricted Territory (as applicable).

10.4 Permitted Activities

(a) Clauses 10.3(a) and 10.3(b)(1) do not prevent Boral Guarantor or USG Guarantor or any of their Restricted Persons from:

(1) owning or controlling directly or indirectly shares or other securities of a company or trust listed on a recognised stock exchange, provided the aggregate holding owned or controlled by the relevant Guarantor and its Restricted Persons does not exceed 5% of any class of the relevant entity’s securities;

(2) acquiring by purchase, merger or otherwise, an interest in a business which is engaged or involved in a Restricted Business in a Restricted Territory, provided that:

• the Restricted Business in the Restricted Territory accounts for no more than 25% of revenue of the acquired business; and

• the Restricted Business in the Restricted Territory is closed or (subject to clause 10.4(b)) divested to the JV Group or a bona fide third party within 6 months after the acquisition.

(b) If clause 10.4(a)(2) applies and the relevant Guarantor (Restricted Business Seller) (or any of its Restricted Persons, as the case may be) proposes to divest, rather than close, the relevant Restricted Business (for the purposes of this clause 10.4(b), the Sale Business) then the relevant Restricted Business Seller must not (or if applicable must ensure that the relevant Restricted Person or Persons do not) divest or commit to divest the Sale Business unless:

(1) the other Guarantor and the Companies have been given a notice in writing (a Divestment Notice) specifying:

• the details of the Sale Business;

• the price at which the Restricted Business Seller (or relevant Restricted Persons as the case may be) is prepared to sell the Sale Business; and

• the other terms and conditions on which the Restricted Business Seller (or relevant Restricted Persons as the case may be) is prepared to sell the Sale Business;

(2) the Companies have been given at least 60 days (the Assessment Period) to conduct due diligence investigations and make an offer to buy the Sale Business on the terms set out in the Divestment Notice; and

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(3) clause 10.4(c) has been complied with.

(c) If:

(1) the Companies (or any JV Group Member nominated by the Companies) make an offer to buy the Sale Business on the terms set out in the Divestment Notice within the Assessment Period, the Restricted Business Seller must ensure that the offer is accepted and the sale completed in accordance with the relevant terms; or

(2) the Companies do not make such an offer within the Assessment Period, the Sale Business can be sold to a bona fide third party within the time period required by clause 10.4(a)(2) provided the price and other terms are not materially more favourable to the third party buyer than the terms set out in the Divestment Notice.

10.5 No restriction on USG or Boral conducting businesses outside the Territory

For the avoidance of doubt nothing in clause 10.3(a) or 10.3(b)(1) is intended to prevent (and does not prevent) either Guarantor or any of their respective Affiliates acquiring, carrying on or otherwise having an interest in, or being engaged in, any business whatsoever at any time in any geographical area outside the Territory, including any business that is the same as or substantially similar to (or that competes with) a Restricted Business.

10.6 Severability

(a) The parties agree that the restrictions set out in this clause 10 are to be regarded as separate, distinct and severable so that the unenforceability of any restriction will in no way affect the enforceability of any other restriction.

(b) If any of the restrictions in this clause 10 is void as unreasonable for the protection of the interests of any party and would be valid, if:

(1) part of the wording was deleted;

(2) the period of the restriction was reduced;

(3) the area of the restriction was reduced;

(4) the scope of the definition of ‘Restricted Business’ or the ‘JV Restricted Business’ (as relevant) was narrowed; or

(5) any combination of the foregoing,

the restraint will apply with the minimum modifications necessary to make it effective.

10.7 Acknowledgment

Each party acknowledges:

(a) that all the restrictions in this clause 10 are reasonable in the circumstances and necessary to protect the goodwill of the Business (including the businesses of the various members of the JV Group) or the Parent Businesses, as the case may be, and are intended to operate to the maximum possible extent; and

(b) the remedy of damages may be inadequate to protect the interests of a Guarantor (or other members of its Group) in the event of the breach or threatened breach of an applicable provision of this clause 10 and that a Guarantor (or other member of its Group) is entitled to seek and obtain injunctive relief, or any other relief.

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Part C – Shareholder exit and default provisions

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11 Disposal - general

11.1 Standstill Period

(a) For the purposes of this agreement the Standstill Period means the period commencing on the date of this agreement and ending on the 7^th anniversary of the date of this agreement.

(b) Subject to clauses 11.1(c) and 11.1(d), a Shareholder must not Dispose of any JV Shares during the Standstill Period except with the prior written consent of the other Shareholder.

(c) a Shareholder may Dispose of all of its JV Shares (being, for the avoidance of doubt, all of its JVC 1 Shares and all of its JVC 2 Shares) at any time during the Standstill Period:

(1) if an Event of Default occurs in respect of the other Shareholder and the Disposal occurs under clauses 14 and 15; or

(2) if the Disposal occurs in accordance with clause 7.

(d) JV Shares may be Disposed of during the Standstill Period in accordance with clause 11.4.

(e) During the Standstill Period a Shareholder must not, and must ensure that its Parent, Affiliates, agents and adviser do not:

(1) offer to Dispose of any JV Shares (or, for the avoidance of doubt any JVC 1 Shares separately to any JVC 2 Shares and vice versa);

(2) solicit, invite, encourage or initiate offers or proposals in relation to the Disposal of any JV Shares (or, for the avoidance of doubt any JVC 1 Shares separately to any JVC 2 Shares and vice versa); or

(3) participate in or continue any negotiations or discussions with respect to any Disposal or potential Disposal of any JV Shares (or, for the avoidance of doubt any JVC 1 Shares separately to any JVC 2 Shares and vice versa).

except with the prior written consent of the other Shareholder or to the extent necessary to enable the Shareholder to comply with any provision of this agreement.

11.2 Disposals following Standstill Period

Following expiry of the Standstill Period, a Shareholder must not Dispose of its JV Shares unless (without limiting clause 18.6(b)):

(a) the other Shareholder gives its prior written consent;

(b) the Shareholder complies with clause12;

(c) an Event of Default occurs in respect of the other Shareholder and the Disposal occurs under clauses 14 and 15; or

(d) the Disposal occurs in accordance with clause 7,

provided that JV Shares may at any time be Disposed of during the Standstill Period in accordance with clause 11.4.

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11.3 Security Interests over JV Shares

Despite anything in clauses 11.1 and 11.2 a Shareholder must not at any time create a Security Interest over a JV Share unless the other Shareholder gives its prior written consent.

11.4 Intra-group transfers

(a) JV Shares may be Disposed of (and JVC 1 Shares and JVC 2 Shares may separately be Disposed of) at any time if each of the following is satisfied (and the remainder of this clause 11.4 is complied with):

(1) the Disposal consists of:

(A) in relation to JVC 1 Shares held by Boral Holder 1, the sale, transfer or assignment of its entire interest in all (but not some only) of its JVC 1 Shares to a transferee that is a Wholly Owned Subsidiary of Boral Guarantor;

(B) in relation to JVC 2 Shares held by Boral Holder 2, the sale, transfer or assignment of its entire interest in all (but not some only) of its JVC 2 Shares to a transferee that is a Wholly Owned Subsidiary of Boral Guarantor; or

(C) in relation to JV Shares held by USG, the sale, transfer or assignment of its entire interest in all (but not some only) of its JVC 1 Shares or its JVC 2 Shares (or both) to a transferee that is a Wholly Owned Subsidiary of USG Guarantor; and

(2) the Disposal has been approved by the other Shareholder (being USG where clause 11.4(a)(1)(A) or 11.4(a)(1)(B) applies and Boral where clause 11.4(a)(1)(C) applies), such approval not to be unreasonably withheld or delayed where:

(A) the Disposal does not adversely affect such other Shareholder’s risk or cost profile in relation to its interest in the JV Group (having regard in particular to the identity of the acquiring entity and its jurisdiction of incorporation); and

(B) in the case of a proposed sale, transfer or assignment of USG’s JVC 1 Shares only (or its JVC 2 Shares only) this agreement has been amended to the extent necessary to reflect that two separate USG entities will be holding JV Shares (with approval of either party to such amendments not to be unreasonably withheld or delayed).

(b) Before any sale, transfer or assignment is effected in reliance on clause 11.4(a) the existing holder of the relevant JV Shares (the Transferor) must ensure that the proposed buyer, transferee or assignee transferee (the Transferee) enters into an Adherence Deed agreeing to be bound by this agreement as if named as a party (and specifically as if named as ‘Boral Holder 1’, ‘Boral Holder 2’ or ‘USG’, as the case may be).

(c) Subject always to clause 11.4(d) a Transferee under this clause 11.4 may itself subsequently sell, transfer or assign its JV Shares (or its JVC 1 Shares or JVC 2 Shares) under this clause to a Wholly Owned Subsidiary of its Parent, provided the requirements of clauses 11.4(a) and 11.4(b)are satisfied.

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(d) A Transferee that becomes a holder of JV Shares under any application of this clause 11.4 must transfer, and the relevant guarantor party (being Boral Guarantor where that is the Transferor’s Parent and USG Guarantor where that is the Transferor’s Parent) must ensure that it sells, transfers or assigns all its JV Shares to another Wholly Owned Subsidiary of the Transferor’s Parent before that Shareholder ceases to be a Wholly Owned Subsidiary of the Transferor’s Parent, and for the avoidance of doubt clause 11.4(b) will apply in relation to any such transfer.

(e) Nothing in this clause 11.4 is intended to affect clause 13.1(c) or clause 18.6(b) as it applies to all other Disposals of JV Shares.

11.5 No avoidance

(a) It is the intention of the parties that no Shareholder Disposes of or otherwise parts with or deals in any JV Shares or the economic benefits deriving from any JV Shares, other than under clauses 7, 11.4 or 14 of this agreement (and clause 15 to the extent invoked by those clauses), unless clause 12 has been complied with in respect of those JV Shares.

(b) Without limiting clause 11.5(a), unless the Shareholders agree otherwise in writing, a Shareholder may not (nor may it attempt to) Dispose of all or any of its JV Shares except by transfer of the entire legal and beneficial interest in those JV Shares free from all Security Interests.

(c) No party may employ any device or technique or participate in any transaction designed to circumvent this intention.

11.6 Adherence Deed and registration of transfers

(a) JVC 1 will not recognise and must not register any transfer of JVC 1 Shares (or any interest in or right to acquire JVC 1 Shares) and JVC 2 will not recognise and must not register any transfer of JVC 2 Shares (or any interest in or right to acquire JVC 2 Shares) if this agreement has not been complied with and any purported Disposal in breach of this agreement is void.

(b) JVC 1 must register a transfer of JVC 1 Shares and JVC 2 must register a transfer of JVC 2 Shares made in compliance with this agreement.

(c) A Shareholder must not Dispose of JV Shares or any interest in or right to acquire JV Shares, JVC 1 must not issue JVC 1 Shares, and JVC 2 must not issue JVC 2 Shares, to any person who is not a Shareholder at the time at which they acquire or are issued JV Shares, unless that person agrees in writing to become a party to, and to be bound by the provisions of this agreement by signing an Adherence Deed prior to or contemporaneously with such transfer or issue.

(d) Subject to clause 11.6(e), each party to this agreement from time to time agrees that any person who executes an Adherence Deed is bound by the terms of this agreement, and has rights under this agreement, with effect from the date of the relevant transfer or issue of the JV Shares as if that person were named as a party to this agreement in the relevant capacity, in accordance with the terms of the Adherence Deed.

(e) A person who executes an Adherence Deed as the result of a transfer of JV Shares to that person will not be liable under this Agreement for any breach of the transferor that occurred before the date of the transfer, or for any liability of the transferor under this agreement that was incurred before the date of the transfer.

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(f) Without limiting the foregoing, to the extent JV Shares (or any other equity securities) are:

(1) issued to anyone other than an existing Shareholder; or

(2) transferred to anyone other than an existing Shareholder;

in circumstances where there are additional shareholders to Boral and USG in the Companies, the parties must, before that issue or transfer, ensure that the relevant third party enters into an Adherence Deed agreeing to be bound by this agreement amended as reasonably required by the Shareholders and agreed with the third party.

12 Pre-emptive provisions

12.1 General

After expiry of the Standstill Period a Shareholder may transfer its entire interest in all (but not some only) of its JV Shares if it complies with this clause 12.

12.2 Notice of Sale

(a) A Shareholder (the Seller) wishing to transfer its JV Shares under this clause 12 must give a written notice to that effect to the other Shareholder (the Recipient). The notice (a Notice of Sale) must specify:

(1) the JV Shares that the Seller proposes to sell, which must be all of the JV Shares held by the Seller (the Sale Shares);

(2) the minimum sale price for the Sale Shares (as a parcel), which must be a cash price expressed in US dollars (the Floor Price);

(3) the proposed terms on which the Seller proposes to sell the Sale Shares (the Sale Terms), in the form of draft sale documentation; and

(4) a statement to the effect that the Recipient may offer to purchase all (but not part of) the Sale Shares at the Floor Price and on the Sale Terms if the Recipient complies with clause 12.3.

(b) A Notice of Sale is irrevocable (except with the written consent of the Recipient).

(c) The Sale Terms specified in a Notice of Sale must not include:

(1) conditions to the sale or obligations on the purchaser which by their nature are not capable of being complied with by or in relation to the Recipient, its Parent or Affiliates. For the avoidance of doubt this does not apply to any obligation to pay the purchase price; or

(2) conditions to the sale which the satisfaction or non-satisfaction of which are within the sole control of the Seller or its Parent or Affiliates.

12.3 Offer to purchase Sale Shares

The Recipient may offer to purchase the Sale Shares at the price and on the terms set out in the Notice of Sale by giving notice to that effect (an Offer Notice) to the Seller within 45 days after receipt of the Notice of Sale (the Response Period).

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12.4 Recipient does not offer to purchase

(a) If the Recipient does not give an Offer Notice to the Seller within the Response Period, or advises the Seller in writing within the Response Period that it does not wish to give an Offer Notice, the Seller may sell all (but not some only) of the Sale Shares to a third party buyer (Third Party Buyer) provided that:

(1) the aggregate sale price for the Sale Shares is a cash price in US dollars that is equal to or higher than the Floor Price;

(2) the terms of the sale are not materially more favourable to the Third Party Buyer than the Sale Terms and are such as to permit compliance with clause 12.4(e)(2) should that clause apply;

(3) the sale is to a single Third Party Buyer who is a bona fide third party buyer (not being a Parent or Affiliate of the Seller) on an arm’s length basis;

(4) the Seller enters into a legally binding agreement with the Third Party Buyer in relation to the sale within 90 days from expiry of the Response Period;

(5) the sale of the Sale Shares to the Third Party Buyer is completed as soon as reasonably practicable and in any event within 12 months from expiry of the Response Period; and

(6) the Seller has complied with clause 12.4(c) and clause 12.9(b).

(b) The Seller must ensure that there is no agreement, arrangement or understanding between the Seller and the Third Party Buyer (or, in each case, their respective Parents or Affiliates) conditional on, or in connection with, the sale by the Seller of the Sale Shares such as to confer a benefit or advantage or potential benefit or advantage on the Third Party Buyer (or a Related Corporation or Affiliate) which was not capable of being extended to the Recipient under the terms contained in the Notice of Sale.

(c) The Seller must not sell the Sale Shares to a Third Party Buyer pursuant to this clause 12.4 unless:

(1) the Seller has first given notice in writing to the Recipient (a Sale Terms Notice), specifying:

• the identity of the Third Party Buyer;

• the aggregate sale price for which the Third Party Buyer is willing to purchase all of the Sale Shares;

• the terms on which the Third Party Buyer is willing to purchase the Sale Shares, in the form of draft sale documentation;

• written confirmation that the proposed transaction complies with clauses 12.4(a)(1) to 12.4(a)(3) and clause 12.4(b); and

• a statement to the effect that the Recipient has the right (Tag Right) to require that its JV Shares are included as part of any sale transaction if the Recipient complies with clause 12.9(a); and

(2) the Recipient has not exercised its Tag Right within 21 days after receipt of the Sale Terms Notice (or has given confirmation in writing to the Seller within that period that it does not propose to exercise its Tag Right).

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(d) The Seller must give to the Recipient a copy of any agreement with the Third Party Buyer relating to the Sale Shares within 7 days after execution of the agreement.

(e) (Without limiting the remedies of any party if any purported sale to a Third Party Buyer does not comply with this clause 12.4) if:

(1) the Seller does not enter into a legally binding agreement with the Third Party Buyer in relation to the sale within the period required by clause 12.4(a)(4); or

(2) the sale of the Sale Shares to the Third Party Buyer is not completed within the period required by clause 12.4(a)(5),

the Seller must not sell the Sale Shares to the Third Party Buyer (or any other person) without complying again with this clause 12 (unless the sale occurs pursuant to any other provision of this agreement which permits the relevant Disposal).

12.5 Recipient offers to purchase

If the Recipient gives an Offer Notice to the Seller within the Response Period:

(a) the Seller may accept the Recipient’s offer by notice in writing to the Recipient to that effect within 15 days after the date of receipt of the Offer Notice (the Acceptance Period), in which case clause 12.6 will apply; or

(b) the Seller may reject the Recipient’s offer by notice in writing to the Recipient to that effect within the Acceptance Period, in which case clause 12.7 will apply,

provided that if the Seller does not give notice accepting or rejecting within the Acceptance Period it will be taken to have rejected the Recipient’s offer and clause 12.7 will apply accordingly.

12.6 Offer is accepted

If this clause 12.6 applies, the Seller must sell to the Recipient all of its JV Shares and the Recipient must purchase those JV Shares at the Floor Price and on and subject to the Sale Terms, and clause 15 will apply.

12.7 Offer is rejected

(a) If this clause 12.7 applies the Seller may for a period of up to 180 days from expiry of the Acceptance Period (the Marketing Period) market the Sale Shares to potential third party buyers on terms that would enable the Seller to give a Second Notice of Sale in relation to the transaction which complies with the requirements of clause 12.7(b).

(b) If the Seller finds a third party buyer (Third Party Buyer) to which it wishes to sell all the Sale Shares the Seller may at any time (but only once) during the Marketing Period give a further notice of sale (Second Notice of Sale) to the Recipient, specifying:

(1) the identity of the Third Party Buyer;

(2) the aggregate sale price for which the Third Party Buyer is willing to purchase all of the Sale Shares, which must be a cash price expressed in US dollars which is higher than the Floor Price;

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(3) the terms on which the Third Party Buyer is willing to purchase the Sale Shares, in the form of draft sale documentation, which must not be materially more favourable to the Third Party Buyer than the Sale Terms, must comply with clause 12.2(c) and must be such as to permit compliance with clause 12.8(d)(2) should that clause apply;

(4) written confirmation that the Third Party Buyer is a single buyer who is a bona fide prospective purchaser (not being a Parent or Affiliate of the Seller) on an arm’s length basis who has made an offer to purchase the Sale Shares at the price and on the terms set out in the Second Notice of Sale;

(5) written confirmation that that there is no agreement, arrangement or understanding between the Seller and the Third Party Buyer (or, in each case, their respective Parents or Affiliates) conditional on, or in connection with, the sale by the Seller of the Sale Shares such as to confer a benefit or advantage or potential benefit or advantage on the Third Party Buyer (or its Related Body Corporate or Affiliate) which is not capable of being extended to the Recipient under the terms contained in the Second Notice of Sale; and

(6) a statement to the effect that the Recipient:

• has an option (Last Right) to purchase all the Sale Shares at the cash price and on the terms set out in the Second Notice of Sale if the Recipient complies with clause 12.8; and

• has the right (Tag Right) to require that its JV Shares are included as part of any sale transaction if the Recipient complies with clause 12.9(a).

(c) A Second Notice of Sale is irrevocable (except with the written consent of the Recipient).

(d) If on expiry of the Marketing Period the Seller has not given a Second Notice of Sale in relation to the Sale Shares which complies with the requirements of clause 12.7(b), the Seller must cease its marketing of the Sale Shares and must not sell the Sale Shares without complying again with this clause 12 unless:

(1) the sale occurs pursuant to any other provision of this agreement which permits the relevant Disposal; or

(2) the Recipient remains willing to purchase the Sale Shares in accordance with its offer given during the Acceptance Period pursuant to clause 12.5(a) (in which case the Seller may accept that offer and clause 12.6 will apply).

12.8 Last Right

(a) If a Second Notice of Sale is given by the Seller, the Recipient (may exercise its Last Right to purchase the Sale Shares at the cash price and on the terms set out in the Second Notice of Sale by giving notice to the Seller to that effect within 21 days after the date of receipt of the Second Notice of Sale (the Decision Period), with such notice to confirm that the Recipient does not exercise its Tag Right. For the avoidance of doubt, the Recipient cannot exercise its Last Right if it has already exercised its Tag Right.

(b) If the Recipient exercises its Last Right within the Decision Period in accordance with clause 12.8(a), the Seller must sell to the Recipient all of its JV Shares and the Recipient must purchase those JV Shares at the price and on and subject to the terms set out in the Second Notice of Sale and clause 15 will apply

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(c) If the Recipient does not exercises its Last Right or its Tag Right within the Decision Period then the Seller may sell all (but not some only) of the Sale Shares to the Third Party Buyer identified in the Second Notice of Sale provided that:

(1) the sale is at the price and on the terms specified in the Second Notice of Sale;

(2) the Seller enters into a legally binding agreement with the Third Party Buyer in relation to the sale within 60 days from expiry of the Decision Period);

(3) the sale of the Sale Shares to the Third Party Buyer is completed as soon as practicable and in any event within 12 months from expiry of the Decision Period.

(d) In the event:

(1) the Seller does not enter into a legally binding agreement with the Third Party Buyer in relation to the sale within the periods required by clause 12.8(c)(2); or

(2) the sale of the Sale Shares to the Third Party Buyer is not completed within the periods required by clause 12.8(c)(3),

the Seller must not sell the Sale Shares to the Third Party Buyer (or any other person) without complying again with this clause 12 (unless the sale occurs pursuant to any other provision of this agreement which permits the relevant Disposal).

12.9 Tag Right

(a) The Recipient may exercise its Tag Right in relation to a proposed sale of Sale Shares by the Seller:

(1) if a Sale Terms Notice is given by the Seller under clause 12.4(c), by giving notice to the Seller to that effect within 21 days after receipt of the Sale Terms Notice; or

(2) if a Second Notice of Sale is given by the Seller under clause 12.7(b), by giving notice to the Seller to that effect within the Decision Period referred to in clause 12.8(a) with such notice to confirm that it does not exercise its Last Right (for the avoidance of doubt, the Recipient cannot exercise its Tag Right if it has already exercised its Last Right).

(b) If the Recipient exercises its Tag Right in relation to a proposed sale in accordance with clause 12.9(a), then the Seller may only proceed to sell the Sale Shares to the relevant Third Party Buyer if the Third Party Buyer concurrently purchases all of the Recipient’s JV Shares at the price and on the terms set out in the Sale Terms Notice or Second Sale Notice (as the case may be), but modified as necessary to:

(1) ensure that the rights and liabilities of the Seller and the Recipient are several and pro rata; and

(2) to reflect the identity of the Recipient as the seller of the Recipient’s JV Shares,

or on such other terms as the Recipient, Seller and Third Party Buyer may agree.

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(c) If the Recipient exercises its Tag Right but the sale of the Sale Shares and the Recipient’s JV Shares to the relevant Third Party Buyer has not been completed on terms which comply with this clause 12.9 within 12 months after the date of exercise of the Tag Right, the Seller must not sell the Sale Shares to the Third Party Buyer (or any other person) without complying again with this clause 12 (unless the sale occurs pursuant to any other provision of this agreement which permits the relevant Disposal).

12.10 Time periods

The Shareholders may by agreement in writing extend (or shorten) any time period applicable under this clause 12 in relation to any given transaction.

13 Events of Default

13.1 Events of Default

An Event of Default occurs in relation to a Shareholder if:

(a) material breach: (without limiting clause 13.1(e) or 13.1(f) where that is the relevant breach) the Shareholder (or its Parent) commits a material breach of a material term of this agreement and that breach:

(1) is incapable of remedy; or

(2) (without limiting clause 13.1(b)) if capable of remedy, is not remedied to the satisfaction of the other Shareholder (acting reasonably and in good faith):

• within 60 days; or

• if the breach occurs within 6 months after the Shareholder or its Parent has materially breached the same term, within 30 days,

after being notified in writing by the other Shareholder of the breach;

(b) repeated breach: the Shareholder (or its Parent):

(1) commits a material breach of a material term of this agreement in circumstances where:

• the breach is capable of remedy; but

• the Shareholder or its Parent has materially breached the same term on two or more occasions during the preceding 12 months; or

(2) materially and persistently breaches any term of this agreement, whether or not that breach is capable of remedy;

(c) Change of Control: a Change of Control occurs in respect of the Shareholder or of any Relevant Affiliate of the Shareholder;

(d) Insolvency Event: an Insolvency Event occurs in relation to the Shareholder or any Relevant Affiliate of the Shareholder;

(e) Disposal of Shares: the Shareholder Disposes, or purports to Dispose, of any JV Shares in breach of either Constitution or this agreement;

(f) Shareholder loans: clause 17 is breached in relation to the Shareholder;

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(g) failure to attend Board meetings: in circumstances where both Shareholders are Major Shareholders, a failure by all directors appointed by the Shareholder to the Board of a Company to attend a duly convened meeting of the Board of that Company 3 or more times in succession, where the subject matter of any resolution to be considered at the meeting needs to be passed by Super Resolution of the Board. For the avoidance of doubt for these purposes an adjournment of a Board meeting will not constitute a separate Board meeting in its own right;

(h) failure to attend Shareholder meetings: a failure by the Shareholder or proxy of the Shareholder to attend a duly convened meeting of Shareholders 3 or more times in succession, where the subject matter of any resolution to be considered at the meeting needs to be passed by the Unanimous Resolution of Shareholders and the vote of the relevant Shareholder is required in order for such a resolution to be passed. For the avoidance of doubt for these purposes an adjournment of a Shareholder meeting will not constitute a separate Shareholder meeting in its own right;

(i) breach by JV Group: a JV Group Member has breached in any material respect clause 1.3(d)(1) of this agreement, clause 8.2(e)) of this agreement, or any IP Licence Agreement and each of the following applies:

(1) the breach has been notified to the Shareholder (for the avoidance of doubt the Defaulting Shareholder in this context for the purposes of clause 14) in writing by the Companies or by the other Shareholder, specifying that the notice is for the purposes of this clause 13.1(i) (JV Breach Notice);

(2) the relevant breach is reasonably capable of reversal or remedy;

(3) the other Shareholder (for the avoidance of doubt the Non-Defaulting Shareholder in this context for the purpose of clause 14) has proposed to the Defaulting Shareholder in writing and in good faith a reasonable and proportionate course of action to reverse or remedy the breach notified in the JV Breach Notice, and either:

(A) the Defaulting Shareholder has not within 30 days after the date of the JV Breach Notice itself proposed in good faith an alternative reasonable and proportionate cause of action to reverse or remedy the breach; or

(B) the Defaulting Shareholder or the directors it has appointed to either Board is or are wilfully preventing the passing of a Board (or, if a Fundamental Matter is involved, Shareholder) resolution in relation to the Non-Defaulting Shareholder’s proposal in circumstances where there is no bona fide dispute between the directors (or Shareholders, as applicable) as to the appropriate action to be taken in relation to the breach; and

(4) the relevant breach has not otherwise been reversed or remedied to the reasonable satisfaction of both Shareholders.

13.2 Change of Control

(a) For the purposes of clause 13.1(c) a Change of Control occurs in respect of USG or a Relevant Affiliate of USG:

(1) in the case of USG, if it ceases to be a Wholly Owned Subsidiary of USG Guarantor;

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(2) in the case of any other Relevant Affiliate of USG (other than USG Guarantor itself), if the relevant entity ceases to be a Wholly Owned Subsidiary of USG Guarantor; or

(3) in the case of USG Guarantor, if a person (or group of associated persons) who did not previously do so acquires or holds directly or indirectly:

(A) securities in USG Guarantor conferring 50% or more of the voting or economic interests in USG Guarantor; or

(B) the power to control the appointment or dismissal of the majority of USG Guarantor’s directors,

or any person enters into any agreement or arrangement performance of which would result in such an acquisition or holding.

(b) For the purposes of clause 13.1(c) a Change of Control occurs in respect of Boral or a Relevant Affiliate of Boral:

(1) in the case of Boral, if it ceases to be a Wholly Owned Subsidiary of Boral Guarantor;

(2) in the case of any other Relevant Affiliate of Boral (other than Boral Guarantor itself), if the relevant entity ceases to be a Wholly Owned Subsidiary of Boral Guarantor; or

(3) in the case of Boral Guarantor, if a person (or group of associated persons) who did not previously do so acquires or holds directly or indirectly:

(A) securities in Boral Guarantor conferring 50% or more of the voting or economic interests in Boral Guarantor; or

(B) the power to control the appointment or dismissal of the majority of Boral Guarantor’s directors,

or any person enters into any agreement or arrangement performance of which would result in such an acquisition or holding.

(c) For the avoidance of doubt, a Change of Control in respect of either USG or a Relevant Affiliate of USG, or Boral or a Relevant Affiliate of Boral (Controlled Person), does not include:

(1) a reconstruction of the Controlled Person or an amalgamation of the Controlled Person with another entity where the entity involved or arising following the reconstruction or amalgamation and which holds the shares in the Controlled Person is beneficially owned solely by an entity of which the Controlled Person was a Wholly Owned Subsidiary prior to the reconstruction or amalgamation or any Wholly Owned Subsidiary of such entity; or

(2) any transfer of shares in the Controlled Person to any Wholly Owned Related Corporation, provided that such Wholly Owned Related Corporation remains a part of the relevant Shareholder Group of the Controlled Person after the date of the transfer.

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13.3 Insolvency Events

For the purposes of clause 13.1(d) an Insolvency Event occurs in relation to a person or entity (the Relevant Person) if any of the following occurs:

(a) controller: any of the following occur:

(1) a controller (as defined in section 9 of the Corporations Act) is appointed; or

(2) a resolution to appoint controller is passed,

to the Relevant Person or over an asset of the Relevant Person unless, in the case of an appointment, the other Shareholder is satisfied that the appointment of the controller is capable of being set aside, and it is set aside, within 7 days of the appointment being made;

(b) winding up: any of the following occur:

(1) an order is made; or

(2) a resolution is passed,

for the winding up of the Relevant Person;

(c) administration: any of the following occur:

(1) an administrator is appointed to the Relevant Person; or

(2) a resolution to appoint an administrator to the Relevant Person is passed;

(d) deregistration: the Relevant Person is deregistered;

(e) suspends payment: the Relevant Person suspends payment of its debts generally;

(f) insolvency: the Relevant Person is:

(1) unable to pay its debts when they are due; or

(2) presumed to be insolvent under the Corporations Act;

(g) arrangements: the Relevant Person enters into or resolves to enter into any arrangement, composition or compromise with, or assignment for the benefit of, any of its creditors;

(h) ceasing business: the Relevant Person ceases to carry on business; or

(i) analogous event: anything analogous to or having a substantially similar effect to any of the events specified in clauses 13.3(a) to 13.3(h) happens in relation to the Relevant Person under the laws of any jurisdiction.

13.4 Notice

If either of the Companies becomes aware of an Event of Default occurring in respect of a Shareholder, the relevant Company will promptly notify the other parties.

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14 Effect of Events of Default

14.1 Call Option

(a) If an Event of Default occurs in respect of a Shareholder (the Defaulting Shareholder), then immediately on the occurrence of an Event of Default the other Shareholder (the Non-Defaulting Shareholder) has an option to purchase all (but not part only) of the Defaulting Shareholder’s JV Shares at the Fair Market Value of those JV Shares in accordance with this clause 14 (a Call Option).

(b) A Call Option and the right to exercise it is without prejudice to any other right that the Non-Defaulting Shareholder may have in respect of the relevant Event of Default.

(c) The Non-Defaulting Shareholder’s Call Option in respect of any Event of Default will lapse if:

(1) the Non-Defaulting Shareholder does not give a Default Notice in respect of the Event of Default within the period required by clause 14.2(a); or

(2) the Call Option is not exercised within the period specified in clause 14.5(a).

However this does not affect any additional Call Options becoming exercisable in the event of any further Events of Default.

14.2 Assessment of Fair Market Value – initial phase

(a) At any time within 90 days of the Non-Defaulting Shareholder becoming aware of the occurrence of the Event of Default, the Non-Defaulting Shareholder may serve a written notice on the Defaulting Shareholder setting out the details of the Event of Default and stating that it requires that the Fair Market Value of the Defaulting Shareholder’s JV Shares be determined (a Default Notice).

(b) If the Non-Defaulting Shareholder gives a Default Notice within the period required by clause 14.2(a) then the Shareholders must enter into good faith negotiations and use all reasonable endeavours to agree the Fair Market Value of the Defaulting Shareholder’s JV Shares.

(c) If the Shareholders cannot agree the Fair Market Value of the Defaulting Shareholder’s JV Shares within 28 days after delivery of the Default Notice then the matter must be referred (via two separate referrals) to two firms or persons (being the Initial Experts for the purposes of the remaining provisions of this clause 14.2) for assessment. The Initial Experts will be selected as follows:

(1) each Shareholder must nominate one firm from the list below:

(A) PwC (or its successor entity);

(B) Deloitte (or its successor entity);

(C) KPMG (or its successor entity);

(D) Ernst & Young (or its successor entity); and

(2) if two Initial Experts are not appointed as a result of nominations under clause 14.2(c)(1) (whether because either or both Shareholders refuses to nominate, because both Shareholders nominate the same firm or because either or both firms nominated refuse the

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appointment) then unless the Shareholders agree on the firms to be appointed firms must be drawn by lot by the Chair of the Boards (in the presence of a representative of USG and Boral) from the list in clause 14.2(c)(1) or where that does not result in two Initial Experts being appointed (because an insufficient number of firms have accepted appointments), from the following additional list until two Initial Experts are able to be appointed:

(A) Houlihan Lokey (or its successor entity);

(B) Duff & Phelps (or its successor entity);

(C) Grant Samuel (or its successor entity);

(D) BDO (or its successor entity);

(E) Grant Thornton (or its successor entity);

(F) PKF (or its successor entity),

provided always that in any given case the Shareholders may by agreement in writing appoint any two firms or persons they consider to be appropriate (whether or not appearing on any list above) as the Initial Experts for the purposes of this clause 14.2.

(d) The Shareholders must jointly instruct each of the Initial Experts to:

(1) accept submissions from each Shareholder made within 14 days after the date of appointment of the relevant Initial Expert (provided that if a Shareholder does not provide a submission within the time period, the Expert may proceed in accordance with this clause);

(2) assess the Fair Market Value of the Defaulting Shareholder’s JV Shares in accordance with the valuation procedures set out in Schedule 7; and

(3) issue to each Shareholder and the Companies a certificate (the Initial Expert’s Certificate) specifying the Fair Market Value of the JV Shares as assessed by the relevant Initial Expert,

within the shortest practicable time.

(e) The Shareholders agree that:

(1) in assessing the Fair Market Value of the relevant JV Shares, the Initial Experts act as an expert not an arbitrator;

(2) the Defaulting Shareholder must bear the costs of both Initial Experts.

(f) The parties must promptly provide all information and assistance reasonably requested by any Initial Expert.

14.3 Binding determination of Fair Market Value

(a) (Unless the Fair Market Value of the Defaulting Shareholder’s JV Shares has already been agreed between the Shareholders at any stage), once both Initial Experts have issued their Initial Expert’s Certificates the Shareholders must again enter into good faith negotiations and use all reasonable endeavours to agree the Fair Market Value of the Defaulting Shareholder’s JV Shares.

(b) If the Shareholders still cannot agree the Fair Market Value of the Defaulting Shareholder’s JV Shares within 14 days after both Initial Expert’s Certificates have been issued the matter must be referred to:

(1) a suitably qualified and independent person that is agreed between the Shareholders for the purpose; or

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(2) failing agreement within the 14 day period referred to above, a firm drawn by lot by the Chair of the Boards (in the presence of a representative of USG and Boral) from the list in clause 14.2(c)(1) (ignoring any distinction between the groups of firms set out in that clause but excluding any firm appointed as an Initial Expert),

such person or firm being the Determining Expert for the purposes of the remaining provisions of this clause 14.3.

(c) The Shareholders must instruct the Determining Expert to do each of the following within the shortest practicable time:

(1) accept submissions from each Shareholder made within 14 days after the date of appointment of the Determining Expert (provided that if a Shareholder does not provide a submission within the time period, the Determining Expert may proceed in accordance with this clause);

(2) determine the Fair Market Value of the Defaulting Shareholder’s JV Shares in accordance with the valuation procedures set out in Schedule 7, but subject to the requirements that Fair Market Value determined by the Determining Expert:

(A) must not exceed the higher of the two Fair Market Values determined in the Initial Expert’s Certificates; and

(B) must not be less than the lower of the two Fair Market Values determined in the Initial Expert’s Certificates (unless the only reason the valuation is lower is because of the operation of paragraph (b)(2) of Schedule 7 in relation to any Dividend paid or declared after the date of the relevant Initial Expert’s Certificate); and

(3) issue to each Shareholder and the Companies a certificate (the Final Certificate) specifying the Fair Market Value of the JV Shares as determined by the Determining Expert.

(d) The Shareholders agree that:

(1) in determining the Fair Market Value of the relevant JV Shares, the Determining Expert acts as an expert not an arbitrator;

(2) the decision of the Determining Expert, as detailed in the Final Certificate, is final and binding on each of them in the absence of fraud or manifest error; and

(3) the Defaulting Shareholder must bear the costs of the Determining Expert.

(e) The parties must promptly provide all information and assistance reasonably requested by the Determining Expert.

14.4 Failure of expert process

(a) If clause 14.2 requires the assessment of the Fair Market Value of the Defaulting Shareholder’s JV Shares to be referred to Initial Experts but Initial Expert’s Certificates are not issued by two Initial Experts because:

(1) USG and Boral do not agree on the identity of the Initial Experts and none (or not enough) of the firms selected as potential Initial Experts under the process in clause 14.2(c) agrees to the accept the appointment;

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(2) two Initial Experts are appointed but either or both Initial Experts subsequently withdraw or advise that they are for any reason unable to make an assessment; or

(3) for any other reason,

and USG and Boral cannot within a further 14 days agree on the appointment of alternative Initial Experts, then the expert determination process will be taken to have failed and any party may commence proceedings in a court of competent jurisdiction in relation to the determination of the Fair Market Value of the Defaulting Shareholder’s JV Shares.

(b) If two Initial Expert’s Certificates are issued and clause 14.3 requires the determination of the Fair Market Value of the Defaulting Shareholder’s JV Shares to be referred to a Determining Expert but no expert determination on the matter is possible because:

(1) USG and Boral do not agree on the identity of the Determining Expert and none of the firms selected as potential Determining Experts agree to accept the appointment;

(2) a Determining Expert is appointed but the Determining Expert subsequently withdraws or advises that it is for any reason unable to make a determination; or

(3) for any other reason,

the Fair Market Value of the Defaulting Shareholder’s JV Shares will (in the absence of manifest error in either such certificate, in which case any party may commence proceedings in a court of competent jurisdiction in relation to the determination) be deemed to be the mid point between the Fair Market Values assessed for those JV Shares in the two Initial Expert’s Certificates.

14.5 Exercise of options

(a) The Non-Defaulting Shareholder may exercise its Call Option within 28 days after:

(1) receipt of the Final Certificate (or if clause 14.4 applies the date the Fair Market Value Fair of the Defaulting Shareholder’s JV Shares is definitively determined by a court of competent jurisdiction or deemed determined by application of clause 14.4(b)); or

(2) if earlier, the date the Shareholders agree in writing the Fair Market Value of the Defaulting Shareholder’s JV Shares for the purposes of the Call Option,

by giving written notice to that effect to the Defaulting Shareholder.

(b) If the Non-Defaulting Shareholder gives a Default Notice within the period required by clause 14.2(a), the Companies must provide to the Non-Defaulting Shareholder all information and assistance reasonably required by the Non-Defaulting Shareholder in order for it to consider and, if it so determines, exercise its Call Option (including all information and assistance reasonably required for due diligence investigations on the JV Group) and the Non-Defaulting Shareholder may despite clause 18 disclose any such information on a confidential basis to its Parent and Related Corporations and their respective advisers and financiers.

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(c) If the Non-Defaulting Shareholder exercises the Call Option within the time period required by clause 14.5(a), the Defaulting Shareholder must sell to the Non-Defaulting Shareholder all of its JV Shares and the Non-Defaulting Shareholder must purchase those JV Shares at their Fair Market Value (as agreed, determined or deemed determined in accordance with this clause 14), and clause 15 will apply.

14.6 Time periods

The Shareholders may by agreement in writing extend (or shorten) any time period applicable under this clause 14 in relation to any given Event of Default.

15 Completion of transfer of JV Shares between Shareholders

15.1 Definitions

The meanings of the terms used in this clause 15 are set out below.

Term	Meaning
Transferor Shareholder	means a Shareholder who is a: 1       Defaulting Shareholder; or 2       Seller.
Transferee Shareholder	means where the Shareholder who is not the Transferor Shareholder.
Relevant Date	means, where the Transferor Shareholder is a: 1       Defaulting Shareholder; the date the Non-Defaulting Shareholder exercises its Call Option; or 2       Seller, the date the Seller accepts the Recipient’s offer pursuant to clause 12.5(a) or the date the Recipient exercises its Last Right under clause 12.8(a) (as relevant).

15.2 Contract for sale and purchase

Where any clause of this agreement provides that this clause 15 is to apply to the sale and purchase of a Shareholder’s JV Shares, then with effect from the applicable Relevant Date the Shareholders will be bound by a contract for the sale and purchase of the relevant JV Shares on and subject to:

(a) the terms set out in this clause 15; and

(b) where the Transferor Shareholder is a Seller, the relevant Sale Terms or the terms set out in the relevant Second Notice of Sale (as applicable),

but so that to the extent of any inconsistency the provisions of this clause 15 will prevail.

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15.3 Transfer

(a) The Transferor Shareholder will be deemed to warrant in favour of the Transferee Shareholder (at the Relevant Date and at closing of the transfer of the JV Shares pursuant to this clause 15) that it is:

(1) the sole legal and beneficial owner of its JV Shares;

(2) has full right, power and authority to sell and transfer its JV Shares to the Transferee Shareholder;

(3) that the Transferor Shareholder transfers to the Transferee Shareholder free clear and unencumbered legal title to its JV Shares free of any Security Interests and free of any third party rights,

and for the avoidance of doubt where the Transferor Shareholder is a Seller will also give any other warranties required under the relevant Sale Terms or the terms set out in the relevant Second Notice of Sale (as applicable).

(b) Within 7 days of the Relevant Date the Transferee Shareholder may notify the Transferor Shareholder in writing of all Consents it requires in order to proceed with the purchase of the JV Shares (failing which the Transferee Shareholder will be taken to have notified that no Consents are required).

(c) Each party must use its best endeavours to ensure that each Consent notified under clause 15.3(b) is obtained as expeditiously as possible including, but not limited to, providing all reasonable assistance to the other parties as is necessary to obtain each Consent.

(d) The purchase price payable for the Transferor Shareholder’s JV Shares (as specified in this Agreement) is payable in Immediately Available Funds on the closing of the purchase and sale, which must take place on the day which is 14 days after the later of:

(1) the Relevant Date; and

(2) the date on which all Consents (if any) notified under clause 15.3(b) have been received by the Transferee Shareholder (or waived at the Transferee Shareholder’s absolute discretion),

or, where the Transferor Shareholder is a Seller, if later the date required under the relevant Sale Terms or the terms set out in the relevant Second Notice of Sale (as applicable).

(e) At the closing of the purchase and sale, the Transferor Shareholder must deliver to the Transferee Shareholder:

(1) the share certificates and an executed transfer for the Transferor Shareholder’s JV Shares;

(2) a written resignation from each director of the Companies appointed by the Transferor Shareholder;

(3) a duly executed notice irrevocably appointing the Transferee Shareholder as the Transferor Shareholder’s proxy in respect of the Transferee Shareholder’s JV Shares until such time as those shares are registered in the name of the Transferee Shareholder,

and where the Transferor Shareholder is a Seller, the parties must for the avoidance of doubt each do the things required to be done at closing under the relevant Sale Terms or the terms set out in the relevant Second Notice of Sale (as applicable).

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(f) The Transferee Shareholder indemnifies the Transferor Shareholder against any claim, action, damage, loss, liability, cost, charge, expense, outgoing, or payment that the Transferor Shareholder pays, suffers or incurs or is liable for in respect of any action taken by the Transferee Shareholder as the Transferor Shareholder’s proxy under clause 15.3(e)(3).

(g) If each Consent (if any) notified under clause 15.3(b) is not satisfied or waived by the Transferee Shareholder within 12 months after the date of service of the notice under clause 15.3(b) then (without prejudice to any other right that a Shareholder may have under this agreement and without prejudice to any termination rights under any terms applicable under clause 15.2(b)):

(1) either Shareholder may by notice to the other terminate the contract of sale and purchase constituted under this agreement on the Relevant Date; and

(2) upon such termination the Transferor Shareholder will have no further obligation to sell its JV Shares to the Transferee Shareholder under this clause 15.

15.4 Transferee Shareholder to assume guarantees

(a) Each of the Shareholders must take all reasonable steps to ensure that, effective from closing of the sale and purchase of JV Shares pursuant to this clause 15, the Transferor Shareholder and its Parent or Related Corporations are released from any actual, contingent or accrued liabilities under any Support Commitments. For these purposes ‘reasonable steps’ includes the Transferee Shareholder or a Related Corporation providing the relevant third party beneficiary with a replacement guarantee or other arrangement (as the case may be) on terms the same or substantially the same as the terms of the existing Support Commitment.

(b) To the extent the Transferor Shareholder or any Related Corporation has not been released from a Support Commitment by closing of the relevant sale, and to the extent the parties have not already implemented appropriate cross indemnities under clause 8.10, the Transferee Shareholder must indemnify the relevant entity in respect of any loss, liability or expense that it pays, suffers, incurs or is liable for under or in relation to that Support Commitment after closing. The Transferor Shareholder holds the benefit of this indemnity on trust for its Related Corporations.

16 Termination

16.1 Term

(a) The Shareholders may terminate this agreement at any time by agreement in writing.

(b) Subject to clause 16.2, this agreement:

(1) ceases to apply to a Shareholder that has transferred all its JV Shares as permitted by this agreement; and

(2) terminates when any Shareholder holds all the issued JV Shares.

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16.2 Survival

The occurrence of any event specified in clause 16.1 will not affect:

(a) any accrued rights and obligations of the parties in respect of any breach of this agreement prior to the occurrence of that event; or

(b) any provision of this agreement which is expressed to come into effect on, or survive, the occurrence of that event.

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Part D – Miscellaneous

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17 Operations of Shareholders

17.1 Definitions

The meanings of the terms used in this clause 17 are set out below:

(a) Boral Intercompany Loan means any loan provided at any time by any Boral Group Member (as lender) to Boral Holder 1 or to Boral Holder 2 ;and

(b) USG Intercompany Loan means any loan provided at any time by any USG Group Member (as lender) to USG.

17.2 Restrictions on USG

Notwithstanding the terms of any USG Intercompany Loan:

(a) USG Guarantor must ensure that no USG Group Member demands repayment of; and

(b) USG must not (and USG Guarantor must ensure that USG does not) repay or prepay,

any amount of principal, interest or other amount under or in connection with any USG Intercompany Loan if such repayment or prepayment would or would be reasonably likely to result in an Insolvency Event occurring with respect to USG.

17.3 Restrictions on Boral

Notwithstanding the terms of any Boral Intercompany Loan:

(a) Boral Guarantor must ensure that no Boral Group Member demands repayment of; and

(b) a Boral Holder must not (and USG Guarantor must ensure that each Boral Holder does not) repay or prepay,

any amount of principal, interest or other amount under or in connection with any Boral Intercompany Loan if such repayment or prepayment would or would be reasonably likely to result in an Insolvency Event occurring with respect to Boral Holder 1 or Boral Holder 2.

18 Confidentiality and publicity

18.1 Definition

For the purposes of this clause 18:

(a) JV Information means any information relating to the Business or the operations, assets or affairs of any JV Group Member; or

(b) Shareholder Information means, in relation to a Shareholder:

(1) any information relating to the business, assets or affairs of that Shareholder or any Parent or Affiliate of that Shareholder (to the extent disclosed in the course of the transactions contemplated by this agreement or the Transaction Documents); and

(2) the terms of this agreement or any transactions contemplated by it.

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18.2 Confidentiality

(a) Subject to clause 18.3, each Shareholder (and its respective Parent) must not, and must (in addition to the confidentiality obligations contained in any other Transaction Document) ensure that its directors, officers, employees, agents, representatives and Affiliates do not:

(1) disclose any JV Information or any Shareholder Information in relation to the other Shareholder;

(2) use any JV Information, or Shareholder Information in relation to the other Shareholder, in any manner which may cause or is calculated to cause loss to any JV Group Member or any other party; or

(3) make any public announcement or issue any press release regarding this agreement or the transactions contemplated by it (unless the form of the announcement or release has been agreed by both Shareholders).

(b) Subject to clause 18.3, each Company must not, and must ensure (in addition to the confidentiality obligations contained in any other Transaction Document) that its officers (other than directors nominated by individual Shareholders), employees, agents, representatives and Subsidiaries do not:

(1) disclose any JV Information, except to the extent the disclosure has been approved by the Boards or the Shareholders in accordance with this Agreement;

(2) disclose any Shareholder Information in relation to either Shareholder;

(3) use any Shareholder Information in relation to either Shareholder, in any manner which may cause or is calculated to cause loss to any JV Group Member or any other party; or

(4) make any public announcement or issue any press release regarding this agreement or the transactions contemplated by it (unless the form of the announcement or release has been agreed by both Shareholders).

18.3 Permitted disclosure

Subject to law (including legal restrictions on the use and disclosure of personal information) a party may disclose, and may permit its Parent, directors, officers, employees, agents, representatives and Affiliates to disclose, any JV Information or Shareholder Information in relation to a Shareholder:

(a) with the prior written consent of:

(1) in the case of JV Information, the Boards or the Shareholders in accordance with this Agreement; or

(2) in the case of Shareholder Information, the relevant Shareholder; or

(b) if it is required to do so:

(1) by law or a Government Agency; or

(2) (in the case of a Parent only) by any regulatory authority or recognised stock exchange on which its shares or other securities are listed in compliance with the disclosure requirements of the relevant authority or stock exchange,

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provided, in respect to Shareholder Information, that the recipient has to the extent possible having regard to the required timing of the disclosure consulted with the provider of the information as to the form and content of the disclosure.

(c) to the party’s directors, officers, employees, bankers, auditors, professional advisers, ratings agencies or to the party’s Related Corporations (or their respective directors, officers, employees, bankers, auditors, rating agencies or professional advisers) provided that the recipient must keep the relevant information confidential and so that the party making the disclosure will be responsible for any breach of confidentiality by the relevant recipient, or any use of JV Information or Shareholder Information by the recipient that is incompatible with clause 18.2(a)(2) (or clause 18.2(b)(3) as applicable), unless the recipient has entered into an agreement or deed of the nature contemplated by clause 18.4;

(d) if the relevant information is in the public domain at the time of the relevant disclosure, other than by a breach of this clause 18;

(e) (in the case of a Shareholder only and subject to clause 18.4) the information is disclosed to a bona fide prospective purchaser of the party’s JV Shares in circumstances where clause 12 permits the recipient to market its JV Shares to the relevant person provided, in respect to Shareholder Information, sufficient advanced notice is given to permit the relevant Shareholder to object to any disclosure it considers to be in breach of this agreement;

(f) the disclosure is made to an Initial Expert or Determining Expert as contemplated by clause 14.2 or 14.3 provided such disclosure is on a confidential basis;

(g) (in the case of a Shareholder only) the disclosure is made in order for the party to seek a Consent for a transaction contemplated by this agreement, and (to the extent possible) is made on a confidential basis;

(h) to a Sale Agent on a confidential basis in the course of an appointment under clause 7.4 (and subject to clause 7.4(d)(6) the Sale Agent will for the avoidance of doubt be permitted to disclose JV Information and Shareholder Information to bona fide prospective purchasers of the JV Enterprise in the course of discharging the Sale Agent’s role) provided, in respect to Shareholder Information, sufficient advanced notice is given to permit the relevant Shareholder to object to any disclosure it considers to be in breach of this agreement; or

(i) the disclosure is expressly permitted or required under any provision of this agreement or any Transaction Document.

18.4 Disclosure to a prospective purchaser

Any party that makes or permits a disclosure of JV Information or Shareholder Information in relation to any Shareholder under clause 18.3(e) must ensure that the prospective purchaser first enters into a deed poll in favour of the parties whereby it agrees to comply with provisions substantially similar to those contained in this clause 18.

18.5 USG Confidential Information

(a) Notwithstanding anything to the foregoing, no Boral Group Member or JV Group Member is permitted to use or disclose any Confidential Information (as that term is defined in the USG Umbrella Intellectual Property Agreements) other than in accordance with those documents (or the associated specific confidentiality agreements pursuant to those documents), provided that:

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(1) Boral may disclose Confidential Information to a bona fide prospective purchaser of Boral’s JV Shares in circumstances where clause 12 permits Boral to market its JV Shares to the relevant person;

(2) Boral may disclose Confidential Information to an Initial Expert or Determining Expert as contemplated by clause 14.2 or 14.3; and

(3) a Sale Agent may disclose Confidential Information to bona fide prospective buyers of the JV Enterprise in the course of an appointment under clause 7.4;

but in each case:

(4) provided that in no event shall Boral or a Sale Agent disclose Trade Secrets (as that term is defined in the USG Umbrella Intellectual Property Agreement) owned by one or more USG Group Members or one or more JV Group Members without written permission in advance from the USG Group Member or USG Group Members (at their discretion), and such permission if granted may include limitations on the recipients of such disclosures, limitation on their use, and safe guards to protect the Trade Secrets taking into account their value and sensitivity to a USG Group Member or the JV Group;

(5) only to the extent that the disclosure is reasonably required to assist the relevant recipient to meaningfully evaluate the value of the JV Group and the relevant JV Shares (or the JV Enterprise, as the case may be);

(6) only to the extent that the disclosure does not and is not likely to jeopardise any Trade Secrets or proprietary information of any USG Group Member or JV Group Member, or pending applications for, patents, trademark registrations, copyright registrations or domain name registrations being prosecuted by any USG Group Member or JV Group Member; and

(7) (without limiting clause 7.4(d)(6) in the case of a Sale Agent) only to the extent that Boral or the Sale Agent, as the case may be, has first ensured that the relevant recipient has entered into a deed poll in favour of USG, USG Guarantor and the relevant USG Group Member whereby it agrees not to use or disclose such Confidential Information (other than for the express purpose of evaluating the value of the JV Group and the relevant JV Shares (or the JV Enterprise, as the case may be) and where applicable making a decision whether or not to acquire them and on what terms); and

(8) Boral or the Sale Agent (as applicable) provides USG and the relevant USG Group Member with a copy of the proposed Confidential Information that is to be disclosed 3 Business Days prior to disclosure (in order that USG and the USG Group Member may reasonably object to any disclosure it considers to be in breach of this clause),

and the Companies may disclose Confidential Information to Boral or a Sale Agent to the extent Boral or the Sale Agent is entitled to disclose such Confidential Information as set out above.

(b) Boral Guarantor and Boral indemnify any affected USG Group Member for any loss suffered by the USG Group Member a result of any disclosure of Confidential Information in accordance with this clause 18.5.

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18.6 Boral Confidential Information

(a) Notwithstanding anything to the foregoing, no USG Group Member or JV Group Member is permitted to use or disclose any Confidential Information (as that term is defined in the Boral Umbrella Intellectual Property Agreements) other than in accordance with that document or the associated specific confidentiality agreements, provided that:

(1) USG may disclose Confidential Information to a bona fide prospective purchaser of USG’s JV Shares in circumstances where clause 12 permits USG to market its JV Shares to the relevant person; and

(2) USG may disclose Confidential Information to an Initial Expert or Determining Expert as contemplated by clause 14.2 or 14.3; and

(3) a Sale Agent may disclose Confidential Information to bona fide prospective buyers of the JV Enterprise in the course of an appointment under clause 7.4;

but in each case:

(4) provided that in no event shall USG or a Sale Agent disclose Trade Secrets (as that term is defined in the Boral Umbrella Intellectual Property Agreement) owned by one or more Boral Group Members or one or more JV Group Members without written permission in advance from the Boral Group Member (at its discretion), and such permission if granted may include limitations on the recipients of such disclosures, limitation on their use, and safe guards to protect the trade secrets taking into account their value and sensitivity to the Boral Group Member;

(5) only to the extent that the disclosure is reasonably required to assist the relevant recipient to meaningfully evaluate the value of the JV Group and the relevant JV Shares (or the JV Enterprise, as the case may be);

(6) only to the extent that the disclosure does not and is not likely to jeopardise any trade secrets or proprietary information of any Boral Group Member or JV Group Member, or pending applications for, patents, trademark registrations, copyright registrations or domain name registrations being prosecuted by any Boral Group Member or JV Group Member; and

(7) (without limiting clause 7.4(d)(6) in the case of a Sale Agent) only to the extent that USG or the Sale Agent, as the case may be, has first ensured that the relevant recipient has entered into a deed poll in favour of Boral and Boral Guarantor (and any other relevant Boral Group Member) whereby it agrees not to use or disclose such Confidential Information (other than for the express purpose of evaluating the value of the JV Group and the relevant JV Shares (or the JV Enterprise, as the case may be) and where applicable making a decision whether or not to acquire them and on what terms); and

(8) USG or the Sale Agent (as applicable) provides Boral (and any other relevant Boral Group Member) with a copy of the proposed Confidential Information that is to be disclosed 3 Business Days prior to disclosure (in order that Boral may reasonably object to any disclosure it considers to be in breach of this clause),

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and the Companies may disclose Confidential Information to USG or a Sale Agent to the extent USG or the Sale Agent is entitled to disclose such Confidential Information as set out above.

(b) USG Guarantor and USG indemnify any affected Boral Group Member for any loss suffered by the Boral Group Member a result of any disclosure of Confidential Information in accordance with this clause 18.6.

18.7 Third Party IP

(a) The parties acknowledge that the JV Group holds know how and other proprietary information licensed to it by third parties (Third Party IP) and that the JV Group is subject to obligations in relation to the disclosure and use of the Third Party IP. Accordingly, to the extent the Third Party IP is identified to Boral and USG in writing by the JV Group:

(1) USG Guarantor and USG undertake to put appropriate processes in place to preserve the confidentiality of the Third Party IP that the JV Group has identified to them in writing and that Third Party IP is not communicated by any USG officers or employees (or otherwise) to any USG Group Member, and is not used by any USG Group Member to violate the legal rights of the relevant third party or third parties; and

(2) Boral Guarantor and Boral undertake to put appropriate processes in place to preserve the confidentiality of the Third Party IP that the JV Group has identified to them in writing and that Third Party IP is not communicated by any Boral officers or employees (or otherwise) to any Boral Group Member, and is not used by any Boral Group Member to violate the legal rights of the relevant third party or third parties.

(b) Clause 18.7(a) does not apply to a party to the extent:

(1) the relevant Third Party IP is in the public domain; or

(2) that party reasonably forms the view that the Third Party IP is infringing it or its Affiliates’ Intellectual Property.

19 Stapling

19.1 JVC 1 Shares and JVC 2 Shares are Stapled

Each JV Share is made up of one JVC 1 Share and one JVC 2 Share that are Stapled to one another in accordance with this clause 19.

19.2 Restrictions on dealings in JVC 1 Shares

Without limiting any provision of this agreement restricting the Disposal of any JV Shares (but subject always to clause 11.4 and clause 19.5), JVC 1 must not (and the Shareholders must use all reasonable endeavours to ensure that JVC 1 does not):

(a) issue a JVC 1 Share unless JVC 2 issues a JVC 2 Share to the same person at the same time and on terms that the JVC 1 Share is Stapled to the JVC 2 Share immediately on issue;

(b) cancel (whether by buy-back, redemption or otherwise) a JVC 1 Share unless JVC 2 cancels the JVC 2 Share Stapled to that JVC 1 Share at the same time;

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(c) make a call on, forfeit or accept the surrender of any partly-paid JVC 1 Share unless JVC 2 makes a call on, forfeits or accepts the surrender of the partly-paid JVC 2 Share Stapled to that JVC 1 Share at the same time;

(d) convert JVC 1 Shares into a larger or smaller number of JVC 1 Shares unless JVC 2 converts the JVC 2 Shares Stapled to those JVC 1 Shares into the same larger or smaller number of JVC 2 Shares at the same time;

(e) agree or offer to do any of the above, or invite a person to participate in any of the above transactions unless JVC 2 agrees, offers or invites a person, to participate in the corresponding transaction;

(f) do any of the above in relation to any other type of equity security convertible into JVC 1 Shares, including for the avoidance of doubt, any options to subscribe for JVC 1 Shares, unless JVC 2 does the same time at the same time on the same terms (and on the basis that the resulting JVC 1 security is Stapled to the resulting JVC 2 security); or

(g) vary the terms of any equity securities issued by JVC 1 unless JVC 2 makes the corresponding variation to the terms of the JVC 2 equity securities to which they are Stapled.

19.3 Restrictions on dealings in JVC 2 Shares

Clause 19.2 applies in relation to JVC 2 mutatis mutandis as if all reference in that clause to ‘JVC 1’ and ‘JVC 2’ were reversed and all references to a ‘JVC 1 Share’ and a ‘JVC 2 Share’ were reversed.

19.4 Transfers

Subject always to clause 11.4 and clause 19.5:

(a) JVC 1 must not register any transfer of a JVC 1 Share unless JVC 2 registers the transfer of the JVC 2 Share Stapled to that JVC 1 Share to the same person at the same time; and

(b) JVC 2 must not register any transfer of a JVC 2 Share unless JVC 1 registers the transfer of the JVC 1 Share Stapled to that JVC 2 Share to the same person at the same time.

19.5 Boral Holders – special provisions

For the purposes of clauses 19.2, 19.3 and 19.4 Boral Holder 1 and Boral Holder 2 are to be regarded as the same person, so that (without limitation):

(a) an issue will satisfy clause 19.2(a) if an issue of a JVC 1 Share to Boral Holder 1 occurs concurrently with an issue of a JVC 2 Share to Boral Holder 2; and

(b) a transfer will satisfy clause 19.4 if a transfer of a JVC 1 Share to Boral Holder 1 occurs concurrently with a transfer of a JVC 2 Share to Boral Holder 2.

19.6 Administrative matters

(a) The Companies must:

(1) maintain a register of holders of JV Shares and record all details of, and dealings in, JV Shares and the JVC 1 Shares and JVC 2 Shares comprising them in that register; and

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(2) ensure that the register of holders of JV Shares is entirely consistent with the members’ registers maintained by JVC 1 and JVC 2.

(b) The Companies must issue joint certificates to each holder of JV Shares.

19.7 Allocation of subscription amounts

(a) The Companies must allocate:

(1) the subscription amount received on issue of JV Share between its JVC 1 Share component and JVC 2 Share component; and

(2) the amount payable on cancellation (whether on repurchase, redemption, buy-back or otherwise) of any JV Share between its JVC 1 Share component and JVC 2 Share component,

on the basis of the relative fair values of those components as agreed by the Shareholders before the relevant issue or cancellation (or where applicable in accordance with any values specified in any Valid Funding Notice).

(b) If a JV Share is not issued fully-paid, the Companies must allocate:

(1) the unpaid amount;

(2) any amount received on payment of a call on the JV Share; and

(3) any amount received on sale of forfeited JV Shares,

between its JVC 1 Share component and JVC 2 component in the same proportions as they would allocate any subscription amount received on issue of that JV Share.

(c) Clause 19.7(a) applies with appropriate modifications to any issue of equity securities by JVC 1 and JVC 2 other than JV Shares.

19.8 Saving

Nothing in this clause 19 is intended to exclude or limit the need to comply with the relevant provisions of this agreement or applicable law (including Shareholder or Board approval requirements) in relation to the issue or transfer of securities or any other relevant action.

20 Guarantor provisions

20.1 Boral guarantee

(a) Boral Guarantor:

(1) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of Boral’s obligations under this agreement; and

(2) as a separate and additional liability, indemnifies each other party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the party arising from any default or delay in the due and punctual performance of Boral’s obligations under this agreement.

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(b) The liability of Boral Guarantor under this clause 20.1 is not affected by anything which, but for this clause 20.1, might operate to release or exonerate Boral Guarantor in whole or in part from its obligations including any of the following, whether with or without the consent of Boral Guarantor:

(1) the grant to Boral, Boral Guarantor or any other person of any time, waiver or other indulgence, or the discharge or release of Boral, Boral Guarantor or any other person from any liability or obligation;

(2) any transaction or arrangement that may take place between any party, any Related Corporation of a party, the Buyer Guarantor or any other person;

(3) any other party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against Boral, Boral Guarantor or any other person;

(4) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any party or any Related Corporation of a party from Boral, Boral Guarantor or any other person or by the taking of or failure to take any security;

(5) the failure or omission or any delay by any party to give notice to Boral Guarantor of any default by Boral or any other person under this agreement; and

(6) any legal limitation, disability, incapacity or other circumstances related to the Boral, Boral Guarantor or any other person.

(c) This clause 20.1 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 20.1 is a continuing obligation of Boral Guarantor, and remains in full force and effect for so long as Boral has any liability or obligation to any other party under this agreement and until all of those liabilities or obligations have been fully discharged.

(e) Boral Guarantor must make all payments which become due under this clause 20.1, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If Boral is compelled by law to deduct any withholding, then, in addition to any payment under this clause 20.1, it must pay to the relevant beneficiary party such amount as is necessary to ensure that the net amount received by that party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

(f) Boral Guarantor must pay all moneys that it becomes liable to pay under this clause 20.1 in the currency in which they are payable under this agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

(g) Boral Guarantor has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 20.1 , against any moneys that any other party may be, or become, liable to pay to a Boral Group Member whether under this agreement or otherwise.

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20.2 USG guarantee

(a) USG Guarantor:

(1) unconditionally and irrevocably guarantees to each other party on demand, the due and punctual performance of USG’s obligations under this agreement; and

(2) as a separate and additional liability, indemnifies each other party against all Loss, actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against the party arising from any default or delay in the due and punctual performance of USG’s obligations under this agreement.

(b) The liability of USG Guarantor under this clause 20.2 is not affected by anything which, but for this clause 20.2, might operate to release or exonerate USG Guarantor in whole or in part from its obligations including any of the following, whether with or without the consent of USG Guarantor:

(1) the grant to USG, USG Guarantor or any other person of any time, waiver or other indulgence, or the discharge or release of USG, USG Guarantor or any other person from any liability or obligation;

(2) any transaction or arrangement that may take place between any party, any Related Corporation of a party, the Buyer Guarantor or any other person;

(3) any other party exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against USG, USG Guarantor or any other person;

(4) the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by any party or any Related Corporation of a party from USG, USG Guarantor or any other person or by the taking of or failure to take any security;

(5) the failure or omission or any delay by any party to give notice to USG Guarantor of any default by USG or any other person under this agreement; and

(6) any legal limitation, disability, incapacity or other circumstances related to the USG, USG Guarantor or any other person.

(c) This clause 20.2 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this agreement as amended, varied, supplemented, renewed or replaced.

(d) This clause 20.2 is a continuing obligation of USG Guarantor, and remains in full force and effect for so long as USG has any liability or obligation to any other party under this agreement and until all of those liabilities or obligations have been fully discharged.

(e) USG Guarantor must make all payments which become due under this clause 20.2, free and clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction). If USG is compelled by law to deduct any withholding, then, in addition to any payment under this clause 20.2, it must pay to the relevant beneficiary party such amount as is necessary to ensure that the net amount received by that party after withholding equals the amount the party would otherwise be entitled to if not for the withholding.

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(f) USG Guarantor must pay all moneys that it becomes liable to pay under this clause 20.2 in the currency in which they are payable under this agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

(g) USG Guarantor has no right to set off, deduct or withhold any moneys which it may be or become liable to pay under this clause 20.2, against any moneys that any other party may be, or become, liable to pay to a USG Group Member whether under this agreement or otherwise.

21 Representations and warranties

21.1 Warranties

(a) Each party represents and warrants to each other party:

(1) it is duly incorporated and validly existing under the laws of the place of its incorporation;

(2) it has full corporate power to execute, deliver and perform its obligations under this agreement and to carry out the transactions contemplated by this agreement;

(3) the execution, delivery and performance of this agreement:

• has been properly authorised by it; and

• does not constitute a breach of any law or obligation, or cause or result in a default under any agreement or Security Interest by which it is bound and that would prevent it from entering into and performing its obligations under this agreement;

(4) this agreement constitutes a legal, valid and binding obligation of it enforceable in accordance with its terms by appropriate legal remedy;

(5) there are no actions, claims, proceedings or investigations pending or to the best of its knowledge threatened against it or by it that may have a material adverse effect on its ability to perform its obligations under this agreement;

(b) Each party will be deemed to represent and warrant the matters specified in clause 21.1(a) throughout the duration of this agreement.

(c) Each representation and warranty in clause 21.1(a) is to be treated as a separate representation and warranty. The interpretation of any statement made may not be restricted by reference to or inference from any other statement.

21.2 Notification of breach

Each party undertakes to give written notice immediately to each other party of any matter or event coming to its attention that:

(a) shows any of the representations and warranties given by it in this agreement to be or to have been untrue or misleading or breached; or

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(b) constitutes or is reasonably likely to constitute (with the passage of time, the giving of notice, the making of any determination hereunder or any combination thereof) an Event of Default.

22 Rights and obligations of Boral Holders

22.1 Joint and several parties

Subject to this clause 22, in this agreement a reference to the party ‘Boral’ is to be read as a reference to Boral Holder 1 and Boral Holder 2 jointly and severally so that:

(a) all obligations and liabilities of, and all agreements, undertakings and acknowledgements by, Boral under this agreement are taken to be assumed and given by each of the Boral Holders, jointly and severally;

(b) to the extent that an amount is payable by Boral under this agreement, that amount is payable by the Boral Holders jointly and severally;

(c) a right or power conferred on Boral under this agreement may be exercised by either Boral Holder acting alone (and any such exercise will be taken to have been by, and will bind, both of them). Without limiting the foregoing, any consent, approval or exercise of discretion by either Boral Holder will constitute a consent, approval or exercise of discretion by both of them for the purposes of this agreement;

(d) a notice given pursuant to clause 23 by either Boral Holder will be taken to be a notice given by, and will bind, both of them;

(e) receipt by either Boral Holder of any payment, notice or other document that any other party has to pay or give Boral under this agreement operates to discharge that other party in relation to each Boral Holder (but for the avoidance of doubt in relation to any payment, only to the extent of the relevant amount paid);

(f) a reference to an Affiliate or Related Corporation of Boral is a reference to an Affiliate or Related Corporation of either Boral Holder; and

(g) all obligations or liabilities of other parties to Boral are owed to the Boral Holders jointly,

and any reference to a ‘Shareholder’ will where that Shareholder is Boral apply on the same basis.

22.2 Holdings to be aggregated

Boral’s JVC 1 Percentage, JVC 2 Percentage and Shareholding Percentage are for the avoidance of doubt to be determined using the aggregate number of JVC 1 Shares and JVC 2 Shares held by the Boral Holders.

22.3 Operation of pre-emptive provisions

(a) If the Shareholder giving a Notice of Sale under clause 12 is Boral, that Notice of Sale must be in respect of all JVC 1 Shares and JVC 2 Shares held by both Boral Holders at the relevant time. The Boral Holders will be the Seller for the purposes of that clause (on the joint and several basis described in clause 23.1, but so that each will separately transfer the JVC 1 Shares or JVC 2 Shares of which it is the registered holder).

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(b) If the Shareholder receiving a Notice of Sale under clause 12 is Boral, the Boral Holders will be the Recipient for the purposes of that clause on the joint and several basis described in clause 22.1, but so that:

(1) any sale of the relevant Seller’s JV Shares to the Recipient under any provision of clause 12 will (unless the Shareholders agree otherwise in writing) be on the basis that the Seller’s JVC 1 Shares will be transferred to Boral Holder 1 and the Seller’s JVC 2 Shares will be transferred to Boral Holder 2, and:

• the relevant Sale Terms

• (if applicable) the terms set out in any Second Notice of Sale,

will be taken to be modified to the extent to permit this to occur if the Recipient is the ultimate buyer of the Sale Shares; and

(2) if the Boral Holders as Recipient exercise a Tag Right in relation to a proposed sale of the relevant Sale Shares, the modifications to the applicable sale terms under clause 12.9(b) will include such modifications as necessary to reflect that the Boral Holders have joint rights and liabilities but will transfer their JV Shares as two separate entities.

22.4 Operation of default provisions

(a) An Event of Default is taken to have occurred in relation to Boral if an Event of Default occurs in relation to either or both of the Boral Holders.

(b) If an Event of Default occurs in relation to Boral, the Defaulting Shareholder for the purposes of clause 14 will be the Boral Holders on the joint and several basis described in clause 22.1, so that:

(1) at the closing of any sale resulting from the exercise of the Non-Defaulting Shareholder’s Call Option each Boral Holder will separately transfer the JVC 1 Shares or JVC 2 Shares of which it is the registered holder; and

(2) the proxies contemplated by clause 15.3(b) will be given separately by each Boral Holder in respect of the JVC 1 Shares or JVC 2 Shares of which it is the registered holder,

and for the avoidance of doubt the Call Option of the Non-Defaulting Shareholder will apply in respect to the total number of JVC 1 Shares and JVC 2 Shares held by both Boral Holders.

(c) If an Event of Default occurs in relation to USG, the Boral Holders will be the Non-Defaulting Shareholder for the purposes of any application of clause 14, on the joint and several basis described in clause 22.1 , but so that (unless the Shareholders agree otherwise in writing) at the closing of any sale resulting from the exercise of the Non-Defaulting Shareholder’s Call Option the Defaulting Shareholder’s JVC 1 Shares will be transferred to Boral Holder 1 and its JVC 2 Shares will be transferred to Boral Holder 2.

22.5 Operation of Deadlock provisions

(a) If the Shareholder that exercises its Call Right pursuant to clause 7.5(c) is USG in circumstances where the relevant Best Offer contemplates the acquisition of all JV Shares (as opposed to the Business), the Boral Holders will be the selling parties for the purposes of that clause (on the joint and several basis described in clause 22.1) but so that each Boral Holder will agree to separately transfer all of the JVC 1 Shares or JVC 2 Shares of which it is the registered holder to USG.

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24    General

(b) If the Shareholder that exercises the Call Right pursuant to clause 7.5(c) is Boral, the Boral Holders will be the Exercising Shareholder for the purposes of that clause (on the joint and several basis described in clause 22.1) and so that if the Best Offer contemplates the acquisition of JV Shares (as opposed to the Business), the terms of the Best Offer will be taken to be amended so that Boral Holder 1 will acquire the JVC 1 Shares it does not already own and Boral Holder 2 will acquire the JVC 2 Shares it does not already own.

22.6 Issues of securities

Unless the Shareholders agree otherwise in writing, to the extent this agreement entitles Boral to subscribe for additional JV Shares (or any other equity securities issued by the Companies in accordance with this agreement), then without limiting clause 22.1(b):

(a) Boral Holder 1 must subscribe for any component of the entitlement comprising JVC 1 Shares (or other JVC 1 securities); and

(b) Boral Holder 2 must subscribe for any component of the entitlement comprising JVC 2 Shares (or other JVC 2 securities).

22.7 Operation limited to this agreement

For the avoidance of doubt nothing in this clause 22 is intended to:

(a) render Boral Holder 1 and Boral Holder 2 jointly and severally liable to any person in respect of any obligation or liability except as expressly set out in this agreement; or

(b) limit the operation of clause 19 other than as expressly set out in that clause.

23 Notices

23.1 Form of Notice

A notice or other communication to a party under this agreement (Notice) must be:

(a) in writing and in English and signed on behalf of the sending party; and

(b) addressed to that party in accordance with the details nominated in Schedule 13 (or any alternative details nominated to the sending party by Notice).

23.2 How Notice must be given and when Notice is received

(a) A Notice must be given by one of the methods set out in the table below.

(b) A Notice is regarded as given and received at the time set out in the table below.

However, if this means the Notice would be regarded as given and received outside the period between 9.00am and 5.00pm (addressee’s time) on a Business Day (Business Hours Period), then the Notice will instead be regarded as given and received at the start of the following Business Hours Period.

Shareholders agreement page 80

24    General

Method of giving Notice	When Notice is regarded as given and received
By hand to the nominated address	When delivered to the nominated address
By a globally recognized courier to the nominated address	When confirmed delivered by the courier: 1       by 5.00 pm (local time in the place of receipt) on a Business Day – on that day; or 2       after 5.00 pm (local time in the place of receipt) on a Business Day, or on a day that is not a Business Day – on the next Business Day.
By email to the nominated email address	When the email (including any attachment) comes to the attention of the recipient party or a person acting on its behalf.

23.3 Notice must not be given by electronic communication

A Notice must not be given by electronic means of communication (other than email as permitted in clause 23.2).

24 General

24.1 Costs and expenses

(a) Each of USG, USG Guarantor, Boral and Boral Guarantor must pay its own costs (including legal costs) and expenses in connection with the negotiation, preparation, execution and delivery of this agreement. Boral Guarantor must pay the costs (including legal costs) and expenses in connection with the negotiation, preparation, execution and delivery of this agreement that are incurred by either of the Companies (or their Subsidiaries or any other entity in which the Companies have an interest).

(b) For the avoidance of doubt the JV Group is responsible for its own costs and expenses in respect of the performance of any JV Group Member’s obligations under this agreement (or any Transaction Document) moving forward other than the transaction costs contemplated above.

24.2 Entire agreement

This agreement (with the Constitutions) states all the express terms agreed by the parties in respect of its subject matter. It supersedes all prior discussions, negotiations, understandings and agreements in respect of its subject matter.

Shareholders agreement page 81

24    General

24.3 Assignment of rights

Except as expressly contemplated by any Adherence Deed rights arising out of or under this agreement are not assignable by a party without the prior written consent of the other parties except as expressly permitted by this agreement.

24.4 Governing law and jurisdiction

(a) This agreement is governed by the laws in force in New South Wales.

(b) Each party irrevocably submits to the (non-exclusive, as between the two) jurisdiction of:

(1) courts exercising jurisdiction in New South Wales, Australia and courts of appeal from them; and

(2) courts exercising jurisdiction in Illinois, United States of America, and courts of appeal from them,

in relation to any proceedings arising out of or in connection with this agreement, and no party submits to the jurisdiction of any other courts in relation to any such proceedings.

24.5 Service of process

Without preventing any other mode of service, any document in an action (including without limitation, any writ of summons or other originating process or any third or other party notice) may be served on any party by being delivered to or left for that party at its address for service of notices under clause 22.

24.6 Waivers

(a) No party to this agreement may rely on the words or conduct of any other party as a waiver of any right unless the waiver is in writing and signed by the party granting the waiver.

(b) In this clause 24.6:

(1) conduct includes delay in the exercise of a right;

(2) right means any right arising under or in connection with this agreement and includes the right to rely on this clause.

(3) waiver includes an election between rights and remedies, and conduct which might otherwise give rise to an estoppel.

24.7 Variation

A variation of any term of this agreement must be writing and signed by the parties.

24.8 Counterparts

This agreement may be executed in any number of counterparts that together will constitute one instrument. A party may execute this agreement by signing any counterpart.

Shareholders agreement page 82

24    General

24.9 Further assurances

Each party must do all things and execute all further documents necessary to give full effect to this agreement and their obligations under it.

24.10 Prohibition and enforceability

(a) Any provision of, or the application of any provision of, this agreement or any right, power, authority, discretion or remedy conferred by this agreement that is prohibited in any jurisdiction is, in that jurisdiction, ineffective only to the extent of that prohibition.

(b) Any provision of, or the application of any provision of, this agreement that is void, illegal or unenforceable in any jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions in that or any other jurisdiction.

24.11 Relationship of parties

(a) Nothing in this agreement gives a party authority to bind any other party in any way, except as expressly stated in this agreement.

(b) Nothing in this agreement imposes any fiduciary duties on a party in relation to any other party or is to be construed as constituting a partnership between the parties, except as expressly stated in this agreement.

(c) The rights, duties, obligations and liabilities of Boral and USG arising out of this agreement are several in proportion to their Shareholding Percentage and are neither joint nor joint and several.

24.12 Exercise of rights

(a) Unless expressly required by the terms of this agreement, a party is not required to act reasonably in giving or withholding any consent or approval or exercising any other right, power, authority, discretion or remedy, under or in connection with this agreement.

(b) A party may (without any requirement to act reasonably) impose conditions on the grant by it of any consent or approval, or any waiver of any right, power, authority, discretion or remedy, under or in connection with this agreement. Any conditions must be complied with by the party relying on the consent, approval or waiver.

24.13 Remedies cumulative

Except as provided in this agreement and permitted by law, the rights, powers and remedies provided in this agreement are cumulative with and not exclusive to the rights, powers or remedies provided by law independently of this agreement.

24.14 Survival of clauses

Clauses 9, 10, 16, 18, 20, 22, 23 and 24 and each indemnity in this agreement, survive termination of this agreement.

Shareholders agreement page 83

Schedule 1

Definitions and interpretation

1 Definitions

The meanings of the terms used in this document are set out below.

Term	Meaning
Acceptance Period	is defined in clause 12.5(a).
Adjacent Intellectual Property Option	has the meaning provided in the USG Umbrella Intellectual Property Agreements.
Adherence Deed	means a deed substantially in the form of Schedule 12.
Affiliate	in relation to a party: 1       a Related Corporation of the party; 2       an entity the party Controls; 3       an entity that Controls the party (other than a Parent); and 4       an entity that is Controlled by an entity that Controls the party, but so that no JV Group Member will be regarded as an Affiliate of a Boral Group Member or a USG Group Member (and vice versa).
Anti-Corruption Law	means the United States Foreign Corrupt Practices Act 1977, the United Kingdom Bribery Act 2010, the Malaysian Anti-Corruption Commission Act 2009 and the Australian Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 (Cth) (in each case, as amended from time to time) and all other Legal Requirements that prohibit bribery, the provision of or acceptance of unlawful gratuities, facilitation payments or other benefits to or from any Government Agency or any other person, as well as any such prohibitions of an international funding institution.
Appointing Parties	is defined in clause 7.4(a).
Best Offer	is defined in clause 7.4(f).

Shareholders agreement page 84

Schedule 1    Definitions and interpretation

Term	Meaning
Board	the board of directors JVC 1 or the board of directors of JVC 2 as the context requires.
Board Fundamental Matters	each matter set out in Schedule 4.
Boral	both the Boral Holders on the basis described in clause 22.
Boral Director	a director of JVC 1 or JVC 2 appointed by Boral under clause 5.2.
Boral Group	Boral Guarantor and each Related Corporation of Boral Guarantor from time to time, not including any member of the JV Group (and Boral Group Member means any member of the Boral Group).
Boral Holders	Boral Holder 1 and Boral Holder 2.
Boral IP Option Matter	1       any decision by either Company to exercise on any given occasion (and any exercise of): •    an Adjacent Intellectual Property Option pursuant to either of the USG Umbrella Intellectual Property Agreements; •    a Breakthrough Intellectual Property Option pursuant to either of the USG Umbrella Intellectual Property Agreements; •    any right of either Company under clause 13.1 of either of the USG Umbrella Intellectual Property Agreements to distribute products in the Territory; or •    any right of either Company under clause 3.2(c) of either of the USG Umbrella Intellectual Property Agreements to terminate a USG Contributed Intellectual Property Licence Agreement; and 2       the negotiation of the royalty and other relevant terms of the resulting arrangements with the relevant USG Group Member in accordance with and subject to the terms of the USG Umbrella Intellectual Property Agreements.
Boral Respondent	Boral, its Parent and Affiliates
Boral Umbrella Intellectual Property Licence Agreements	means the Umbrella Intellectual Property Licence Agreements dated on or about the date of this agreement between (respectively): 1       Boral Limited, Boral Holder 1 and JVC 1; and 2       Boral Limited, Boral Holder 2 and JVC 2.

Shareholders agreement page 85

Schedule 1    Definitions and interpretation

Term	Meaning
Breakthrough Intellectual Property Option	has the meaning provided in the USG Umbrella Intellectual Property Agreements.
Budget	the budget, comprising separate revenue and capital budgets, for the JV Group (or any part of it, as the context requires) in respect of a Financial Year or a calendar year (as relevant).
Business	is defined in clause 1.2(a).
Business Day	a day (not being a Saturday, Sunday or public holiday in the relevant jurisdiction) on which trading banks are open for business in Sydney, Australia, Singapore and Chicago, USA.
Call Option	is defined in clause 14.1(a).
Call Right	is defined in clause 7.5(b).
Catch-Up Period	Is defined in clause 8.10(b).
Control	has the meaning given in s50AA of the Corporations Act.
Chair	the chairperson of both Boards for the time being.
Change of Control	has the meaning given to that term in clause 13.2.
Code	means the United States Internal Revenue Code of 1986, as amended.
Companies	JVC 1 and JVC 2 and Company means either of them as the context requires.
Company Claim	a claim of a Company or any other JV Group Member against a Respondent: 1       for breach of any agreement between the JV Group Member and the Respondent; or 2       to enforce a right against the Respondent in relation to a liability, loss, cost, charge or expense paid, suffered or incurred by any JV Group Member from an act or omission of the Respondent.

Shareholders agreement page 86

Schedule 1    Definitions and interpretation

Term	Meaning
Consents	in relation to any sale and purchase of JV Shares to which clause 15 applies, approvals and other consents identified by the relevant Transferee Shareholder that are required from any Government Agency or any third party so that the sale and purchase of the relevant JV Shares: 1       does not involve a breach by any JV Group Member, the purchasing Shareholder or any of the purchasing Shareholder’s Related Corporations (each a Relevant Person) of any law or a condition of a material licence held by the Relevant Person; and 2       does not breach a term of any material contract or agreement to which a Relevant Person is party, cause a default under any such material contract or agreement or allow any counterparty to any such material contract or agreement (other than a Relevant Person) to terminate or to impose or require the adoption of terms that are less favourable to the Relevant Person than the current terms.
Constitution	1       in relation to JVC 1, the Memorandum and Articles of Association of JVC 1; and 2       in relation to JVC 2, the Constitution of JVC 2.
Corporations Act	the Corporations Act 2001 (Cth).
Deadlock	is defined in clause 7.1.
Deadlock Notice	is defined in clause 7.2(a).
Decision Period	is defined in clause 12.8(a).
Default Notice	is defined in clause 14.2(a).
Defaulting Shareholder	is defined in clause 14.1(a).
Determining Expert	is defined in clause 14.3(b).

Shareholders agreement page 87

Schedule 1    Definitions and interpretation

Term	Meaning
Dispose	in relation to JV Shares includes to: 1       sell, transfer, assign, gift, create a trust or option over, or otherwise deal in any legal or beneficial interest in; 2       alienate the right to exercise the vote attached to; 3       grant a Security Interest over or any right to acquire; 4       decrease any economic interest in; or 5       agree to do any of the above in relation to, any JVC 1 Share or JVC 2 Share.
Disputed Matter	is defined in clause 7.2(a).
Divestment Notice	is defined in clause 10.4(b).
Dividend	Includes a dividend, bonus or other distribution in kind or cash
Employee Benefit Plans	means benefit plans offered in any jurisdiction to employees, directors, officers, consultants or independent contractors of a JV Group Member, including severance, separation, salary continuation, supplemental pension, bonus, incentive, profit participation, share option, phantom share, share purchase, share appreciation right, deferred compensation, retirement, profit sharing, leave of absence, layoff, day or dependent care, legal services, life, health, accident, disability, workers’ compensation, supplemental unemployment, change in control or retention plans, policies, practices, programs, funds or arrangements of any kind.
Eligible Boral Director	is defined in clause 6.4(a)(1)
Eligible USG Director	Is defined in clause 6.4(a)(2)
Event of Default	any event specified in clause 13.1.
Execution Notice	is defined in clause 7.5(a).
Exercising Shareholder	Is defined in clause 7.5(d)
Fair Market Value	in relation to a parcel of JV Shares, their value assessed in accordance with the principles set out in Schedule 7.
Final Certificate	is defined in clause 14.3(c).
Financial Year	the financial year of the JV Group, being each 12 month period commencing 1 July and ending on the subsequent 30 June (unless varied by Unanimous Resolution of the Shareholders in accordance with this agreement).

Shareholders agreement page 88

Schedule 1    Definitions and interpretation

Term	Meaning
First Adjourned Board Meeting	is defined in clause 6.1(c)
First Response Period	is defined in clause 7.5(a).
Floor Price	is defined in clause 12.2(a).
Fundamental Matters	the Major Fundamental Matters and the Minor Fundamental Matters.
Government Agency	any government or any governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or similar entity having powers or jurisdiction under any law or regulation or the listing rules of any recognised stock or securities exchange in any part of the world.
Government Official	means any officer, representative, employee of or person acting in an official capacity for: 1       any Government Agency; 2       public international organisation or monetary fund; 3       any government-owned or government-controlled corporation; or 4       any political party, party official or candidate for public office
Guarantor	Boral Guarantor or USG Guarantor, as the context requires.
High Risk Jurisdictions	The jurisdictions in which it has been determined that use of any JV IP licensed pursuant to an IP Licence Agreement poses a high risk to the integrity, value or enforceability of such licensed JV IP, including as a result of misappropriation, as listed in Part 1 of Schedule 8, as amended from time to time in accordance with clause 9.3(b).
High Risk Procedures	The procedures that are to be implemented and maintained in the High Risk Jurisdictions, as listed in Part 2 of Schedule 8, as amended from time to time in accordance with clause 9.3(c).

Shareholders agreement page 89

Schedule 1    Definitions and interpretation

Term	Meaning
IFRS	International Financial Reporting Standards, as issued by the International Accounting Standards Board.
Immediately Available Funds	1       cash; 2       bank cheque; or 3       telegraphic or other electronic means of transfer of cleared funds into a bank account nominated in advance by the payee.
Initial Expert	is defined in clause 14.2(c).
Initial Expert’s Certificate	is defined in clause 14.2(d).
Insolvency Event	is defined in clause 13.3.
Intellectual Property Rights	has the meaning provided in the USG Umbrella Intellectual Property Agreements.
IP Licence Agreements	1       the USG Umbrella Intellectual Property Agreements and each agreement contemplated by the schedules to those agreements; and 2       the Boral Umbrella Intellectual Property Agreements and each agreement contemplated by the schedules to those agreements.
JV Enterprise	is defined in clause 7.4(c).
JV Group	each of JVC 1, JVC 2 and their respective Subsidiaries from time to time (and JV Group Member means any member of the JV Group).
JV IP	all Intellectual Property Rights owed by, or licensed to, any member of the JV Group from time to time (including all Intellectual Property Rights licensed under the IP Licence Agreements).
JV Share	means a security in the JV Group, being one JVC 1 Share and one JVC 2 Share that are Stapled to each other.
JVC 1 Board	means the board of directors of JVC 1

Shareholders agreement page 90

Schedule 1    Definitions and interpretation

Term	Meaning
JVC 1 Percentage	in relation to a Shareholder at any time, the number of JVC 1 Shares held by the Shareholder expressed as a percentage of the total number of JVC 1 Shares on issue at the relevant time.
JVC 1 Share	an ordinary share in the capital of JVC 1.
JVC 2 Board	means the board of directors of JVC 2
JVC 2 Percentage	in relation to a Shareholder at any time, the number of JVC 2 Shares held by the Shareholder expressed as a percentage of the total number of JVC 2 Shares on issue at the relevant time.
JVC 2 Share	an ordinary share in the capital of JVC 2.
Last Right	is defined in clause 12.7(b).
Legal Requirement	any international, national, federal, state, local, municipal, foreign or other law, statute, constitution, principle of common law, resolution, ordinance, code, order, edict, decree, rule, regulation, treaty, ruling or requirement issued, enacted, adopted, implemented or otherwise put into effect by, or under the authority of, any Government Agency or any public international organisation in any jurisdiction.
Loan Terms	the terms set out in Schedule 11.
Marketing Period	is defined in clause 12.7(a).
Major Fundamental Matters	means each matter set out in Schedule 5.
Major Shareholder	means each Shareholder whose Shareholding Percentage is 37.5% or more at the relevant time.
Minor Fundamental Matters	means each matter set out in Schedule 6.
Minor Shareholder	means each Shareholder whose Shareholding Percentage is 12.5% or higher but less than 37.5% at the relevant time.

Shareholders agreement page 91

Schedule 1    Definitions and interpretation

Term	Meaning
Non-Defaulting Shareholder	is defined in clause 14.1(a).
Non-Withdrawing Shareholder	is defined in clause 7.6(a).
Notice	is defined in clause 23.1.
Notice of Sale	is defined in clause 12.2(a).
Offer Notice	is defined in clause 12.3.
Parent	1	in the case of Boral or any other Boral Group Member, Boral Guarantor; and
	2	in the case of USG or any other USG Group Member, USG Guarantor.
Products	products for wall, ceiling, floor lining and exterior systems that utilise gypsum, plasterboard, mineral fibre ceiling tiles, mineral wool, steel grid, studs and track, plastic beads, cement board, gypsum fibreboard, fibre cement, joint compound, jointing tapes, plaster and other materials (such as geopolymer or other pozzolanic materials) and ancillary products and related tools.
Recipient	is defined in clause 12.2(a).
Records	means all books, records, accounts, reports, correspondence, files and other documents and information or data (whether in printed, electronic or other form) in the possession of a JV Group Member relating to the Business or the businesses, assets or affairs of that JV Group Member or its clients, including any statutory books and registers, minute books, books of account, trading and financial records, employee records, tax returns and related correspondence and customer lists, supplier lists, price lists, pricing models and sales and marketing materials.
Related Corporation	in relation to an entity, each body corporate:
	1	that is a Subsidiary of that entity;
	2	of which the entity is a Subsidiary (other than, where the relevant entity is a Boral Group Member or a USG Group Member, a Parent); or
	3	that is a Subsidiary of a company of which the entity is also a Subsidiary.

Shareholders agreement page 92

Schedule 1    Definitions and interpretation

Term	Meaning
	but so that no JV Group Member will be regarded as a Related Corporation of a Boral Group Member or a USG Group Member (and vice versa).
Relevant Affiliate	in relation to a Shareholder:
	1	that Shareholder’s Parent;
	2	any Related Corporation of the Shareholder’s Parent that Controls the Shareholder; and
	3	any Related Corporation of the Shareholder’s Parent that is a party to an IP Licence Agreement,
	but not including for the avoidance of doubt any JV Group Member.
Representative	means, in relation to any entity, a director, officer, agent, consultant employee or contractor of that entity.
Respondent	means a USG Respondent or a Boral Respondent.
Response Period	is defined in clause 12.3.
Relevant Person	is defined in clause 13.3.
Restricted Business	is defined in clause 10.2.
Restricted Employee	is defined in clause 10.2.
Restricted Period	is defined in clause 10.2.
Restricted Persons	is defined in clause 10.2.
Restricted Territory	is defined in clause 10.2.
Sale Agent	is defined in clause 7.4(a).
Sale Business	is defined in clause 10.4(b).

Shareholders agreement page 93

Schedule 1    Definitions and interpretation

Term	Meaning
Sale Notice	is defined in clause 7.3.
Sale Shares	is defined in clause 12.2(a).
Sale Terms	is defined in clause 12.2(a).
Sale Terms Notice	is defined in clause 12.4(c).
Second Adjourned Board Meeting	is defined in clause 6.1(d).
Second Notice of Sale	is defined in clause 12.7(b).
Second Response Period	is defined in clause 7.5(b).
Securities	shares, debentures, convertible notes, or other instruments convertible into shares or debentures, options or other equity or debt securities.
Security Interest	any legal or equitable interest or power:
	1	reserved in or over an asset (or any interest in any asset) including, but not limited to, any retention of title; or
	2	created or otherwise arising in or over any interest in any asset under a bill of sale, mortgage, charge, lien, pledge, trust or power,
	by way of security for the payment of a debt or any other monetary obligation or the performance of any other obligation and includes:
	3	any agreement to grant or create any of the above; and
	4	a security interest within the meaning of section 12(1) of the Personal Property Securities Act 2009 (Cth).
Seller	is defined in clause 12.2(a).
Shareholder	Boral or USG.
Shareholder Group	the Boral Group or the USG Group.
Shareholding Percentage	in relation to a Shareholder at any time, the mean average of its JVC 1 Percentage and its JVC 2 Percentage at the relevant time (and so that each Shareholder’s Shareholding Percentage at the date of this agreement is 50%).

Shareholders agreement page 94

Schedule 1    Definitions and interpretation

Term	Meaning
Singapore Nominee	a director appointed to the JVC 1 Board under clause 5.1(b).
Standstill Period	is defined in clause 11.1(a).
Stapled	the linking together of a JVC 1 Share and a JVC 2 Share in accordance with clause 19.
Strategic Plan	the strategic plan of the JV Group (or any part of it, as the context requires) as approved by the Boards under clause 8.1.
Subsidiary	has the meaning given in the Corporations Act.
Super Resolution	in relation to a Board resolution, subject to clause 6.10:
	1	if both Shareholders are Major Shareholders at the relevant time, a resolution of the Board where all votes that may be cast on the resolution (excluding votes of directors that this agreement or any applicable law does not permit to vote on the resolution) are cast in favour; or
	2	if only one Shareholder is a Major Shareholder, a resolution of the Board where a simple majority of votes that may be cast on the resolution (excluding votes of directors that this agreement or any applicable law does not permit to vote on the resolution) are cast in favour, provided the majority includes at least one director appointed by the Major Shareholder; and
Support Commitments	in relation to any person, any guarantees or similar surety or credit support arrangements given by that person in relation to the obligations of any JV Group Member as contemplated by clause 8.11.
Tag Right	means the right referred to in clause 12.4(c) or clause 12.7(b), as the context requires.
Territory	is defined in clause 1.3.
Third Party Buyer	has the meaning given in clause 12.4(a) or 12.7(b), as the context requires.

Shareholders agreement page 95

Schedule 1    Definitions and interpretation

Term	Meaning
Third Party IP	has the meaning provided in clause 18.7.
Transaction Documents	1       this agreement; 2       the IP Licence Agreements; 3       the Transitional and Ongoing Services Agreements entered into on or about the date of this agreement between the Companies and (respectively) certain USG Group Members and certain Boral Group Members.
Unanimous Resolution	in relation to a resolution of Shareholders: 1       in the case of a Major Fundamental Matter, a resolution of Shareholders that has been approved by each Major Shareholder in accordance with: •    clauses 6.7(e) and 6.7(f); or •    clause 6.7(g); and 2       in the case of Minor Fundamental Matters, a resolution of Shareholders that has been approved by each Major Shareholder and each Minor Shareholder (if any) in accordance with a; •    clauses 6.7(e) and 6.7(f); or •    clause 6.7(g).
USG Director	a director of JVC 1 or JVC 2 appointed by USG under clause 5.2.
USG Group	USG Guarantor and each Related Corporation of USG Guarantor from time to time, not including any member of the JV Group (and USG Group Member means a member of the USG Group).
USG IP Option Matter	1       any decision by either Company to exercise on any given occasion (and any exercise of) a Breakthrough Intellectual Property Option pursuant to either of the Boral Umbrella Intellectual Property Agreements; and 2       the negotiation of the royalty and other relevant terms of the resulting arrangements with the relevant Boral Group Member in accordance with and subject to the terms of the Boral Umbrella Intellectual Property Agreements.
USG Respondent	USG, its Parent or Affiliates.

Shareholders agreement page 96

Schedule 1    Definitions and interpretation

Term	Meaning
USG Umbrella Intellectual Property Agreements	means the Umbrella Intellectual Property Licence Agreements dated on or about the date of this agreement between (respectively): 1       USG Corporation, USG Netherlands Global Holding BV and JVC 1; and 2       USG Corporation, USG Foreign Investment Ltd and JVC 2.
Valid Funding Notice	is defined in clause 8.9(c).
Withdrawing Shareholder	is defined in clause 7.6(a)(5).
Wholly Owned Related Corporation	has the meaning given to the term related body corporate in the Corporations Act but on the basis that subsidiary means (including in the definition of holding company in the Corporations Act) Wholly Owned Subsidiary.
Wholly Owned Subsidiary	in relation to an entity, a wholly-owned subsidiary of that entity as defined in section 9 of the Corporations Act.

2 Interpretation

In this agreement:

(a) Headings, bold type and the entirety of clause 2 of this agreement are for convenience only and do not affect the interpretation of this agreement.

(b) The singular includes the plural and the plural includes the singular.

(c) Words of any gender include all genders.

(d) Other parts of speech and grammatical forms of a word or phrase defined in this agreement have a corresponding meaning.

(e) An expression importing a person includes any company, partnership, joint venture, association, trust, corporation or other body corporate and any Government Agency as well as an individual.

(f) A reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment or exhibit to, this agreement and a reference to this agreement includes any schedule, attachment or exhibit.

(g) A reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements or re-enactments of any of them.

(h) A reference to a document includes all amendments or supplements to, or replacements or novations of, that document.

(i) A reference to a party to a document includes that party’s successors and permitted assignees.

Shareholders agreement page 97

Schedule 1    Definitions and interpretation

(j) A reference to an agreement other than this agreement includes a deed and any legally enforceable undertaking, agreement, arrangement or understanding, whether or not in writing.

(k) No provision of this agreement will be construed adversely to a party because that party was responsible for the preparation of this agreement or that provision.

(l) A reference to a body, other than a party to this agreement (including an institute, association or authority), whether statutory or not:

(1) which ceases to exist; or

(2) whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions.

(m) A reference to $ is to US Dollars.

Shareholders agreement page 98

Signing page

Executed as a deed

	Signed sealed and delivered by Boral Building Materials Pty Limited by
sign here u
	Company Secretary/Director
print name
sign here u
	Director
print name
	Signed sealed and delivered by Boral International Pty Limited by
sign here u
	Company Secretary/Director
print name
sign here u
	Director
print name
	Signed sealed and delivered by USG Netherlands Global Holdings B.V. by
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	Authorised Representative
print name

Shareholders agreement page 1

Schedule 1    Signing page

	Signed sealed and delivered by [USG Boral Building Products Pty Limited] by
sign here u
	Company Secretary/Director
print name
sign here u
	Director
print name
	Signed sealed and delivered by [USG Boral Building Products Pte Limited] by its attorney
sign here u
	Name of attorney
print name
	Signed sealed and delivered by Boral Limited by
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	Company Secretary/Director
print name
sign here u
	Director
print name
	Signed sealed and delivered by USG Corporation by
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	Authorised Representative
print name

Shareholders agreement page 2

EX-99.1

Exhibit 99.1

	For Immediate Release Contact Media Robert Williams (312) 436-4356 rewilliams@usg.com
	Investors Matthew Ackley (312) 436-6263 investorrelations@usg.com

USG CORPORATION REPORTS PRELIMINARY, UNAUDITED 2013

THIRD QUARTER RESULTS

CHICAGO, October 16, 2013— USG Corporation (NYSE:USG), a leading building products company, issued a press release today announcing its planned joint venture with Boral Corporation.

In conjunction with that announcement, USG Corporation is releasing preliminary, unaudited results for the quarter ended September 30, 2013. For the three months ended September 30, 2013, USG Corporation expects to report net sales of approximately $925 million, net income of approximately $23 million, and diluted net income per common share of approximately $0.21. For the three-month comparative period in 2012, USG reported net sales of $828 million, net loss of $29 million and diluted net loss per common share of $0.28. USG attributes the year over year improved results to better wallboard price and volume and positive operating results at L&W Supply, partially offset by higher SG&A expense as expected and lower profitability from its shipping company, GTL, due to timing of shipments in the second half of the year.

The preliminary, unaudited results presented herein are based on currently available information. These preliminary, unaudited results are subject to the completion of USG’s quarterly closing and review procedures and the regular quarterly review process of its independent registered public accounting firm. As a result, the information presented herein is subject to change.

As previously announced, a conference call and webcast to discuss third quarter, 2013 results will be held at 10:00 a.m. Central Time on October 24, 2013.

USG Corporation

USG Corporation is a manufacturer and distributor of innovative, high-performance building systems through its United States Gypsum Company, USG Interiors, LLC, L&W Supply Corporation and other subsidiaries. Headquartered in Chicago, USG Worldwide operations serve the commercial, residential, and repair and remodel construction markets, enabling our customers to build the outstanding spaces where people live, work and play. USG wall, ceiling, exterior sheathing, flooring underlayment and roofing systems provide leading-edge building solutions, while L&W Supply branch locations efficiently stock and deliver building materials throughout the United States. USG and its subsidiaries are proud sponsors of the U.S Olympic and Paralympic teams and the Canadian Olympic team. For additional information, visit www.usg.com.

####

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to management’s expectations about future conditions. Actual business, market or other conditions may differ materially from management’s 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 enter into and operate the joint venture with Boral Limited, including risks that our joint venture partner, Boral Limited, 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 press release. Additional information concerning these and other factors may be found in our filings with the Securities and Exchange Commission, including the “Risk Factors” in our most recent Annual Report on Form 10-K.

EX-99.2

Exhibit 99.2

PRESS RELEASE

16 October 2013

Boral Limited and USG Corporation to Form a World-Leading

Plasterboard & Ceilings Joint Venture in

Asia, Australasia & the Middle East

• Combines USG’s best-in-class building products technologies and strategic assets in Asia, New Zealand and the Middle East with Boral’s leading plasterboard manufacturing and distribution footprint in Asia and Australia

• Leading share positions in most markets served and uniquely positioned for synergistic expansion

• US$1.6 billion¹ 50/50 joint venture with operations in 12 countries across Asia, Australasia and the Middle East

• USG to make upfront cash payment to Boral of US$500 million on completion², with potential additional earn out payments to Boral of up to US$75 million

Boral Limited (ASX:BLD) and USG Corporation (NYSE:USG) today announced that they have entered into agreements to form a strategic joint venture to create a world-leading building business, USG Boral Building Products. The 50/50 joint venture will leverage the two companies’ iconic brands, complementary geographic footprints and technological expertise to deliver a unique portfolio of building products across Asia, Australasia and the Middle East.

Boral will contribute its Gypsum division to the joint venture, which includes its plasterboard operations in Australia and Asia. USG, the largest North American manufacturer of plasterboard, will contribute its Asian and Middle Eastern businesses, as well as exclusive access to its world-leading ceilings, cement board, fibre board, lightweight plasterboard and joint compound building products technologies in the joint venture’s territory.

Bringing together the game-changing technologies and expertise of USG with Boral’s leading manufacturing and distribution network in the region creates a vehicle that will deliver a superior offering to one of the fastest growing plasterboard regions in the world. This combination is expected to position the business with a significant competitive advantage and market leadership position for the long-term.

“The transaction is a major step forward for Boral and our vision is to create a world-leading interior linings business in Asia, Australasia and the Middle East,” said Boral’s CEO & Managing Director, Mike Kane. “The joint venture strategically aligns with Boral’s goal to grow earnings from Asia over the longer-term by effectively leveraging our extensive distribution position with complementary building products and markets. In addition to equipping the Gypsum division for

¹  Asset value of US$1.6bn is subject to finalisation of fair valuation and completion adjustments, and final foreign exchange rate at the date of completion

²  Targeted completion is currently expected to occur in January 2014

Page 1 of 4

long-term accelerated growth in Asia, the joint venture with USG creates a strong competitive advantage for the Australian plasterboard business through the application of game-changing technologies, significantly strengthens Boral’s financial position and provides greater strategic flexibility to the Boral group. This joint venture will be value accretive for our shareholders.”

USG’s Chairman, President and CEO, Jim Metcalf, stated, “We are excited by the prospects for profitable growth through this strategic partnership. We have long been focused on our strategic plan to diversify our earnings and differentiate our business through innovation. The joint venture with Boral, Asia’s leading plasterboard manufacturer and distributor, gives USG the reach to immediately expand our world-leading building products operations outside North America, and enables both companies to more effectively capitalize on market opportunities in some of the world’s highest growth construction markets.”

The roll-out of new technologies across the joint venture operations will be phased over two years and involve a total investment of approximately US$50 million, which is expected to be self-funded through the joint venture.

The Joint Venture is anticipated to benefit from significant synergies, which will ramp up over time and are expected to exceed US$50 million per annum within three years of the new technologies being rolled out. Synergies will come from manufacturing and freight cost savings and will also include revenue enhancements generated by a superior product offering and complementary products that will be sold through existing sales channels.

Frederic de Rougemont, CEO of Boral Gypsum and appointed CEO of the joint venture, said: “The combination of our gypsum and related businesses in Asia, Australasia and the Middle East provides an unparalleled manufacturing and distribution footprint, encompassing some of the highest growth markets in the world. The joint venture’s access to USG’s unrivalled technology and continued innovation will provide the business with superior performing products that are lighter, stronger and more efficient to manufacture, transport and install. This will build on Boral’s well-established gypsum operations in the region, creating a formidable and sustainable leadership position.”

The joint venture will be owned 50% by Boral and 50% by USG. In order to achieve an interest of 50% in the joint venture, USG will pay Boral total cash payments (equalisation payments) of up to US$575 million. USG’s equalisation payments to Boral will occur in tranches, with a portion conditional on the business meeting budgeted targets, as follows:

• US$500 million upon deal agreement completion;

• US$25 million on the 3rd anniversary of completion if joint venture earnings targets have been achieved at that time; and

• US$50 million on the 5th anniversary of completion if joint venture earnings targets have been achieved at that time.

The joint venture will have 633 million m² (6.8 BSF) of plasterboard manufacturing capacity supplemented by an extensive portfolio of complementary building product operations spanning 12 countries. Management of the joint venture will be shared between Boral and USG with Frederic de Rougemont from Boral Gypsum appointed as CEO and Paul Monzella from USG Corporation appointed as CFO. USG will appoint the Chairman, Jennifer Scanlon, with the right to appoint chairman alternating every two years.

Targeted completion is currently anticipated to occur on or by 31 January 2014 and is subject to certain closing conditions, including Foreign Investment Review Board (FIRB) approval, third party consents, and other conditions precedent as are customary for this type of transaction.

Further detail about the transaction, the joint venture assets, agreed joint venture terms and company specific impacts are outlined in the accompanying presentation.

Page 2 of 4

A joint-CEO presentation and conference call for investors will take place today at

10.30am (Australian Eastern Daylight Standard Time) / 6.30pm (US Central Standard Time).

Dial-in: Australia 1800 098 754 / +61 2 9338 7300; USA 1888 400 8039; Canada 1866 927 0848;

Hong Kong 800 967 072; Singapore 800 616 2252; UK: 080 8234 2459.

Conference ID: 81902152

The presentation will also be webcast via www.boral.com.au and www.USG.com.

USG Corporation:

USG Corporation is a manufacturer and distributor of innovative, high-performance building systems through its United States Gypsum Company, USG Interiors, LLC, L&W Supply Corporation and other subsidiaries. Headquartered in Chicago, USG Worldwide operations serve the commercial, residential, and repair and remodel construction markets, enabling our customers to build the outstanding spaces where people live, work and play. USG wall, ceiling, exterior sheathing, flooring underlayment and roofing systems provide leading-edge building solutions, while L&W Supply branch locations efficiently stock and deliver building materials throughout the United States. USG and its subsidiaries are proud sponsors of the U.S Olympic and Paralympic teams and the Canadian Olympic team. For additional information, visit www.usg.com.

Boral:

Boral is a global building products and construction materials group, headquartered in Sydney, Australia. With leading positions in Cement & Construction Materials in Australia; Plasterboard in Australia and Asia; and Cladding and Roof Tiles in the USA, Boral produces and distributes a broad range of materials and products including quarry products, cement, fly ash, pre-mix concrete, asphalt, clay bricks, clay and concrete roof tiles, concrete masonry products, plasterboard, windows and timber. See www.boral.com.au for more information.

For more information:

USG Corporation Matthew Ackley Senior Manager, Investor Relations Telephone: +1 312-436-6263 investorrelations@usg.com Boral Limited Kylie FitzGerald Group Communications & Investor Relations Director Telephone: +61 2 9220 6591 or +61 401 895 894 kylie.fitzgerald@boral.com.au   Boral Limited ABN: 13 008 421 761

Page 3 of 4

USG Cautionary Statement:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to management’s expectations about future conditions. Actual business, market or other conditions may differ materially from management’s 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 enter into and operate the joint venture with Boral Limited, including risks that our joint venture partner, Boral Limited, 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 press release. Additional information concerning these and other factors may be found in our filings with the Securities and Exchange Commission, including the “Risk Factors” in our most recent Annual Report on Form 10-K.

Page 4 of 4

EX-99.3

16 October 2013

Jim Metcalf

Chairman, President & CEO

Mike Kane

CEO & Managing Director

Creating a World Leading Joint Venture

Asia  –

Australasia  –

Middle East

Exhibit 99.3

®

2

USG Cautionary Statements

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform

Act of 1995 related to management’s expectations about future conditions. Actual business, market or other

conditions may differ materially from management’s 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 enter into

and operate the joint venture with Boral Limited, including risks that our joint venture partner, Boral Limited, 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 presentation. Additional

information concerning these and other factors may be found in our filings with the Securities and Exchange

Commission, including the “Risk Factors” in our most recent Annual Report on Form 10-K.

3

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

Boral and USG are forming a US $1.6 billion

1

plasterboard and

ceilings joint venture, USG Boral Building Products, bringing together

Boral’s leading plasterboard manufacturing and distribution footprint in

Asia and Australia with USG’s world-leading building products

technologies and strategic assets in Asia and the Middle East.

1.

Asset value of US$1.6bn subject to finalisation of fair valuation, completion adjustments and final foreign exchange rates at the date of completion

®

5

1.

US$1.6bn asset valuation subject to finalisation of fair valuation, completion adjustments and final foreign exchange rates at the date of completion

2.

Middle East joint venture refers to assets held in Saudi Arabia

Overview of the transaction

50:50 US$1.6bn  plasterboard and ceilings joint venture, USG Boral Building Products,

will encompass the following assets:

-

Boral’s Gypsum operations in Asia and Australia, including its holdings in, or portions of,

Gypsum Resources Australia (GRA) and Rondo joint ventures with CSR

-

USG’s

wholly

owned

operations

in

Asia,

New

Zealand,

and

its

holdings

in,

or

portions

of,

current

joint

ventures

in

the

Middle

East²,

Oman

and

China

-

Exclusive rights to use USG’s intellectual property including its world-leading plasterboard,

joint compound and ceilings technologies

To achieve 50% ownership interest, USG will make a US$500m upfront cash payment

to Boral

-

Boral will also have the potential to receive earn out payments of up to US$75m, based on

three-

and five-year earnings targets

1

6

Creating a leading building products partnership

in Asia, Australasia and the Middle East

1.

Includes Asia, Australasia and the Middle East

The joint venture will be the market leader in its Territory

in sales, scale, distribution,

coverage (product and geography) and technology

USG

is a world leader in building products technologies with strategic assets in the

Middle East, New Zealand and Asia

BORAL

has a leading plasterboard manufacturing and distribution footprint in Asia and

Australia

Combined

business

delivers:

#1 or #2 position in most markets served

Sustainable long-term competitive advantage through game-changing technologies

Substantial synergies, expected from

-

Roll-out of USG technology across Boral’s Gypsum operations

-

Leveraging Boral’s distribution network to offer USG’s adjacent products

Capability to pursue and self-fund new opportunities

Over 150 years of combined industry leadership and experience

1

7

Building

Products

11%

Overview of BORAL

(ASX: BLD)

A$3.7bn

market

cap

(US$3.5bn)

1

A$5.3bn

(US$5.4bn)

2

revenue

in

FY2013

3

12,610 employees as of 30 June 2013

Construction Materials, Building Products

and Gypsum

Australia,  Asia and US

Overview of USG

(NYSE: USG)

US$3.0bn

market

cap

1

US$3.2bn

revenue

in

FY2012

3

8,500 employees as of 31 December 2012

Gypsum, Ceilings and Product Distribution

North America, South America, Asia and

Middle East

Geographic revenue –

FY2012

Segment revenue –

FY2012

Segment revenue –

FY2013

Geographic revenue –

FY2013

Construction

Materials &

Cement 60%

Boral USA 11%

Boral

Gypsum

18%

Australia

78%

Asia

11%

USA

11%

Product

distribution

4

31%

The joint venture partners

Gypsum

53%

Ceilings

16%

United

States

80%

Other

8%

Canada

12%

1.

Source: Company reports. Share price from IRESS and Factset as at 10 October 2013. Based on A$/US$ exchange rate of 0.95 as at 10 October 2013

2.

Based on average A$/US$ exchange rate of 1.02 for the year ended 30 June 2013

3.

Boral’s financial year ended 30 June 2013; USG’s financial year ended 31 December 2012

4.

USG’s Product Distribution business outside Asia and the Middle East and Boral’s Building Products division (which includes Bricks, Roofing, Timber & Windows) are not a part

of the Joint Venture transaction

8

USG

BLD

50%

50%

Korea

Thailand/

Philippines

Aus/NZ

India

Middle East

86m m²

(0.9 BSF)

capacity & Boral

sales presence in

Australia

50% Rondo metal

products

50% GRA gypsum

mine

USG NZ grid

manufacturing

USG sales

presence

105m m²

(1.1 BSF)

capacity in

Thailand &

Boral sales

presence (71% 

interest)

Gypsum mine

Boral metal

products

USG sales

presence

65m m²

(0.7 BSF)

capacity &

Boral sales

presence

Boral metal

products

USG sales

presence

10m

m²

(0.1 BSF)

capacity  in

Malaysia &

Boral sales

presence

50% Rondo

metal products

USG joint

compound

manufacturing

USG sales

presence

155m m²

(1.7 BSF)

capacity³

&

Boral sales

presence

Boral metal

products

50% interest in

USG ceiling

tile, metal

ceiling grid &

mineral wool

manufacturing

9m

m²

(0.1 BSF)

capacity &

Boral sales

presence

Boral metal

products

50% Rondo

metal

products

USG Joint

Compound

USG sales

presence

Boral sales

presence

50% interest in

8m m² (0.1 BSF)

plant in Oman³ 

55% interest in

Oman gypsum

mine

45% interest in

ceiling, metal

ceiling grid,

metal stud, and

joint compound

plant in Saudi

Arabia

Vietnam

USG TECHNOLOGY

153m m²

(1.6 BSF)²

capacity &

Boral sales

presence

USG sales

presence

42m m²

(0.5 BSF)

capacity³

&

Boral sales

presence

Boral metal

products

USG sales

presence

Boral operations

USG operations

Indonesia

China

Malaysia/

Singapore

1.

Actual structure will be via two JV legal entities

2.

m m² refers to million square metres; BSF refers to billion square feet

3.

Post completion of capacity expansion at Ho Chi Minh City (Vietnam) and Chongqing (China) in financial

year ending 30 June 2014 and construction of new plant in Oman in calendar year 2014 (CY2014)

4.

Post completion of manufacturing facility expected in 1Q CY2014

Overview of joint venture operations in

Asia, Australasia and the Middle East

USG Boral Building

Products¹

Plant

4

9

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

10

2009:

Durock

®

Cement Board

Next-Gen up to

25% lighter

2010:

SHEETROCK

®

Brand

UltraLight  Panels up to 30%

lighter

2011:

SHEETROCK

®

Brand

UltraLight Panels

FIRECODE

®

30  up to

30% lighter

2011:

SHEETROCK

®

Brand

UltraLight Panels

FIRECODE

®

X

up to

15% lighter

2012:

SHEETROCK

®

Brand

UltraLightWeight

All Purpose Joint Compound up to

40% lighter

2013:

SHEETROCK

®

Brand

UltraLight Panels Mold

Tough

®

up to 20%

lighter

1.

See slide in appendix for an overview of USG’s technology journey and leading innovations

2.

Equivalent cost compared to USG’s previous generation technology plasterboard, but at a lower cost relative to industry standard / Boral Gypsum plasterboard

USG: A history of differentiating

through innovation

USG

has

led

every

major

industry

innovation

1

-

US$170m invested in R&D since 2003 with 2,000+ patents received

-

Dedicated research & development facility in Libertyville, Illinois, US

Significant recognition received for innovations

-

2011 –

Global Gypsum Magazine’s Product of the Year Award and The Home Depot’s Product Innovation of

the Year Award (SHEETROCK®

Brand UltraLight Panels)

-

2013 –

Ranked a Top Innovator in the Industrial Materials Sector by the Patent Board

Superior performing, lower weight products in plasterboard, cement board and joint compound

-

UltraLight

products

command

a

price

premium,

can

be

produced

at

equivalent

cost

2

and reduce freight

-

Better score and snap, superior sag resistance, and lighter weight characteristics improve contractor and

distributor productivities

11

Strong market response and rapid

adoption of UltraLight technology

US: Total Board Volumes

1.

Classic volume refers to USG’s technologies preceding UltraLight third generation technology

Mexico

Improved performance attributes speeds adoption in emerging market

Lighter weight generates freight savings and improved profitability

Positioned as a premium price, superior performance product

Canada

Strong conversion rate attributed to performance characteristics

Lighter weight increases contractor productivity and profitability

High adoption rates in all end use markets

50% conversion across full USG plasterboard

portfolio in 3 years

~80% of ½” wallboard converted to

SHEETROCK® Brand UltraLight Panels

Side by side comparison drives rapid adoption

in the retail channel

Superior performance attributes encourage

residential adoption

Productivity enhancements yield strong 

commercial conversion   

United States

UltraLight Volume

USG Classic Volume

¹

12

Customer testimonials illustrate the strong

value proposition of USG’s UltraLight portfolio

“When we started tracking board counts on this product we began seeing

production rate increases”

–

Commercial Contractor, US

“We will use the product whenever possible”

–

Residential Contractor, US

“I could do easily 5-10 more sheets”

–

Installer, US

“All attributes are excellent, I prefer this board”

–

Contractor, Mexico

“Lighter, easier to screw, easier to install, and has no difficulty cutting”

–

Contractor, Mexico

"Panel weight makes it easier to install & work with”

–

Contractor, Mexico

“It just flows onto the walls”

–

Contractor,

US

regarding

SHEETROCK®

Brand

UltraLightweight

Joint

Compound

For additional information : www.theweighthasbeenlifted.com

High-performance ceilings business provides

a strong, complementary adjacency that further

differentiates the joint venture

Acoustical Tile

Full-line high performance

offering

Sustainable solutions

Architectural specification

focused

Specialty Solutions

Innovator

Leading brands

Enhances the aesthetics of

finished space

Creates a basis of design for the

specifier

Suspension Systems

Globally recognised DONN®

grid

World class manufacturing

Complete code approvals

Partnered with GE for

integrated LED lighting solution

Commercial Segments

Extends the portfolio for

commercial projects

Strong in all commercial

segments

Broadens the portfolio of

product solutions for commercial

projects

#2 USG global share in the industry with leading brands

International manufacturing and market coverage

Profitable business with stable margins through the US cycle

Solutions focused on performance, sustainability and aesthetics

13

14

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’

combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

15

1.

Production either online or expected to be online in CY2014

2.

Production may be at the same physical location.  Other production includes ceiling tile, metal ceiling grid, metal products, joint compounds, mineral wool and cornice production

3.

Certain manufacturing facilities and gypsum quarries held in joint venture with third parties (refer to page 8 of this presentation)

CHINA

THAILAND

VIETNAM

MALAYSIA

INDONESIA

PHILIPPINES

SOUTH KOREA

AUSTRALIA

NEW ZEALAND

INDIA

SAUDI ARABIA

USG/ Boral

JV

Capacity 

(m m²)1

633

Capacity 

(BSF)1

6.8

Manufacturing footprint

(number of operations)

Boral plasterboard plant

Boral gypsum mine

³

Boral other production

2,3

USG plasterboard plant

1,3

USG gypsum mine

³

USG other production

1,2,3

18

2

28

3

1

4

2

3

1

3

1

3

2

1

3

1

3

3

5

6

1

2

OMAN

1

1

1

1

3

3

1

1

1

9

Joint venture has leading positions

across Asia, Australasia and the Middle East

16

JV plasterboard market share 2013

5

Country

Board Capacity

Board

lines

Non-board

production

Sales

offices

Gypsum

mine

(m m

2

)

(BSF)

China

155

1.7

7

9

7

-

Korea

153

1.6

4

3

6

-

Thailand

105

1.1

3

3

3

1

Australia

86

0.9

3

4

9

1

Indonesia

65

0.7

3

3

5

-

Vietnam

42

0.5

2

3

5

-

Malaysia/

Singapore

10

0.1

1

4

4

-

India

9

0.1

1

3

7

-

Other

4

-

-

-

1

8

-

New Zealand

-

-

-

1

1

-

Saudi Arabia

-

-

-

3

3

-

Oman

8

0.1

1

-

-

1

Total

633

6.8

25

37

58

3

Revenue contribution from largest to smallest

Joint venture market positions

37%

43%

54%

6%

41%

58%

48%

16%

55%

13%

1.

Production either online or expected to be online in CY2014

2.

Includes metal stud, metal ceiling grid, joint compound, ceiling tile, cornice and/or mineral wool facilities

3.

Certain manufacturing facilities and gypsum mines held in joint venture with third parties (refer to page 8 of this presentation)

4.

Other includes metal plant in the Philippines and export business in UAE, Philippines, and Hong Kong

5.

Source: management estimates based on plasterboard sales volume, excluding ceiling tiles

3

2

1

1

3

1

1

1

3

2

3

3

3

1

1

1

17

2013

Market

size

in

JV

region

-

except

China

1

(million m²)

2013

Market

size

in

JV

region

1

(million m²)

Total

682

Total

2,262

1.

USG and Boral estimates for plasterboard market (excluding ceiling tiles)

2.

Middle East defined as including UAE, Oman and Saudi Arabia

Asian markets represent strong growth

potential for JV building products

2

Non-China

China

223

136

87

83

55

44

24

18

12

Korea

Australia

Indonesia

Thailand

India

Vietnam

Malaysia & Singapore

Philippines

Middle East

Market Highlights

Korea:

Australia:

Indonesia:

Thailand:

China:

India:

Middle East:

mature market with appetite for high performance and high quality products

strong growth in third most populated country in Asia, with large consumer market

solid growth with opportunity to increase plasterboard penetration

largest market with continued growth due to government limitations on brick and clay

demand for faster building construction is accelerating modern product usage

steady growth resulting from strong government investment in numerous markets

mature market with strong potential in residential wall penetration

18

Strong economic growth forecast across most

Asian markets

Increasing commercial projects expected to drive

growth in non-residential construction

Increasing urbanisation will drive growth in

residential new build

1.

Source: IMF data at October 2013

2.

Boral management estimates for plasterboard demand. GDP per capital and population based on IMF 2013 forecast data.

Real GDP growth –

Asian countries

Plasterboard demand/GDP per capita

Historically plasterboard use starts in ceilings then moves

to walls, and starts in commercial then moves to housing

Lightweight, flexible and easy to install characteristics

make plasterboard the interior lining product of choice

-

USG technology expected to enhance this attribute

Asia expected to become the world’s largest plasterboard

market by 2015

Forecast  real GDP growth –

5 year CAGR to 2018

Revenue contribution from largest to smallest

Strong macro fundamentals driving

growing market demand

1

1

1

19

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

®

Substantial synergies expected from both the application of

USG’s gypsum technologies (manufacturing and freight cost

savings plus revenue enhancements) and leveraging Boral’s

customer relationships and distribution platform

(USG’s adjacent products)

21

Targeted synergy breakdown

Manufacturing,

freight & other

cost savings

Adjacent products

through Boral

channels

Revenue

growth

Synergies -

geographic allocation

Australia

Korea

China

Thailand

Other

Anticipated synergies exceed US$50m per annum

within 3 years of completing technology roll-out

Synergies:

Adjacent product synergies to commence immediately

Other synergies to ramp up following 2 year phased

technology roll-out and as market penetration increases

Upfront operational expenditure will exceed synergies in first

two years

Based on extensive due diligence undertaken, including

product testing

Expect substantial synergies from:

Roll-out of USG’s technologies:

-

lower manufacturing & freight costs

-

enhanced revenues through price premium

Adjacent product sales through Boral market channels

-

ceiling products, metal products, cement and fibre board,

joint compounds

22

Implementation of technology

expected to be self-funded

Targeted roll-out of technologies across all gypsum manufacturing lines

Phased over approximately 2 years

Approximately US$50m of capital expenditure expected to implement technology

upgrades

Includes equipment modification, staff training, secondment of USG technology team

and other upgrades

Expected to be funded through JV cash flows

23

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

24

1.

Subject to finalisation of fair valuation, completion adjustments and final foreign exchange rates at the date of completion

Including USG’s and Boral’s respective shares in non-controlling and controlled interests

2.

Subject to achieving three-

and five-year earnings targets

Estimated asset value of the joint venture is US$1.6bn¹

-

US$1.35bn for assets contributed by Boral; US$0.25bn for assets contributed by USG

USG’s contributed

assets include a perpetual licence in the JV’s Territory to USG’s current

plasterboard technology, and the ceilings, joint compound and grid technologies currently

used in the Territory (including improvements to current technologies)

Up to US$575m total payment from USG to Boral:

-

US$500m cash upfront

-

Earn out payments totalling up to US$75m²

(net present value of ~US$50m)

Estimated transaction value¹

USD

BORAL

USG

Assets

$1,350m¹

$250m¹

Cash

($500m)

Balancing cash

payment

$500m

NPV of earn out

($50m)

²

From JV earnings

$50m

²

Net contribution to JV

$800m

$800m

25

Key transaction terms

Structure

USG’s and Boral’s respective assets to be contributed into the joint venture

USG to make US$500m initial payment, then two potential earn outs: US$25m

after 3 years and US$50m after 5 years upon achieving earnings targets

Management

CEO will be Frederic de Rougemont, Boral Gypsum

CFO will be Paul Monzella, USG Corporation

Joe Holmes, Chief Technology Officer, and Bill Hogan, VP Product

Adjacencies, from USG Corporation will be executives

Finance and Technical Committees will provide oversight and assistance to

joint venture management

Governance

Chairman will be Jennifer Scanlon, USG Corporation (no casting vote)

Right to appoint chairman will rotate every two years

Board

will

consist

of

equal

nominee

directors

from

Boral

and

USG

for

as

long

as they hold 50:50 interests

Funding

Joint

venture

expected

to

be

self

funding

with

ability

to

borrow

in

its

own

right,

subject to JV

Board approval

Targeted dividend distribution of 50% of after-tax profit

26

Intellectual Property

Joint venture granted exclusive royalty-fee rights in the Territory to current

Boral IP and USG IP, including improvements to current technology

Exclusive

option

during

the

term

to

licence

future

“breakthrough

IP”

developed

by USG and Boral

Exclusive

option

during

the

term

to

licence

“adjacent

IP”

generated

by

USG

Distribution rights

Exclusive distribution rights for USG products in the JV Territory during the term

Non-compete

Joint venture

parties

will

not

compete

with

the

joint

venture

in

the

defined

Territory

Party who exits the joint venture will not compete until the later of the third

anniversary of their exit, or 10 years from the commencement of the joint

venture

Transfer of interest / change

of control

7 year standstill on transfer of interest in joint venture

Pre-emptive rights including

right

of

first

offer,

last

right

to

buy

and

tag-along

right for non-selling party

Change of control, which applies to any entity in the chain of ownership,

including the parent companies, triggers a call option for the other party at fair

market value

Key transaction terms

27

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

28

US$m

Projected JV earnings

$35 -

$45

Adjustment for USG’s contribution to the JV

($6 -

$8)

USG projected interest expense

($22 -

$25)

Total projected JV impact to USG’s net income

in CY2014

$7 -

$12

Calendar

year

2014

expected

impact

to

USG

earnings

¹

Accretive

–

US$7-$12m expected

contribution to USG bottom line in

CY2014

5

. Results are expected to

increase over time as technology is

propagated and capabilities are

optimised

NPV

positive

–

expected

future

returns exceed present value of cash

contributions as synergies are realised

Balance

Sheet

positive

–

expected EBITDA to offset additional

leverage, with higher cash contribution

and lower debt/EBITDA over time

USG expects to fund the joint venture

through US$350m in long-term debt

and US$150m of cash from its

balance sheet, with earn out payments

of up to US$75m

6

1.

Guidance will not be provided on a quarterly or annual basis

2.

JV

results

will

be

reflected

in

USG’s

Equity

Method

Income

on

its

Statement

of

Operations,

below

the

Operating

Profit

line

and may vary based on

finalization of fair valuation at the date of completion and foreign exchange rates

3.

Represents full projected earnings contributions from USG’s contributed entities in 2014

4.

Expected interest payment related to the long-term debt used to fund the joint venture

5.

Expected contribution is based on 12 months of operations, results may vary based on the actual commencement date of JV operations

6.

$75m

earn

out

payments

have

a

Net

Present

Value

of

$50m

based

on

the

three-

and

five-year

performance

targets

USG funding and earnings implications

4

5

3

2

29

US$500m upfront cash:

-

Majority of proceeds to be applied to

reducing Boral’s debt

-

May also consider capital management

initiatives, subject to market conditions 

JV self funding

Strengthening BORAL’s Balance Sheet

Impact to financial statements

30 June

2013

Gearing

(Net debt / net debt + equity)

30%

22%

Gearing

(covenant calculation )

40%

29%

As at 30 June 2013 –

Proforma Gearing

Reduction in proforma gearing reflects

group net debt reducing to ~ A$0.9bn

Transaction will be reflected in Boral’s accounts as an equity accounted interest (50%) in joint

ventures following

Proforma

1

-

De-consolidation of existing Australian and Asian subsidiaries

-

Recognition of single balance sheet asset, equity accounted investment in joint ventures, at fair value

Final accounting impact will be finalised following transaction completion

Value accretive for Boral shareholders

1.

Illustrative impact on balance sheet ratios if the transaction had occurred on 30 June 2013. Unaudited figures for illustrative purposes only, assumes FX AUD/ USD of 0.9257

30

Year ended 30 June 2013 –

Proforma Income Statement

Illustrative FY2013 Income Statement as if transaction had occurred

on 1 July 2012

FY2013 proforma assumptions:

-

Interest savings based on initial debt

repayment of A$250m

4

and A$250m

4

cash on deposit

-

Excludes: impact from USG

contributed operations

5

, benefits from

synergies, integration costs and any

gain/ loss on disposal at date of

transaction (after fair value

adjustments) –

will be treated as a

significant item

In FY2014, expect Boral’s NPAT

to reduce by around A$15m

Expect ~US$35-$45m as 50%

share of JV post-tax earnings in

first full year

1.

Excluding significant items

2.

Illustrative deconsolidation of Gypsum Australian and Asian entities

3.

Illustrative impact of equity accounted post-tax earnings and interest savings  (excludes earnings from USG entities and synergies)

4.

Initial proceeds of US$500m at July 2012 FX rate 1:1

5.

Net contribution from USG in FY2013 is negligible

6.

Assumes a negligible level of net debt within the JV

Figures may not add due to rounding.

BORAL –

impact on Income Statement

Group

Proforma

adj²

Proforma

adj³

Proforma

Group

Revenue

5,286

(919)

-

4,367

EBIT

¹

228

(83)

27

172

Net interest

(97)

4

20

(73)

Income tax

expense¹

(20)

16

(6)

(10)

Non-controlling

interest

(6)

8

-

2

Profit after tax¹

104

(55)

41

91

31

Content

1.

Overview of the transaction / strategic rationale

2.

USG’s IP / Technology and adjacent products

3.

JV’s combined footprint and markets

4.

Synergies

5.

Key transaction terms

6.

Company specific factors

7.

Summary

Appendix

32

Combined

capability to

deliver significant

synergies

Strengthened

platform to drive

revenue and

margin growth

World class production capacity across

Asia, Australasia and the Middle East

Sales, marketing, and logistics 

excellence and commercial leverage

World Class Capacity

World leading gypsum, ceilings, and joint

compound technologies

Market leader across Asia Pacific region

Experienced management and operating

team

Core Competitive Advantages

Strong Growth Potential

Strong underlying economic

growth forecast across key markets

Combined platform provides unrivalled

foundation for growth

Volume growth supported by  >200m m²

currently unused capacity¹

Market Leading Positions

Strong brands respected for quality and

reliability

Extensive logistics and distribution

network in Asia, Australasia and the

Middle East

Deep customer relationships

1.

Based on 69% asset utilisation for year ended 30 June 2013 and includes capacity expansion projects at Ho Chi Minh City (Vietnam) and Chongqing (China) and construction of

new plant in Oman to be completed in CY2014

Creating a world-leading plasterboard and ceiling

partnership in Asia, Australasia and the Middle East

BORAL asset

platform

+

USG technology

platform

QUESTIONS

Transaction completion targeted for January 2014

It’s your world. Build it.

Build Something Great

®

®

APPENDIX

Build Something Great

It’s your world. Build it.

35

Sept 2013, USG ranked 9th in innovation

out of 112 companies in the Industrial

Materials Industry by the Patent Board

2000 –

2012 

1,100+ US Patents

Sheetrock®

Brand

UltraLight Panels

Securock®

Glass-

Mat Roof Board

Durock®

Cement

Board Next-Gen

SHEETROCK®

Brand

UltraLightWeight

All Purpose Joint

Compound

Humitek®

Levelrock®

Next Generation Gypsum

Panels

Levelrock Floor

Underlayment System

USG™

Decorative Interior

Finish System

Geometrix™

Metal Ceiling

Panels

Astro™

ClimaPlus™

Ceiling

Panels

Translucents™

Luminous

Panels

Topo™

3-D Ceiling Panels

Humitek Gypsum Panels

Securock®

Roof Board

Sheetrock®

All Purpose Joint

Compound with Dust Control

Sheetrock®

Mold-Tough

panels

Zero-emitting ceiling tiles 

High Recycled Content

Suspension Systems

True Wood Ceiling Panels

Securock®

Glass-Mat

Sheathing

Securock®

Glass-Mat Liner

Panels

Durock®

Fiberock®

Structocore Security

System

Durock Cement Board

Sheetrock Plus 3™

Joint

Compound

X-Technology Ceiling

Panels

Firecode®

Compound

3/4" Ultracode®

Core

Gypsum Panels

Compässo™

Suspension

Trim

Quick Release II Clip

Cuvatura™3-D System

Radar™

ClimaPlus™

Ceiling Panels

Fiberock Panels

USG Drywall Suspension

System

Ultrawall®

Structocore

Structocore™

Wall System

First Metal Stud Drywall

System

RC-1 Channel

Sheetrock WR Gypsum

Panels

Chemically Hardening Joint

Compound

SW Gypsum Panels

Blendtex Gypsum Panels

Exterior Ceiling Board

Ultrawall Relocatable Wall

System

USG Shaft Wall System

Textone SW Gypsum Panels

Area Separation Wall

System

Light Steel Framing

Pyrofill®

Firecode®

Structo-Gauge®

Gauging

Plaster

Pyrofill®

Poured Gypsum

Roof Deck

Water Repellent

Wallboard

Structo-Lite Perlited

Plaster

Sheetrock Firecode Core

(Type X)

Tapered Edge Panels

Ready-Mixed Joint

Compound

2" Solid Gypsum Wall

Board System

Acoustone®

Rocklath®

Gyplap®

Gypsum

Sheathing

Rocklath Gypsum Lath

Acoustone Ceiling Tiles

Perf-A-Tape®

Joint

Reinforcement

Sheetrock®

Sheetrock Gypsum

Panels

Pyrobar Gypsum

Partition Tile

Differentiate Through Innovation