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                                                                   EXHIBIT 10.16
                    AMENDED AND RESTATED SEVERANCE AGREEMENT

         THIS AGREEMENT is made as of this 21st day of November, 2000, between
FRANKLIN BANK, NATIONAL ASSOCIATION ("Franklin"), and David L. Shelp (the
"Officer").

                                    RECITALS:

         Franklin and the Officer entered into that certain Severance Agreement
dated October 29, 1993, pursuant to which the Officer was provided with certain
severance compensation in the event of a change in control of Franklin.
Effective November 21, 1995, the Board of Directors approved various
modifications to the original Severance Agreement and Franklin and the Officer
entered into that certain Amended and Restated Severance Agreement dated
November 21, 1995 (the "1995 Severance Agreement").

         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 amend and restate
that certain 1995 Severance Agreement in accordance with the terms set forth
herein (as amended and restated, 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 as otherwise set
forth in Sections 16 and 17 below).

         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.

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         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. 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
         acquirer 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



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         (iv) if during any period of two consecutive years (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-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 (excluding the
         nomination and election of the June 2000 Non-Management Directors as
         defined in Section 16 below).

         (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 (excluding the Franklin/Bingham Actions as defined in Section
         16 below).

         3. Termination Following Change in Control.

         A. Compensation Upon Termination. Subject to Section 17 below, 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



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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.

         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, other than assignments and changes attributable to the
         July 2000 Position and the December 2000 Position, each as defined in
         Section 16 below;

         (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.



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         (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, 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



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         (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 3G; for purposes of this Agreement, no such
         purported termination shall be effective.

         Officer's night 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 the 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. Subject to
Section 17 below, 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) the 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 2.5
         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



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         the difference between (a) the option exercise 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
         (less any amounts already paid to the Trust pursuant to Section 16D(4)
         below) 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 (i.e.,
         the amounts deposited in the Trust for Officer's account) 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 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


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         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 this 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 Offices 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 the Chairman of
Franklin 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 the 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 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 and Section 16D(4)(b)), or otherwise.



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                  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 pay or shall cause such employer to pay any amounts owed to the
         Officer pursuant to Section 4 or Section 16 hereof, as applicable.

                  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. 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.



                                       9
<PAGE>



         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. Specifically, this Agreement amends and
restates in its entirety that certain Severance Agreement dated October 29, 1993
between the Officer and Franklin and that certain Amended and Restated Severance
Agreement dated November 21, 1995 between the Officer and Franklin.

         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:










                                       10
<PAGE>



<TABLE>
<S>                                                  <C>
         If To Franklin:   Attention:                Chairman of the Board of Directors
                                                     Franklin Bank, N.A.
                                                     24725 West Twelve Mile Road Suite 210
                                                     Southfield, Michigan 48034

         If To The Officer:                          David L. Shelp
                                                     24725 West Twelve Mile Road, Suite 210
                                                     Southfield, Michigan 48034
</TABLE>

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 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 the 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.

         16. Officer's Entitlement to Terminate for Good Reason.

                  A. Effective July 16, 2000, Officer was appointed as acting
         president of Franklin and was assigned additional duties associated
         therewith (the "July 2000 Position"). Effective November 21, 2000, the
         Board of Directors (i) approved the appointment of Officer to President
         and Chief Executive Officer of Franklin effective upon the
         implementation of Franklin's Employee Operational Effectiveness
         Committee Plan (the "December 2000 Position") and (ii) approved various
         modifications to the 1995 Severance Agreement.





                                       11
<PAGE>



                  B. Franklin's Board of Directors and the Officer recognize
         that Franklin incurred a Change in Control (as defined in Section 2 of
         the 1995 Severance Agreement) due to (i) Franklin's Board of Director's
         authorization and approval of Franklin's proposed merger with Bingham
         Financial Services Corporation ("Bingham") and Franklin's execution of
         the Agreement and Plan of Merger dated as of March 19, 2000 among
         Bingham, BFSC Merger, N.A. and Franklin, as amended, (collectively, the
         "Franklin/Bingham Actions") and (ii) the nomination and election of two
         non-management sponsored directors to the Board of Directors of
         Franklin in connection with Franklin's 2000 annual meeting of
         shareholders (the "June 2000 Non-Management Directors"). In addition,
         Franklin's Board of Directors and the Officer recognize that the
         assignment of duties and/or changes in titles/offices associated with
         the Officer's July 2000 Position and December 2000 Position would
         entitle Officer to terminate Officer's employment for Good Reason (as
         defined in Section 3F of the 1995 Severance Agreement).

                  C. Franklin's Board of Directors and Officer recognize that,
         pursuant to the 1995 Severance Agreement, Officer could terminate
         Officer's employment for Good Reason and be entitled to certain
         severance benefits thereunder.

                  D. Franklin's Board of Directors and Officer agree that the
         Officer's appointment to the July 2000 Position and the December 2000
         Position together with the other events described in Section 16B above
         should not be a basis for increasing his severance benefits beyond that
         which he would have otherwise been entitled to under the 1995 Severance
         Agreement if the Officer decided to terminate his employment as of the
         date hereof for Good Reason.

                  E. Subject to Section 17 below, in the event, Officer
         terminates his employment for Good Reason based on his appointment to
         the July 2000 Position or the December 2000 Position and the other
         events described in Section 16B above on or before March 19, 2003, then
         the Officer shall receive the benefits provided below:

                           (1) Officer shall be entitled to receive from
                  Franklin the benefits set forth in Section 4(1) above.

                           (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 $371,566 (including interest thereon from the
                  date hereof to the date of payment at 8.0% per annum
                  determined on the basis of a 360-day year of twelve 30-day
                  months compounded quarterly). In addition, Franklin shall pay
                  as severance to Officer an amount which after applying the
                  provisions of Section 4999 would provide Officer with the same
                  approximate aggregate cash under Section 16 of the Agreement
                  that Officer would have received under Section 16 of the
                  Agreement but for the application of Section 4999.

                           (3) Officer shall be entitled to receive from
                  Franklin the benefits set forth in Section 4(3) and Section
                  4(4) above.

                           (4) If not already paid into the Trust referenced in
                  Section 5 above, Franklin shall pay the amount provided for in
                  Section 16E(2) above to the Trust within 5 days of the date
                  hereof.

                                    (a) The actual calculation of the payments
                      provided for in Subsections (2) and (3) above (the
                      "Section 16 Payment") shall be made no later than 5 days
                      following the Date of Termination by Franklin's
                      independent accountants such



                                       12
<PAGE>



                      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 Section 16 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 to review the
                      calculations. Such accountant and the independent
                      accountants who prepared the calculation of the Section 16
                      Payment shall then select a third independent accountant
                      and the three accountants shall determine the Section 16
                      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 Section 16 Payment will
                      be the average of the calculation of each of the three
                      groups of accountants.

                                    (b) 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
                      Section 16 Payment (not including the 5.0% late charges).
                      In the event that the amount of the Section 16 Payment
                      exceeds the Section 16 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).

                                    (c) For purposes of the Trust Agreement, the
                      Section 16 Payment shall be considered an Initial Payment.

                           (5) Payments under this Section 16 (including
                  payments from the Trust) shall be payable ten (10) days
                  following the Date of Termination unless the Officer has
                  contested the calculation of the actual payment provided above
                  in which case the final payment shall be paid by Franklin to
                  the Officer no later than 28 days following the Date of
                  Termination.

                      F. Officer agrees that in the event he terminates his
         employment for Good Reason pursuant to Section 16E above, Franklin may,
         in its sole discretion, extend Officer's employment period for up to an
         additional 180 days. Franklin shall continue to pay Officer all of his
         regular salary and benefits during the extended employment period. For
         the avoidance of doubt, such extended employment period shall not
         effect the determination of whether Officer terminated his employment
         on or before March 19, 2003 pursuant to Section 16E above.

         17. Relationship Between Section 4 and Section 16.

                      A. Other than Officer's termination of his employment for
         Good Reason pursuant to Section 16E above, subject to the terms of this
         Agreement, Officer shall be entitled to severance compensation under
         Section 4 above.

                      B. Officer shall only be entitled to severance
         compensation payable under this Agreement under Section 4 or under
         Section 16. In no event shall Officer be entitled to severance
         compensation payable under both Section 4 and Section 16.



                                       13
<PAGE>



                      C. Officer shall be entitled to elect that severance
         compensation be paid under either Section 4 or Section 16; provided
         that both sections would otherwise apply if not for the restrictions
         contained in Section 17B.

         18. Limited Waiver. Officer recognizes that, except as set forth in
Section 16 above, he has waived his rights to severance payments (which would
otherwise be available under the 1995 Severance Agreement) in the event he
terminates his employment for Good Reason based on his appointment to the July
2000 Position or the December 2000 Position and the other events described in
Section 16B above.

                            [Signature page follows]




                                       14
<PAGE>





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

                                        FRANKLIN BANK, NATIONAL ASSOCIATION



                                        By:_____________________________________

                                        Its:____________________________________


                                        OFFICER


                                        ----------------------------------------
                                                David L. Shelp