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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive proxy statement
[X] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
USG CORPORATION
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(Name of Registrant as Specified in Its Charter)
USG CORPORATION
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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USG CORPORATION
OVERVIEW OF LONG TERM EQUITY PLAN PROPOSAL FOR 2000 PROXY
PROPOSED ALLOCATION OF SHARES
- - USG proposes to allocate 2.4 million shares to the Long Term Equity Plan
component of the Omnibus Management Incentive Plan for use during the
period 2001 - 2003 (an average of 800,000 shares per year).
- - The shares (in the form of options or restricted shares) would be granted
to senior managers as part of USG's management compensation plan.
- - Approximately 200 managers currently participate in the Long term Equity
Plan.
- - The prior allocation of 1.65 million shares for the period 1998 - 2000 has
been virtually exhausted, leaving almost no shares available for
compensation purposes.
PURPOSE OF LONG TERM EQUITY PLAN
- - Equity grants are used to align the interests of management with those of
shareholders.
- - Equity grants link compensation with attainment of strategic business
objectives.
- - Equity grants are crucial in providing competitive compensation to attract
and retain management talent in a very tight labor market. Significant
grants to senior managers (and increasingly to middle managers) are the
norm among organizations with which USG competes for management talent.
- - USG has instituted guidelines mandating stock ownership by senior managers
who participate in the Long term Equity Plan.
COMPARATIVE DATA
- - The proposed allocation is appropriate for an organization of USG's
size--about 1.67% of shares outstanding per year.
- - Surveys by Towers Perrin and Pearl Meyers & Partners, Inc. indicate the
average annual allocation for large organizations is about 2.0% of shares
outstanding.
- - The potential dilutive effect is within guidelines established by
Institutional Shareholder Services and large institutions such as Fidelity.
