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USG CORP. ANNOUNCES COMPLETION OF 10-1/4 PERCENT NOTE EXCHANGE

 CHICAGO, Aug. 11 /PRNewswire/ -- USG Corp. (NYSE: USG) announced today that it has completed the exchange of $138.5 million of bank term loan and capitalized interest notes for new 10-1/4 percent senior notes due 2002. The implementation of this exchange eliminates all scheduled bank amortization payments prior to Dec. 31, 1997, and provides USG with a mechanism to repay or purchase up to $165 million of its public senior debt due prior to Jan. 1, 1999. Under the terms of the exchange, USG Interiors also paid off all outstanding revolving credit facility capitalized interest notes for approximately $9 million in cash.
 Commenting on the exchange, USG's Chairman and CEO Eugene B. Connolly said,
"This is a win-win exchange for the company and the banks. The banks received a marketable note with a higher rate of interest, while USG improved its financial flexibility and paved the way for the possible early retirement of senior debt."
 As previously announced, the new 10-1/4 percent senior notes were offered to the bank group in exchange for up to $95 million of bank term loans and up to $47.4 million of capitalized interest notes. The exchange was completed today with more than 97 percent acceptance by the bank syndicate. As a result, $138.5 million of bank term loan and term capitalized interest was exchanged for a like amount of 10-1/4 percent notes.
 The $3 million portion of the $95 million of bank term loan that was not exchanged for new 10-1/4 percent senior notes was added to the final maturity of the bank term loan due in 2000.
 USG Corp. is a Fortune 250 company whose subsidiaries are market leaders in their key product groups of gypsum wallboard, joint compound and related gypsum products, ceiling tile and grid and building products distribution.
 -0- 8/11/93
 /CONTACT: USG corporate communications department, 312-606-4124, investor communications department, 312-606-5594/
 (USG)


CO: USG Corp. ST: Illinois IN: SU:

SM -- NY032 -- 1582 08/11/93 10:20 EDT
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Publication:PR Newswire
Date:Aug 11, 1993
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