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                                                                    EXHIBIT 10.6

                              CFSB BANCORP, INC.
                     1994 STOCK OPTION AND INCENTIVE PLAN


     1.   PURPOSE OF THE PLAN.

     The purpose of this CFSB Bancorp, Inc. 1994 Stock Option and Incentive Plan
(the "Plan") is to advance the interests of the Company through providing select
Employees and Directors of the Bank, the Company, and their Affiliates with the
opportunity to acquire Shares. By encouraging such stock ownership, the Company
seeks to attract, retain and motivate the best available personnel for positions
of substantial responsibility and to provide additional incentive to Employees
and Directors of the Company or any Affiliate to promote the success of the
business.

     2.   DEFINITIONS.

     As used herein, the following definitions shall apply.

     (a)  "Affiliate" shall mean any "parent corporation" or "subsidiary
corporation" of the Company, as such terms are defined in Section 424(e) and
(f), respectively, of the Code.

     (b)  "Agreement" shall mean a written agreement entered into in accordance
with Paragraph 5(c).

     (c)  "Awards" shall mean, collectively, Options, SARs, and Restricted
Stock, unless the context clearly indicates a different meaning.

     (d)  "Bank" shall mean Community First Bank, A Federal Savings Bank.

     (e)  "Board" shall mean the Board of Directors of the Company.

     (f)  "Change in Control" shall mean the acquisition of ownership, holding
or power to vote more than 25% of the Bank's or Company's voting stock by any
person (except ownership or control of the Bank by the Company itself shall not
constitute a "Change in Control"). For purposes of this subparagraph only, the
term "person" refers to an individual or a corporation, partnership, trust,
association, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization or any other form of entity not specifically listed herein. The
decision of the Committee as to whether a change in control has occurred shall
be conclusive and binding.

     (g)  "Code" shall mean the Internal Revenue Code of 1986, as amended.

     (h)  "Committee" shall mean the Stock Option Committee appointed by the
Board in accordance with Paragraph 5(a) hereof.

     (i)  "Common Stock" shall mean the common stock, par value $.01 per share,
of the Company.

     (j)  "Company" shall mean CFSB Bancorp, Inc.

     (k)  "Continuous Service" shall mean the absence of any interruption or
termination of service as an Employee or Director. Continuous Service shall not
be considered interrupted in the case of sick leave, military leave or any other
leave of absence approved by the Company or in the case of transfers between
payroll locations of the Company or between the Company, an Affiliate or a
successor.


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     (l)  "Director" shall mean any member of the Board, and any member of the
Board of Directors of an Affiliate.

     (m)  "Disinterested Person" shall mean any member of the Board who, at the
time discretion under the Plan is exercised, is a "disinterested person" within
the meaning of Rule 16b-3.

     (n)  "Effective Date" shall mean the date specified in Paragraph 15 hereof.

     (o)  "Employee" shall mean any person employed by the Company or an
Affiliate.

     (p)  "Exercise Price" shall mean the price per Optioned Share at which an
Option or SAR may be exercised.

     (q)  "ISO" means an option to purchase Common Stock which meets the
requirements set forth in the Plan, and which is intended to be and is
identified as an "incentive stock option" within the meaning of Section 422 of
the Code.

     (r)  "Market Value" shall mean the fair market value of the Common Stock,
as determined under Paragraph 7(b) hereof.

     (s)  "Non-ISO" means an option to purchase Common Stock which meets the
requirements set forth in the Plan but which is not intended to be and is not
identified as an ISO. 

     (t)  "Option" means an ISO and/or a Non-ISO.

     (u)  "Optioned Shares" shall mean Shares subject to an Option granted
pursuant to this Plan.

     (v)  "Participant" shall mean any person who receives an Award pursuant to
the Plan.

     (w)  "Plan" shall mean this CFSB Bancorp, Inc. 1994 Stock Option and
Incentive Plan.

     (x)  "Restricted Stock" means Common Stock which is subject to restrictions
against transfer and forfeiture and such other terms and conditions determined
by the Committee, as provided in Paragraph 10.

     (y)  "Rule 16b-3" shall mean Rule 16b-3 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended.

     (z)  "Share" shall mean one share of Common Stock.

     (aa) "SAR" (or "Stock Appreciation Right") means a right to receive the
appreciation in value, or a portion of the appreciation in value, of a specified
number of shares of Common Stock.

     3.   TERM OF THE PLAN AND AWARDS.

     (a)  Term of the Plan. The Plan shall continue in effect for a term of ten
years from the Effective Date, unless sooner terminated pursuant to Paragraph 18
hereof. No Award shall be granted under the Plan after ten years from the
Effective Date.

     (b)  Term of Awards. The term of each Award granted under the Plan shall be
established by the Committee, but shall not exceed 10 years; provided, however,
that in the case of an Employee who owns Shares 

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representing more than 10% of the outstanding Common Stock at the time an ISO is
granted, the term of such ISO shall not exceed five years.

     4.   SHARES SUBJECT TO THE PLAN.

     (a)  General Rule.  Except as otherwise required by the provisions of
Paragraph 12 hereof, the aggregate number of Shares deliverable pursuant to
Awards shall not exceed 372,818. Such Shares may either be authorized but
unissued Shares or Shares held in treasury. If Awards should expire, become
unexercisable or be forfeited for any reason without having been exercised or
without having become vested in full, the Optioned Shares shall, unless the Plan
shall have been terminated, be available for the grant of additional Awards
under the Plan.

     (b)  Special Rule for SARs.  The number of Shares with respect to which an
SAR is granted, but not the number of Shares which the Company delivers or could
deliver to an Employee or individual upon exercise of an SAR, shall be charged
against the aggregate number of Shares remaining available under the Plan;
provided, however, that in the case of an SAR granted in conjunction with an
Option, under circumstances in which the exercise of the SAR results in
termination of the Option and vice versa, only the number of Shares subject to
the Option shall be charged against the aggregate number of Shares remaining
available under the Plan. The Shares involved in an Option as to which option
rights have terminated by reason of the exercise of a related SAR, as provided
in Paragraph 9 hereof, shall not be available for the grant of further Options
under the Plan.

     5.   ADMINISTRATION OF THE PLAN.

     (a)  Composition of the Committee.  The Plan shall be administered by the
Committee, which shall consist of not less than three (3) members of the Board
who are Disinterested Persons. Members of the Committee shall serve at the
pleasure of the Board. In the absence at any time of a duly appointed Committee,
the Plan shall be administered by those members of the Board who are
Disinterested Persons.

     (b)  Powers of the Committee.  Except as limited by the express provisions
of the Plan or by resolutions adopted by the Board, the Committee shall have
sole and complete authority and discretion (i) to select Participants and grant
Awards, (ii) to determine the form and content of Awards to be issued in the
form of Agreements under the Plan, (iii) to interpret the Plan, (iv) to
prescribe, amend and rescind rules and regulations relating to the Plan, and (v)
to make other determinations necessary or advisable for the administration of
the Plan. The Committee shall have and may exercise such other power and
authority as may be delegated to it by the Board from time to time. A majority
of the entire Committee shall constitute a quorum and the action of a majority
of the members present at any meeting at which a quorum is present, or acts
approved in writing by a majority of the Committee without a meeting, shall be
deemed the action of the Committee.

     (c)  Agreement.  Each Award shall be evidenced by a written agreement
containing such provisions as may be approved by the Committee. Each such
Agreement shall constitute a binding contract between the Company and the
Participant, and every Participant, upon acceptance of such Agreement, shall be
bound by the terms and restrictions of the Plan and of such Agreement. The terms
of each such Agreement shall be in accordance with the Plan, but each Agreement
may include such additional provisions and restrictions determined by the
Committee, in its discretion, provided that such additional provisions and
restrictions are not inconsistent with the terms of the Plan. In particular, the
Committee shall set forth in each Agreement (i) the Exercise Price of an Option
or SAR, (ii) the number of Shares subject to, and the expiration date of, the
Award, (iii) the manner, time and rate (cumulative or otherwise) of exercise or
vesting of such Award, and (iv) the restrictions, if any, to be placed upon such
Award, or upon Shares which may be issued upon exercise of such Award.

     The Chairman of the Committee and such other Directors as shall be
designated by the Committee are hereby authorized to execute Agreements on
behalf of the Company and to cause them to be delivered to the recipients of
Awards.

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     (d)  Effect of the Committee's Decisions.  All decisions, determinations
and interpretations of the Committee shall be final and conclusive on all
persons affected thereby.

     (e)  Indemnification.  In addition to such other rights of indemnification
as they may have, the members of the Committee shall be indemnified by the
Company in connection with any claim, action, suit or proceeding relating to any
action taken or failure to act under or in connection with the Plan or any
Award, granted hereunder to the full extent provided for under the Company's
Charter or Bylaws with respect to the indemnification of Directors.

     6.   GRANT OF OPTIONS.

     (a)  General Rule.  In its sole discretion, the Committee may grant Options
to Employees (including Employees who are Directors), and to Directors who join
the Board after the Effective Date and who are not members of the Committee on
the date of the Award.

     (b)  Special Rules for ISOs.  The aggregate Market Value, as of the date
the Option is granted, of the Shares with respect to which ISOs are exercisable
for the first time by an Employee during any calendar year (under all incentive
stock option plans, as defined in Section 422 of the Code, of the Company or any
present or future Affiliate) shall not exceed $100,000. Notwithstanding the
prior provisions of this paragraph, the Committee may grant Options in excess of
the foregoing limitations, in which case such Options granted in excess of such
limitation shall be Options which are Non-ISOs.

     7.   EXERCISE PRICE FOR OPTIONS.

     (a)  Limits on Committee Discretion.  The Exercise Price as to each Option
granted under the Plan shall not be less than the Market Value of the Optioned
Shares on the date of grant. In the case of an Employee who owns Shares
representing more than 10% of the Company's outstanding Shares of Common Stock
at the time an ISO is granted, the Exercise Price for such ISO shall not be less
than 110% of the Market Value of the Optioned Shares at the time the ISO is
granted.

     (b)  Standards for Determining Exercise Price.  If the Common Stock is
listed on a national securities exchange (including the NASDAQ National Market
System) on the date in question, then the Market Value per Share shall be not
less than the average of the highest and lowest selling price on such exchange
on such date, or if there were no sales on such date, then the Exercise Price
shall be not less than the mean between the bid and asked price on such date. If
the Common Stock is traded otherwise than on a national securities exchange on
the date in question, then the Market Value per Share shall be not less than the
mean between the bid and asked price on such date, or, if there is no bid and
asked price on such date, then on the next prior business day on which there was
a bid and asked price. If no such bid and asked price is available, then the
Market Value per Share shall be its fair market value as determined by the
Committee, in its sole and absolute discretion.

     8.   EXERCISE OF OPTIONS.

     (a)  Generally.  Any Option granted hereunder shall be exercisable at such
times and under such conditions as shall be permissible under the terms of the
Plan and of the Agreement granted to a Participant. An Option may not be
exercised for a fractional Share.

     (b)  Procedure for Exercise.  A Participant may exercise Options, subject
to provisions relative to its termination and limitations on its exercise, only
by (1) written notice of intent to exercise the Option with respect to a
specified number of Shares, and (2) payment to the Company (contemporaneously
with delivery of such notice) in cash, in Common Stock, or a combination of cash
and Common Stock, of the amount of the Exercise Price for the number of Shares
with respect to which the Option is then being exercised. Each such notice (and
payment where required) shall be delivered, or mailed by prepaid registered or
certified mail, addressed to the Treasurer of the Company at the

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Company's executive offices. Common Stock utilized in full or partial payment of
the Exercise Price for Options shall be valued at its Market Value at the date
of exercise.

     (c)  Period of Exercisability.  Except to the extent otherwise provided in
the terms of an Agreement, an Option may be exercised by a Participant only
while he is an Employee or Director and has maintained Continuous Service from
the date of the grant of the Option, or within three months after termination of
such Continuous Service (but not later than the date on which the Option would
otherwise expire), except if the Employee's or Director's Continuous Service
terminates by reason of --

          (1)  "Just Cause" which for purposes hereof shall have the meaning set
     forth in any unexpired employment or severance agreement between the
     Participant and the Bank and/or the Company (and, in the absence of any
     such agreement, shall have the meaning set forth in 12 C.F.R. (S)
     563.39(b)(1) as in effect on the Effective Date), then the Participant's
     rights to exercise such Option shall expire on the date of such
     termination;

          (2)  death, then to the extent that the Participant would have been
     entitled to exercise the Option immediately prior to his death, such Option
     of the deceased Participant may be exercised within two years from the date
     of his death (but not later than the date on which the Option would
     otherwise expire) by the personal representatives of his estate or person
     or persons to whom his rights under such Option shall have passed by will
     or by laws of descent and distribution;

          (3)  Permanent and Total Disability (as such term is defined in
     Section 22(e)(3) of the Code), then to the extent that the Participant
     would have been entitled to exercise the Option immediately prior to his
     Permanent and Total Disability, such Option may be exercised within one
     year from the date of such Permanent and Total Disability, but not later
     than the date on which the Option would otherwise expire.

     Notwithstanding the provisions of any Option which provides for its
exercise in installments as designated by the Committee, such Option shall
become immediately exercisable upon the Participant's death or Permanent and
Total Disability.

     (d)  Effect of the Committee's Decisions. The Committee's determination
whether a Participant's Continuous Service has ceased, and the effective date
thereof shall be final and conclusive on all persons affected there by.

     9.   SARS (STOCK APPRECIATION RIGHTS)

     (a)  Granting of SARs.  In its sole discretion, the Committee may from time
to time grant SARs to Employees (including Employees who are Directors), and to
Directors who join the Board after the Effective Date and who are not members of
the Committee on the date of the Award. The Committee may grant SARs either in
conjunction with, or independently of, any Options granted under the Plan. An
SAR granted in conjunction with an Option may be an alternative right wherein
the exercise of the Option terminates the SAR to the extent of the number of
shares purchased upon exercise of the Option and, correspondingly, the exercise
of the SAR terminates the Option to the extent of the number of Shares with
respect to which the SAR is exercised. Alternatively, an SAR granted in
conjunction with an Option may be an additional right wherein both the SAR and
the Option may be exercised. An SAR may not be granted in conjunction with an
ISO under circumstances in which the exercise of the SAR affects the right to
exercise the ISO or vice versa, unless the SAR, by its terms, meets all of the
following requirements:

          (1)  The SAR will expire no later than the ISO;

          (2)  The SAR may be for no more than the difference between the
          Exercise Price of the ISO and the Market Value of the Shares subject
          to the ISO at the time the SAR is exercised;

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          (3)  The SAR is transferable only when the ISO is transferable, and
          under the same conditions;

          (4)  The SAR may be exercised only when the ISO may be exercised; and

          (5)  The SAR may be exercised only when the Market Value of the Shares
          subject to the ISO exceeds the Exercise Price of the ISO.

     (b)  Exercise Price.  The Exercise Price as to any particular SAR shall not
be less than the Market Value of the Optioned Shares on the date of grant.

     (c)  Timing of Exercise.  Any election by a Participant to exercise SARs
shall be made during the period beginning on the 3rd business day following the
release for publication of quarterly or annual financial information and ending
on the 12th business day following such date. This condition shall be deemed to
be satisfied when the specified financial data is first made publicly available.
In no event, however, may an SAR be exercised within the six-month period
following the date of its grant.

     The provisions of Paragraph 8(c) regarding the period of exercisability of
Options is incorporated by reference herein, and shall determine the period of
exercisability of SARs.

     (d)  Exercise of SARs.  An SAR granted hereunder shall be exercisable at
such times and under such con ditions as shall be permissible under the terms of
the Plan and of the Agreement granted to a Participant, provided that an SAR may
not be exercised for a fractional Share. Upon exercise of an SAR, the
Participant shall be entitled to receive, without payment to the Company except
for applicable withholding taxes, an amount equal to the excess of (or, in the
discretion of the Committee if provided in the Agreement, a portion of) the
excess of the then aggregate Market Value of the number of Optioned Shares with
respect to which the Participant exercises the SAR, over the aggregate Exercise
Price of such number of Optioned Shares. This amount shall be payable by the
Company, in the discretion of the Committee, in cash or in Shares valued at the
then Market Value thereof, or any combination thereof.

     (e)  Procedure for Exercising SARs.  To the extent not inconsistent
herewith, the provisions of Paragraph 8(b) as to the procedure for exercising
Options are incorporated by reference, and shall determine the procedure for
exercising SARs.

     10.  RESTRICTED STOCK AWARDS.

     Any Share of Restricted Stock which the Committee may grant to Employees
(including Employees who are Directors), and to Directors who join the Board
after the Effective Date and who are not members of the Committee on the date of
the Award, shall be subject to the following terms and conditions, and to such
other terms and conditions as are either applicable generally to Awards, or
prescribed by the Committee in the applicable Agreement:

     (a)  Restriction Period. At the time of each award of Restricted Stock,
there shall be established for the Restricted Stock a restriction period, which
shall be no less than 6 months and no greater than 5 years (the "Restriction
Period"). Such Restriction Period may differ among Participants and may have
different expiration dates with respect to portions of shares of Restricted
Stock covered by the same award.

     (b)  Vesting Restrictions.  The Committee shall determine the restrictions
applicable to the award of Restricted Stock, including, but not limited to,
requirements of Continuous Service for a specified term, or the attainment of
specific corporate, divisional or individual performance standards or goals,
which restrictions may differ with respect to each Participant. The Agreement
shall provide for forfeiture of Shares covered thereby if the specified
restrictions are not met during the Restriction Period, and may provide for
early termination of any Restriction Period in the event of satisfaction of the
specified restrictions prior to expiration of the Restricted Period.

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     (c)  Vesting upon Death, Disability, or Retirement. The Committee shall set
forth in the Agreement the percentage of the award of Restricted Stock which
shall vest in the Participant in the event of death, disability or retirement
prior to the expiration of the Restriction Period or the satisfaction of the
restrictions applicable to an award of Restricted Stock.

     (d)  Acceleration of Vesting. Notwithstanding the Restriction Period and
the restrictions imposed on the Restricted Stock, as set forth in any Agreement,
the Committee may shorten the Restriction Period or waive any restrictions, if
the Committee concludes that it is in the best interests of the Company to do
so.

     (e)  Ownership; Voting. Stock certificates shall be issued in respect of
Restricted Stock awarded hereunder and shall be registered in the name of the
Participant, whereupon the Participant shall become a stockholder of the Company
with respect to such Restricted Stock and shall, to the extent not inconsistent
with express provisions of the Plan, have all the rights of a stockholder,
including but not limited to the right to receive all dividends paid on such
Shares and the right to vote such Shares. Said stock certificates shall be
deposited with the Company or its designee, together with a stock power endorsed
in blank, and the following legend shall be placed upon such certificates
reflecting that the shares represented thereby are subject to restrictions
against transfer and forfeiture:

          "The transferability of this certificate and the shares of stock
     represented thereby are subject to the terms and conditions (including
     forfeiture) contained in the CFSB Bancorp, Inc. 1994 Stock Option and
     Incentive Plan, and an agreement entered into between the registered owner
     and the Stock Option Committee appointed under the CFSB Bancorp, Inc. 1994
     Stock Option and Incentive Plan. Copies of such Plan and Agreement are on
     file in the offices of the Secretary of CFSB Bancorp, Inc., 112 East
     Allegan Street, Lansing, Michigan 48901."

     (f)  Lapse of Restrictions. At the expiration of the Restricted Period
applicable to the Restricted Stock, the Company shall deliver to the
Participant, or the legal representative of the Participant's estate, or if the
personal representative of the Participant's estate shall have assigned the
estate's interest in the Restricted Stock, to the person or persons to whom his
rights under such Stock shall have passed by assignment pursuant to his will or
to the laws of descent and distribution, the stock certificates deposited with
it or its designee and as to which the Restricted Period has expired and the
requirements of the restrictions have been met. If a legend has been placed on
such certificates, the Company shall cause such certificates to be reissued
without the legend.

     (g)  Forfeiture of Restricted Stock. The Agreement shall provide for
forfeiture of any Restricted Stock which is not vested in the Participant or for
which the restrictions have not been satisfied during the Restriction Period.

     11.  CHANGE IN CONTROL

     (a)  General Rule.  Notwithstanding the provisions of any Award which
provides for its exercise or vesting in installments, all Shares of Restricted
Stock shall become fully vested upon a Change in Control, and for a period of 60
days beginning on the date of such Change in Control, all Options and SARs shall
be immediately exercisable and fully vested. With respect to Options, at the
time of a Change in Control, the Participant shall, at the discretion of the
Committee, be entitled to receive cash in an amount equal to the excess of the
Market Value of the Common Stock subject to such Option over the Exercise Price
of such Shares, in exchange for the cancellation of such Options by the
Participant.

     (b)  Exception to General Rule.  Notwithstanding subparagraph (a) of this
Paragraph, in no event may an SAR be exercised, or an Option be cancelled in
exchange for cash, within the six-month period following the date of its grant.

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     12.  EFFECT OF CHANGES IN COMMON STOCK SUBJECT TO THE PLAN.

     (a)  Recapitalizations; Stock Splits, Etc.  The number and kind of
shares reserved for issuance under the Plan, and the number and kind of shares
subject to outstanding Awards (and the Exercise Price thereof in the case of
Options and SARs), shall be proportionately adjusted for any increase, decrease,
change or exchange of Shares for a different number or kind of shares or other
securities of the Company which results from a merger, consolidation, re
capitalization, reorganization, reclassification, stock dividend, split-up,
combination of shares, or similar event in which the number or kind of shares is
changed without the receipt or payment of consideration by the Company.

     (b)  Transactions in which the Company is Not the Surviving Entity.
Subject to Paragraph 11 hereof, in the event of (i) the liquidation or
dissolution of the Company, (ii) a merger or consolidation in which the Company
is not the surviving entity, or (iii) the sale or disposition of all or
substantially all of the Company's assets (any of the foregoing to be referred
to herein as a "Transaction"), all outstanding Awards shall be surrendered. With
respect to each Award so surrendered, the Committee shall in its sole and
absolute discretion determine whether the holder of the surrendered Award shall
receive --

          (1)       for each Share then subject to an outstanding Award the
          number and kind of shares into which each outstanding Share (other
          than Shares held by dissenting stockholders) is changed or exchanged,
          together with an appropriate adjustment to the Exercise Price in the
          case of Options and SARs; or

          (2)       a cash payment (from the Company or the successor
          corporation), in an amount equal to the Market Value of the Shares
          subject to the Award on the date of the Transaction, less the Exercise
          Price of the Award in the case of Options and SARs.

     (c)  Special Rule for ISOs.  Any adjustment made pursuant to subparagraphs
(a) or (b)(1) hereof shall be made in such a manner as not to constitute a
modification, within the meaning of Section 424(h) of the Code, of outstanding
ISOs.

     (d)  Conditions and Restrictions on New, Additional, or Different Shares or
Securities. If, by reason of any adjustment made pursuant to this Paragraph, a
Participant becomes entitled to new, additional, or different shares of stock or
securities, such new, additional, or different shares of stock or securities
shall thereupon be subject to all of the conditions and restrictions which were
applicable to the Shares pursuant to the Award before the adjustment was made.

     (e)  Other Issuances.  Except as expressly provided in this Paragraph, the
issuance by the Company or an Affiliate of shares of stock of any class, or of
securities convertible into Shares or stock of another class, for cash or
property or for labor or services either upon direct sale or upon the exercise
of rights or warrants to subscribe therefor, shall not affect, and no adjustment
shall be made with respect to, the number, class, or Exercise Price of Shares
then subject to Awards or reserved for issuance under the Plan.

     13.  NON-TRANSFERABILITY OF AWARDS.

     Awards may not be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will or by the laws of descent and
distribution, or pursuant to the terms of a "qualified domestic relations order"
(within the meaning of Section 414(p) of the Code and the regulations and
rulings thereunder).

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     14.  TIME OF GRANTING AWARDS.

     The date of grant of an Award shall, for all purposes, be the later of the
date on which the Committee makes the determination of granting such Award, or
the Effective Date. Notice of the determination shall be given to each
Participant to whom an Award is so granted within a reasonable time after the
date of such grant.

     15.  EFFECTIVE DATE.

     The Plan shall become effective immediately upon its adoption by the Board.
Awards may be made prior to approval of the Plan by the stockholders of the
Company if the exercise of Awards in the form of Options and/or SARs, and the
vesting of Awards in the form of Restricted Stock, are conditioned upon
stockholder approval of the Plan.

     16.  APPROVAL BY STOCKHOLDERS.

     The Plan shall be approved by stockholders of the Company within twelve
(12) months before or after the Effective Date.

     17.  MODIFICATION OF AWARDS.
    
     At any time, and from time to time, the Board may authorize the Committee
to direct execution of an instrument providing for the modification of any
outstanding Award, provided no such modification shall confer on the holder of
said Award any right or benefit which could not be conferred on him by the grant
of a new Award at such time, or impair the Award without the consent of the
holder of the Award.

     18.  AMENDMENT AND TERMINATION OF THE PLAN.

     (a)       The Board may from time to time amend the terms of the Plan and,
with respect to any Shares at the time not subject to Awards, suspend or
terminate the Plan; provided that any amendment that is "material" within the
meaning of Rule 16b-3 shall be subject to stockholder approval.

     (b)       No amendment, suspension or termination of the Plan shall,
without the consent of any affected holders of an Award, alter or impair any
rights or obligations under any Award theretofore granted.

     19.  CONDITIONS UPON ISSUANCE OF SHARES.

     (a)       Compliance with Securities Laws.  Shares of Common Stock shall
not be issued with respect to any Award unless the issuance and delivery of such
Shares shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, the rules and regulations
promulgated thereunder, any applic able state securities law, and the
requirements of any stock exchange upon which the Shares may then be listed. The
Plan is intended to comply with Rule 16b-3, and any provision of the Plan which
the Committee determines in its sole and absolute discretion to be inconsistent
with said Rule shall, to the extent of such inconsistency, be inoperative and
null and void, and shall not affect the validity of the remaining provisions of
the Plan.

     (b)  Special Circumstances.  The inability of the Company to obtain
approval from any regulatory body or authority deemed by the Company's counsel
to be necessary to the lawful issuance and sale of any Shares hereunder shall
relieve the Company of any liability in respect of the non-issuance or sale of
such Shares. As a condition to the exercise of an Option or SAR, the Company may
require the person exercising the Option or SAR to make such representations and
warranties as may be necessary to assure the availability of an exemption from
the registration requirements of federal or state securities law.

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     (c)  Committee Discretion.  The Committee shall have the discretionary
authority to impose in Agreements such restrictions on Shares as it may deem
appropriate or desirable, including but not limited to the authority to impose a
right of first refusal or to establish repurchase rights or both of these
restrictions.

     20.  RESERVATION OF SHARES.

     The Company, during the term of the Plan, will reserve and keep available a
number of Shares sufficient to satisfy the requirements of the Plan.

     21.  WITHHOLDING TAX.

     The Company's obligation to deliver dividends on Restricted Stock, or to
deliver Shares upon exercise of Options and/or SARs or upon the vesting of
Restricted Stock (or such earlier time that the Participant makes an election
under Section 83(b) of the Code) shall be subject to the Participant's
satisfaction of all applicable federal, state and local income and employment
tax withholding obligations. The Committee, in its discretion, may permit the
Participant to satisfy the obligation, in whole or in part, by irrevocably
electing to have the Company withhold Shares, or to deliver to the Company
Shares that he already owns, having a value equal to the amount required to be
withheld. The value of Shares to be withheld, or delivered to the Company, shall
be based on the Market Value of the Shares on the date the amount of tax to be
withheld is to be determined. As an alternative, the Company may retain, or sell
without notice, a number of such Shares sufficient to cover the amount required
to be withheld.

     22.  NO EMPLOYMENT OR OTHER RIGHTS.

     In no event shall an Employee's or Director's eligibility to participate or
participation in the Plan create or be deemed to create any legal or equitable
right of the Employee, Director, or any other party to continue service with the
Company, the Bank, or any Affiliate of such corporations. No Employee or
Director shall have a right to be granted an Award or, having received an Award,
the right to again be granted an Award. However, an Employee or Director who has
been granted an Award may, if otherwise eligible, be granted an additional Award
or Awards.

     23.  GOVERNING LAW.

     The Plan shall be governed by and construed in accordance with the laws of
the State of Michigan, except to the extent that federal law shall be deemed to
apply.

                                       10
<PAGE>
 
                              CFSB BANCORP, INC.

          ----------------------------------------------------------

                   BOARD RESOLUTIONS RE SEC SECTION 16 RULES
          ----------------------------------------------------------


     WHEREAS, CFSB Bancorp, Inc. (the "Company") maintains the CFSB Bancorp,
Inc. 1994 Stock Option and Incentive Plan, as amended, and the 1990 Stock Option
Plan (together, the "Stock Plans"); and

     WHEREAS, the Company has determined that said Stock Plans should be amended
to conform with final revisions that the Securities and Exchange Commission
("SEC") has made to its rules and regulations under Section 16 of the Securities
Exchange Act of 1934, as amended; and

     WHEREAS, these SEC rule changes took effect on August 15, 1996, and the
Company desires to conform its stock-related plans with these rules; and

     WHEREAS, the Board deems it to be in the best interests of the Company and
Community First Bank to amend the Stock Plans to conform with Rule 16b-3 of the
revised Regulations.

     NOW, THEREFORE, BE IT RESOLVED, that all stock-related plans of the Company
shall, as of August 15, 1996, become subject to SEC Rule 16b-3, as revised by
the SEC in May of 1996 pursuant to SEC Release No. 34-37261; and be it

     RESOLVED FURTHER, that the 1996 Amendments to the Stock Plans,
substantially in the form attached hereto as Exhibits "A" and "B" are approved,
subject to such final adjustments as the Company's President may deem necessary
or appropriate in order to conform said plans with Rule 16b-3; and be it

     RESOLVED FURTHER, that the Company's President be and hereby is authorized
and directed to execute said 1996 Amendments and to take such other actions
deemed necessary or appropriate to effect the purposes and the intent of the
foregoing resolutions.


<PAGE>
 
                                                                       EXHIBIT A

                              CFSB BANCORP, INC.
               1994 STOCK OPTION AND INCENTIVE PLAN, AS AMENDED

                             ____________________

                                1996 Amendment
                             ____________________


     WHEREAS, CFSB Bancorp, Inc. (the "Company") maintains the CFSB Bancorp,
Inc. 1994 Stock Option and Incentive Plan, as amended (the "Plan"); and

     WHEREAS, the Company has determined that said Plan should be amended to
conform with final revisions that the Securities and Exchange Commission ("SEC")
has made to its rules and regulations under Section 16 of the Securities
Exchange Act of 1934, as amended; and

     WHEREAS, these SEC rule changes took effect on August 15, 1996, and the
Company desires to immediately conform the Plan with these rules.

     NOW, THEREFORE, pursuant to Paragraph 18 of the Plan, the Plan is hereby
amended as follows, effective August 15, 1996.

     1.   Subparagraph 2(m) of the Plan shall be deleted in its entirety and
subparagraphs 2(n) through 2(r) shall be relettered 2(m) through 2(q),
respectively.

     2.   Paragraph 2 of the Plan shall be amended further by inserting the
definition of "Non-Employee Director" after new subparagraph 2(q) to provide as
follows:

               (r)  "Non-Employee Director" shall have the meaning provided in
     Rule 16b-3.

     3.   Paragraph 5(a) of the Plan shall be amended by replacing the words
"three (3) members" with "two (2) members" and the words "Disinterested Persons"
with "Non-Employee Directors."

     4.   Paragraph 8 of the Plan shall be amended by adding the following
subparagraph 8(e) immediately after subparagraph 8(d):

               (e)  Six-Month Holding Period.  Notwithstanding any other
     provision of this Plan to the contrary, Common Stock that is purchased upon
     exercise of an Option or SAR may not be sold within the six-month period
     following the grant date of that Option or SAR, except in the event of a
     Participant's death or Permanent and Total Disability, a Change in Control,
     or such other event as the Board may specifically deem appropriate.


<PAGE>

1996 Amendment
1994 Stock Option and Incentive Plan, as amended
Page 2

 
     5.   Paragraph 9(c) shall be amended by deleting its last sentence.

     6.   Paragraph 10 shall be amended by adding the following subparagraph
10(h) immediately at the end thereof:

               (h)  Six-Month Holding Period. In no event may Restricted Stock
          be sold within the six-month period following the award of such
          Restricted Stock, except in the event of a Change in Control or such
          other event as the Board may specifically deem appropriate.

     7.   The first sentence in Paragraph 11(a) shall be amended by deleting the
words "for a period of 60 days beginning on the date of such Change in
Control,".

     8.   Paragraph 11 shall be further amended by deleting subparagraph 11(b).

     9.   Nothing contained herein shall be held to alter, vary or affect any of
the terms, provisions, or conditions of the Plan or any Option entered into
thereunder, other than as stated above.

     WHEREFORE, on this 20th day of November, 1996, the Company hereby executes
this 1996 Amendment to the Plan.

                                    CFSB BANCORP, INC.


                                    By /s/ Robert H. Becker
                                      -----------------------------------
                                      Its President

11/20/96
--------------------
Date                                Attest: /s/ Holly L. Schreiber
                                           ------------------------------