Fill and Sign the Saco Me Property for Sale and Lease Commercial Exchange Form

- 1 - PROPOSAL II CHANGE IN LOCATION OF MAIN OFFICE Franklin's Main Office is maintained in leased premises located in an office building near the intersection of 12 Mile Road and Northwestern Highway in Southfield, Michigan. Franklin is considering relocating its Main Office to new leased facilities near its current locati on; including one or more sites outside the City of Southfield. All proposed sites under consideration are located within two miles or less of the current Main Office location. The possible sites are in the ci ties of Birmingham, Farmington Hills, Southfield and West Bloomfield, Michigan. In all events, any relocation to a new facility in these areas would not change the market area or communities serve d by Franklin. The Board of Directors has authorized Management of Franklin to pursue new leased facilities in these areas, but no specific site has been selected at this date. The proposed relocation is being considered at the present time in view of the upcoming expiration of Franklin's current headquarters' lease on February 28, 1993 and in order to obtain newer facilities at comparative cost savings. In the event of any relocation of a bank's main office outside of the limits of the city in which it is then located, national banking laws require (i) 2/3rds stockholder approval, (ii) amendment of the Batik's Articles of Association, and (iii) approval by the Office of the Comptroller of the Currency ("OCC") (12 USC ฀ 30, 12 CFR ฀ 5.40). Management believes stockholders' approval at this Meeting of Franklin's possible relocation of -its Main Office to any of the cities listed above (othe r than Southfield), will expedite Franklin's negotiations with prospective office building owners who otherwise may not want to delay consummation of a lease agreement by waiting for stockholder approval or enter into a conditional lease arrangement, thereby tying up their property for a long period of time without any certainty that a lease will be approved. National banking laws require the approval of 2/3rds of the outstanding shares entitled to vote for a change in the location of a main office outside its current city limits. Each stockholder is entit led to one vote for each share of common stock held as of the Record Date. In voting on Proposal II, stockholders will also be voting to amend Articles Second and Seventh of the Articles of Association Articles Second and Seventh, as proposed to be amended, are attached hereto as Addendum A. The proposed amendments to Franklin's Articles will substitute the name of the specific city chosen (if any) in place of Southfield, Michigan (the current location of Franklin's Main Office). In accordance with national banking laws, if a specific proposed site outside Southfield is chosen, Franklin must also obtain the approval of the OCC. Franklin intends to file an application with the OCC as soon as a specific site is identified. In connection therewith, a public notice of the application must also be published in a newspaper of general circulation in the community in which Franklin proposes to relocate. The public is provided an opportunity to comment on the proposed relocation. If approved by the OCC, the change in location must occur within 18 months from the date of approval. The relocation of the Main Office within the limited and nearby areas identified or to another site i n Southfield will not change Franklin's community delineation as designated in its Community - 2 - Reinvestment Act Statement. Management believes a relocation is desirable primarily because of current opportunities in the local marketplace to (i) obtain long-term cost savings on leased premises, (ii) create more efficient use of space and (iii) improve the quality of its space, thereby further enhancing Franklin's image in the community. There is no certainty that Franklin will relocate outside the City of Southfield. If Franklin's Main Office is relocated to another site in Southfield, no stockholder approval will be required; only OCC approval will be necessary. If Franklin remains in its current site neither stockholder nor OCC approval will be required. Approval of Proposal II and, accordingly, the amendments to Articles Second and Seventh requires the affirmative vote of 2/3rds of the outstanding shares of Franklin entitled to vote represented in person or by proxy at the Meeting. THE BOARD OF DIRECTORS BELIEVES THAT PROPOSAL 11 IS IN THE BEST INTERESTS OF FRANKLIN AND ITS STOCKHOLDERS AND UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" APPROVAL OF PROPOSAL 11. ADDENDUM A Proposed Amendments to Articles Second and Seventh of the Articles of Association of Franklin Bank, National Association: SECOND. The main office of the Association shall be in _________________, Oakland County, Michigan. The general business of the Association shall be conducted at its main office and its branches. SEVENTH. The Board of Directors shall have the power to change the location of the main office to any other place within the limits of _________________ Michigan, without the approval of the common shareholders, and shall have the power to establish or change the location of any branch or branches of the Association to any other location permitted under applicable law without the approval of the common shareholders, subject to approval by the OCC. Either Birmingham, Farmington Hills, or West Bloomfield, as determined by the Board of Directors. If the Board of Directors determines that the Main Office will remain in Southfield, Michigan, Articles Second and Seventh will not be amended.