<PAGE>






                                                                    EXHIBIT 10.7
                                FORM OF OFFICERS
                    AMENDED AND RESTATED SEVERANCE AGREEMENT


         THIS AGREEMENT is made as of this _____ day of _________________,19___,
between FRANKLIN BANK, NATIONAL ASSOCIATION, ("Franklin") and
________________________________ (the "Officer").

                                    RECITALS:

         In recognition of the Officer's continued loyalty to Franklin, the
benefits that have derived to Franklin from the Officer's service on behalf of
Franklin, acknowledging the substantial and significant commitment that the
Officer made when joining Franklin by foregoing other banking career
opportunities and in recognition of the tremendous benefits to shareholders of
continuing the services of the Officer during any transition period involving a
change in control, the Board of Directors has determined to enter into a certain
Severance Agreement in accordance with the terms set forth herein (referred to
as the "Agreement").

         Franklin's Board of Directors recognizes that in the current bank
consolidation environment the possibility of a change in control may exist with
respect to Franklin, as with any other publicly held corporation, bank or
financial institution, and that the uncertainty posed by such a possibility may
prove distracting to the Officer to the detriment of Franklin, its affiliates
and its shareholders.

         Franklin's Board of Directors has determined that it is appropriate to
reinforce and encourage the continued attention and dedication of the Officer to
Officer's assigned duties without distraction in the potentially disturbing
circumstances arising from the possibility of. a change in control of Franklin.
Franklin is, therefore, willing, in order to provide the Officer with a measure
of security with respect to Officer's employment with Franklin in the event of a
change of control of Franklin, to provide the severance compensation set forth
in detail below, so that the Officer will be in a position to act with respect
to a possible change in control of Franklin in the best interests of Franklin
and its shareholders, without concern as to the Officer's own financial
security, and in order to create a non-disruptive and successful transition in
the event of a change in control.

         This Agreement sets forth the severance compensation which Franklin
agrees it will pay to the Officer solely if the Officer's employment with
Franklin terminates under one of the circumstances described herein within three
(3) years following a change in control of Franklin. Except where expressly
provided, this Agreement is not intended to modify and shall not modify the
terms of the Officer's employment with Franklin under any other circumstances.
In addition, the Agreement shall not modify the ability of Franklin to terminate
the Officer at-will under the National Bank Act. The Agreement simply provides
the Officer with certain severance benefits upon the occurrence of certain
events of termination following a change in control of Franklin.

         Accordingly, in order to induce the Officer to remain in the employ of
Franklin prior to, during, and following a change in control of Franklin, and in
consideration of the promises and the respective covenants and agreements of the
parties herein contained, the parties agree as follows:

         1.       TERM.
                  ----



                                       1
<PAGE>



         This Agreement will begin on the date entered above (the "Commencement
Date") and will continue in effect through the third anniversary of the
Commencement Date. However, on the first anniversary of the Commencement Date,
and on each such anniversary date thereafter, the term of this Agreement will be
extended automatically for one (1) additional year (resulting in a continual
three (3) year term) unless, not later than six (6) months prior to such
anniversary date, Franklin gives written notice to the Officer that it has
elected not to extend this Agreement (in which event the one (1) additional year
will not be added to the term so that the term will be two (2) years from the
anniversary date of the year in which such notice has been provided).
Notwithstanding the above, if a Change in Control as defined below occurs during
the term of this Agreement, this Agreement will continue in effect for at least
thirty six (36) months beyond the end of the month in which any Change in
Control occurs.

         2.       CHANGE IN CONTROL.
                  -----------------

For purposes of this Agreement, a Change in Control of Franklin shall be deemed
to have occurred upon the occurrence of any of the events described in
Subsections (i), (ii), (iii), (iv), (v) and (vi) below, whether occurring prior
to, subsequent to or simultaneous to each other. Each event (including each
occurrence of an event within (i), (ii), (iii), (iv), (v) or (vi) constitutes a
separate Change in Control for purposes of this Agreement.

         (i)      any person or group (as such terms are used in Sections 13(d)
                  and 14(d)(2) of the Securities Exchange Act of 1934, as
                  amended (the "Exchange Act"), other than a trustee or other
                  fiduciary under an employee benefit plan established or
                  maintained by Franklin, is or becomes the beneficial owner
                  (within the meaning of Rule 13d-3 under the Exchange Act),
                  directly or indirectly, of securities of Franklin representing
                  more than 10% of the combined voting power of Franklin's then
                  outstanding securities; provided, however, that such
                  acquisition of more than 10% of the combined voting power of
                  Franklin's outstanding securities will not constitute a Change
                  in Control under this Subsection (i) if the excess is acquired
                  in violation of law and the acquiror by court order,
                  settlement or otherwise disposes or is required to dispose of
                  all securities acquired in violation of law; or

         (ii)     upon the first purchase of Franklin's Common stock pursuant to
                  a tender or exchange offer which results in the sale of more
                  than 10% of the combined voting power of Franklin's then
                  outstanding securities (other than a tender or exchange offer
                  initiated by Franklin or a trustee or other fiduciary under an
                  employee benefit plan established or maintained by Franklin);
                  or

         (iii)    upon (A) a merger or consolidation of Franklin with or into
                  another institution, other than a merger or consolidation,
                  which would result in the voting securities of Franklin
                  outstanding immediately prior thereto continuing to represent
                  (either by remaining or by being converted into voting
                  securities of the surviving entity) at least 90% of the
                  combined voting power of the voting securities of Franklin or
                  such surviving entity outstanding immediately after such
                  merger or consolidation); or (B) a sale, exchange, lease,
                  mortgage pledge, transfer, or other disposition (in one
                  transaction or a series of related transactions) of all or
                  substantially all of the assets of Franklin which shall
                  include, without limitation, the sale of assets or earning
                  power aggregating more than 50% of the assets or earning power
                  of Franklin on a consolidated basis; or (C) any liquidation or
                  dissolution of Franklin; or (D) any reorganization, reverse
                  stock split, or recapitalization of Franklin which would
                  result in a Change in Control; or

         (iv)     if during any period of two consecutive years (not including
                  any `period prior to the execution of this Agreement),
                  individuals who at the beginning of such period constitute the
                  Board of Directors of Franklin (the "Continuing Directors")
                  cease for any reason to constitute at least two-




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<PAGE>



                  thirds thereof; provided, however, that any individual (other
                  than a director designated by a person described in Subsection
                  (i) above) whose election or nomination for the election as a
                  member of the Board of Directors of Franklin by Franklin's
                  stockholders was approved by a vote of at least two-thirds of
                  the Continuing Directors then in office shall be deemed a
                  Continuing Director; or

         (v)      nomination of a non-management sponsored director(s) for
                  election or appointment to the Board of Directors of Franklin.

         (vi)     any transaction or series of related transactions having,
                  directly or indirectly the same effect as any of the
                  foregoing; or any agreement, contract, or other arrangement
                  providing for any of the foregoing.

         3.       TERMINATION FOLLOWING CHANGE IN CONTROL.
                  ---------------------------------------

         A.       COMPENSATION UPON TERMINATION. If a Change in Control of
Franklin shall have occurred while the Officer is still an employee of Franklin,
the Officer shall receive the benefits provided in Section 4 if within three (3)
years following a Change in Control there has been a termination of the
Officer's employment with Franklin by the Officer or by Franklin (including
termination or non-renewal of employment by Franklin pursuant to any employment
agreement with Officer), unless such termination is as a result of (i) the
Officer's death, (ii) the Officer's Disability (as defined in Subsection 3C
below); (iii) the Officer's termination by Franklin for Cause (as defined in
Subsection 3E below); or (iv) the Officer's decision to terminate employment
other than for Good Reason (as defined in Subsection 3F below).

         B.       DEATH. If a Change in Control occurs while the Officer is
still an employee, and within three (3) years following the Change in Control
the Officer dies, this Agreement shall terminate and Franklin shall pay to the
Officer's estate or beneficiary, as applicable, Officer's full salary, full
Benefit Plans, as defined below in Subsection 3F(iii), full Securities Plans, as
defined in Subsection 3F(iv), full Cash Bonus, as defined below in Subsection
3F(v), and full Incentive Plans, as defined in Subsection 3F(vi), to the extent
accrued, earned or vested, in effect at the time of death. The estate or
beneficiary, as applicable, shall have all such additional rights as may be
provided under any of such Plans or separate insurance coverage to the estate or
beneficiary. Any payment of salary or otherwise due under such Plans shall be
paid no later than ten (10) days following the date of death.

         C.       DISABILITY. If, a Change in Control occurs while the Officer
is still an employee of Franklin and within three (3) years following the Change
in Control, the Officer becomes incapacitated due to physical or mental illness,
and the Officer shall have been absent from officer's duties with Franklin on a
full-time basis for twelve (12) consecutive months and if within thirty (30)
days after written Notice of Termination as defined in Section 3G below is
thereafter given by Franklin, the Officer shall not have returned to the
full-time performance of the Officer's duties, Franklin may terminate this
Agreement for "Disability" and shall pay the Officer the Officer's full salary,
full Benefit Plans, as defined below in Subsection 3F(iii), full Securities
Plans, as defined below in Subsection 3F(iv), full Cash Bonus as defined below
in Subsection 3F(v) and full Incentive Plans as defined below in Subsection
3F(vi), to the extent accrued, earned or vested, from the commencement of the
Disability period through the Date of Termination as defined in Subsection 3H
below at the rate in effect at the time of the commencement of the disability
period. In addition, the disabled Officer shall have such additional rights
under any of such Plans or separate insurance coverage as are provided to a
disabled Officer thereunder. Any payment of salary or otherwise due under such
Plans shall be paid no later than ten (10) days following the Date of
Termination.


                                       3
<PAGE>



         D.       TERMINATION BY OFFICER WITHOUT GOOD REASON. If a Change in
Control occurs while the Officer is still an employee of Franklin and within
three (3) years following the Change in Control, the Officer terminates the
Officer's employment without Good Reason, as defined in 3(f), the Officer shall
provide Franklin with Notice of Termination and Franklin shall pay the Officer
the Officer's full salary, full benefit plans, as defined below in Subsection
3F(iii), full Securities Plans, as defined in Subsection 3F(iv), full Cash
Bonus, as defined below in Subsection 3F(v), and full Incentive Plans, as
defined below in Subsection 3F(vi), to the extent accrued, earned or vested,
through the Date of Termination as defined in Subsection 3H below at the rate in
effect at the time Notice of Termination is given. In addition, the Officer
shall have such additional rights under any of such Plans as are provided to
Officer under such Plans. Any payment of salary or otherwise due under such
Plans shall be paid no later than ten (10) days following the Date of
Termination.

         E.       TERMINATION FOR CAUSE. If a Change in Control occurs while the
Officer is still an employee of Franklin and within three (3) years following
the Change in Control, the Officer is terminated by Franklin for "Cause,"
Franklin shall provide the Officer with Notice of Termination and shall pay the
Officer the Officer's full salary, full Benefit Plans, as defined below in
Subsection 3F(iii), full Securities Plans as defined in Subsection 3F(iv), full
Cash Bonus as defined below in Subsection 3F(v) and full Incentive Plans as
defined below in Subsection 3F(vi), to the extent accrued or earned or vested,
from the commencement of the actions giving rise to the conviction through the
Date of Termination as defined in Section 3H below at the rate in effect at the
time Notice of Termination is given. In addition, the Officer shall have such
additional rights under any of the Plans as are provided under such Plans. Any
payment of salary or otherwise due under such Plans shall be paid no later than
ten (10) days following the Date of Termination. For purposes of this Agreement
only, Franklin shall have "Cause" to terminate the Officer's employment
hereunder only on the basis of conviction of the Officer of a felony or any
crime involving embezzlement, fraud or misrepresentation. Notwithstanding the
foregoing, the Officer shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to the Officer a copy of a
resolution duly adopted by the affirmative vote of not less than two-thirds of
the entire membership of Franklin's Board of Directors at a regular or special
meeting of the Board held for the purpose (after reasonable notice to the
Officer and an opportunity for the Officer, together with the Officer's counsel,
to be heard before the Board), finding that in the good faith opinion of the
Board, the Officer was guilty of the conduct resulting in the conviction and
specifying the particulars thereof in detail.

         F.       TERMINATION BY OFFICER FOR GOOD REASON. The Officer may
terminate the Officer's employment for Good Reason. For purposes of this
Agreement "Good Reason" shall mean, without Officer's express written consent,
any of the following:

         (i)      the assignment to the Officer by Franklin of duties
                  inconsistent with the Officer's position, duties,
                  responsibilities and status with Franklin as of the day prior
                  to the Change in Control of Franklin, or a change in the
                  Officer's titles or offices as in effect the day immediately
                  prior to the Change in Control of Franklin, or any removal of
                  the Officer from or any failure to re-elect the Officer to any
                  of such positions;

         (ii)     a reduction by Franklin in the Officer's base salary as in
                  effect on the day prior to the Change in Control or Franklin's
                  failure to increase (within 12 months of the Officer's last
                  increase in base salary), the Officer's base salary after a
                  Change in Control of Franklin in an amount which at least
                  equals, on a percentage basis, the average percentage increase
                  in base salary for all officers of Franklin effected in the
                  preceding 12 months.

         (iii)    any failure by Franklin to continue in effect for such Officer
                  any benefit plan or arrangement or perquisite (including,
                  without limitation, payment of club dues, providing an
                  automobile or automobile allowance, payment of all business
                  expenses of operation of the automobile,




                                       4
<PAGE>




                  Franklin's group life insurance plan and medical, dental,
                  accident and disability plans) in which the Officer is
                  participating as of the day prior to the Change in Control of
                  Franklin (or any other plans providing the Officer with
                  substantially similar benefits) (hereinafter referred to as
                  "Benefit Plans"), or the taking of any action by Franklin
                  which would adversely affect the Officer's participation in or
                  materially reduce the Officer's benefits under any such
                  Benefit Plan or deprive the Officer of any material fringe
                  benefit enjoyed by the Officer as of the day prior to the
                  Change in Control of Franklin;

         (iv)     any failure by Franklin to grant Officer an amount of stock
                  options designed to produce a value to Officer substantially
                  consistent with the average value of stock options received by
                  officers of Franklin for the three years immediately prior to
                  the Date of Termination and any failure by Franklin to
                  continue in effect any plan or arrangement to receive
                  securities of Franklin (including, without limitation, any
                  plan or arrangement to receive and exercise stock options,
                  stock appreciation rights, restricted stock or grants thereof,
                  or the Employee Stock Ownership Plan ("ESOP")) in which the
                  Officer is participating as of the day prior to the Change in
                  Control of Franklin (or plans or arrangements providing
                  Officer with substantially similar benefits) (hereinafter
                  referred to as "Securities Plans") or the taking of any action
                  by Franklin which would adversely affect the Officer's
                  participation in or materially reduce the Officer's benefits
                  under any such Securities Plan;

         (v)      any failure to pay to Officer an annual cash bonus that is at
                  least equal to Officer's average cash bonus for the three
                  years immediately prior to the Change in Control (hereinafter
                  referred to as "Cash Bonus"),

         (vi)     any failure by Franklin to continue in effect any incentive
                  plan or arrangement in which the Officer is participating as
                  of the day prior to the Change in Control of Franklin (or any
                  other plans or arrangements providing Officer with
                  substantially similar benefits) (hereinafter referred to as
                  "Incentive Plans") or the taking of any action by Franklin
                  which would adversely affect the Officer's participation in
                  any such Incentive Plan or reduce the Officer's benefits under
                  any such Incentive Plan;

         (vii)    a relocation of Franklin's principal executive offices outside
                  of Oakland County, Michigan or the Officer's relocation to any
                  place outside of Oakland County, Michigan, except for required
                  travel by the Officer on Franklin's business to an extent
                  substantially consistent with the Officer's business travel
                  obligations at the time of a Change in Control of Franklin;

         (viii)   any failure by Franklin to provide the Officer with the number
                  of paid vacation days to which the Officer is entitled
                  pursuant to the Officer's employment agreement or on the basis
                  of years of service with Franklin in accordance with
                  Franklin's normal vacation policy in effect at the time of a
                  Change in Control of Franklin;

         (ix)     any material breach by Franklin of any provision of this
                  Agreement;

         (x)      any failure by Franklin to obtain the assumption of Officer's
                  employment or of this Agreement by a successor or assignee of
                  Franklin; or

         (xi)     any purported termination of the Officer's employment by
                  Franklin which is not effected pursuant to a Notice of
                  Termination satisfying the requirements of Section 30; for
                  purposes of this Agreement, no such purported termination
                  shall be effective.



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<PAGE>




         Officer's right to terminate the Officer's employment pursuant to this
Subsection F shall not be affected by Officer's incapacity due to physical or
mental illness. Officer's continued employment shall not constitute consent to,
or a waiver of rights with respect to, any circumstance constituting Good Reason
hereunder.

         G.       NOTICE OF TERMINATION. Any termination by Officer (other than
by death) or by Franklin shall be communicated by a written Notice of
Termination to the other party hereto in accordance with Section 11 hereof For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice which shall indicate those specific termination provisions relied upon
and which sets forth in reasonable detail tile facts and circumstances claimed
to provide a basis for termination of the Officer's employment.

         H.       DATE OF TERMINATION. "Date of Termination" shall mean (a) if
Officer's employment is terminated for Disability, thirty (30) days after Notice
of Termination is given (provided that Officer shall have not returned to the
full time performance of the Officer's duties during such thirty day period) and
(b) if Officer's employment is terminated for any reason other than death or
Disability, thirty (30) days after Notice of Termination is given.

         4.       SEVERANCE COMPENSATION UPON TERMINATION OF EMPLOYMENT.
                  -----------------------------------------------------

         If a Change in Control of Franklin shall have occurred while the
Officer is still an employee of Franklin and if effective upon or within three
(3) years following the Change in Control there has been a termination of the
Officer's employment with Franklin by the Officer or by Franklin (including
termination or non-renewal of employment by Franklin pursuant to any employment
agreement with Officer), unless such termination is as a result of (i) the
Officer's death, (ii) tile Officer's Disability (as defined in Subsection 3C
above); (iii) the Officer's termination by Franklin for Cause (as defined in
Subsection 3E above); or (iv) the Officer's decision to terminate employment
other than for Good Reason (as defined in Subsection 3F above), then the Officer
shall receive the benefits provided below:

                  (1)      Franklin shall pay the Officer the Officer's full
                           salary, full Benefit Plans, full Securities Plans,
                           full Cash Bonus and full Incentive Plans through the
                           Date of Termination, to the extent accrued, earned or
                           vested, at the highest rate or amount in effect prior
                           to the Date of Termination; and

                  (2)      In lieu of any further salary payments to Officer for
                           periods subsequent to the Date of Termination,
                           Franklin shall pay as severance pay to Officer a lump
                           sum severance payment equal to _______ times the
                           Officer's gross compensation (including base salary,
                           Cash Bonus and any deferred compensation) for any
                           twelve month period yielding the highest dollar
                           amount during the 3 years preceding the Date of
                           Termination. In addition, Franklin shall pay as
                           severance to Officer an amount which after applying
                           the provisions of Section 4999 of the Code, as
                           amended (or as replaced by any other Code Section)
                           ("Section 4999") would provide Officer with the same
                           approximate aggregate cash under Section 4 of the
                           Agreement that Officer would have received under
                           Section 4 of the Agreement but for the application of
                           Section 4999.

                  (3)      In addition, in lieu of exercising or retaining the
                           Officer's right to exercise any outstanding stock
                           options then held by Officer, Officer may elect to
                           surrender to Franklin the Officer's rights in such
                           outstanding stock options (whether or not then
                           exercisable) then held by Officer, and, upon such
                           surrender, Franklin shall pay to Officer an amount in
                           cash per share equal to the aggregate of the
                           difference between (a) the option exercise




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<PAGE>




                           prices of the shares subject to such surrendered
                           options and the greater of (i) the average price per
                           share paid in connection with the acquisition of
                           shares in connection with a Change in Control if such
                           shares were acquired by the payment of cash or the
                           then fair market value per option share or the
                           consideration paid for such shares if such shares
                           were acquired for consideration other than cash, (ii)
                           the price per share paid in connection with any
                           tender offer for shares of Franklin Common Stock
                           leading to a Change in Control, or (iii) the mean
                           between the high and low selling prices of such stock
                           on the NASDAQ National Market on the Date of
                           Termination. Notwithstanding the requirement that
                           Franklin pay Officer at the time or times set forth
                           below, if applicable, the payment shall pursuant to
                           this Subsection (3) be delayed so that it is paid
                           promptly in a manner which is in compliance with
                           Section 16(b) of the Exchange Act.

                  (4)      In addition, Franklin shall maintain in full force
                           and effect, for the continued benefit of the Officer
                           for 3 years; all Benefit Plans in which the Officer
                           was entitled to participate during the 3 years prior
                           to the Date of Termination, provided that the
                           Officer's continued participation is possible under
                           the general terms and provisions of such Benefit
                           Plans. In the event that the Officer's participation
                           in any Benefit Plan is barred, Franklin shall arrange
                           to provide the Officer with benefits substantially
                           similar to those which the Officer would otherwise
                           have been entitled to receive under such Benefit Plan
                           from which the Officer's continued participation is
                           barred.

                  (5)      The payments provided for in Subsections (2) and (3)
                           above shall initially be paid by Franklin to the
                           Trust referenced in Section 5 below within 5 days
                           following a "Potential Change of Control". A
                           Potential Change of Control means: (i) Franklin
                           entering into or the Board of Directors authorizing
                           an agreement, the consummation of which would result
                           in the occurrence of a Change in Control; (ii) any
                           person publicly announces an intention to take or to
                           consider taking actions which if consummated would
                           constitute a Change in Control; or (iii) adoption by
                           the Board of Directors of Franklin of a resolution to
                           the effect that, for purposes of this Agreement, a
                           Potential Change in Control has occurred. The initial
                           payment shall be an estimate of the payments provided
                           for in Subsections (2) and (3) above (the "Initial
                           Payment") as determined by Franklin's independent
                           accountants. The actual calculation of the payments
                           provided for in Subsections (2) and (3) above (the"
                           Actual Payment") shall be made no later than 5 days
                           following the Date of Termination by the same
                           independent accountants who made the calculation of
                           the Initial Payment and such calculation shall be
                           delivered during this five (5) day period to Franklin
                           and to the Officer. The Officer may, by notice given
                           to Franklin no later than eight (8) days following
                           the Date of Termination, contest the calculation of
                           the Actual Payment by the independent accountants and
                           give notice to Franklin of the amount calculated by
                           the Officer. In such event, the Officer may designate
                           an independent certified public accountant (the
                           "Designated Auditor") to review the calculations. The
                           Designated Auditor and the independent accountants
                           who prepared the calculation of the Actual Payment
                           shall then select a third independent accountant and
                           the three accountants shall determine the Actual
                           Payment no later than twenty-one (21) days following
                           the Date of Termination. If the three groups of
                           accountants cannot come to an agreement, the Actual
                           Payment will be the average of the calculation of
                           each of the three groups of accountants.

                           The Actual Payment (less the Initial Payment paid to
                           the Trust (the "Final Payment")) shall be paid by
                           Franklin to the Officer no later than ten (10) days
                           following the Date of




                                       7
<PAGE>



                           Termination, unless the Officer has contested the
                           calculation of the Actual Payment as provided above,
                           in which case, the Final Payment shall be paid by
                           Franklin to the Officer no later than twenty-eight
                           (28) days following the Date of Termination. If
                           Franklin does not timely pay the Officer, for every
                           day it is late in payment to the Officer, and/or if
                           Franklin causes the Trust not to pay the Officer
                           (whether through litigation or other means), for
                           every day that the payment is late, Franklin shall
                           pay to the Officer an additional five (5.0%) percent
                           of the Actual Payment (not including the 5.0% late
                           charges). In the event that the amount of the Initial
                           Payment exceeds the Actual Payment determined to have
                           been due, the Officer shall return the excess to
                           Franklin and such excess shall constitute a loan by
                           Franklin to the Officer on the fifth day after demand
                           by Franklin (together with interest at the rate
                           provided in Section 1274(b)(2)(B) of the Code).

                  (6)      Franklin also shall pay to Officer all legal fees and
                           expenses incurred by Officer as a result of such
                           termination (including all such fees and expenses, if
                           any, incurred in contesting or disputing any such
                           termination) or in seeking to obtain or enforce any
                           right or benefit provided by tins Agreement
                           (including, but not limited to, the expenses of any
                           tax counsel and independent accountants employed or
                           in connection with any tax audit or proceeding to the
                           extent attributable to the application of Section
                           4999 of the Code to any payment or benefit provided
                           hereunder). Such payments shall be made within 5 days
                           after Officer's request for payment accompanied with
                           such evidence of fees and expenses incurred as
                           Franklin reasonably may require.

         5.       ESTABLISHMENT OF TRUST.
                  ----------------------

         Franklin shall promptly create a Trust for the benefit of the Officer.
In the event of a Potential Change in Control, Franklin shall fund such Trust as
provided in Section 4 above. Among other things, the Trust Agreement shall
provide that the Trust shall not be revoked or the principal thereof invaded
without the written consent of the Officer. The Trust Agreement shall also
provide that upon receipt by the Trust of notification by either the Board of
Directors of Franklin, or the Officer of a Change in Control and of the
termination of the Officer, as certified or attested to by the (i) Board of
Directors, or (ii) Officer and Read P. Dunn in his individual capacity or David
F. Simon in his individual capacity, the Trustee shall pay the Initial Payment
to the Officer no later than the next business day following receipt of such
notification.

         The Trustee shall be a national or state bank or a holding company
thereof having a consolidated net worth of not less than $10,000,000, selected
by Franklin. Nothing in this paragraph shall relieve Franklin of any of its
obligations under this Agreement, except that actual disbursements from the
Trust to the Officer in satisfaction of payments under this Agreement, will be
applied to reduce Franklin's obligations under this Agreement, to the extent of
such disbursements. Any funds, including interest or investment earnings
thereon, remaining in the Trust and designated for the Officer shall revert and
be paid to Franklin if (A) a court of competent jurisdiction determines that the
circumstances giving rise to that particular funding of the Trust no longer
exists; or (B) the Board of Directors of Franklin and the Officer direct the
Trustee to release tile funds designated for the Officer. A copy of the Trust
Agreement is attached as Exhibit A to this Agreement.

         Notwithstanding any other provision of this Section 5 to the contrary,
the Trust Agreement shall provide that Trustee's obligation to pay the Officer
the Initial Payment shall be suspended upon receipt of a notice of determination
by the Office of the Comptroller of the Currency (the "OCC") that Franklin is in
a troubled condition at the time payment would otherwise be due and owing and
that the Severance Payments are




                                       8
<PAGE>



prohibited under banking laws and regulations. The Trustee shall thereafter hold
or release the Initial Payment as directed by the OCC.

         6.       NO OBLIGATION TO MITIGATE DAMAGES:  NO EFFECT ON OTHER
                  ------------------------------------------------------
CONTRACTUAL RIGHTS.
------------------

                  A.       The Officer shall not be required to mitigate damages
                           or the amount of any payment provided for under this
                           Agreement by seeking other employment or otherwise,
                           nor shall the amount of any payment provided for
                           under this Agreement be reduced by any compensation
                           earned by the Officer as the result of employment by
                           another employer after the Date of Termination, by
                           retirement benefits, by offset against any amount
                           claimed to be owed by Officer to Franklin (except as
                           provided in Section 4(5) above), or otherwise.

                  B.       Except as provided herein, the provisions of this
                           Agreement, and any payment provided for hereunder,
                           shall not increase or reduce any amounts otherwise
                           payable, or in any way increase or diminish the
                           Officer's existing rights, or rights which would
                           accrue solely as a result of the passage of time,
                           under any Benefit Plan, Incentive Plan or Securities
                           Plan, employment agreement or other contract, plan or
                           arrangement.

         7.       SUCCESSOR TO FRANKLIN.
                  ---------------------

                  A.       Franklin will require any successor or assignee
                           (whether direct or indirect, by purchase, merger,
                           consolidation or otherwise) to all or substantially
                           all of the business and/or assets of Franklin, by
                           agreement in form and substance satisfactory to the
                           Officer, expressly, absolutely and unconditionally to
                           assume and agree to perform this Agreement in the
                           same manner and to the same extent that Franklin
                           would be required to perform it if no such succession
                           or assignment had taken place. Any failure of
                           Franklin to obtain such agreement prior to the
                           effectiveness of any such succession or assignment
                           shall be a material breach of this Agreement and
                           shall entitle the Officer to terminate the Officer's
                           employment for Good Reason. As used in this
                           Agreement, "Franklin" shall include any successor or
                           assign to its business and/or assets as aforesaid
                           which executes and delivers the agreement provided
                           for in this Section 7 or which otherwise becomes
                           bound by all the terms and provisions of this
                           Agreement by operation of law, or otherwise. If at
                           any time during the term of this Agreement the
                           Officer is employed by any institution a majority of
                           the voting securities of which is then owned by
                           Franklin, "Franklin" as used in this Agreement shall
                           in addition include such employer. In such event,
                           Franklin agrees that it shall payor shall cause such
                           employer to pay any amounts owed to the Officer
                           pursuant to Section 4 hereof.

                  B.       This Agreement shall inure to the benefit of and be
                           enforceable by the Officer's personal and legal
                           representatives, executors, administrators,
                           successors, heirs, distributees, devisees and
                           legatees. If the Officer should die while any amounts
                           are still payable to Officer hereunder, all such
                           amounts, unless otherwise provided herein, shall be
                           paid in accordance with the terms of this Agreement
                           to the officer's devisee, legatee, or other designee
                           or, if there be no such designee, to the Officer's
                           estate.

         8.       WITHHOLDING OF TAXES.
                  --------------------



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<PAGE>



         Franklin may withhold from any amounts payable under this Agreement all
federal, state, city, or other taxes as required by law.

         9.       DUTY NOT TO DISCLOSE CONFIDENTIAL INFORMATION.
                  ---------------------------------------------

         The Officer acknowledges that the Officer's relationship with the
Company is one of high trust and confidence, and that he has access to
Confidential Information (as hereinafter defined) of Franklin. The Officer shall
not, directly or indirectly, communicate, deliver, exhibit or provide any
Confidential Information to any person, firm, partnership, corporation,
organization or entity, except as required in the normal course of the Officer's
duties. The duties contained in this paragraph shall be binding upon the Officer
during the time that he/she is employed by the Company and following the
termination of such employment. Such duties will not apply to any such
Confidential Information which is or becomes in the public domain through no
action on the part of the Officer, is generally disclosed to third parties by
Franklin without restriction on such third parties, or is approved for release
by written authorization of the Board of Directors of Franklin. The term
"Confidential Information" shall mean any and all confidential, proprietary, or
secret information relating to Franklin's business, services, customers,
business operations, or activities and any and all trade secrets, products,
methods of conducting business, information, skills, knowledge, ideas, know-how,
or devices used in, developed by, or pertaining to Franklin's business and not
generally known, in whole or in part, in any trade or industry in which Franklin
is engaged.

         10.      ENTIRE AGREEMENT.
                  ----------------

         This Agreement contains the entire agreement between the parties with
respect to the subject matter contained herein, and supersedes all prior and
contemporaneous oral and written communications and agreements with respect
thereto.

         11.      NOTICE.
                  ------

         For purposes of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have
been duly given when delivered to the party or when mailed by United States
registered mail, return receipt requested, postage prepaid, as follows:



         If To Franklin:       Attention: President, CEO, Secretary or Treasurer
                                          Franklin Bank, N.A.
                                          24725 West Twelve Mile Road Suite 210
                                          Southfield, Michigan 48034

         If To The Officer:
                                          -------------------------------------
                                          -------------------------------------
                                          -------------------------------------



or such other address as either party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.

         12.      MISCELLANEOUS.
                  -------------

         No provisions of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing signed by
the Officer and Franklin. No waiver by either party


                                       10
<PAGE>



hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. In the event of a conflict between any employment
agreement and this Agreement, the terms of this Agreement shall prevail. This
Agreement shall be governed by and construed in accordance with the laws and
regulations of Franklin's applicable regulatory agency. All references to
sections of the Exchange Act or the Code shall be deemed also to refer to any
successor provisions to such sections. The obligations of Franklin under
Sections 4 and 5 shall survive tile expiration of the term of this Agreement.

         13.      VALIDITY.
                  --------

         The invalidity or unenforceability of any provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect. Moreover, to the extent
that any provision of this Agreement is deemed invalid or unenforceable, such
provision shall be interpreted and/or modified so as to be deemed valid and
enforceable.

         14.      COUNTERPARTS.
                  ------------

         This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together will
constitute one and the same instrument.

         15.      LEGAL FEES AND EXPENSES.
                  -----------------------

         Franklin shall pay all legal fees and expenses which the Officer may
incur as a result of the breach of this Agreement by Franklin or as a result of
Franklin or any shareholder of Franklin or any federal or state agency
contesting the validity or enforceability of this Agreement or the Officer's
interpretation of or determinations under this Agreement.

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

                                         FRANKLIN BANK, NATIONAL ASSOCIATION

                                         By:
                                            ----------------------------------
                                         Its:
                                             ---------------------------------

                                         "OFFICER"

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




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