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Thursday, 08/27/2009 5:46:01 AM

Thursday, August 27, 2009 5:46:01 AM

Post# of 48
EXP has filled the CFO position....

The SEC Form 8-K filed by EXP on August 20, 2009 reported that D. Craig Kesler was named CFO. I hope that Craig holds this position longer than Mark Dendle who was CFO for only 1 yr.

I must rely upon the Executive Committee’s judgement in this choice; however, in my opinion, Craig does not have much experience coming into such an important management position. He is 33 yrs old. During the past 3 yrs he has been EXP’s VP for Investor Relations and Corporate Development. Prior to joining EXP he served as public accountant with Arthur Andersen and Ernst & Young for 6 yrs.

I had expected Bill Devlin to be CFO should the Executive Committee choose an in-house candidate. This expectation was based upon Bill’s signing the recent Q10, a signature that normally would be that of the company’s CFO (see #msg-39897220).

Personally, I prefer in-house promotions for high level appointments such as this; I am content with Craig’s choice. In my experience, external candidates are usually over-rated; the external candidate either has a rather long learning curve before becoming effective or is very disruptive as he/she forces his/her culture upon the system.

I note that the PR associated with Craig’s appointment reiterated EXP’s commitment towards extending its low cost producer position. This leads me to believe that compensation costs were a factor in Craig’s promotion (an external candidate of merit would likely have required a larger compensation package). Indeed, the compensation package offered to Craig is less than that offered to Mark Dendle one year ago.

Craig Kesler starts with an annual base salary of $250,000 and a 15% incentive bonus. He received 10,000 restricted EXP shares effective Aug 21, 2009, with the restrictions lapsing ratably over 5 years.

Mark Dendle started with a base salary of $400,000 and also was to participate in the company’s incentive bonus plan. He received 15,000 restricted EXP shares which were to lapse ratably over 7 yrs. In addition, he received 100,000 stock option shares with an option term of 6 years.

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Aug 25 2009 8-K Announcing Kesler’s appointment as CFO: http://www.sec.gov/Archives/edgar/data/918646/000119312509180737/d8k.htm

Aug 24, 2009 PR issued regarding CFO appointment: http://ir.eaglematerials.com/ReleaseDetail.cfm?ReleaseID=404589

July 24 2009 Q-10 where Mr. Devlin exercised CFO signature functions http://www.sec.gov/Archives/edgar/data/918646/000119312509155019/d10q.htm

Jun 5, 2008 8-K describing Mark Dendle’s compensation package: http://www.sec.gov/Archives/edgar/data/918646/000095013408010818/d57385e8vk.htm

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