Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Disclosure controls and procedures
An evaluation of the Company’s disclosure controls and procedures (as defined in Section 13a-15(e) of the Securities Exchange Act of 1934 (the "Act") was carried out under the supervision and with the participation of the Company’s Chief Executive Officer, Chief Financial Officer and several other members of the Company’s senior management as of the end of the period covered by this report. The Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures in effect as of December 31, 2023 were effective in ensuring that the information required to be disclosed by the Company in the reports it files or submits under the Act was (i) accumulated and communicated to the Company’s management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Management's report on internal control over financial reporting. First Northwest Bancorp's management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) of the Act. The Company's internal control system is designed to provide reasonable assurance to our management and the board of directors regarding the preparation and fair presentation of published financial statements for external purposes in accordance with generally accepted accounting principles.
This process includes policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on the financial statements. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Also, because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Additionally, in designing disclosure controls and procedures, our management was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. As a result of these inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Furthermore, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
The Company's management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2023. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 Framework) . Based on that assessment, the Company's management believes that, as of December 31, 2023, First Northwest Bancorp's internal control over financial reporting is effective based on those criteria.
Moss Adams LLP, an independent registered public accounting firm, has audited the Company's consolidated financial statements as of December 31, 2023, which is included in Item 8. Financial Statements and Supplementary Data.
Changes in Internal Controls. There have been no changes in the Company’s internal control over financial reporting for the year ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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Item 9B. Other Information
Not applicable.
Item 9C. Disclosures Regarding Foreign Jurisdictions that Prevent Inspections
None.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information regarding the Company's directors contained under the section captioned "Proposal 1 – Election of Directors" in the Company’s proxy statement, a copy of which will be filed with the SEC no later than 120 days after December 31, 2023, (the "Proxy Statement"), is incorporated herein by reference.
For information regarding the executive officers of the Company and the Bank, see the information contained under the section captioned "Item 1. Business - Information About Our Executive Officers," which is incorporated by reference.
The Company has an audit committee. The members of the Audit Committee are directors Sherilyn Anderson (Chairperson), Stephen Oliver, Dana Behar, Cindy Finnie, Lynn Terwoerds and Jennifer Zaccardo. Each member of the Audit Committee is "independent" as defined in the Nasdaq Stock Market listing standards. The Board of Directors has determined that Ms. Zaccardo meets the definition of "audit committee financial expert," as defined by the SEC.
The Board of Directors has adopted a Code of Ethics for the Company’s officers (including its principal executive officer and senior financial officers), directors and employees. The Company’s Code of Ethics is posted on the Investor Relations section of our website at www.ourfirstfed.com.
The information regarding compliance with Section 16(a) of the Securities Exchange Act of 1934 included in the section captioned "Delinquent Section 16(a) Reports" in the Proxy Statement is incorporated herein by reference.
There have been no material changes to the procedures by which shareholders may recommend nominees to the Company's Board of Directors.
Item 11. Executive Compensation
The information contained in the sections captioned "Executive Compensation" and "Director Compensation" in the Proxy Statement is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information contained in the sections captioned "Principal Shareholders" and "Beneficial Ownership by Directors and Named Executive Officers" in the Proxy Statement is incorporated herein by reference.
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The following table summarizes share and exercise price information about First Northwest Bancorp's equity compensation plans as of December 31, 2023.
Plan category
Number of securities to be issued upon exercise of outstanding options, warrants, and rights
Weighted-average exercise price of outstanding options, warrants, and rights
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(a)
(b)
(c)
Equity compensation plans approved by security holders:
First Northwest Bancorp 2020 Equity Incentive Plan (1)
—
N/A
289,511
Equity compensation plans not approved by security holders
N/A
N/A
N/A
Total
—
—
289,511
(1) Shareholders approved the First Northwest Bancorp 2020 Equity Incentive Plan (the "2020 Plan") on May 5, 2020. As of December 31, 2023, 74,402 restricted shares were outstanding under the 2020 Plan and no stock options have been awarded. The restricted shares will vest in equal annual installments over periods of up to three years. All of the shares shown in column (c) may be granted under the 2020 Plan in the form of restricted shares, as well as other types of awards. No additional awards may be made under the First Northwest Bancorp 2015 Equity Incentive Plan (the "2015 Plan"), which was approved by shareholders on November 16, 2015. As of December 31, 2023, 21,620 restricted shares and no options remained outstanding under the 2015 Plan.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information contained in the sections captioned "Corporate Governance and Board Matters – Transactions with Related Persons" and "Corporate Governance and Board Matters – Director Independence" in the Proxy Statement is incorporated herein by reference.
Item 14. Principal Accounting Fees and Services
The information contained under the section captioned "Proposal 3 – Ratification of Appointment of Independent Auditor" in the Prox y Statement is incorporated herein by reference.
PART IV
Item 15. Exhibits, Financial Statement Schedules
( a) 1. Financial Statements.
For a list of the financial statements filed as part of this report see Part II – Item 8.
2. Financial Statement Schedules.
All schedules have been omitted as the required information is either inapplicable or contained in the Consolidated Financial Statements or related Notes contained in Part II, Item 8, "Financial Statements and Supplementary Data," of this Form 10-K.
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3. Exhibits required by Item 601 of Regulation S-K:
Exhibit No.
Exhibit Description
Filed Herewith
Form
Original Exhibit No.
Filing Date
3.1
Articles of Incorporation of First Northwest Bancorp, as amended June 3, 2022
10-Q
3.1
8/12/2022
3.2
Bylaws of First Northwest Bancorp as amended effective June 3, 2022
10-Q
3.2
8/12/2022
4.1
Indenture, Including Forms of 3.75% Fixed-to-Floating Rate Subordinated Notes due 2031
8-K
4.1
3/25/2021
4.2
Description of Common Stock
10-Q
4.1
8/12/2022
10.1*
First Northwest Bancorp 2015 Equity Incentive Plan
10-K
10.1
3/15/2019
10.2*
Form of First Northwest Bancorp 2015 Equity Incentive Plan Restricted Stock Award Agreement as amended effective November 23, 2020
10-K
10.2
3/15/2021
10.3*
Employment Agreement with Matthew P. Deines dated December 7, 2021
8-K
10.1
12/9/2021
10.4*
Form of Executive Employment Agreement with Terry A. Anderson, Derek J. Brown, Geraldine L. Bullard, Christopher W. Neros, and Christopher J. Riffle
10-K
10.4
3/15/2019
10.5*
First Northwest Bancorp 2020 Equity Incentive Plan
10-Q
10.4
5/11/2020
10.6*
Form of First Northwest Bancorp 2020 Equity Incentive Plan Restricted Share Award Agreement
10-Q
10.1
8/10/2020
10.7*
First Federal Fiscal 2023 Cash Incentive Plan
10-Q
10.1
5/12/2023
10.8*
Non-Employee Director Compensation Policy
10-Q
10.2
5/12/2023
10.9
Loan Agreement, dated as of May 20, 2022, by and Between First Northwest Bancorp and NexBank
8-K
10.1
5/27/2022
10.10
Security Agreement, dated as of May 20, 2022, by and between First Northwest Bancorp and NexBank
8-K
10.2
5/27/2022
10.11
Revolving Credit Note dated May 20, 2022, of First Northwest Bancorp
8-K
10.3
5/27/2022
10.12
Agreement for the Purchase and Sale of Real Property by and between First Fed Bank and Mountainseed Real Estate Services, LLC**
8-K
10.1
1/31/2024
21
Subsidiaries of First Northwest Bancorp
X
23
Consent of Independent Registered Public Accounting Firm
X
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act
X
31.2
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
X
32
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act
X
97.1
Compensation Clawback Policy
X
101
The following materials from First Northwest Bancorp's Annual Report on Form 10-K for the year ended December 31, 2023, formatted in Inline Extensible Business Reporting Language (XBRL): (1) Consolidated Balance Sheets; (2) Consolidated Statements of Income; (3) Consolidated Statements of Comprehensive Income; (4) Consolidated Statements of Changes in Shareholders' Equity; (5) Consolidated Statements of Cash Flows; and (6) Notes to Consolidated Financial Statements
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101
* Denotes a management contract or compensatory plan or arrangement.
** Certain schedules and exhibits to this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby agrees to furnish a copy of any omitted schedule or similar attachment to the SEC upon request.
Item 16. Form 10-K Summary
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FIRST NORTHWEST BANCORP
March 15, 2024
By:
/s/Matthew P. Deines
Matthew P. Deines
President, Chief Executive Officer and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By:
/s/Matthew P. Deines
March 15, 2024
Matthew P. Deines
President, Chief Executive Officer and Director
(Principal Executive Officer)
By:
/s/Geraldine L. Bullard
March 15, 2024
Geraldine L. Bullard
Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
By:
/s/Cindy H. Finnie
March 15, 2024
Cindy H. Finnie
Chair of the Board and Director
By:
/s/Sherilyn G. Anderson
March 15, 2024
Sherilyn G. Anderson
Director
By:
/s/Dana D. Behar
March 15, 2024
Dana D. Behar
Director
By:
/s/Craig A. Curtis
March 15, 2024
Craig A. Curtis
Director
By:
/s/ Gabriel S. Galanda
March 15, 2024
Gabriel S. Galanda
Director
By:
/s/ Lynn A. Terwoerds
March 15, 2024
Lynn A. Terwoerds
Director
By:
/s/Norman J. Tonina, Jr.
March 15, 2024
Norman J. Tonina, Jr.
Director
By:
/s/Jennifer Zaccardo
March 15, 2024
Jennifer Zaccardo
Director
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