Exhibit 10.4
CHANGE OF CONTROL LETTER
AGREEMENT
March 27, 2009
Eric J. Wedeen
1803 Cumberland Green
St. Charles, IL 60174
Dear Eric:
The Board of Directors of Community
Bank-Wheaton/Glen Ellyn (the “Bank,” which reference
shall include Community Financial Shares, Inc. (“CFS”),
the holding company of the Bank, has determined that it is
advisable and in the best interests of the Bank, CFS and its
stockholders, to provide reasonable assurance to certain key
employees that, upon a change of control of the Bank or of CFS,
appropriate severance arrangements are in place in the event of the
involuntary termination of your employment, other than for good
cause as specified below.
The following is proposed as an
inducement to you to remain in the employ of the Bank and to
dedicate your efforts to its best interests:
SECTION 1 . If, at any time within eighteen
(18) months following the “change of control” of
the Bank or CFS, either: (i) your employment is terminated by
reason of your disability, death or retirement pursuant to any
retirement plan or policy of the Bank of general application to key
employees; (ii) the essential elements of your position, in
terms of duties and authority are materially reduced without good
cause, each without your voluntary consent; (iii) there is a
material reduction in your aggregate compensation, not related to
or resulting from documented, diminished performance; or
(iv) you are required to regularly perform services at a
location which is greater than fifty (50) miles from your
principal office at the time of the change of control, you will
then be entitled to the benefits (“Severance Benefits”)
as set forth herein.
SECTION 2.
Upon the occurrence of the event
described in Section 1 (i) above, or upon the occurrence
of any of the other events in Section 1 which results in your
termination, then:
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2.1
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The Bank will
pay to you in an immediate lump-sum cash payment an amount equal to
Nine (9) months of your current annual salary, exclusive of
periodic bonus compensation, plus any unused earned vacation time;
plus
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2.2
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Medical and life insurance
coverage provided to you and your family by the Bank, at its cost,
until the earlier of: (i) you waive coverage by giving written
notice of waiver to the Bank; (ii) nine (9) months elapse
from the effective date of your
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Eric J. Wedeen
Change of Control
Page 2
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termination; or (iii) you
become a participant in group insurance benefit programs of a new
employer. If coverage is not permitted under applicable policy
terms, the Bank will provide equivalent benefits. Upon termination
of this benefit in accordance with the terms hereof, you shall be
entitled to exercise the policy options normally available to the
Bank’s employees upon termination of employment.
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SECTION 3.
For purposes of this Agreement,
“change of control” shall be deemed to have taken place
if, subsequent to the date hereof:
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3.1
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a third person,
including a “group” as defined in Section 13(d)
(3) of the Securities Exchange Act of 1934 (as in effect on
the date hereof), becomes the beneficial owner of shares of the CFS
having greater than Fifty Percent (50%) or more of the total
number of votes that may be cast for the election of directors of
CFS, including for this purpose any shares beneficially owned by
such third person or group as of the date hereof; or,
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3.2
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as the result
of, or in connection with, any cash tender or exchange offer,
merger or other business combination, sale of assets or contested
election, or any combination of the foregoing transactions (a
“Transaction”), the persons who were directors of the
Bank before the Transaction shall cease to constitute a majority of
the Board of Directors of the Bank or any successor to the
Bank.
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3.3
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In the event of
any reorganization involving CFS or the Bank in a transaction
initiated by the Bank in which the stockholders of CFS immediately
prior to such reorganization become the stockholders of a successor
or ultimate parent corporation of CFS resulting from such
reorganization and the persons who were directors of the Bank
immediately prior to such reorganization constitute a majority of
the Board of Directors of such successor or ultimate parent, no
“change of control” shall be deemed to have taken place
solely by reason of such reorganization, notwithstanding the fact
that the Bank may have become the wholly-owned subsidiary of
another corporation in such reorganization and the Board of
Directors thereof may have been reconstituted, and thereafter the
term “Bank” for the purposes of this paragraph shall
refer to such successor or ultimate parent corporation.
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SECTION 4.
Any payment not made when due in
accordance with this Agreement shall thereafter bear interest at
the prime lending rate from time to time in effect by the
Bank.
SECTION 5 . This Agreement may not be assigned by the Bank
except (i) to CFS; or (ii) in connection with a merger
involving the Bank or CFS or a sale of substantially all of its
assets, and the obligations of the Bank provided for in this
Agreement shall be the binding legal obligat
