INLAND NORTHWEST BANK SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENT

1.1

“ Accrual Balance ” means the liability that should be accrued by the Bank, under Generally Accepted Accounting Principles (“GAAP”), for the Bank’s obligation to the Executive under this Agreement, by applying Accounting Principles Board Opinion Number 12 (“APB 12”) as amended by Statement of Financial Accounting Standards Number 106 (“FAS 106”) and the Discount Rate. Any one of a variety of amortization methods may be used to determine the Accrual Balance. However, once chosen, the method must be consistently applied.

1.2

“ Beneficiary ” means each designated person or entity, or the estate of the deceased Executive, entitled to any benefits upon the death of the Executive pursuant to Article 4.

1.3

“ Beneficiary Designation Form ” means the form established from time to time by the Plan Administrator that the Executive completes, signs and returns to the Plan Administrator to designate one or more Beneficiaries.

1.4

“ Board ” means the Board of Directors of the Bank as from time to time constituted.

1.5

“ Change in Control ” means a change in the ownership or effective control of the Bank, or in the ownership of a substantial portion of the assets of the Bank, as such change is defined in Code Section 409A.

1.6

“ Code ” means the Internal Revenue Code of 1986, as amended, and all regulations and guidance thereunder, including such regulations and guidance as may be promulgated after the Effective Date of this Agreement.

1.7

“ Disability ” means the Executive: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than

twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees or directors of the Bank. Medical determination of disability may be made by either the Social Security Administration or by the provider of an accident or health plan covering employees or directors of the Bank, provided that the definition of “disability” applied under such insurance program complies with the requirements of the preceding sentence. Upon the request of the Plan Administrator, the Executive must submit proof to the Plan Administrator of the Social Security Administration’s or the provider’s determination.

1.8

“ Discount Rate ” means the rate used by the Plan Administrator for determining the Accrual Balance. The initial Discount Rate is six percent (6%). However, the Plan Administrator, in its discretion, may adjust the Discount Rate to maintain the rate within reasonable standards according to GAAP and/or applicable bank regulatory guidance.

1.9

“ Early Termination ” means Separation from Service before Normal Retirement Age except when such Separation from Service occurs (i) following a Change in Control; (ii) due to death, (iii) Termination for Cause, or (iv) Disability.

1.10

“ Effective Date ” means January 1, 2008.

1.11

“ Employment Agreement ” means the Employment Agreement between the Bank and the Executive effective January 8, 2003, as it may be amended from time to time.

1.12

“ Normal Retirement Age ” means the Executive attaining age sixty five (65).

1.13

“ Normal Retirement Date ” means the Executive attaining the Normal Retirement Age.

1.14

“ Plan Administrator ” means the Board or such committee or person as the Board shall appoint.

1.15

“ Plan Year ” means each twelve (12) month period commencing on January 1 and ending on December 31 of each year. The initial Plan Year shall commence on the Effective Date of this Agreement and end on the following December 31.

1.16

“ Separation from Service ” means the termination of the Executive’s employment with the Bank for reasons other than death. Whether a Separation from Service takes place is determined in accordance with the requirements of Code Section 409A based on the facts and circumstances surrounding the termination of the Executive’s employment and whether the Bank and the Executive intended for the Executive to provide significant services for the Bank following such termination. A Separation from Service will not have occurred if:

(a)

the Executive continues to provide services as an employee of the Bank at an annual rate that is twenty percent (20%) or more of the services rendered, on average, during the immediately preceding three (3) full calendar years of employment (or, if employed less than three (3) years, such lesser period) and the annual remuneration for such services is twenty percent (20%) or more of the average annual remuneration earned during the final three (3) full calendar years of employment (or, if less, such lesser period), or

(b)

the Executive continues to provide services to the Bank in a capacity other than as an employee of the Bank at an annual rate that is fifty percent (50%) or more of the services rendered, on average, during the immediately preceding three (3) full calendar years of employment (or if employed less than three (3) years, such lesser period) and the annual remuneration for such services is fifty percent (50%) or more of the average annual remuneration earned during the final three (3) full calendar years of employment (or if less, such lesser period).

1.17

“ Specified Employee ” means a key employee (as defined in Code Section 416(i) without regard to paragraph 5 thereof) of the Bank if any stock of the Bank or any entity required to be aggregated with the Bank under Section 414(b) or Section 414(c) of the Code is publicly traded on an established securities market or otherwise, as determined by the Plan Administrator based on the twelve (12) month period ending each December 31 (the “identification period”). If the Executive is determined to be a Specified Employee for an identification period, the Executive shall be treated as a Specified Employee for purposes of this Agreement during the twelve (12) month period that begins on the first day of the fourth month following the close of the identification period.

1.18

“ Termination for Cause ” means Separation from Service resulting from the termination of the Executive’s employment for Cause as defined in the Executive’s Employment Agreement.

2.1

Normal Retirement Benefit . Upon the Normal Retirement Date, the Bank shall distribute to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Article.

2.1.1

Amount of Benefit . The annual benefit under this Section 2.1 is Forty-Eight Thousand Dollars ($48,000).

2.1.2

Distribution of Benefit . The Bank shall distribute the annual benefit to the Executive in twelve (12) equal monthly installments commencing on the first day of the month following the Executive attaining Normal Retirement Age. The annual benefit shall be distributed to the Executive for one hundred twenty (120) consecutive months.

2.2

Early Termination Benefit . If Early Termination occurs, the Bank shall distribute to the Executive the benefit described in this Section 2.2 in lieu of any other benefit under this Article.

2.2.1

Amount of Benefit . The benefit under this Section 2.2 is the Accrual Balance determined as of the end of the month preceding Separation from Service.

2.2.2

Distribution of Benefit . The Bank shall distribute the benefit to the Executive in a lump sum as soon as administratively practicable following Separation from Service.

2.3

Disability Benefit . If the Executive experiences a Disability which results in a Separation from Service prior to Normal Retirement Age, the Bank shall distribute to the Executive the benefit described in this Section 2.3 in lieu of any other benefit under this Article.

2.3.1

Amount of Benefit . The benefit under this Section 2.3 is the Accrual Balance determined as of the end of the month preceding Separation from Service.

2.3.2

Distribution of Benefit . The Bank shall distribute the benefit to the Executive in a lump sum as soon as administratively practicable following Separation from Service.

2.4

Change in Control Benefit . If a Change in Control occurs, the Bank shall distribute to the Executive the benefit described in this Section 2.4 in lieu of any other benefit under this Article.

2.4.1

Amount of Benefit . The benefit under this Section 2.4 is the net present value of the Normal Retirement Benefit set forth at Section 2.1.1 as of the date of the Change in Control using the Discount Rate.

2.4.2

Distribution of Benefit . The Bank shall distribute the benefit calculated in Section 2.4.1 to the Executive in a lump sum as soon as administratively practicable following the Change in Control.

2.4.3

Assumption of Agreement . Anything in this Agreement to the contrary notwithstanding, in the event of a Change in Control and to the extent permitted by applicable law, any surviving corporation may assume this Agreement. To the extent the surviving corporation assumes this Agreement, the Executive will not be entitled to any payments under this Section 2.4.

2.4.4

280G Limits . Anything in this Agreement to the contrary notwithstanding, in the event that the Bank’s independent public accountants determine that any payment by the Bank to or for the benefit of the Executive, whether paid or payable pursuant to the terms of this Agreement or pursuant to any other agreement, would be nondeductible by the Bank for federal income tax purposes because of Section 280G of the Code, then the amount payable to or for the benefit of the Executive pursuant to this Agreement shall be reduced (but not below zero) to the Reduced Amount. For purposes of this Section 2.4.4, the “Reduced Amount” shall be the amount which maximizes the amount payable without causing the payment to be nondeductible by the Bank because of Section 280G of the Code.

2.5

Restriction on Commencement of Distributions . Notwithstanding any provision of this Agreement to the contrary, if the Executive is considered a Specified Employee at Separation from Service, the provisions of this Section 2.5 shall govern all distributions hereunder other than the distributions under Section 2.1. Benefit distributions other than the distributions under Section 2.1 that are made due to a Separation from Service occurring while the Executive is a Specified Employee shall not be made during the first six (6) months following Separation from Service. Rather, any distribution which would otherwise be paid to the Executive during such period shall be accumulated and paid to the Executive in a lump sum on the first day of the seventh month following the Separation from Service. All subsequent distributions shall be paid in the manner specified.

2.6

Distributions Upon Income Inclusion Under Code Section 409A . If any amount is required to be included in income by the Executive prior to receipt due to a failure of this Agreement to meet the requirements of Code Section 409A, the Executive may petition the Plan Administrator for a distribution of that portion of the amount the Bank has accrued with respect to the Bank’s obligations hereunder that is required to be included in the Executive’s income. Upon the grant of such a petition, which grant shall not be unreasonably withheld, the Bank shall distribute to the Executive immediately available funds in an amount equal to the portion of the amount the Bank has accrued with respect to the Bank’s obligations hereunder required to be included in income as a result of the failure of this Agreement to meet the requirements of Code Section 409A, within ninety (90) days. Such a distribution shall affect and reduce the Executive’s benefits to be paid under this Agreement.

2.7

Change in Form or Timing of Distributions . For distribution of benefits under this Article 2, the Executive and the Bank may, subject to the terms of Section 8.1, amend this Agreement to delay the timing or change the form of distributions. Any such amendment:

(a)

may not accelerate the time or sched