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): May 12, 2023

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))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
  
Trading
Symbol(s)
  
Name of each exchange on
which registered
Common Stock, $0.01 par value per share
  
FFNW
  
The NASDAQ Stock Market LLC

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 May 12, 2023, the Board of Directors of First Financial Northwest Bank (the “Bank”) approved amendments to the following documents: (1) the Bank’s employment agreements (the “Employment Agreements”) with Joseph W. Kiley III, its President and Chief Executive Officer, and Richard P. Jacobson, its Executive Vice President, Chief Operating Officer and Chief Financial Officer (the “Executives”); (2) the Bank’s supplemental executive retirement plan participation agreement with Mr. Kiley originally effective as of July 1, 2013 (the “2013 SERP”); (3) the Bank’s supplemental retirement plans (the “2020 SERPs”) with each of the Executives; and (4) the form of the Bank’s change in control severance agreement (the “CIC Agreement”) with various officers of the Bank. The Bank is a wholly owned subsidiary of First Financial Northwest, Inc. (“First Financial”).
The amendments to the above plans and agreements are designed to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) by (a) amending where applicable the definitions of Change in Control, Separation from Service and Involuntary Termination to be consistent with the definitions of those terms in Section 409A of the Code, (b) clarifying the timing of when a release of claims needs to be executed under the Employment Agreements, the CIC Agreement and the 2013 SERP, (c) clarifying the timing of the severance payments under the Employment Agreements and the CIC Agreement, including adding language to such agreements that if the time period for considering and not revoking the required release of claims starts in one year and ends in the following year, then the severance will not be paid until the following year, and (d) revising the Employment Agreements to specify how any reduction in severance payments would be implemented if necessary to avoid any parachute payments under Section 280G of the Code, rather than having the Executives choose which payments or benefits would be reduced.  None of the amendments to the above documents increase the amounts payable under such plans and agreements.
The following is a brief description of the terms and conditions of the above plans and agreements;
Employment Agreements.  The employment agreements with Messrs. Kiley and Jacobson provide for payments in the event of disability, death or termination.  If either executive becomes entitled to benefits under the terms of our then-current disability plan, if any, or becomes otherwise unable to fulfill his duties under the employment agreement, he shall be entitled to receive such group and other disability benefits as are then provided for executive employees.  In the event of either executive’s disability, his employment agreement will not be suspended, except that the obligation to pay his salary shall be reduced in accordance with the amount of any disability income benefits he receives such that, on an after-tax basis, he realizes from the sum of disability income benefits and his salary the same amount as he would realize on an after-tax basis from his salary if he had not become disabled.  Upon a resolution adopted by a majority of the disinterested members of the Board of Directors or an authorized committee, we may discontinue payment of the executive’s salary beginning six months after a determination that he has become entitled to benefits under the disability plan or is otherwise unable to fulfill his duties under the employment agreement.
In the event of Mr. Kiley’s or Mr. Jacobson’s death while employed under an employment agreement and prior to any termination of employment, the Bank will pay to the estate, or such person as may have previously been designated, the salary that was not previously paid and that would have been earned if employment had continued under the agreement through the last day of the month in which the death occurred, together with the benefits provided under the employment agreement through that date.
The employment agreements also provide for benefits in the event of either Mr. Kiley’s or Mr. Jacobson’s involuntary termination.  If  employment is terminated for any reason other than cause, or change in control, or voluntary termination of employment because of a material diminution of or interference with duties, responsibilities or benefits, including any of the following actions unless consented to: (1) a requirement to be based at any place other than Renton, Washington, or within a radius of 35 miles from the location of the Bank’s administrative offices; (2) a material demotion; (3) a material reduction in the number or seniority of direct report personnel; (4) a 20 percent or more reduction in base salary; (5) a material permanent increase in the required hours of work or workload; or (6) the failure of the Bank’s Board of Directors to appoint Mr. Kiley as President and Chief Executive Officer of the Bank, or Mr. Jacobson as Executive Vice President and Chief Financial Officer/Chief Operating Officer, the Bank must pay certain benefits.  The executive would receive salary at the rate in effect immediately prior to the date of termination over the one-year period beginning on the date of termination.  The Bank would also be required to provide, during the one-year period beginning on date of termination, substantially the same group life insurance, hospitalization, medical, dental, prescription drug and other health benefits, and

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long-term disability insurance (if any) for the benefit of the executive and dependents and beneficiaries who would have been eligible for such benefits if the involuntary termination had not occurred.
If Mr. Kiley’s or Mr. Jacobson’s employment is terminated during the year following the effective date of a change in control of First Financial or the Bank, or voluntary termination of employment following a change in control for any of the reasons listed in the previous paragraph, the Bank must pay the executive a lump sum equal to 299 percent of his base amount (as defined in Section 280G of the Code) and must provide, during the one-year period beginning on the date of termination, substantially the same group life insurance, hospitalization, medical, dental, prescription drug and other health benefits, and long-term disability insurance (if any) for the benefit of the executive and dependents and beneficiaries who would have been eligible for such benefits if the involuntary termination had not occurred.
Section 280G of the Code provides that severance payments that equal or exceed three times the individual’s base amount are deemed to be “parachute payments” if they are conditioned upon a change in control.  Individuals are subject to a 20 percent excise tax on the difference between the total parachute payments and the executive’s average taxable income for the five years preceding the year in which the change in control occurs (“excess parachute payments”).  If excess parachute payments are made, First Financial and the Bank would not be entitled to deduct the amount of such excess parachute payments.  Messrs. Kiley and Jacobson’s employment agreements provide that severance and other payments that are subject to a change in control will be reduced to the extent necessary to ensure that no amounts payable to the executive will be considered excess parachute payments.
Supplemental Retirement Agreements.  The Bank entered into a participation agreement under the plan with Mr. Kiley effective July 1, 2013, which 2013 SERP was amended on July 10, 2017, January 10, 2020 and May 12, 2023.  The participation agreement provides for an annual pension of $28,000.  Mr. Kiley’s benefit will commence following his separation from service and will be paid in monthly installments over 15 years to Mr. Kiley or to his designated beneficiary if he dies before 180 monthly benefit payments have been made.  If Mr. Kiley remains employed with the Bank until age 69, the monthly benefit payment will be extended from 180 months until the end of his life, assuming he lives beyond the end of the 180-month period.  If Mr. Kiley dies prior to the commencement of benefits under this SERP, then his beneficiary will receive a $200,000 lump sum death benefit.
In January 2020, the Bank also entered into SERP agreements with Messrs. Kiley and Jacobson.  The 2020 SERPs each provide that if the executive separates from service after attaining normal retirement age (age 69 for Mr. Kiley and age 65 for Mr. Jacobson) for any reason other than death, he will receive a lifetime monthly benefit equal to what is provided under a specifically identified annuity contract that has been purchased to informally fund the executive’s 2020 SERP (the “normal retirement benefit”). The normal retirement benefit will commence on the first day of the second month following the executive’s separation from service.
If the executive separates from service prior to attaining normal retirement age (age 69 for Mr. Kiley and age 65 for Mr. Jacobson) for any reason other than death or a change in control, he will receive an early termination benefit equal to the normal retirement benefit determined as if he remained employed until normal retirement age, multiplied by a vesting percentage.  For Mr. Kiley, the vesting percentage is determined by dividing his account balance (the amount accrued to pay his 2020 SERP benefit) as of his separation from service date by his projected account balance on his normal retirement age.  For Mr. Jacobson, the vesting percentage, determined on a monthly basis, is as follows: 17% for each of the first full five plan years in which he is employed by the Bank (i.e., 85% after five years of service), 91% after six full years of service, 96% after seven full years of service and 100% after eight full years of service.  The early termination benefit will commence on the first day of the second month following when the executive attains his normal retirement age.
If the executive is actively employed at the time of a change in control and experiences an involuntary termination (as defined in his employment agreement with the Bank, which includes a voluntary termination for good reason) within 24 months following the change in control, then the executive will receive a fully vested normal retirement benefit, payable at the same time and the same manner as the normal retirement benefit described above.  If the acquirer in the change in control transaction does not assume the executive’s 2020 SERP, then the change in control benefit will be paid regardless of whether the executive is involuntarily terminated.  No SERP benefit will be paid if the executive’s termination of employment is for “cause” as defined in the 2020 SERP. 
If the executive dies while actively employed, or after his separation from service but prior to attaining his normal retirement age, his designated beneficiary will receive a lump sum death benefit equal to his SERP account balance.  If the

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executive dies after SERP payments have commenced, but before 180 monthly payments have been received, then his designated beneficiary will receive the present value of the remaining payments (that is, 180 payments less the number of payments actually received).  
SERP payments may be reduced to the extent necessary to avoid the excise tax under Code Section 4999 or to comply with regulatory requirements.
Change in Control Severance Agreement.  The Bank entered into amended and restated change in control severance agreements with Ronnie J. Clariza, its Senior Vice President and Chief Risk Officer, Simon Soh, its Senior Vice President and Chief Credit Officer, and Dalen D. Harrison, its Senior Vice President and Chief Banking Officer on December 16, 2020.  The agreements each have an initial three-year term and are renewable for an additional one-year period on December 31 and each anniversary thereafter, provided that within the 90-day period prior to the anniversary date the Board of Directors of the Bank does not inform the executive in writing that the agreement will not be extended.  If within 12 months following a change in control of First Financial or the Bank, the executive’s employment is terminated without cause, or the executive terminates his or her own employment on account of being assigned duties inconsistent with the executive’s initial position, duties and responsibilities, or upon the occurrence of certain events described in the agreements, the executive would be entitled to payment and benefits.  Each severance agreement requires that the Bank: (1) pay the executive’s salary through the day of termination, including the pro rata portion of any incentive award; (2) pay for the remaining term of the agreement the executive’s life, health and disability coverage; and (3) pay in a lump sum an amount equal to 200 percent of the executive’s annual base salary.  Any payments under the agreements are subject to reduction pursuant to Section 280G of the Code to avoid excess parachute payments.
The foregoing descriptions of the amendments to the Employment Agreements, the 2013 SERP, the 2020 SERPs and the form of the CIC Agreement are qualified in their entirety by reference to the full text of such amendments, which are attached to this report as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6, respectively, and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d)  Exhibits

10.1

10.2

10.3

10.4

10.5

10.6

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Cover Page Interactive Data File (embedded within the Inline XBRL document)






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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: May 16, 2023
 
By:
 /s/ Richard P. Jacobson
     
Richard P. Jacobson
Executive Vice President and
  Chief Financial Officer
     












5

Exhibit 10.1

AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT FOR JOSEPH W. KILEY III

THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank formerly known as First Savings Bank Northwest (the “Bank”), and Joseph W. Kiley III (“the “Employee”).
WHEREAS, the Bank and the Employee previously entered into an Employment Agreement on August 14, 2012 which was amended and restated as of December 2, 2013 (the “Agreement”);

WHEREAS, the parties desire to amend the Agreement to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Section 13 of the Agreement provides that the Agreement may be amended by a written agreement signed by the Bank and the Employee; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Employee hereby amend the Agreement as follows:
1. The definition of “Change in Control” in Section 1 of the Agreement is hereby amended to read in its entirety as follows:
“Change in Control” means (1) an offeror other than the Company (as defined below) purchases 30% or more of the outstanding shares of stock of the Company or the Bank pursuant to a tender or exchange offer for such shares; (2) any person (as the term is used in Sections 13(d) and 14(d) of the Securities  Exchange Act of 1934 (“Exchange Act”)) becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly of securities of the Company or the Bank representing 30% or more of the combined voting power of the Company’s or the Bank’s outstanding securities; (3) the date a majority of the members of the board of directors of the Company is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date of the appointment or election; or (4) consummation of a plan of reorganization, merger, acquisition, consolidation, sale of all or substantially all of the assets of the Company or a similar transaction in which the Company is not the resulting entity; provided that the term “Change in Control” shall not include an acquisition of securities by an employee benefit plan of the Bank or the Company and provided further each of the above events shall be deemed to be a “Change in Control” only if it also constitutes either a change in the ownership of the Company or the Bank, a change in the effective control of the Company or the Bank or a change in the ownership of a substantial portion of the assets of the Company or the Bank, in each case as provided under Section 409A of the Code and the regulations thereunder.”
 

2. The definition of “Involuntary Termination” in Section 1 of the Agreement is hereby amended to add the following language at the end of such definition:
“Notwithstanding the foregoing, prior to any termination of employment for good reason, the Employee must first provide written notice to the Bank within ninety (90) days of the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Bank received the written notice from the Employee.  If the Bank remedies the condition within such thirty (30) day cure period, then no good reason shall be deemed to exist with respect to such condition.  If the Bank does not remedy the condition within such thirty (30) day cure period, then the Employee may deliver a notice of termination for good reason at any time within sixty (60) days following the expiration of such cure period.”

3. The definition of “Separation from Service” in Section 1 of the Agreement is hereby amended to read in its entirety as follows:
“Separation from Service” means a termination of the Employee’s employment with the Bank (and all corporations, entities or organizations with whom the Bank would be considered a single employer pursuant to subsections (b) and (c) of Section 414 of the Code), in each case as determined in accordance with Section 409A of the Code and Treasury Regulation §1.409A-1(h).  In determining whether a Separation from Service has occurred, the Bank shall take into account all of the facts and circumstances, special rules and presumptions set forth in the above regulation, including whether the Bank and the Employee reasonably anticipate that either no further services would be performed after a certain date or that the level of bona fide services the Employee would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed over the immediately preceding 36-month period.”
4. The last sentence of Section 7(a) of the Agreement is hereby amended to read in its entirety as follows, with the additional language after the first sentence set forth below to immediately follow such sentence:
“No payment shall be made under clause (i) of this Paragraph 7(a), and no insurance benefits shall be provided under clause (ii) of this Paragraph 7(a) after the 60th day following the Date of Termination, unless in each case the Employee timely executes a release substantially in the form attached as Exhibit A hereto so that the revocation period for the release expires before the 60th day following the Date of Termination.  If the Employee does not revoke his executed release, then the Bank shall (y) pay in the first payroll period following the expiration of the revocation period (subject to Section 7(m) below) the amount of the Employee’s Salary that has accrued since the Date of Termination, with the remaining Salary during the One-Year Period to be paid in accordance with the Bank’s regular payroll schedule, and (z) continue to provide
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    the insurance benefits under clause (ii) of this Paragraph 7(a) for the remainder of the One-Year Period.”
5. Clause (i) of Section 7(d) of the Agreement is hereby amended to delete the phrase “within 25 business days after the Date of Termination”.
6. The last sentence of Section 7(d) of the Agreement is hereby amended to read in its entirety as follows, with the additional language after the first sentence set forth below to immediately follow such sentence:
“No payment shall be made under clause (i) of this Paragraph 7(d), and no insurance benefits shall be provided under clause (ii) of this Paragraph 7(d) after the 60th day following the Date of Termination, unless in each case the Employee timely executes a release substantially in the form attached as Exhibit A hereto so that the revocation period for the release expires before the 60th day following the Date of Termination.  If the Employee does not revoke his executed release, then the Bank shall (y) pay in the first payroll period following the expiration of the revocation period (subject to Section 7(m) below) the lump sum payment set forth in clause (i) of this Paragraph 7(d), and (z) continue to provide the insurance benefits under clause (ii) of this Paragraph 7(d) for the remainder of the 24-month period.”
7. Section 7(k) of the Agreement is hereby amended to delete the last sentence of such section and to add a new sentence at the end of such section to read in its entirety as follows:
“If the payments and benefits under this Section 7 are required to be reduced, then the cash severance shall be reduced first, followed by a reduction in the fringe benefits.”
8. Section 7 of the Agreement is hereby amended to add a new subsection (m) at the end of such section to read in its entirety as follows:
“(m) Year-End Straddle Rule.  Notwithstanding any other provision contained in this Agreement, if either (i) the time period for making any cash payment under subsections (a) and (d) of this Section 7 commences in one calendar year and ends in the succeeding calendar year or (ii) the time period that the Employee has to consider the terms of the general release required by subsections (a) and (d)  of this Section 7 (including any revocation period under such release) commences in one calendar year and ends in the succeeding calendar year, then the payment shall not be paid until the succeeding calendar year.”

9. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the Agreement.
10. All other provisions of the Agreement shall continue in full force and effect.

(Signature page follows)



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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Employee and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
/s/Roger H. Molvar
  Name:
Roger H. Molvar
  Title:
Chair, Compensation and Awards Committee 
     
     
  EMPLOYEE 
     
  By:
/s/Joseph W. Kiley III
  Name:
Joseph W. Kiley III
 
 
 
 
 
 
 
 





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Exhibit 10.2

AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT FOR RICHARD P. JACOBSON

THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank formerly known as First Savings Bank Northwest (the “Bank”), and Richard P. Jacobson (“the “Employee”).
WHEREAS, the Bank and the Employee previously entered into an Employment Agreement on December 2, 2013 (the “Agreement”);

WHEREAS, the parties desire to amend the Agreement to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Section 13 of the Agreement provides that the Agreement may be amended by a written agreement signed by the Bank and the Employee; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Employee hereby amend the Agreement as follows:
1. The definition of “Change in Control” in Section 1 of the Agreement is hereby amended to read in its entirety as follows:
“Change in Control” means (1) an offeror other than the Company (as defined below) purchases 30% or more of the outstanding shares of stock of the Company or the Bank pursuant to a tender or exchange offer for such shares; (2) any person (as the term is used in Sections 13(d) and 14(d) of the Securities  Exchange Act of 1934 (“Exchange Act”)) becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly of securities of the Company or the Bank representing 30% or more of the combined voting power of the Company’s or the Bank’s outstanding securities; (3) the date a majority of the members of the board of directors of the Company is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date of the appointment or election; or (4) consummation of a plan of reorganization, merger, acquisition, consolidation, sale of all or substantially all of the assets of the Company or a similar transaction in which the Company is not the resulting entity; provided that the term “Change in Control” shall not include an acquisition of securities by an employee benefit plan of the Bank or the Company and provided further each of the above events shall be deemed to be a “Change in Control” only if it also constitutes either a change in the ownership of the Company or the Bank, a change in the effective control of the Company or the Bank or a change in the ownership of a substantial portion of the assets of the Company or the Bank, in each case as provided under Section 409A of the Code and the regulations thereunder.”
 

2. The definition of “Involuntary Termination” in Section 1 of the Agreement is hereby amended to add the following language at the end of such definition:
“Notwithstanding the foregoing, prior to any termination of employment for good reason, the Employee must first provide written notice to the Bank within ninety (90) days of the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Bank received the written notice from the Employee.  If the Bank remedies the condition within such thirty (30) day cure period, then no good reason shall be deemed to exist with respect to such condition.  If the Bank does not remedy the condition within such thirty (30) day cure period, then the Employee may deliver a notice of termination for good reason at any time within sixty (60) days following the expiration of such cure period.”

3. The definition of “Separation from Service” in Section 1 of the Agreement is hereby amended to read in its entirety as follows:
“Separation from Service” means a termination of the Employee’s employment with the Bank (and all corporations, entities or organizations with whom the Bank would be considered a single employer pursuant to subsections (b) and (c) of Section 414 of the Code), in each case as determined in accordance with Section 409A of the Code and Treasury Regulation §1.409A-1(h).  In determining whether a Separation from Service has occurred, the Bank shall take into account all of the facts and circumstances, special rules and presumptions set forth in the above regulation, including whether the Bank and the Employee reasonably anticipate that either no further services would be performed after a certain date or that the level of bona fide services the Employee would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed over the immediately preceding 36-month period.”
4. The last sentence of Section 7(a) of the Agreement is hereby amended to read in its entirety as follows, with the additional language after the first sentence set forth below to immediately follow such sentence:
“No payment shall be made under clause (i) of this Paragraph 7(a), and no insurance benefits shall be provided under clause (ii) of this Paragraph 7(a) after the 60th day following the Date of Termination, unless in each case the Employee timely executes a release substantially in the form attached as Exhibit A hereto so that the revocation period for the release expires before the 60th day following the Date of Termination.  If the Employee does not revoke his executed release, then the Bank shall (y) pay in the first payroll period following the expiration of the revocation period (subject to Section 7(m) below) the amount of the Employee’s Salary that has accrued since the Date of Termination, with the remaining Salary during the One-Year Period to be paid in accordance with the Bank’s regular payroll schedule, and (z) continue to provide the

2
insurance benefits under clause (ii) of this Paragraph 7(a) for the remainder of the One-Year Period.”
5. Clause (i) of Section 7(d) of the Agreement is hereby amended to delete the phrase “within 25 business days after the Date of Termination”.
6. The last sentence of Section 7(d) of the Agreement is hereby amended to read in its entirety as follows, with the additional language after the first sentence set forth below to immediately follow such sentence:
“No payment shall be made under clause (i) of this Paragraph 7(d), and no insurance benefits shall be provided under clause (ii) of this Paragraph 7(d) after the 60th day following the Date of Termination, unless in each case the Employee timely executes a release substantially in the form attached as Exhibit A hereto so that the revocation period for the release expires before the 60th day following the Date of Termination.  If the Employee does not revoke his executed release, then the Bank shall (y) pay in the first payroll period following the expiration of the revocation period (subject to Section 7(m) below) the lump sum payment set forth in clause (i) of this Paragraph 7(d), and (z) continue to provide the insurance benefits under clause (ii) of this Paragraph 7(d) for the remainder of the 24-month period.”
7. Section 7(k) of the Agreement is hereby amended to delete the last sentence of such section and to add a new sentence at the end of such section to read in its entirety as follows:
“If the payments and benefits under this Section 7 are required to be reduced, then the cash severance shall be reduced first, followed by a reduction in the fringe benefits.”
8. Section 7 of the Agreement is hereby amended to add a new subsection (m) at the end of such section to read in its entirety as follows:
“(m) Year-End Straddle Rule.  Notwithstanding any other provision contained in this Agreement, if either (i) the time period for making any cash payment under subsections (a) and (d) of this Section 7 commences in one calendar year and ends in the succeeding calendar year or (ii) the time period that the Employee has to consider the terms of the general release required by subsections (a) and (d)  of this Section 7 (including any revocation period under such release) commences in one calendar year and ends in the succeeding calendar year, then the payment shall not be paid until the succeeding calendar year.”

9. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the Agreement.
10.            All other provisions of the Agreement shall continue in full force and effect.

(Signature page follows)

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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Employee and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
/s/Roger H. Molvar
  Name:
Roger H. Molvar
  Title:
Chair, Compensation and Awards Committee
     
     
  EMPLOYEE 
     
  By:
/s/Richard P. Jacobson
  Name:
Richard P. Jacobson










4
Exhibit 10.3

AMENDMENT NO. 1 TO
EXCUTIVE SUPPLEMENTAL RETIREMENT PLAN PARTICIPATION AGREEMENT
FOR JOSEPH W. KILEY III

THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank (the “Bank”), and Joseph W. Kiley III (“the “Participant”).
WHEREAS, the Bank and the Participant previously entered into an Executive Supplemental Retirement Plan Participation Agreement for the benefit of the Executive, which was originally effective as of July 1, 2013 and which was most recently amended and restated as of January 10, 2020 (the “2013 SERP”);

WHEREAS, the parties desire to amend the 2013 SERP to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Paragraph 5.E of the 2013 SERP gives the Bank the exclusive right to amend, modify or terminate the 2013 SERP, subject to the Bank giving the Executive 30 days’ written notice prior to the effective date of the amendment; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Executive hereby amend the SERP as follows:
1. The second and third sentences of Section 1, Paragraph A of the 2013 SERP are hereby amended to read in their entirety as follows:
“For purposes of the preceding sentence, “Involuntary Termination” and “Change in Control” shall have the same meaning as in the Participant’s employment agreement dated December 2, 2013, as such employment agreement may be amended or restated from time to time. If the above requirements are satisfied and if the Participant executes and does not revoke the general release of claims as required below, then upon the first day of a month during the 90-day period beginning with the date of the Participant’s “separation from service” (as that phrase is defined in Section 409A of the Internal Revenue Code and the regulations and guidance of general applicability issued thereunder (“Section 409A”)), taking into account the rules and presumptions provided for in the Section 409A regulations, from the Bank and all other related entities (as determined under Section 409A), the Bank shall begin paying to the Participant an annual pension of Twenty Eight Thousand ($28,000) Dollars for 15 years, payable in monthly installments (180 months in total), with the first installment due on the above date and with the remaining installments due on the first day of each following month.”

2. The last sentence of Section 1, Paragraph A of the 2013 SERP is hereby amended to read in its entirety as follows”
“No payments shall be made under this Paragraph 1.A unless the Participant timely executes a release substantially in the form attached as Exhibit A hereto so that the revocation period expires before the 60th day following the date of the Participant’s separation from service as defined herein.” 
3. By signing this Amendment, the Participant hereby waives his right to receive 30 days’ advance notice of the effective date of this Amendment.
4. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the 2013 SERP.
5. All other provisions of the 2013 SERP shall continue in full force and effect.
(Signature page follows)









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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Participant and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
/s/Roger H. Molvar
  Name:
Roger H. Molvar
  Title:
Chair, Compensation and Awards Committee
     
     
  PARTICIPANT
     
  By:
/s/Joseph W. Kiley III
  Name:
Joseph W. Kiley III










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Exhibit 10.4

AMENDMENT NO. 1 TO
SUPPLEMENTAL EXCUTIVE RETIREMENT PLAN
FOR JOSEPH W. KILEY III
THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank (the “Bank”), and Joseph W. Kiley III (“the “Executive”).
WHEREAS, the Bank previously adopted the First Financial Northwest Bank Supplemental Executive Retirement Plan for the benefit of the Executive as of January 10, 2020 (the “SERP”);

WHEREAS, the parties desire to amend the SERP to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Article 7.1 of the SERP provides that the SERP may be amended by a written agreement signed by the Bank and the Executive; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Executive hereby amend the SERP as follows:
1. Article 1.6(c) of the SERP is hereby amended to read in its entirety as follows:
“(c)   the date that a majority of the members of the board of directors of the Company is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the board of directors of the Company before the date of the appointment or election; or”

2. Article 1.13 of the SERP is hereby amended to read in its entirety as follows:
“1.13 Separation from Service” means a termination of the Executive’s employment with the Bank (and all corporations, entities or organizations with whom the Bank would be considered a single employer pursuant to subsections (b) and (c) of Section 414 of the Code), in each case as determined in accordance with Section 409A of the Code and Treasury Regulation §1.409A-1(h).  In determining whether a Separation from Service has occurred, the Bank shall take into account all of the facts and circumstances, special rules and presumptions set forth in the above regulation, including whether the Bank and the Executive reasonably anticipate that either no further services would be performed after a certain date or that the level of bona fide services the Executive would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed over the immediately preceding 36-month period.”
3. Article 7.1 of the SERP is hereby amended to read in its entirety as follows:


“7.1.  Amendments and Termination.  Subject to Article 7.11 of this Plan, this Plan may be amended or terminated solely by a written agreement signed by the Bank and by the Executive.”
4. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the SERP.
5. All other provisions of the SERP shall continue in full force and effect.

(Signature page follows)











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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Executive and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
/s/Roger H. Molvar
  Name:
Roger H. Molvar
  Title:
Chair, Compensation and Awards Committee
     
     
  EXECUTIVE
     
  By:
/s/Joseph W. Kiley III
  Name:
Joseph W. Kiley III












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Exhibit 10.5

AMENDMENT NO. 1 TO
SUPPLEMENTAL EXCUTIVE RETIREMENT PLAN
FOR RICHARD P. JACOBSON
THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank (the “Bank”), and Richard P. Jacobson (“the “Executive”).
WHEREAS, the Bank previously adopted the First Financial Northwest Bank Supplemental Executive Retirement Plan for the benefit of the Executive as of January 10, 2020 (the “SERP”);

WHEREAS, the parties desire to amend the SERP to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Article 7.1 of the SERP provides that the SERP may be amended by a written agreement signed by the Bank and the Executive; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Executive hereby amend the SERP as follows:
1. Article 1.6(c) of the SERP is hereby amended to read in its entirety as follows:
“(c)   the date that a majority of the members of the board of directors of the Company is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the board of directors of the Company before the date of the appointment or election; or”

2. Article 1.13 of the SERP is hereby amended to read in its entirety as follows:
“1.13 Separation from Service” means a termination of the Executive’s employment with the Bank (and all corporations, entities or organizations with whom the Bank would be considered a single employer pursuant to subsections (b) and (c) of Section 414 of the Code), in each case as determined in accordance with Section 409A of the Code and Treasury Regulation §1.409A-1(h).  In determining whether a Separation from Service has occurred, the Bank shall take into account all of the facts and circumstances, special rules and presumptions set forth in the above regulation, including whether the Bank and the Executive reasonably anticipate that either no further services would be performed after a certain date or that the level of bona fide services the Executive would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed over the immediately preceding 36-month period.”
3. Article 7.1 of the SERP is hereby amended to read in its entirety as follows:


“7.1.  Amendments and Termination.  Subject to Article 7.11 of this Plan, this Plan may be amended or terminated solely by a written agreement signed by the Bank and by the Executive.”
4. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the SERP.
5. All other provisions of the SERP shall continue in full force and effect.

(Signature page follows)












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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Executive and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
/s/Roger H. Molvar
  Name:
Roger H. Molvar
  Title:
Chair, Compensation and Awards Committee
     
     
  EXECUTIVE
     
  By:
/s/Richard P. Jacobson
  Name:
Richard P. Jacobson












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Exhibit 10.6

AMENDMENT NO. 1 TO
FORM OF CHANGE IN CONTROL SEVERANCE AGREEMENT

THIS AMENDMENT No. 1 (the “Amendment”) is adopted effective as of May 12, 2023 by and between First Financial Northwest Bank, a Washington state chartered commercial bank formerly known as First Savings Bank Northwest (the “Bank”), and _________ (“the “Employee”).
WHEREAS, the Bank and the Employee previously entered into an Amended and Restated Change in Control Severance Agreement on December 16, 2020 (the “Agreement”);

WHEREAS, the parties desire to amend the Agreement to ensure compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Section 9 of the Agreement provides that the Agreement may be amended by a written agreement signed by the Bank and the Employee; and

WHEREAS, the Board of Directors of the Bank has approved this Amendment.
NOW, THEREFORE, in consideration of the foregoing, the Bank and the Employee hereby amend the Agreement as follows:
1. The definition of “Involuntary Termination” in Section 1(e) of the Agreement is hereby amended to add the following language at the end of such definition:
“Notwithstanding the foregoing, prior to any termination of employment for good reason, the Employee must first provide written notice to the Bank within ninety (90) days of the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Bank received the written notice from the Employee.  If the Bank remedies the condition within such thirty (30) day cure period, then no good reason shall be deemed to exist with respect to such condition.  If the Bank does not remedy the condition within such thirty (30) day cure period, then the Employee may deliver a notice of termination for good reason at any time within sixty (60) days following the expiration of such cure period.”

2. Clause (iii) of Section 3(a) of the Agreement is hereby amended to delete the phrase “within 25 days after the later of the date of such Change in Control or the Date of Termination,”.

3. The next to last sentence of Section 3(a) of the Agreement is hereby amended to read in its entirety as follows, with the additional language after the first sentence set forth below to immediately follow such sentence:
“No insurance benefits shall be provided under clause (ii) of this Section 3(a) after the 60th day following the Date of Termination and no payment shall be made under clause (iii) of this Section 3(a) unless the Employee timely executes a release substantially in the form 


attached as Exhibit A hereto so that the revocation period expires before the 60th day following the Date of Termination.  If the Employee does not revoke his executed release, then the Bank shall (y) pay in the first payroll period following the expiration of the revocation period (subject to Section 3(j) below) the lump sum payment set forth in clause (iii) of this Section 3(a), and (z) continue to provide the insurance benefits under clause (ii) of this Section 3(a) for the remainder of the remaining term of this Agreement.”
4. Section 3 of the Agreement is hereby amended to add a new subsection (j) at the end of such section to read in its entirety as follows:
“(j) Year-End Straddle Rule.  Notwithstanding any other provision contained in this Agreement, if either (i) the time period for making any cash payment under Section 3(a) commences in one calendar year and ends in the succeeding calendar year or (ii) the time period that the Employee has to consider the terms of the general release required by Section 3(a) (including any revocation period under such release) commences in one calendar year and ends in the succeeding calendar year, then the payment shall not be paid until the succeeding calendar year.”

5. Capitalized terms not otherwise defined in this Amendment shall have the meanings ascribed to them in the Agreement.
6. All other provisions of the Agreement shall continue in full force and effect.

(Signature page follows)







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IN WITNESS WHEREOF, this Amendment has been executed as of the date first written above by the Employee and by a duly authorized representative of the Bank.

 
FIRST FINANCIAL NORTHWEST BANK
 
 
 
By:
 
  Name:
 
  Title:
 
     
     
  EMPLOYEE
     
  By:
 
  Name:













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