**Exhibit 10.4**

 

June 28,2005

 

R. Scott Reining

18N340 Sawyer Road

West Dundee, Illinois  60118

 

Dear Mr. Reining:

 

In connection with the anticipated merger (the “Merger”) of EFC Bancorp, Inc.(the “Company”) with and into MAF Bancorp, Inc. (the “Purchaser”) ascontemplated by the Agreement and Plan of Reorganization by and between thePurchaser and the Company (the “Merger Agreement”), the Company, EFS Bank (the “CompanyBank”) and you hereby enter into this agreement (this “Agreement”).  Capitalized terms used but not otherwisedefined in this Agreement shall have the meaning set forth in the MergerAgreement.

 

# 1.                                     *Options*.  Prior to December 31,2005, you may exercise any and all vested options for the purchase of Companycommon stock (the “Options”) that you hold as of the date hereof and, withrespect to any such Options that are “incentive stock options” within themeaning of Section 422 of the Internal Revenue Code of 1986, as amended(the “Code”), subject to any restrictions on sale pursuant to applicable law,sell the shares of the Company’s common stock underlying such Options, suchthat all income from such exercise shall be included in your gross income for2005.  For the avoidance of doubt, andnotwithstanding anything herein to the contrary, any income that you derivefrom the exercises of the Options (and sale of the underlying shares) as setforth in the preceding sentence shall not be taken into account in computingany benefits under any plan, program or arrangement of Mid America Bank (the “PurchaserBank”) the Purchaser, the Company Bank, the Company or their affiliates.

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# 2.                                     *2005 Supplemental ExecutiveRetirement Agreement Payment*.  Prior to December 23, 2005, the CompanyBank shall pay to you an amount equal to the amount set forth on Exhibit Aas the “2005 Supplemental Executive Retirement Agreement Payment.”  For the avoidance of doubt, andnotwithstanding anything herein to the contrary, the 2005 SupplementalExecutive Retirement Agreement Payment shall not be taken into account incomputing any benefits under any plan, program or arrangement of the PurchaserBank, the Purchaser, the Company Bank, the Company or their affiliates.

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# 3.                                     *Payment on the Effective Date*.  On theEffective Date, the Company Bank shall pay you a lump sum payment in cash inthe amount set forth on Exhibit A (the “Effective Date Payment”).  For the avoidance of doubt, andnotwithstanding anything herein to the contrary, the Effective Date Paymentshall not be taken into account in computing any benefits under any plan, programor arrangement of the Purchaser Bank, the Purchaser, the Company Bank, theCompany or their affiliates.  In theevent that the Effective Date does not occur, you shall not be entitled to anypayment under this Section 3.

 

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# 4.                                     *Executive Split Dollar LifeInsurance; Medical Continuation.*

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## (a)                                SupplementalLife/Split Dollar Plan. ** **Effective as of the date hereof,the Company Bank’s Supplemental Life/Split Dollar Plan and each Split DollarPolicy Endorsement thereunder (collectively, “SL/SD Plan”) is amended hereby toprovide that (a) the aggregate amount of death benefit proceeds which maybe paid to your beneficiaries shall not exceed the lesser of: (i) theThree Times Base Salary Amount (defined to mean your current base salary as ofthe date of this letter, multiplied by three (3), (ii) the sum of amountsshown as the maximum dollar amount of each of the endorsements to which you area party (the “Maximum Dollar Amount”), or (iii) the amount by which theaggregate death benefits payable under all Policies maintained under the Planfor the purpose of insuring your life exceeds the aggregate cash value of suchPolicies immediately prior to your death, and (b) the Plan may be amended or terminated following theEffective Time, provided Purchaser maintains, or causes Purchaser Bank tomaintain, in full force and effect a life insurance policy or policies (whichneed not be one or more Policies established under the SL/SD Plan) insuringyour life which provide an aggregate death benefit payable to your beneficiaryor beneficiaries equal to the lesser of the Three Times Base Salary Amount ofthe Participant or the Maximum Dollar Amount.

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## (b)                               MedicalContinuation.  For the one year-periodfollowing the Effective Date, the Company will continue, or will cause theCompany Bank to continue, to provide you with access to medical and dentalcoverage under its group plan as in effect from time to time with respect tosimilarly situated executives of the Company, including any cost sharing orcontributions required to be made by you, provided, that, to the extent thatthe Company is unable to provide, or to cause the Company Bank to provide, youwith (or ceases to be able to provide you with) such continuation coverageunder the terms of its insurance policies as in effect from time to time, theCompany Bank shall pay to you a cash payment equal to the Company Bank’s costof providing such coverage (which cost is to be determined by reference to the “COBRA”premium applicable to such coverage) reduced by an amount equal to the thenapplicable employee contributions.  Youshall pay the Company Bank the employee share for such coverage, as determinedby the Company Bank based on the cost of the coverage to be provided to you, onan annual basis in advance, with the first such installment payable on theEffective Date.  Your eligibility for “COBRA”continuation coverage under Section 4980B of the Code shall commence uponthe Effective Date and the COBRA coverage period shall run concurrently withand offset the one-year period under this Section 4(b).  In the event that the Effective Date does notoccur, you shall not be entitled to any benefit under this Section 4(b).

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# 5.                                     *Termination of the PriorAgreement; Agreement to Remain Employed Through Effective Time*.  Youhereby agree that, in consideration for entering into this Agreement, effectiveas of the date hereof, the Change in Control Agreement by and between theCompany Bank and you, effective as of May 1, 2004, (the “Prior Agreement”)shall be null and void and no person or entity shall be obligated to pay to youor any person any amounts in respect of the Prior Agreement.  Further, in consideration of the benefitsconferred upon you, the Company and the Company Bank pursuant to thisAgreement, you hereby agree not to terminate your employment with the CompanyBank or any of its subsidiaries prior to the Effective Time, and, prior to theEffective Time, the Company Bank agrees not to terminate your employment withthe Company Bank or its subsidiaries without the prior written consent of thePurchaser.  You hereby represent andwarrant that, but for the benefit plans and agreements of or with the

 

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# Company orthe Company Bank that are specifically referred to herein, any tax-qualifiedpension plans or insured welfare benefit plans of the Company Bank and yourrights in respect of outstanding stock options and restricted stock in respectof Company common stock under the Company’s stock compensation plans, you arenot entitled to or eligible for any other payments or benefits under any plans,agreements or arrangements of or with the Company or the Company Bank andhereby waive any rights with respect thereto, including the Company BankSupplemental Executive Retirement Agreement.

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# 6.                                     *Withholding and Reduction.*  TheCompany or Company Bank will withhold and deposit all federal, state and localincome and employment taxes that are owed with respect to all amounts paid orbenefits provided to or for you by the Company or any affiliate pursuant tothis Agreement.  You, the Company and theCompany Bank agree that none of the payments and benefits payable or providedto you or for your benefit under this Agreement or otherwise in connection withthe Merger are expected to constitute an “excess parachute payment” within themeaning of Section 280G of the Code. However, notwithstanding anything to the contrary contained in thisAgreement or the Prior Agreement, in no event shall the aggregate payments orbenefits to be made or afforded to you under this Agreement or otherwise (the “Payments”)constitute an “excess parachute payment” under Section 280G of the Codeand in order to avoid such a result the Payments will be reduced, if necessary,to an amount such that when aggregated with all other payments, benefits ordistributions in the nature of compensation to or for your benefit, whetherpaid, payable or provided pursuant to this Agreement or otherwise (the “AggregatePayments”), the value of such Aggregate Payments shall be equal to three (3) timesyour “base amount,” as determined in accordance with Section 280G of theCode, less $5,000.00.  You hereby agreeto report any amounts paid or benefits provided under this Agreement forpurposes of Federal, state and local income, employment and excise taxes in amanner consistent with the manner in which the Company or Company Bank reportsany such amounts or benefits for purposes of Federal, state and local income,employment and excise taxes.

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# 7.                                     *Successors*.  ThisAgreement is personal to you and without the prior written consent of theCompany shall not be assignable by you otherwise than by will or the laws ofdescent and distribution.  This Agreementshall inure to the benefit of and be enforceable by your legalrepresentatives.  This Agreement shallinure to the benefit of and be binding upon the Company, the Company Bank andtheir successors and assigns.  From andafter the Effective Date, the “Company” shall mean the “Purchaser,” and “CompanyBank” shall mean “Purchaser Bank,” except to the extent the context indicatesotherwise.

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# 8.                                     *Waiver*.  Failureof the Company to demand strict compliance with any of the terms, covenants orconditions of this Agreement shall not be deemed a waiver of such term,covenant or condition, nor shall any waiver or relinquishment of any such term,covenant or condition on any occasion or multiple occasions be deemed a waiveror relinquishment of such term, covenant or condition.

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# 9.                                     *Governing Law and Jurisdiction*. The Agreement is governed by and construed underthe laws of the State of Illinois, without regard to conflict of lawsrules.  You, the Company and the CompanyBank (a) hereby consent to submit to the exclusive personal jurisdictionof any Federal court located in the State of Illinois or any court of the Stateof Illinois

 

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# in theevent any dispute arises out of this Agreement or any of the transactionscontemplated by this Agreement, and (b) hereby waive any right tochallenge jurisdiction or venue in such courts with regard to any suit, action,or proceeding under or in connection with the Agreement.  Each party to this Agreement also herebywaives any right to trial by jury in connection with any suit, action, orproceeding under or in connection with this Agreement.

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# 10.                               *Entire and Final Agreement*.  ThisAgreement shall supersede any and all prior oral or written representations,understandings and agreements of the parties with respect to their employmentrelationship (including, but not limited to all correspondence, memoranda andterm sheets and the Prior Agreement), and it contains the entire agreement ofthe parties with respect to those matters. No agreements or representations, oral or otherwise, express or implied,with respect to the subject matter hereof have been made by either party whichare not set forth expressly in this Agreement. Once signed by the parties hereto, no provision of this Agreement may bemodified or amended unless agreed to in writing, signed by you and a duly authorizedofficer of the Company and the Company Bank and subject to the prior writtenconsent of the Purchaser.

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# 11.                               *Assignment*.  Neitherthis Agreement nor any of the rights, obligations or interests arisinghereunder may be assigned by you. Neither this Agreement nor any of the rights, obligations or interestsarising hereunder may be assigned by the Company or the Company Bank withoutyour prior written consent, to a person or entity other than an affiliate orparent entity of the Company or the Company Bank or its successors or assigns; *provided*, *however*,that, in the event of the merger, consolidation, transfer, or sale of all orsubstantially all of the assets of the Company or the Company Bank with or toany other individual or entity, this Agreement shall, subject to the provisionshereof, be binding upon and inure to the benefit of such successor and suchsuccessor shall discharge and perform all the promises, covenants, duties, andobligations of the Company and the Company Bank hereunder.

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# 12.                               *Section Headings*.  The section headingscontained in this Agreement are inserted for purposes of convenience only andshall not affect the meaning or interpretation of this Agreement.

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# 13.                               *Notices*.  Allnotices required by this Agreement shall be sent in writing and delivered byone party to the other by overnight express mail to the following persons andaddresses:

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| If to the Company and Company Bank: | 1695 Larkin Avenue    |
|-------------------------------------|-----------------------|
|                                | Elgin, Illinois 60123 |

 

If to you:                                                                                               Atthe most recent address on file at the Company.

 

# 14.                               *Execution in Counterparts*.  ThisAgreement may be executed by the parties hereto in counterparts, and each ofwhich shall be considered an original for all purposes.

 

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If the foregoing is satisfactory, please so indicateby signing and returning to the Company and the enclosed copy of this letterwhereupon this will constitute our agreement on the subject.

 

 
|                            | COMPANY                        |
|---------------------------------|--------------------------------|
|                            |                           |
|                            |                           |
|                            | By:                            | /s/ Barrett  J. O’Connor |   |
|                            | Date:  June 28, 2005 |
|                            |                           |
|                            |                           |
|                            | COMPANY BANK                   |
|                            |                           |
|                            |                           |
|                            | By:                            | /s/ Barrett  J. O’Connor |   |
|                            | Date:  June 28, 2005 |
|                            |                           |
|                            |                           |
| ACCEPTED AND AGREED TO:         |                           |
|                            |                           |
|                            |                           |
| /s/ R. Scott Reining            |                           |   |
| R. Scott Reining                |                           |
| Date:   June 28, 2005 |                           |
|                                 |                                |  |  |  |

 

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**EXHIBIT A**

 
| 2005  Supplemental Executive Retirement Agreement Payment (Section 2:) |   | $      | 190,405 |   |
|-----------------------------------------------------------------------------|--------|--------|---------|--------|
|                                                                        |   |   |    |
| Effective  Date Payment (Section 3)                                    |   | $      | 182,223 |   |

 

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