Document:

<PAGE>

                                                                    EXHIBIT 10.3

                             STOCK OPTION AGREEMENT

         This Stock Option Agreement dated as of November 4, 2002 (the
"Agreement"), is by and between Franklin Bank Corp., a Delaware corporation (the
"Company"), and Ranieri & Co., Inc., a Delaware corporation ("Grantee").

                                R E C I T A L S

         WHEREAS, on April 9, 2002, the Company acquired all of the outstanding
capital stock of Franklin Bank, S.S.B., a Texas state savings bank (the "Bank"),
pursuant to the terms of an Agreement and Plan of Reorganization dated as of
October 3, 2001, as amended (the "Reorganization Agreement"); and

         WHEREAS, the Reorganization Agreement imposes certain restrictions upon
the operations of the Company until such time as the Company raises an
additional $35 million in capital through a private placement in which certain
of the former shareholders of the Bank are entitled to participate; and

         WHEREAS, the Company has received a proposal from Friedman, Billings,
Ramsey & Co., Inc. ("FBR") pursuant to which the Company would receive gross
proceeds of approximately $75 million from an offering made through FBR to
qualified institutional investors, institutional accredited investors and
persons living outside the United States, as well as by the Company directly to
the individual accredited investors having participation rights under the
Reorganization Agreement (the "Offering"); and

         WHEREAS, the Company believes that the Offering is in the best
interests of the Company and its stockholders and desires to proceed with the
Offering; and

         WHEREAS, the Company and Grantee have entered into a Consulting
Agreement of even date herewith (the "Consulting Agreement") pursuant to which
the Company has retained the services of Grantee as a consultant, effective upon
closing of the Offering, to assist the Company in the deployment of the
additional capital proposed to be raised in the Offering over the Company's
original expectation; and

         WHEREAS, as partial consideration for the services to be provided by
Grantee under the Consulting Agreement, the Company has agreed to grant to
Grantee the option represented hereby;

         NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth herein, the
Company and Grantee agree as follows:

         1.       GRANT OF OPTION. In consideration of the execution and
delivery of the Consulting Agreement, and subject to the terms and conditions
set forth herein, the Company hereby grants to Grantee an irrevocable option
(the "Option") to purchase 570,000 shares (the "Option Shares") of Class A
Common Stock, par value $.01 per share (the "Class A Common Stock"), of the

<PAGE>

Company at a purchase price per Option Share equal to the fair market value
thereof (agreed to be the price at which the Class A Common Stock is offered and
sold to investors in the Offering), subject to adjustment as provided herein
(the "Purchase Price"). Notwithstanding anything to the contrary contained
herein, and except to the extent the Option represented hereby shall have been
previously exercised, if at any time during the Option Period (as hereinafter
defined) the Company shall exercise its right to terminate the Consulting
Agreement pursuant to Section 3 thereof, such termination shall also terminate
this Agreement and the Option represented hereby, and Grantee's right to
purchase Option Shares, whether or not vested, shall be terminated and of no
further force and effect.

         2.       OPTION PERIOD. (a) Subject to the other terms of this
Agreement, the Option may be exercised by Optionee in whole or in part at any
time during the ten (10) year period (the "Option Period") beginning on the date
hereof (the "Effective Date").

                  (b)      Subject to the other terms of this Agreement, the
Option Shares shall vest in, and become exercisable, by Grantee as follows:

                           (1)      on the first anniversary of the Effective
Date, 190,000 shares shall vest and become exercisable;

                           (2)      on the second anniversary of the Effective
Date, an additional 190,000 shares shall vest and become exercisable, so that on
that date a total of 380,000 shares shall be vested and exercisable; and

                           (3)      on the third anniversary of the Effective
Date, an additional 190,000 shares shall vest and become exercisable, so that on
that date all Option Shares shall be vested and exercisable.

         3.       EXERCISE OF OPTION. In the event that Grantee is entitled to
and wishes to exercise the Option, it will send to the Company a written notice
(an "Exercise Notice"; the date of which being herein referred to as the "Notice
Date") to that effect and which Exercise Notice also will specify the number of
Option Shares Grantee wishes to purchase, the denominations of the certificate
or certificates evidencing the Option Shares which Grantee wishes to purchase
and a date (an "Option Closing Date"), not earlier than five business days nor
later than 15 business days from the Notice Date, for the closing of such
purchase (in all cases an "Option Closing"). Any Option Closing will be at the
offices of the Company in Houston, Texas on the applicable Option Closing Date
or at such other place on such other date as may be necessary so as to comply
with Section 3(b).

                  (b)      Notwithstanding anything to the contrary contained
herein, any purchase of Option Shares upon exercise of the Option will be
subject to compliance with the applicable regulations of the Securities and
Exchange Commission, the Texas Savings and Loan Department, the Office of Thrift
Supervision, the Federal Deposit Insurance Corporation and other agencies having
jurisdiction over the Company's sale, and the Grantee's acquisition, of the
Option Shares, and the obtaining or making of any consents, approvals, orders,
notifications, filings or authorizations, the failure of which to have obtained
or made would have the effect of making the issuance of Option Shares to Grantee
illegal (the "Regulatory Approvals"). In the event that the Option is otherwise
exercisable and Grantee wishes to exercise the Option, the

                                      -2-
<PAGE>

Option may be exercised in accordance with Section 3(a) and Grantee shall
acquire the maximum number of Option Shares specified in the Exercise Notice
that Grantee is then permitted to acquire under the applicable laws and
regulations, and if Grantee thereafter obtains the Regulatory Approvals to
acquire the remaining balance of the Option Shares specified in the Exercise
Notice, then Grantee shall be entitled to acquire such remaining balance. The
Company agrees to use its reasonable efforts to assist Grantee in obtaining the
Regulatory Approvals.

         4.       PAYMENT AND DELIVERY OF CERTIFICATES. (a) At any Option
Closing, Grantee will pay to the Company in immediately available funds by wire
transfer to a bank account designated in writing by the Company an amount equal
to the Purchase Price multiplied by the number of Option Shares to be purchased
at such Option Closing plus the amount of any transfer, stamp or other similar
taxes or charges imposed in connection therewith.

                  (b)      At any Option Closing, simultaneously with the
delivery of immediately available funds as provided in Section 4(a), the Company
will deliver to Grantee a certificate or certificates representing the Option
Shares to be purchased at such Option Closing, which Option Shares will be free
and clear of all liens, claims, charges and encumbrances of any kind whatsoever.
If at the time of issuance of Option Shares pursuant to an exercise of the
Option hereunder, the Company shall have issued any securities similar to rights
under a stockholder rights plan, then each Option Share issued pursuant to such
exercise will also represent such a corresponding right with terms substantially
the same as and at least as favorable to Grantee as are provided under any such
stockholder rights plan then in effect. Grantee shall deliver to The Company a
letter agreeing that Grantee shall not offer to sell or otherwise dispose of
such Option Shares in violation of the registration provisions of applicable
federal and state law or of the provisions of this Agreement.

                  (c)      Certificates for the Option Shares delivered at an
Option Closing will have typed or printed thereon a restrictive legend which
will read substantially as follows:

         "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
         MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN
         EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE."

It is understood and agreed that (i) the reference to restrictions arising under
the Securities Act in the above legend will be removed by delivery of substitute
certificate(s) without such reference if such Option Shares have been registered
pursuant to the Securities Act, such Option Shares have been sold in reliance on
and in accordance with Rule 144 under the Securities Act or Grantee has
delivered to the Company a copy of a letter from the staff of the SEC, or an
opinion of counsel in form and substance reasonably satisfactory to the Company
and its counsel, to the effect that such legend is not required for purposes of
the Securities Act and (ii) the reference to restrictions pursuant to this
Agreement in the above legend will be removed by delivery of substitute
certificate(s) without such reference if the Option Shares evidenced by
certificate(s) containing such reference have been sold or transferred in
compliance with the provisions of this Agreement under circumstances that do not
require the retention of such reference.

                                      -3-
<PAGE>

         5.       REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents and warrants to Grantee that (i) the Company has taken all
necessary corporate and other action to authorize and reserve and, subject to
the receipt of any required Regulatory Approvals, to permit it to issue the
Option Shares; (ii) at all times from the date hereof until the obligation to
deliver Option Shares upon the exercise of the Option terminates, the Company
shall have reserved for issuance, upon exercise of the Option, shares of Class A
Common Stock necessary for Grantee to exercise the Option, and the Company will
take all necessary corporate action to authorize and reserve for issuance all
additional shares of Class A Common Stock or other securities which may be
issued pursuant to Section 7 upon exercise of the Option; and (iii) the shares
of the Class A Common Stock to be issued upon due exercise of the Option,
including all additional shares of Class A Common Stock or other securities
which may be issuable upon exercise of the Option or any other securities which
may be issued pursuant to Section 7, upon issuance pursuant hereto, will be duly
and validly issued, fully paid and nonassessable, and will be delivered free and
clear of all liens, claims, charges and encumbrances of any kind or nature
whatsoever, including without limitation any preemptive rights of any
stockholder of the Company.

         6.       REPRESENTATION AND WARRANTY OF GRANTEE. Grantee hereby
represents and warrants to the Company that any Option Shares or other
securities acquired by Grantee upon exercise of the Option will be acquired for
investment and will not be transferred or otherwise disposed of except in a
transaction registered, or exempt from registration, under the Securities Act.
Grantee has all requisite corporate power and authority to enter into this
Agreement and, subject to any approvals or consents referred to herein, to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on the part of the
Grantee, and this Agreement has been duly executed and delivered by Grantee.

         7.       ADJUSTMENT UPON CHANGES IN CAPITALIZATION, ETC. (a) In the
event of any change in the Class A Common Stock by reason of a stock dividend,
split-up, merger, recapitalization, combination, exchange of shares, or similar
transaction, the type and number of shares or securities subject to the Option,
and the Purchase Price thereof, will be adjusted appropriately, and proper
provision will be made in the agreements governing such transaction, so that
Grantee will receive upon exercise of the Option the number and class of shares
or other securities or property that Grantee would have received in respect of
the Class A Common Stock if the Option had been exercised immediately prior to
such event or the record date therefor, as applicable.

                  (b)      Without limiting the parties' relative rights and
obligations under the Consulting Agreement and the last sentence of Section 1 of
this Agreement, upon the occurrence of a Change of Control (as hereinafter
defined), the Option shall be fully vested and exercisable by the holder
thereof. For purposes of this Agreement, a "Change of Control" shall mean the
happening of any of the following events:

                           (1)      The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 50% or more of either (i) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the Company entitled to vote

                                      -4-
<PAGE>

generally in the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes of this subsection (b), the
following acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company or
(iv) any acquisition by any corporation pursuant to a transaction which complies
with clauses (i), (ii) and (iii) of subsection (3) of this Section 7(b); or

                           (2)      Individuals who, as of the date hereof,
constitute the board of directors of the Company (the "Incumbent Board") cease
for any reason other than the act of Grantee or an affiliate of Grantee to
constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date hereof whose election, or
nomination for election by the Company's stockholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
board of directors of the Company; or

                           (3)      Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a "Business Combination"), in each case, unless following
such Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly, more than
50% of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (ii) no
Person (excluding any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 25% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (iii) at least a majority of the members
of the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the board of directors of the
Company, providing for such Business Combination; or Approval by the
shareholders of the Company of a complete liquidation or dissolution of the
Company; or

                           (4)      Approval by the stockholders of the Company
of a complete liquidation or dissolution of the Company; or

                                      -5-
<PAGE>

                           (5)      The date on which the Company shall
consummate an underwritten public offering of Common Stock registered under the
Securities Act, and as a result of which a class of the Company's capital stock
is authorized for trading in an automated interdealer quotation system of a
registered national securities association or is listed for trading on a
national securities exchange.

         8.       LOSS OR MUTILATION. Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, the Company will execute and deliver a new Agreement of
like tenor and date. Any such new Agreement executed and delivered will
constitute an additional contractual obligation on the part of the Company,
whether or not the Agreement so lost, stolen, destroyed, or mutilated shall at
any time be enforceable by anyone.

         9.       MISCELLANEOUS.

                  (a)      AMENDMENT. This Agreement may not be amended, except
by an instrument in writing signed on behalf of each of the parties.

                  (b)      EXTENSION; WAIVER. Any agreement on the part of a
party to waive any provision of this Agreement, or to extend the time for
performance, will be valid only if set forth in an instrument in writing signed
on behalf of such party. The failure of any party to this Agreement to assert
any of its rights under this Agreement or otherwise will not constitute a waiver
of such rights.

                  (c)      ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES. This
Agreement and the Consulting Agreement (i) constitute the entire agreement, and
supersede all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter of this Agreement, and
(ii) are not intended to confer upon any person other than the parties any
rights or remedies.

                  (d)      GOVERNING LAW. This Agreement will be governed by,
and construed in accordance with, the laws of the State of Delaware, regardless
of the laws that might otherwise govern under applicable principles of conflict
of laws thereof.

                  (e)      NOTICES. All notices, requests, claims, demands, and
other communications under this Agreement shall be sent in the manner and to the
addresses set forth in the Reorganization Agreement.

                  (f)      ASSIGNMENT; TRANSFER. The Option represented hereby
may not be sold, transferred, pledged or hypothecated by Grantee unless the
Company shall have been supplied with evidence reasonably satisfactory to it
that such sale, transfer, pledge or hypothecation is not in violation of the
Securities Act. Subject to satisfaction of the foregoing condition and the other
limitations set forth in this Agreement, the Option represented hereby and the
right to purchase Option Shares shall be transferable by the Grantee or other
holder thereof only to one or more persons, each of whom on the date of transfer
is an employee, officer, director, member, partner, stockholder or other equity
interest holder of the Grantee or its affiliates. As used in this Agreement, an
"affiliate" of Grantee shall mean any person or entity who controls, is
controlled by, or is under common control with, Grantee. To the extent any such
transfer shall occur, the

                                      -6-
<PAGE>

Company shall issue to such transferee an Option identical in form to this
Option, but evidencing the number of shares transferred to such transferee. Upon
any such transfer, transferee shall be entitled to all of the benefits, and
subject to all of the limitations, of Grantee hereunder, and shall be treated
for all purposes as the Grantee. Any assignment or transfer of this option or
any interest therein in violation of this provision shall be void. Subject to
the foregoing provisions this Section 7(f), this Agreement will be binding upon,
inure to the benefit of, and be enforceable by, the parties and their respective
successors and permitted assigns.

                  (g)      FURTHER ASSURANCES. In the event of any exercise of
the Option by Grantee, the Company and Grantee will execute and deliver all
other documents and instruments and take all other actions that may be
reasonably necessary in order to consummate the transactions provided for by
such exercise.

                  (h)      ENFORCEMENT. The parties agree that irreparable
damage would occur and that the parties would not have any adequate remedy at
law in the event that any of the provisions of this Agreement were not performed
in accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties will be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or in Delaware state court, the foregoing being in addition to
any other remedy to which they are entitled at law or in equity. In addition,
each of the parties hereto (i) consents to submit itself to the personal
jurisdiction of any Federal court located in the State of Delaware or any
Delaware state court in the event any dispute arises out of this Agreement or
any of the transactions contemplated by this Agreement, (ii) agrees that it will
not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court, and (iii) agrees that it will not bring
any action relating to this Agreement or any of the transactions contemplated by
this Agreement in any court other than a Federal court sitting in the State of
Delaware or a Delaware state court.

                  (i)      SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible to the fullest
extent permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.

                  (j)      COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrument.

                                      -7-
<PAGE>

         IN WITNESS WHEREOF, the Company and Grantee have caused this Agreement
to be signed by their respective officers thereunto duly authorized as of the
day and year first written above.

                                          FRANKLIN BANK CORP.

                                          ______________________________________
                                          By:
                                          Its:

                                          RANIERI & CO., INC.

                                          ______________________________________
                                          By:  _________________________________
                                          Its: _________________________________

                                      -8-<PAGE>

                                                                    EXHIBIT 10.4

                              CONSULTING AGREEMENT

         THIS CONSULTING AGREEMENT (the "Agreement") by and between Franklin
Bank Corp., a Delaware corporation (the "Company"), and Ranieri & Co., Inc., a
Delaware corporation (the "Consultant"), is dated as of the 4th day of November,
2002.

                               W I T N E S S E T H

         WHEREAS, on April 9, 2002, the Company acquired all of the outstanding
capital stock of Franklin Bank, S.S.B., a Texas state savings bank (the "Bank"),
pursuant to the terms of an Agreement and Plan of Reorganization dated as of
October 3, 2001, as amended (the "Reorganization Agreement"); and

         WHEREAS, the Reorganization Agreement imposes certain restrictions upon
the operations of the Company until such time as the Company raises an
additional $35 million in capital through a private placement in which certain
of the former shareholders of the Bank are entitled to participate; and

         WHEREAS, the Company has received a proposal from Friedman, Billings,
Ramsey & Co., Inc. ("FBR") pursuant to which the Company would receive gross
proceeds of approximately $75 million from an offering made through FBR to
qualified institutional investors, institutional accredited investors and
persons living outside the United States, as well as the individual accredited
investors having participation rights under the Reorganization Agreement (the
"Offering"); and

         WHEREAS, the Company believes that the Offering is in the best
interests of the Company and its stockholders and desires to proceed with the
Offering; and

         WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to retain the services of the Consultant on the terms and conditions set forth
below to assist the Company in the deployment of the additional capital proposed
to be raised in the Offering over the Company's original expectation, and the
Consultant desires to render such services;

         NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

         1.       CONSULTING PERIOD. Subject to earlier termination in
accordance with Section 3 hereof or cancellation in accordance with Section 9
hereof, the Consultant shall make available to the Company employees of
Consultant for the purpose of rendering consulting services, on the terms and
conditions set forth in this Agreement, for the period beginning on the date of
closing of the Offering (or another capital raising transaction in which the
Company receives at least $80 million)(the "Commencement Date") and ending on
the third anniversary of the date of the closing (the "Consulting Period").

         2.       CONSULTING SERVICES. During the Consulting Period, the
Consultant's employees shall devote such time as may be necessary to render such
consulting services as may reasonably

<PAGE>

be requested from time to time by the Board of Directors and/or the Chief
Executive Officer of the Company, including, without limitation: strategic
planning advice and guidance; asset and liability management advice (including,
for example, reviewing Asset/Liability Committee materials and providing input
thereon upon request); advice regarding capital markets transactions and issues;
advice regarding merger and acquisition opportunities in the financial services
industry; and representing the Company's interests in the affairs of the
financial services industry. The Consultant's services shall be performed at
such times and locations as shall be mutually convenient to the Consultant and
the Company.

         3.       TERMINATION. Consultant agrees that it will perform its
services hereunder in conformity with the highest business, trade and
professional standards and will apply to such services the degree of skill, care
and supervision necessary to ensure that the services shall be delivered in a
timely fashion and shall be of the highest quality and in accordance with the
business, trade and professional standards customary in the industry. If the
Company determines that services by Consultant pursuant to this Agreement do not
satisfy the standard of care set forth in this section, the Company may by
written notice of termination specifying the deficiencies and providing
Consultant 20 days to cure all such deficiencies. At the end of such 20-day
period, the Company shall provide Consultant with a written notice either (a)
withdrawing the notice of termination previously delivered and confirming that
the specific delinquencies have been cured, or (b) stating that the
delinquencies have not been cured and confirming termination of the Agreement
effective immediately upon delivery to Consultant of such confirmation. In
addition to the foregoing, Consultant may at any time by written notice to the
Company terminate this Agreement and Consultant's services hereunder effective
15 days after delivery of such notice. Upon termination of this Agreement
pursuant to this Section, Consultant shall be entitled to retain the cash
portion of the Consulting Fee (as hereinafter defined) previously paid or
accrued plus reimbursement for any expenses previously incurred, all to the date
of such termination, but shall forfeit the right to any future payments pursuant
to this Agreement, and shall forfeit the Option (as hereinafter defined) to the
extent not previously exercised.

         4.       CONSULTING FEE. In consideration of the foregoing, and subject
to the provisions of Sections 3 and 9 hereof, the Company shall pay the
Consultant a consulting fee (the "Consulting Fee") composed of (a) a cash
payment of $500,000 per year, payable in equal monthly installments during the
Consulting Period, and (b) a ten-year option to purchase 570,000 shares, subject
to antidilutive adjustment, of Class A Common Stock of the Company at an
exercise price equal to the fair market value thereof, which is agreed to be the
price at which the Company's Class A Common Stock is offered in the Offering
(the "Option"). The Option shall (x) vest and become exercisable in one-third
increments on each of the three anniversary dates of the Commencement Date, (y)
fully vest and become fully exercisable upon the occurrence of a Change of
Control (as hereinafter defined), and (z) shall be transferable to the extent
permitted by applicable securities laws. The Company also shall reimburse the
Consultant for any reasonable out-of-pocket expenses incurred by the Consultant
in performing services pursuant to this Agreement.

         5.       NON-EXCLUSIVE ENGAGEMENT. The Company acknowledges that this
engagement is not exclusive on the part of Consultant and, during the Consulting
Period, the Consultant may

                                      -2-
<PAGE>

engage in other business endeavors, one or more of which may be competitive with
the businesses of the Company.

         6.       CONFIDENTIAL INFORMATION. During the Consulting Period and at
all times thereafter, and except as otherwise required by law or legal process,
the Consultant shall not disclose to anyone who, to the knowledge of the
Consultant, is not authorized to receive such information, any confidential
information of the Company and any confidential information relating to the
Company's former or present customers or potential customers of which the
Consultant becomes aware during the Consulting Period, other than any such
information which was or becomes generally available on a nonconfidential basis
(other than as a result of the Consultant's violation of this Section 6) (the
"Confidential Information"). The Company shall be entitled to all equitable
remedies to enforce any breach or threatened breach of this Section 6.

         7.       INDEMNIFICATION. The Company hereby agrees to indemnify the
Consultant and the employees of Consultant performing services pursuant to this
Agreement to the fullest extent permitted by applicable law from and against any
and all liability, costs and expenses (including attorneys' fees) that may be
incurred by the Consultant as a result of the Consultant's rendering consulting
services to the Company pursuant to this Agreement and as a result of
Consultant's enforcing its rights under this Section 7 against the Company,
other than any such liability which arises as a direct result of the willful
misconduct or gross negligence of the Consultant or its employees performing
services hereunder.

         8.       STATUS AS INDEPENDENT CONTRACTOR. Consultant and the Company
hereby acknowledge and agree that Consultant's service to the Company hereunder
shall be in the capacity of an independent contractor to the Company and not as
an employee, and that the Consultant is solely responsible for the payment of
all federal, state, local and foreign personal income taxes that are required by
applicable laws or regulations to be paid with respect to the consulting fee.

         9.       SUCCESSORS; CHANGE OF CONTROL. (a) This Agreement shall not be
assignable by the Company or the Consultant without the prior written consent of
the other; provided, that the Option may be assigned by Consultant to the extent
provided therein. This Agreement shall be binding upon the Company and its
successors and assigns, and shall inure to the benefit of the Company and its
permitted successors and assigns.

                  (b)      Upon the occurrence of a Change of Control (as
hereinafter defined), this Agreement (i) shall immediately be cancelled without
any further action on the part of the Company or Consultant and subject to
compliance with this section the parties thereafter shall have no further rights
or obligations pursuant to this Agreement, (ii) the Company shall promptly pay
to the Consultant the accrued but unpaid cash portion of the Consulting Fee and
expenses incurred by the Consultant through the date of the Change of Control
and (iii) the Option shall be fully vested and exercisable by the holder
thereof. For purposes of this Agreement, a "Change of Control" shall mean the
happening of any of the following events:

                           (1)      The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3

                                      -3-
<PAGE>

promulgated under the Exchange Act) of 50% or more of either (i) the then
outstanding shares of common stock of the Company (the "Outstanding Company
Common Stock") or (ii) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided, however, that
for purposes of this subsection (b), the following acquisitions shall not
constitute a Change of Control: (i) any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company or (iv) any acquisition by any corporation
pursuant to a transaction which complies with clauses (i), (ii) and (iii) of
subsection (3) of this Section 9(b); or

                           (2)      Individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason other than the
act of Consultant or an affiliate of Consultant to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                           (3)      Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a "Business Combination"), in each case, unless following
such Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly, more than
50% of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (ii) no
Person (excluding any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 25% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (iii) at least a majority of the members
of the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing for such
Business Combination; or

                           (4)      Approval by the stockholders of the Company
of a complete liquidation or dissolution of the Company; or

                                      -4-
<PAGE>

                           (5)      The date on which the Company shall
consummate an underwritten public offering of Common Stock registered under the
Securities Act, and as a result of which a class of the Company's capital stock
is authorized for trading in an automated interdealer quotation system of a
registered national securities association or is listed for trading on a
national securities exchange.

         10.      MISCELLANEOUS. (a) This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of Delaware,
without reference to principles of conflict of laws. The captions of this
Agreement are not part of the provisions hereof and shall have no force or
effect. This Agreement may not be amended or modified except by a written
agreement executed by the parties hereto or their respective successors and
legal representatives.

                  (b)      If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.

                  (c)      The Consultant and the Company acknowledge and agree
that this Agreement supersedes any other agreement between them concerning the
subject matter hereof.

         IN WITNESS WHEREOF, pursuant to the authorization of their respective
Boards of Directors, each of the parties hereto has caused this Agreement to be
executed in its name and on its behalf, all as of the day and year first above
written.

RANIERI & CO., INC.

By: ____________________________________
Name: __________________________________
Title: _________________________________

                                      FRANKLIN BANK CORP.

                                      By: _________________________________

                                      -5-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}]]