SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  December 20, 2018

First Financial Northwest, Inc.
(Exact name of registrant as specified in its charter)

Washington
 
001-33652
 
26-0610707
State or other jurisdiction of
incorporation
 
Commission
File Number
 
(I.R.S. Employer
Identification No.)
         
201 Wells Avenue South, Renton, Washington
 
98057
(Address of principal executive offices)
 
(Zip Code)


Registrant's telephone number (including area code) (425) 255-4400

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions.

[  ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))

[  ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4 (c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

On December 20, 2018 First Financial Northwest Bank (the "Bank"), the wholly-owned subsidiary of First Financial Northwest, Inc. (the "Company") announced the appointment of Randy T. Riffle as the Bank's Executive Vice President and Chief Credit Officer. Mr. Riffle, age 43, joins the Bank from KeyBank where he most recently served as a Senior Vice President and Commercial Credit Executive.  He had worked at KeyBank for 17 years.
A copy of the press release announcing Mr. Riffle's appointment is attached to this report as Exhibit 99.1 and is incorporated herein by reference.

  In connection with his appointment, Mr. Riffle entered into an   offer letter with the Bank on December 14, 2018.  In conjunction with the offer letter, the Bank also agreed to enter into an involuntary termination agreement and a change in control severance agreement with Mr. Riffle.  The material terms of the offer letter, involuntary termination agreement and the change in control severance agreement are summarized below.  A copy of the offer letter is furnished and attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Offer Letter

Under the offer letter, the principal terms of Mr. Riffle's employment are as follows:

·
Position:                           Executive Vice President – Chief Credit Officer.
·
Annual Base Salary:         $250,000, payable semi-monthly, subject to applicable withholdings.
·
Signing bonus:                  $25,000 cash lump sum, subject to applicable withholdings.  Subject to return upon voluntary termination of employment prior to June 15, 2019.
·
Participation in the Bank's equity and non-equity incentive plans, subject to performance metrics.
·
50,000 stock options to be awarded under the First Financial Northwest, Inc. 2016 Equity Incentive Plan ("EIP") in January 2019.  An additional 50,000 stock options will be awarded under the EIP at the first meeting of the Compensation and Awards Committee of the Board of Directors following the first anniversary of employment.  All options will become exercisable at a rate of 20 percent per year.
·
Participation in the Bank's employee benefit plans, including medical, dental, vision and life insurance, AD&D, and short-term and long-term disability insurance.
·
Participation in the Bank's 401(k) plan and employee stock ownership plan.
·
$500 per month car allowance and free parking.
·
$100 per month cell phone allowance.
·
Various time-off benefits.
·
Payment upon involuntary termination under either an involuntary termination agreement or a change in control severance agreement.
The foregoing descriptions of the offer letter, does not purport to be complete and is qualified in its entirety by reference to the offer letter, a copy of which are furnished as Exhibit 10.1 and is incorporated herein by reference.
There are no arrangements or understandings between Mr. Riffle and any person pursuant to which he was selected as the Bank's Executive Vice President and Chief Credit Officer.
There are no family relationships between Mr. Riffle and any of the Company's directors, executive officers or persons nominated or chosen by the Company to become a director or executive
 
2
 
officer, and Mr. Riffle is not a party to any transaction requiring disclosure under Item 404(a) of Regulation S-K.

Item 9.01. Financial Statements and Exhibits

(d)           Exhibits

The following exhibits are being furnished herewith and this list shall constitute the exhibit index:



3

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
 
 
FIRST FINANCIAL NORTHWEST, INC.
 
 
 
 
DATE: December 20, 2018
By:  /s/Joseph W. Kiley III                                  
 
        Joseph W. Kiley III
 
        President and Chief Executive Officer



4
Exhibit 10.1
 



December 13, 2018


Mr. Randy Riffle
Via email: randyriffle@hotmail.com


RE:              Offer of Employment


Dear Randy,

We are pleased to offer you the position of Executive Vice President | Chief Credit Officer.  In this position, you will be reporting directly to me. Your anticipated start date will be December 31, 2018. This letter outlines the conditions of your employment with First Financial Northwest Bank ("Bank" or "FFNWB").

This offer of employment is for a full-time, exempt position with First Financial Northwest Bank.  For the services performed, your compensation will include a semi-monthly salary of $10,416.67, subject to standard deductions and withholdings, payable in accordance with the Bank's customary payroll practices. This semi-monthly amount is equivalent to an annual salary of $250,000.00.  Subject to the Bank's Incentive Policy, you will also be eligible to participate in the Bank's Annual Executive Incentive Plan (Equity and Non-Equity Incentives) based on achievement of performance metrics as developed by Management's and the Board of Directors' mutual satisfaction.

You will be entitled to participate in any present or future employee benefit programs established by FFNWB for its employees and executives, subject to the terms and conditions of those benefit plans or policies. The Bank reserves the right to modify or terminate such benefit plans or programs at any time in its sole discretion, subject to the eligibility requirements and rules of each such plan or program.  Please see page 3 of this letter for specifics.

During your tenure, you will be privy to confidential information and expected to handle confidential matters with discretion.  Accordingly, this offer is subject to your execution of, and compliance with, the Bank's operating policies.  Please note that nothing in this or other agreements limit any employee's right to receive a whistleblower award for information provided to any government agency or entity. You shall not have criminal or civil liability for the disclosure of a trade secret that is made in confidence to a government agency or entity that is made solely to report a suspected issue, or made in a complaint or other document filed in a lawsuit or other proceeding if the document is filed under seal.

The status of your employment at the Bank will be that of an at-will employee which means that you or the Bank may terminate the employment relationship with our without cause, and with or without notice, at any time unless contracted otherwise in a document signed by the Bank's President or his or her authorized designee.
 
 
Randy Riffle
Page 2 of 4

This offer is contingent upon (i) your providing evidence of your identity and U.S. employment eligibility as required by federal law to FFNWB within the first three days after employment commences, (ii) FFNWB receiving acceptable results from standard background and reference checks, (iii) your agreement to disclose to FFNWB any contracts or restrictive covenants you may have with a current or past employer and (iv) not bring your former employers' confidential or trade secret information to FFNWB, or use of this information while working for FFNWB.  We ask that you honor all obligations of trust and confidentiality to your former employers.

First Financial Northwest Bank is an equal opportunity employer and does not discriminate in employment opportunities or practices on the basis of race, color, religion, creed, gender, age, national or ethnic origin, disability, sexual orientation, marital status, veteran or military status, or any other basis prohibited by applicable federal, state or local law.

This offer is valid for five days from the date of this letter.

We are excited about you joining the Bank and look forward to your acceptance of our offer.

Sincerely,

FIRST FINANCIAL NORTHWEST BANK

/s/Joseph W. Kiley III

 
Joseph W. Kiley III
President, CEO & Director



I confirm my acceptance of the offer of employment with the Bank subject to the terms and conditions set forth above.


/s/Randy Riffle                                                          December 14, 2018                                  
Randy Riffle
Date


Randy Riffle
Page 3 of 4
Summary of Executive Benefits (subject to start date of December 31, 2018)


Health and Welfare Plans – Eligible for all Plans effective February 1, 2019
·
Medical Insurance – UnitedHealth Care (executive/Company cost-sharing)
·
Dental Insurance – Delta Dental (executive/Company cost-sharing)
·
Vision Insurance – VSP (executive/Company cost-sharing)
·
Basic Life Insurance ($300,000) – Lincoln Financial (100% Company paid)
·
Basic AD&D Insurance ($300,000) – Lincoln Financial (100% Company paid)
·
Voluntary Life Insurance – Lincoln Financial (100% executive paid)
·
Short Term Disability – Lincoln Financial (100% Company paid)
·
Long Term Disability – Lincoln Financial (100% Company paid)

Stock Options
You will be granted fifty thousand (50,000) options to acquire shares of First Financial Northwest, Inc. ("Company") common stock ("Options") by the Compensation and Awards Committee in January 2019.  These options shall be granted under, and subject to the terms and conditions of, the First Financial Northwest, Inc. 2016 Equity Incentive Plan.  In addition, you will be granted an additional fifty thousand (50,000) options by the Compensation and Awards Committee on their first meeting following your one-year employment anniversary, provided you are still employed with us on that date. All options will be subject to a 5-year vesting schedule (20% per year) commencing on the date of each grant.

Signing Bonus
You will be paid a Signing Bonus equal to 10% of base pay ($25,000) payable in the January 15, 2019 payroll, net of applicable withholdings.  In the event you voluntarily leave employment prior to June 15, 2019, Signing Bonus is subject to repayment in full.

Involuntary Termination and Change in Control
In the event of an involuntary termination (including a voluntary termination for good reason) other than a termination for cause and change in control (subject to specific agreements attached hereto), you will receive: (a) involuntary termination payments equal to one years' then base salary (payable over a one-year period commencing upon your termination of employment); (b) the prorated portion of any incentive or bonus amounts (payable over the one-year period described in (a)); and (c) for the one-year period described in (a) Company-paid medical, dental, vision and disability insurance that would have been provided to you had you remained employed.

Upon an involuntary termination (including a voluntary termination for good reason) other than a termination for cause, during the 12-month period following a change in control, you will receive:  (a) involuntary termination payments equal to one years' then base salary (payable over a one-year period commencing upon your termination of employment); (b) the prorated portion of any incentive or bonus amounts (payable over the one-year period described in the previous paragraph); and (c) for the one-year period described in the previous paragraph, Company-paid medical, dental, vision and disability insurance that would have been provided to you had you remained employed.  In addition, you will be paid a lump sum in cash equal to .99 times your then base salary (determined as of the date of termination, and disregarding any incentive or
 
 
 
Randy Riffle
Page 4 of 4
 
other extraordinary compensation).  This lump sum will be paid within 25 days after the later of the date of such change in control or the date of termination.

For the avoidance of doubt, with respect to the above-referenced payments, the phrase "termination for cause" under this offer letter has the same meaning as the definition of "Termination for Cause" in the Change in Control Severance Agreement and the Involuntary Termination Agreement that the Company will enter into with you in order to provide you with said payments.

The involuntary termination and change in control payments will be subject to customary regulatory, tax and legal limitations and conditions.

Car Allowance
You will receive a car allowance of $500 per month which is intended to cover your out-of-pocket automobile maintenance and gasoline expense as well as auto lease or purchase costs.

Retirement Plans
·
401(K) Plan – subject to Plan requirements.  A copy of the 401(K) Plan Summary Plan Description can be provided for your review.
·
ESOP (Employee Stock Ownership Plan) – subject to Plan requirements.  A copy of the ESOP Summary Plan Description can be provided for your review.

Time Off Benefits
·
PTO (Paid time off) – you will accrue 8.67 hours per pay period and may accumulate up to one and a half times the annual accrual rate (312.12 hours)
·
Paid Holidays – 10 per year – immediate eligibility
·
Jury Duty – up to 2 weeks per year – immediate eligibility
·
Bereavement Time – up to 3 days per event – immediate eligibility

Parking
Free parking in reserved parking space in Bank's parking garage

Cell Phone Allowance
$100 monthly reimbursement for your use of own cell phone for business purposes
 
 


 
 
 
 
 
 
 
 
Exhibit 99.1

 
 
For more information, contact:
Joseph W. Kiley III, President and Chief Executive Officer
Rich Jacobson, Executive Vice President and Chief Financial Officer
(425) 255-4400


First Financial Northwest, Inc. Announces Appointment of Randy Riffle
As Executive Vice President And Chief Credit Officer of First Financial Northwest Bank

Renton, Washington – December 20, 2018 - First Financial Northwest, Inc. (the "Company") (NASDAQ GS :  FFNW), the holding company for First Financial Northwest Bank (the "Bank") today announced that Randy Riffle has been appointed Executive Vice President and Chief Credit Officer of the Bank effective December 31, 2018.
"I am extremely pleased that Randy is joining First Financial Northwest Bank to oversee the Bank's credit policies, procedures and processes, as well as lead our efforts to expand our C&I portfolio in support of the Bank's growth and loan portfolio diversification goals, including expanding our customer base," said Joseph W. Kiley III, President and Chief Executive Officer of the Company and the Bank. "A banking professional of Randy's experience and qualifications is an important addition to our leadership team as we continue to execute on our growth strategies, including growing our branch footprint and expanding our product lines as we head into 2019," Kiley concluded.
Randy joins the Bank with extensive experience as a commercial credit executive with KeyBank, where he was most recently leader of the West Credit Campus that covers the western states for commercial banking and nationally for its Agribusiness and was a member of the Key Bank's Pacific Region Executive Team. His 20‑plus years of industry experience include sales and credit roles with increasing responsibility with KeyBank, including business banking market executive for Washington State. Randy holds a degree in business management from the University of Northern Iowa and a graduate degree in banking from the Pacific Coast Banking School (PCBS), where he continues to serve as Vice Chair of the PCBS LLC Board. Randy's community service has included terms serving the Washington Bankers Association (Director), the United Way of King County (fundraising), and Olive Crest (Trustee). He has additionally attained certification from the Lean Six Sigma Institute.
First Financial Northwest, Inc. is the parent company of First Financial Northwest Bank, an FDIC insured Washington State-chartered commercial bank headquartered in Renton, Washington, serving the Puget Sound Region through 10 full-service banking offices. We are a part of the ABA NASDAQ Community Bank Index and the Russell 2000 Index. For additional information about us, please visit our website at ffnwb.com and click on the "Investor Relations" link at the bottom of the page.
 
 
 

Forward Looking Statements:
 
When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the "SEC"), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases "believe," "will," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," "plans," or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are not historical facts but instead represent management's current expectations and forecasts regarding future events many of which are inherently uncertain and outside of our control. Actual results may differ, possibly materially from those currently expected or projected in these forward-looking statements. Factors that could cause our actual results to differ materially from those described in the forward-looking statements, include, but are not limited to, the following: increased competitive pressures; changes in the interest rate environment; changes in general economic conditions and conditions within the securities markets; legislative and regulatory changes; and other factors described in the Company's latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission – that are available on our website at www.ffnwb.com and on the SEC's website at www.sec.gov .

Any of the forward-looking statements that we make in this Press Release and in the other public statements are based upon management's beliefs and assumptions at the time they are made and may turn out to be wrong because of the inaccurate assumptions we might make, because of the factors illustrated above or because of other factors that we cannot foresee. Therefore, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for 2018 and beyond to differ materially from those expressed in any forward-looking statements made by, or on behalf of, us and could negatively affect our operating and stock performance.