FIRST MIDWEST FINANCIAL, INC.
                  Executive Officer Incentive Stock Option Plan
                          for Mergers and Acquisitions



Statement of Policy

         It is the policy of First Midwest  Financial,  Inc. (the  "Company") to
maintain a program by which the  executive  officers  of the Company are awarded
incentive stock options in accordance with the Company's  long-term objective of
growth  through  mergers and  acquisitions.  As such,  the  Company  shall award
incentive  stock  options  to  executive   officers  of  the  Company  upon  the
consummation of mergers and acquisitions according to the criteria listed below.


Guidelines for Award of Incentive Stock Options

1.   The award of incentive stock options shall be effective upon the closure of
     a merger or acquisition of a financial institution.

2.   The recipient shall be immediately  100% vested as of the effective date of
     grant in the incentive stock options awarded under this plan .

3.   The award of incentive  stock  options  under this plan shall be subject to
     the availability of such stock options. In the event that stock options are
     not  available  in amounts  sufficient  to meet the total  award under this
     plan,  the available  stock options will be awarded on a pro-rata  basis to
     the recipients.

4.   The exercise price of the incentive  stock options  awarded under this plan
     shall be the closing  average bid/ask market price on the effective date of
     grant.

5.   The total number of incentive  stock options  awarded under this plan shall
     be allocated as follows:

                  James S. Haahr                                             40%
                  To be determined by the Board of Directors                 60%


Amount of Incentive Stock Options Awarded

                                                Total Number of Incentive  
      Dollar Amount of Assets Acquired:                 Stock Options    
      ---------------------------------                  -------------  

           Under $100 milllion                             22,500
           $100-$150  million                              30,000
           $150-$200  million                              37,500
           $200-$250  million                              45,000
           $250-$300 million                               52,500
           $300-$400 million                               60,000   
           $400-$500 million                               67,500
           Over $500 million                               75,000