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<SEC-DOCUMENT>0000950124-07-000482.txt : 20070129
<SEC-HEADER>0000950124-07-000482.hdr.sgml : 20070129
<ACCEPTANCE-DATETIME>20070129163013
ACCESSION NUMBER:		0000950124-07-000482
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20070125
ITEM INFORMATION:		Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20070129
DATE AS OF CHANGE:		20070129

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MERCANTILE BANK CORP
		CENTRAL INDEX KEY:			0001042729
		STANDARD INDUSTRIAL CLASSIFICATION:	STATE COMMERCIAL BANKS [6022]
		IRS NUMBER:				383360865
		STATE OF INCORPORATION:			MI
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-26719
		FILM NUMBER:		07561384

	BUSINESS ADDRESS:	
		STREET 1:		5650 BYRON CENTER AVENUE S. W.
		CITY:			WYOMING
		STATE:			MI
		ZIP:			49509
		BUSINESS PHONE:		616 406-3777

	MAIL ADDRESS:	
		STREET 1:		5650 BYRON CENTER AVENUE S. W.
		CITY:			WYOMING
		STATE:			MI
		ZIP:			49509
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>k11763e8vk.htm
<DESCRIPTION>CURRENT REPORT DATED JANUARY 25, 2007
<TEXT>
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<TITLE>e8vk</TITLE>
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
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<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549<BR>
<DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV></B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM 8-K</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>CURRENT REPORT<BR>
PURSUANT TO SECTION 13 OR 15(d) OF THE<BR>
SECURITIES EXCHANGE ACT OF 1934</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Date of Report (date of earliest event reported): January&nbsp;25, 2007</B></DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV></DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>MERCANTILE BANK CORPORATION</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Michigan</B><BR>
(State or other jurisdiction <BR>
of incorporation)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>000-26719</B><BR>
(Commission File<BR>
Number)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>38-3360865</B><BR>
(IRS Employer<BR>
Identification Number)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>310 Leonard Street NW, Grand Rapids, Michigan</B><BR>
(Address of principal executive offices)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>49504</B><BR>
(Zip Code)
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">Registrant&#146;s telephone number, including area code
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>616-406-3000</B>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (<I>see </I>General
Instruction A.2. below):
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT>&nbsp;&nbsp;&nbsp;Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT>&nbsp;&nbsp;&nbsp;Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT>&nbsp;&nbsp;&nbsp;Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT>&nbsp;&nbsp;&nbsp;Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;5.02</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.</B></TD>
</TR>
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 18pt"><U>Adoption of Executive Officer Bonus Plan for 2007</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On January&nbsp;25, 2007, the Board of Directors of Mercantile Bank of Michigan (the &#147;Bank&#148;), a
wholly-owned subsidiary of Mercantile Bank Corporation (&#147;Mercantile&#148;), adopted the Mercantile Bank
of Michigan Executive Officer Bonus Plan for 2007 (the &#147;Plan&#148;). The persons eligible to
participate in the Plan are the four executive officers of the Bank, who are also the four
executive officers of Mercantile. These executive officers are listed in the table below.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="20%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Name of Executive Officer</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Title</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Gerald R. Johnson, Jr.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chairman and Chief Executive Officer of
Mercantile and Chairman of the Bank</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Michael H. Price
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President and Chief Operating Officer of
Mercantile and President and Chief
Executive Officer of the Bank</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Robert B. Kaminski, Jr.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Executive Vice President and Secretary of
Mercantile and Executive Vice President,
Chief Operating Officer and Secretary of
the Bank</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Charles E. Christmas
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Senior Vice President, Chief Financial
Officer and Treasurer of Mercantile and
Senior Vice President and Chief Financial
Officer of the Bank</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The maximum amount that may be paid to each executive officer under the Plan is a percent
of the annual salary that is paid to him for 2007. For Mr.&nbsp;Johnson and Mr.&nbsp;Price, the maximum
amount is 50&nbsp;percent of their annual salary; for Mr.&nbsp;Kaminski and Mr.&nbsp;Christmas, the maximum amount
is 45&nbsp;percent.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan includes three tiers of potential bonus awards, each with its own performance goal.
The executive officers can receive up to 25&nbsp;percent of the maximum amount that can be awarded to
them under the Plan from each of the tier 1 and tier 2 bonus pools, and up to the remaining 50
percent from the tier 3 bonus pool. The precise amount that is awarded, if any, from each tier of
the bonus pool depends on the consolidated net operating income of Mercantile and its consolidated
subsidiaries for 2007, subject to specified adjustments. The amount of consolidated net operating
income required for a full payout of the bonus provided for at each tier increases from tier 1, to
tier 2, to tier 3. The Bank believes that a full payout of the tier 1 bonus pool is likely, a full
payout of the tier 2 bonus pool is less likely and would be difficult to achieve, and a full payout
of the tier 3 bonus would be very difficult to achieve.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan is effective as of January&nbsp;1, 2007, and bonus awards earned under the Plan will be
paid on or before March&nbsp;15, 2008.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mercantile is filing a copy of the Plan as an exhibit to this report.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;9.01 Financial Statements and Exhibits.</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Exhibits.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Exhibit Number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center"><DIV style="margin-left:15px; text-indent:-15px">10.1</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Executive Officer Bonus Plan for 2007</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">MERCANTILE BANK CORPORATION<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Charles E. Christmas
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Charles E. Christmas&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Senior Vice President, Chief
Financial Officer and Treasurer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Date: January&nbsp;26, 2007
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXHIBIT INDEX</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Exhibit Number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align=center><DIV style="margin-left:15px; text-indent:-15px">10.1</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Executive Officer Bonus Plan for 2007</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>


</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>k11763exv10w1.htm
<DESCRIPTION>EXECUTIVE OFFICER BONUS PLAN FOR 2007
<TEXT>
<HTML>
<HEAD>
<TITLE>exv10w1</TITLE>
</HEAD>
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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit&nbsp;10.1
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MERCANTILE BANK OF MICHIGAN</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>EXECUTIVE OFFICER BONUS PLAN FOR 2007</B>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>1. </B><U><B>Purpose of the Plan</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Executive Officer Bonus Plan for 2007 (the &#147;Plan&#148;) provides for cash bonus awards to
executive officers of Mercantile Bank of Michigan (the &#147;Bank&#148;). The bonus awards are based on the
consolidated operating results of the Bank and its consolidated affiliates, including Mercantile
Bank Corporation (the &#147;Company&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purpose of the Plan is to:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>promote the growth, profitability and expense control necessary to accomplish corporate
strategic long term plans</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>encourage superior results by providing a meaningful incentive</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>support teamwork among employees</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>2. </B><U><B>Eligibility</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The executive officers of the Bank who hold the offices listed on Schedule&nbsp;I (collectively,
the &#147;Executive Officers,&#148; and each, an &#147;Executive Officer&#148;) are included in the Plan. An Executive
Officer must be an active employee on the day that the bonus awards are distributed to be eligible
to receive a bonus award. An Executive Officer who is out on medical leave at the time the awards
are distributed will be eligible to receive a bonus award. An Executive Officer who is suspended
with or without pay at the time the awards are distributed will not be eligible to receive a bonus
award. Any unpaid bonus award is cancelled upon termination of employment with the Bank and its
subsidiaries that employed the Executive Officer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>3. </B><U><B>Performance Goals and Bonus Awards</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan includes three tiers of potential bonus awards, each with its own performance goal.
Bonus awards will be paid or not paid for each tier depending on whether the performance goal for
the tier is met for 2007. The bonus awards for each tier will be based, for each eligible
Executive Officer, on a percent of the annual salary actually paid to the Executive Officer for
2007 (including annual salary that may be attributable to the Bank or any of its affiliated
companies). The annual salary used for this purpose will exclude incentive compensation and all
non-cash compensation.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Schedule&nbsp;I lists the maximum potential bonus for each eligible Executive Officer, by level, as
a percent of the eligible Executive Officer&#146;s annual salary. The percentages listed in Schedule&nbsp;I,
for each level, are referred to as the &#147;Maximum Bonus Percentage&#148; and apply to each eligible
Executive Officer based on his or her level. For purposes of the Plan, the terms &#147;Maximum Bonus
Pool&#148; and &#147;Officer Allocation Fraction&#148; are calculated as follows. &#147;Maximum Bonus Pool&#148; equals the
sum of the products obtained by multiplying (a)&nbsp;the Maximum Bonus Percentage for each eligible
Executive Officer (expressed for each as a decimal fraction), times (b)&nbsp;the annual salary paid to
him or her for 2007. The &#147;Officer Allocation Fraction&#148; for each eligible Executive Officer is the
fraction (a)&nbsp;the numerator of which is the product of the Executive Officer&#146;s Maximum Bonus
Percentage (expressed as a decimal fraction) times the annual salary paid to him or her for 2007,
and (b)&nbsp;the denominator of which is the Maximum Bonus Pool.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The bonus awards for each tier will be determined based on the net operating income of the
Company and its subsidiaries, determined on a consolidated basis, after taxes and including pre-tax
accruals for bonus awards under this and all other incentive compensation plans of the Company or
any of its subsidiaries (&#147;Net Operating Income&#148;). For purposes of the Plan, when calculating Net
Operating Income for 2007 (though not for 2006), all income and expenses directly attributable to
activities or investments of the Company or any of its subsidiaries in or for any banking markets
in which neither the Company nor any of its subsidiaries had any significant activities or
investments in 2006 will be excluded.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of determining the Tier 1, Tier 2 and Tier 3 bonus pools set forth below, the
Bank will, to the extent practical, cause the bonus pool for each of Tier 1, Tier 2 and Tier 3,
respectively, to be the same fraction of the Maximum Bonus Pool as the corresponding bonus pool for
each of tier 1, tier 2 and tier 3 under the Bank&#146;s Non-Lender Bonus Plan for 2007 (the &#147;Non-Lender
Bonus Plan&#148;) is a fraction of the maximum bonus pool under the Non-Lender Bonus Plan. It is the
intent that the Plan and the Non-Lender Bonus Plan for corresponding tiers pay the same proportion
of their respective maximum bonus pools for 2007. For example, if the Tier 1 Bonus Pool of the
Plan equals 0.10 times the Maximum Bonus Pool, it would be expected that the tier 1 bonus pool of
the Non-Lender Bonus Plan would equal 0.10 times the maximum bonus pool described in the Non-Lender
Bonus Plan. The proportionality set forth above shall be taken into account in calculating the
amounts that may be paid to eligible Executive Officers for each bonus pool tier without causing
Net Operating Income to be less than a specified amount.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><I>Tier 1 Bonus Pool </I></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Tier 1 bonus pool consists of the lesser of (a)&nbsp;0.25 times the Maximum Bonus Pool, and (b)
the amount, if any, that may be paid to the eligible Executive Officers for 2007 without the Net
Operating Income for 2007 being less than the Net Operating Income for 2007 set forth in the budget
approved by the Board of Directors of the Company for 2007. The Net Operating Income set forth in
the budget as of March&nbsp;1, 2007 shall be used for purposes of determining the Tier 1 bonus pool.
From the Tier
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">1 bonus pool, bonus awards will be paid to each eligible Executive Officer in an amount equal to
the Tier 1 bonus pool times his or her Officer Allocation Fraction.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><I>Tier 2 Bonus Pool</I></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Tier 2 bonus pool consists of the least of (a)&nbsp;0.25 times the Maximum Bonus Pool, (b)&nbsp;one
percent of Net Operating Income for 2006, and (c)&nbsp;the amount, if any, that could be paid to
eligible Executive Officers without Net Operating Income for 2007 being less than the Tier 2 Base
Percent of Net Operating Income for 2006. The Tier 2 Base Percent shall be established by the
Board of Directors of the Bank on or before March&nbsp;1, 2007. From this bonus pool, bonus awards will
be paid to each eligible Executive Officer in an amount equal to the Tier 2 bonus pool times his or
her Officer Allocation Fraction.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><I>Tier 3 Bonus Pool</I></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Tier 3 bonus pool consists of the lesser of (a)&nbsp;0.50 times the Maximum Bonus Pool, and (b)
the amount, if any, that could be paid to eligible Executive Officers without Net Operating Income
for 2007 being less than the Tier 3 Base Percent of Net Operating Income for 2006. From this bonus
pool, bonus awards will be paid to each eligible Executive Officer in an amount equal to the Tier 3
bonus pool times his or her Officer Allocation Fraction.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><I>Bonus Award Exceptions</I></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each bonus award provided for above in this Section&nbsp;3 will be subject to reduction or
cancellation in full by an Administrator (as defined in Section&nbsp;5 below), in its discretion, if the
bonus award would be payable to an employee of the Bank or a subsidiary who at any time during 2007
(a)&nbsp;received from the Bank or subsidiary a performance evaluation in writing that indicates a
composite rating of &#147;needs improvement&#148; or &#147;unsatisfactory&#148; (each presently being one of the two
least favorable evaluation categories used), or a substantially equivalent rating, pursuant to an
annual or other significant performance evaluation, or (b)&nbsp;was on disciplinary probation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>4. </B><U><B>Timing of Bonus Payouts</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonus awards that are earned under the Plan for 2007 will be paid to eligible Executive
Officers on or before March&nbsp;15, 2008.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>5. </B><U><B>Plan Administration</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors of the Bank and its Compensation Committee, or if the Board of
Directors so designates, another committee of the Board of Directors (each an &#147;Administrator&#148;)
will have the authority to administer and interpret the Plan, and approve or determine the amounts
to be distributed under the Plan as bonus awards, including any determination made pursuant to the
last paragraph of Section&nbsp;3 above.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Any interpretation or construction of the Plan or approval or determination of bonus awards by an
Administrator, will be final and binding on the Bank and its subsidiaries, all employees and past
employees, their heirs, successors and assigns. No member of the Board of Directors of the Bank or
any of its affiliates, or any committee of the Board of Directors of the Bank or any affiliate,
will be liable for any action or determination made in good faith regarding the Plan or any bonus
award.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>6. </B><U><B>No Right to Employment</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan does not give any employee any right to continued employment, or limit in any way the
right of the Bank or any affiliated company to terminate his or her employment at any time.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>7. </B><U><B>Withholding of Taxes</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Bank will have the right to deduct from any payment to be made pursuant to the Plan any
Federal, state or local taxes required by law to be withheld.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>8. </B><U><B>Amendment of the Plan</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan may be amended from time to time by the Board of Directors of the Bank, without the
consent of any Executive Officer, other employee or past employee, (a)&nbsp;to the extent required to
comply with applicable law; (b)&nbsp;to make reasonable adjustments for any acquisition or sale of a
business or branch, merger, reorganization, or restructuring, change in accounting principles or
their application, or special charges or extraordinary items, that materially affect the Company or
any of its consolidated subsidiaries; or (c)&nbsp;to make any changes that do not materially and
adversely affect the bonus award payable to any eligible Executive Officer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>9. </B><U><B>Governing Law</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The validity, construction and interpretation of the Plan will be determined in accordance
with the laws of the State of Michigan.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>10. </B><U><B>Effective Date</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan is effective as of January&nbsp;1, 2007.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SCHEDULE I</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>MAXIMUM BONUS PERCENTAGES FOR EXECUTIVE OFFICERS FOR 2007<BR>
UNDER MERCANTILE BANK OF MICHIGAN<BR>
EXECUTIVE OFFICER BONUS PLAN FOR 2007</B>

</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>MAXIMUM BONUS</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">

<TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>EXECUTIVE OFFICER LEVEL</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>PERCENTAGE</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Chief Operating Officer and Chief Financial Officer</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">45</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Chairman of the Board and President</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">50</TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



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