FIRST MANISTIQUE CORPORATION
           1997 DIRECTORS' STOCK OPTION PLAN

        Section 1.  Establishment and Purpose.

     First Manistique Corporation hereby establishes a
stock option plan to be named the First Manistique
Corporation 1997 Directors' Stock Option Plan, for
certain directors of the Company's banking
subsidiaries.  The purpose of the Plan is:  (i) to
provide a non-cash method of compensating directors
that will directly promote the interests of the
stockholders because the rewards made available to the
directors would be directly related to the banking
subsidiaries' returns on equity, and thereby indirectly
related to the Company's return on equity and the price
of its stock; and (ii) to aid the Company and its
subsidiaries in competing with other enterprises for
the services of new directors needed to help ensure the
Company's continued progress.

               Section 2.  Definitions.

     (a)  Act means the Securities Exchange Act of
1934, as amended from time to time.

     (b)  Administrator means the three most senior
executive officers f the Company.

     (c)         Authority means the shares of Stock
       authorized for issuance pursuant to the Plan.

     (d)  Average Equity means the average equity of
          the Subsidiary as computed in preparing the
          audited annual financial statements of the
          Company.

     (e)  Board of Directors means the Board of
Directors of the Company.

     (f)  Company means First Manistique Corporation, a
          corporation organized and existing under the
          laws of the State of Michigan.

     (g)  Eligible Director means a director of a
          Subsidiary who is not otherwise an officer or
          employee of the Company or of any Subsidiary.
          If a person is a director of more than one
          Subsidiary, such person shall, for purposes
          of this Plan, be an Eligible Director only
          with respect to the Subsidiary having the
          largest amount of assets.

     (h)  Effective Date means the date this Plan is
          approved by the Company's stockholders.

     (i)  Fair Market Value means, as long as the
          Common Stock is not actively traded in any
          recognized market, the average price per
          share at which shares of Common Stock were
          bought and sold during the three (3)
          preceding months in transactions known to
          management of the Company involving 100 or
          more shares between purchasers and sellers
          none of whom are directors or officers of the
          Company or any Subsidiary.  If the shares of
          Common Stock are actively traded in any

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          recognized market, the "Fair Market Value" as
          used in the Plan shall mean the average of
          the last reported sales price of Common Stock
          as of the close of business for each of the
          last twenty (20) trading days ending the day
          immediately preceding the day as of which
          "Fair Market Value" is to be determined.

     (j)  Grant Date means, with respect to each
          Option, the day that an Eligible Director is
          granted the Option.

     (k)  Net Income means the net income of a
          Subsidiary as computed in preparing the
          audited annual financial statements of the
          Company.

     (l)  Option means an option granted under this
     Plan to acquire Stock.

     (m)  Optionee means the person to whom an Option
is granted.

     (n)  Option Agreement means an Agreement issued to
          each Eligible Director with respect to each
          Option.

     (o)  Option Date means the first business day
          after an annual meeting of Stockholders with
          respect to each Option.

     (p)  Permitted Transferee means either (i) the
          spouse, a child, or a grandchild of an
          Optionee (each an "Immediate Family Member"),
          (ii) a trust for the exclusive benefit of an
          Optionee and/or one or more Immediate Family
          Members, or (iii) a partnership or limited
          liability company whose only partners or
          members are an Optionee and/or one or more
          Immediate Family Members.

     (q)  Plan means the First Manistique Corporation
1997 Directors' Stock Option Plan.

     (r)  Prior Year means the immediately preceding
fiscal year of the Company.

     (s)  Post-Death Representative(s) means the
          executor(s) or administrator(s) of the
          Optionee's estate or the person or persons to
          whom the Optionee's rights under his or her
          Option pass by Optionee's will or the laws of
          descent and distribution.

     (t)  ROE means the percentage obtained by dividing
          the Average Equity of a Subsidiary for a
          fiscal year into the Net Income of the
          Subsidiary for that fiscal year.

     (u)  Rule 16b-3 means Rule 16b-3 promulgated by
          the Securities and Exchange Commission under
          the Act, as amended from time to time or any
          successor rule.

     (v)  Shares means shares of Stock.

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     (w)  Stock means authorized and unissued shares of
          common stock, no par value, of the Company
          and includes Shares which may be reacquired
          by the Company.

     (x)  Subsidiary means any banking corporation in
          which the Company owns directly, or
          indirectly through subsidiaries, at least
          fifty percent (50%) of the total combined
          voting power of all classes of stock, or any
          other entity (including, but not limited to,
          partnerships and joint ventures) in which the
          Company owns at least fifty percent (50%) of
          the combined equity thereof.

     Any dispute as to the meaning of Average Equity,
Net Income, or ROE shall be resolved by the independent
public accountants then serving the Company.

              Section 3.  Administration.
     The Plan shall be administered on behalf of the
Company by the Administrator.  The Administrator may
adopt, amend, and rescind from time to time such
administrative rules, and may take from time to time
such actions, with or without notice to affected
Optionees or Permitted Transferees, as the case may be,
as the Administrator may deem appropriate to implement
or interpret the provisions of this Plan or to exercise
any authority, discretion, or power explicitly or
implicitly granted to the Administrator under this
Plan, provided that no such rules or actions may be
inconsistent with the provisions of this Plan or Rule
16b-3, or any successor rule, under the Act (in the
case of Optionees affected thereby).  The Administrator
may make rules or take action pursuant to this Section
by any appropriate means.

      Section 4.  Shares Reserved Under the Plan.

     (a)  The maximum number of Shares which may be
issued in connection with Options granted hereunder is
200,000, less any Shares which are covered by, or
issued pursuant to, awards granted under the First
Manistique Corporation Stock Compensation Plan (the
"Stock Compensation Plan").  At any time during the
existence of the Plan, there shall be reserved for
issuance upon the exercise of Options granted under the
Plan an amount of Stock (subject to adjustment as
provided in Section 10 hereof) equal to 200,000 Shares,
less (i) the total number of Shares issued pursuant to
all such exercises which shall have been made prior to
such time, and (ii) the total number of Shares issued
prior to such time pursuant to awards granted under the
Stock Compensation Plan.

     (b)  When an Option is granted, the total number
of Shares issuable upon complete exercise thereof shall
be charged against the maximum number of Shares of the
Authority.  When the Option is exercised, no additional
charge shall be made against the Authority.  If an
exercise price is paid in Shares owned by the Optionee
or the Permitted Transferee, as the case may be, such
Shares shall not be added to the Authority.

     (c)  If an Option terminates in whole in part, by
expiration or for any other reason except exercise of
such Option, the Shares previously charged to the
Authority upon grant of the Option shall be restored to
the Authority, and shall again be available for
issuance under the

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Authority, for as long as such
Authority continues, as if such Shares had never been
subject to an Option.

           Section 5.  Granting of Options.

     Each person who is an Eligible Director on the
Option Date in 1998, and each person who is an Eligible
Director in each subsequent year on the Option Date,
shall receive an Option to acquire Shares at the Fair
Market Value on such date in accordance with the
following schedule:

           *    if the Subsidiary's ROE for the Prior Year was
           less than 13%, No Shares;

           *    if the Subsidiary's ROE for the Prior Year was 13%
           but less than 14%, 200 Shares;

           *    if the Subsidiary's ROE for the Prior Year was 14%
           but less than 15%, 300 Shares;

           *    if the Subsidiary's ROE for the Prior Year was 15%
           or greater, 400 Shares.

References in this Section 5 to Subsidiary relate to
the Subsidiary of which the Eligible Director served as
a director during the prior year.

             Section 6.  Terms of Options.

     Notwithstanding any other provisions of the Plan,
each Option shall be evidenced by an Option Agreement,
which shall include the substance of the following
terms and conditions:

     (a)  The option price for each Share covered by an
          Option shall be an amount equal to one
          hundred percent (100%) of the Fair Market
          Value of a Share on the Grant Date of such
          Option.

     (b)  The Option by its terms shall not be
          transferable by the Optionee otherwise than
          by will or by the laws of descent and
          distribution; provided, however, an Option
          may be transferred, without consideration, to
          a Permitted Transferee if the Optionee
          satisfies such conditions to the transfer as
          may be required by the Administrator.  A
          Permitted Transferee shall succeed to all
          rights and benefits (except any right to
          further transfer of the Option) and be
          subject to all obligations and limitations
          applicable to the original Optionee.
          However, such rights and benefits (except any
          right to further transfer of the Option), and
          obligations and limitations shall be
          determined as if the original Optionee
          continued to hold the Option, whereby
          provisions of this Plan dealing with
          termination of service or death of an
          Optionee will continue to refer to the
          original Optionee regardless of whether an
          Option has been transferred to a Permitted
          Transferee.  The Company shall have no
          obligation to notify a Permitted Transferee
          of the termination of

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          service or death of an
          Optionee.  The designation of a beneficiary
          entitled to exercise an Option upon the
          Optionee's death does not constitute a
          transfer.  The Option shall be exercisable,
          during the Optionee's lifetime, only by the
          Optionee or a Permitted Transferee, as the
          case may be.

     (c)  Options shall become fully exercisable on the
          first anniversary of the Grant Date.  No
          Option shall be exercisable after the
          expiration of ten years from the Grant Date.
          Notwithstanding the foregoing, if the
          Optionee dies before his or her service as a
          director terminates, the Option shall be
          exercisable as to all Shares, to the extent
          not previously exercised.

     (d)  The Option shall not be exercisable after the
          earlier of (i) the last day of the thirty-
          sixth month after the month in which the
          Optionee's service as a director terminates
          for any reason or (ii) the expiration of ten
          years from the Grant Date.

      Section 7.  No Right to Remain a Director.

     The grant of an Option shall not create any right
in any person to remain as a director of the Company.

            Section 8.  Exercise of Option.

     (a)  An Option shall be exercisable only (1) upon
payment to the Company on the exercise date of cash in
the full amount of the option price of the Shares with
respect to which the Option is exercised, (2) upon
delivery to the Company on the exercise date of
certificates representing unencumbered Shares, owned by
the Optionee or the Permitted Transferee, as the case
may be, having a Fair Market Value, on the last trading
date preceding such exercise and delivery, equal to the
full amount of the purchase price of the Shares with
respect to which the Option is exercised, or (3) a
combination of (1) and (2), except that (i) any portion
of the exercise price representing a fraction of a
Share shall in any event be paid in cash, and (ii) no
Shares of Stock which have been held for less than six
months may be delivered in payment of the exercise
price of an Option.  If and to the extent determined by
the Administrator, in its sole discretion, at or after
the Grant Date, payment in full or in part may also be
made by reduction in the number of Shares issuable upon
exercise of the Option based on the Fair Market Value
of the Stock on the last trading date preceding the
exercise.

     (b)  An Optionee or Permitted Transferee, as the
case may be, shall have none of the rights of a
stockholder with respect to Shares subject to the
Option until Shares are issued to the Optionee or
Permitted Transferee upon the exercise of an Option.

            Section 9.  General Provisions.

     The Company shall not be required to issue or
deliver any certificate for Shares to an Optionee or
Permitted Transferee, as the case may be, upon the
exercise of an Option prior to:

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     (a)  If requested by the Company, the filing with
          the Company by the Optionee, the Permitted
          Transferee or the Optionee's Post-Death
          Representative, as the case may be, of a
          representation in writing that at the time of
          such exercise it is their then present
          intention to acquire the Shares being
          purchased for investment and not for resale,
          and/or the completion of any registration or
          other qualification of such Shares under any
          state or federal laws or rulings or
          regulations of any governmental regulatory
          body, which the Company shall determine to be
          necessary or advisable; and

     (b)  The obtaining of any other consent, approval,
          or permit from any state or federal
          governmental agency which the Administrator
          shall, in the Administrator's absolute
          discretion upon the advice of counsel,
          determine to be necessary or advisable.

          Section 10.  Adjustment Provisions.

     In the event any stock dividend is declared upon
the Stock or in the event outstanding Shares of Stock
shall be changed into or exchanged for a different
number, class or kind of Shares of Stock or other
securities of the Company or another corporation,
whether by reason of a split or combination of shares,
recapitalization, reclassification, reorganization,
merger, consolidation, or otherwise, the maximum number
of Shares of Stock which may be charged against the
Authority shall be appropriately and proportionately
adjusted and in any such event a corresponding
adjustment shall be made changing the number, class or
kind of Shares of Stock or other securities which are
deliverable upon the exercise of any Option theretofore
granted without change in the total price applicable to
the unexercised portion of such Option, but with a
corresponding adjustment in the price for each Share or
other securities covered by the unexercised portion of
such Option.  In the event the Company is merged,
consolidated, or reorganized with another corporation,
appropriate provision shall be made for the continuance
of outstanding Options with respect to shares of the
succeeding parent corporation following a merger, or
with respect to shares of the consolidated or
reorganized corporation in the case of a consolidation
or reorganization, and to prevent their dilution or
enlargement compared to the total shares issuable
therein in respect of the Stock.  Adjustments under
this Section 10 shall be made in an equitable manner by
the Administrator, whose determination shall be
conclusive and binding on all concerned.

  Section 11.  Duration, Amendment, and Termination.

     The Board of Directors may at any time terminate
the Plan or make such amendments thereto as it shall
deem advisable and in the best interests of the
Company, without further action on the part of the
Stockholders of the Company; provided, however, that no
such termination or amendment shall, without the
consent of the Optionee or Permitted Transferee, as the
case may be, adversely affect or impair the rights of
such Optionee or Permitted Transferee, as the case may
be, and provided further, that, unless the Stockholders
of the Company shall have first approved thereof, no
amendment of this Plan shall be made whereby:  (a) the
total number of Shares which may be granted under the
Plan to all individuals, or to any of them, shall be

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increased, except by operation of the adjustment
provisions of Section 10 hereof; (b) the term of the
Options shall be extended; (c) the minimum option price
shall be decreased; or (d) the class of eligible
persons to whom options may be granted shall be
changed.  The period during which Options may be
granted under the Authority shall terminate on the
tenth anniversary of the Effective Date, unless the
Plan earlier shall have been terminated as provided
above.

        Section 12.  Date of Granting Options.

     All Options granted under the Plan shall be in
writing and shall be granted as of a Grant Date.

          Section 13.  Stockholder Approval.

     The Plan is to be submitted for approval by the
Stockholders of the Company at the 1997 annual meeting
and shall be effective only upon receiving such
approval.

              Section 14.  Miscellaneous.

     (a)  Subject to the provisions of applicable federal
law, the Plan shall be administered, construed and
enforced according to the internal laws of the State of
Michigan, excluding its conflict of law rules, and
applicable federal law and in courts situated in the
State of Michigan.

     (b)  Transactions under this Plan are intended to
comply with applicable conditions for exemption under
Rule 16b-3.  To the extent any provision of this Plan
or action by the Administrator fails to so comply, it
shall be deemed null and void, to the extent permitted
by law and deemed advisable by the Administrator.

     (c)  The invalidity of any particular provision
herein shall not invalidate all or any part of the
remainder of the Plan, but such remainder shall be and
remain valid in all respects as fully as the law will
permit.