<PAGE>


                                                                    EXHIBIT 10.1
















                           COMMUNITY FIRST BANKSHARES, INC.

                                ANNUAL INCENTIVE PLAN

                                         1997


<PAGE>

<TABLE>
<CAPTION>

1997 AIP


GROUP                         TARGET INCENTIVE              MAXIMUM
-----                         ----------------              -------

<S>       <C>                 <C>                           <C>
I         CEO                      40%                        80%

II        EVP'S                    30%                        60%

III       SVP'S                    20%                        40%

IV        VP'S                     10%                        20%

</TABLE>

SPLIT 50% INTERNAL & 50% EXTERNAL

<TABLE>
<CAPTION>

          TARGET                   INTERNAL                   EXTERNAL
          ------                   --------                   --------

<S>       <C>                      <C>                        <C>
I          40%                      20%                          20%

II         30%                      15%                          15%

III        20%                      10%                          10%

IV         10%                       5%                           5%

</TABLE>
                                          1
<PAGE>

 INTERNAL AWARD CALCULATION

Based on performance versus plan EPS as target.
No award if less than 90% of plan.
Double internal amount @ 115% of plan (see schedule).
Round up at .5 (plan) and down at < .5.

<TABLE>
<CAPTION>
                              Award % of Base Salary
            Fully Diluted  ---------------------------------
 % of Plan      EPS         I        II        III      IV
----------      ----        -        --        ---      --
<S>         <C>           <C>      <C>        <C>       <C>
Under   90      2.16         0         0         0         0
        91      2.18       2.0       1.5       1.0        .5
        92      2.20       4.0       3.0       2.0       1.0
        93      2.23       6.0       4.5       3.0       1.5
        94      2.25       8.0       6.0       4.0       2.0
        95      2.27      10.0       7.5       5.0       2.5
        96      2.29      12.0       9.0       6.0       3.0
        97      2.31      14.0      10.5       7.0       3.5
        98      2.33      16.0      12.0       8.0       4.0
        99      2.35      18.0      13.5       9.0       4.5
       100      2.37      20.0      15.0      10.0       5.0
       101      2.39      21.3      16.0      10.7       5.3
       102      2.41      22.7      17.0      11.3       5.7
       103      2.43      24.0      18.0      12.0       6.0
       104      2.45      25.3      19.0      12.7       6.3
       105      2.47      26.7      20.0      13.3       6.7
       106      2.49      28.0      21.0      14.0       7.0
       107      2.51      29.3      22.0      14.7       7.3
       108      2.53      30.7      23.0      15.3       7.7
       109      2.55      32.0      24.0      16.0       8.0
       110      2.57      33.3      25.0      16.7       8.3
       111      2.59      34.7      26.0      17.3       8.7
       112      2.61      36.0      27.0      18.0       9.0
       113      2.63      37.3      28.0      18.7       9.3
       114      2.65      38.7      29.0      19.3       9.7
       115+     2.67      40.0      30.0      20.0      10.0

</TABLE>

                                          2
<PAGE>

EXTERNAL AWARD CALCULATION

SNL peer group (20 banks) for CURRENT PERFORMANCE YEAR based on group as of
December 31, 1995.

Combines incentive for ROE and growth (see matrix).

SNL 20 BANK GROUP
<TABLE>
--------------------------------------------------------------------------------
<S>             <C>              <C>                 <C>         <C>
Percentile      75th or higher       100%            150%            200%
--------------------------------------------------------------------------------
ROE                  50th             50%            100%            150%
--------------------------------------------------------------------------------
                 49th or lower        0%              50%            100%
--------------------------------------------------------------------------------
                                 49th or lower        50th       75th or higher
--------------------------------------------------------------------------------

</TABLE>

                                                    Percentile asset growth rate

External award calculation:
<TABLE>
<CAPTION>
                                      % OF SALARY AT PERFORMANCE LEVEL
                                     -----------------------------------
            TARGET                    50%      100%      150%      200%
            ------                   ---      ----      ----      ----
<S>                                 <C>       <C>       <C>       <C>
I            20%                      10%       20%       30%       40%

II           15%                     7.5%       15%     22.5%       30%

III          10%                       5%       10%       15%       20%

IV            5%                     2.5%        5%      7.5%       10%

</TABLE>

The SELECTED PEER GROUP reflects our selection of the NINETEEN OTHER
INSTITUTIONS most like the subject institution to be used as a peer group in
comparing relative compensation levels.  For banks with assets of less than $5
billion, the automated process searches in sequence for:

     1.   Banks in the same state within 40% of total assets.
     2.   Banks in the same region within 40% of total assets.
     3.   Banks in the same state within 80% of total assets.
     4.   Banks in the same region within 80% of total assets.
     5.   Any bank within 40% of total assets.
     6.   Any bank within 80% of total assets.
     7.   Banks closest in asset size.

If at any point in the sequence nineteen banks are found, the sequence stops and
those banks form the Selected Peer Group.  If step six is reached and there are
still not nineteen other banks, the banks closest in asset size anywhere in the
country are chosen to round out the peer group.

                                       3