Management Change/Compensation (Form 8-K)

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Comepnsatory Arrangements of Certain Officers.

(e) As of December 2, 2025, 1st Security Bank of Washington ("Bank"), the wholly-owned subsidiary of FS Bancorp, Inc. entered into change of control agreements with Robert Nesbitt, Chief Credit Operations Officer, Sean McCormick, Chief Credit Administration Officer and Phillip Whittington, Chief Financial Officer. These agreements provide that if there is a change in control of the Bank during the term of the agreement, the executive will be entitled to a severance payment if the executive suffers an involuntary termination within six months preceding or twelve months following the change in control. The severance payment will be twelve months of the executive's then current salary, paid in a lump sum within 45 days of the termination. "Involuntary termination" is defined in the change of control agreements as the following:

•	termination of the executive's employment other than for cause;

•	a reduction of the executive's base salary, unless generally applicable to all senior officers of the Bank;

•	a material adverse change in the executive's benefits, contingent benefits or vacation, unless generally applicable to all senior officers of the Bank;

•	a relocation of more than 20 miles from Mountlake Terrace, Washington; or

•	a material demotion of the executive, including but not limited to a material diminution of the executive's title, duties or responsibilities.

The foregoing description of the change in control agreements does not purport to be complete and is qualified in its entirety by reference to the form of change of control agreement, a copy of which is furnished as Exhibit 10.1 and is incorporated herein by reference.