CONSULTING AGREEMENT

        This Consulting Agreement (“Agreement”) is entered into as of this May
8, 2003, by and between BENJ. A SMITH III, a Michigan resident (“Smith”), and
MACATAWA BANK CORPORATION, a Michigan corporation (“Company”). This Agreement
supersedes and totally replaces a Consulting Agreement between the parties dated
June 12, 2002. That prior agreement is terminated and is null and void.

RECITALS

        Smith is the founder of Macatawa Bank (the “Bank”) and the Company. He
currently serves as the Chairman and Chief Executive officer of the Company and
the Chairman of the Bank and is employed by the Bank. He has been in the banking
and investment business for many years and is knowledgeable in all phases of the
business of the Company and the Bank, including financial, management and
operational matters and is a key employee who has played a major role in the
success of the Company and the Bank. It is expected that Smith will continue to
be actively engaged as an employee of the Bank or the Company for some period of
time. However, in the event that Smith should desire to reduce his activity and
involvement and retire from active employment with the Bank and the Company, the
Company wishes to have the benefit of Smith’s expertise and experience on a
consulting basis. The Company has also agreed that in the event of Smith’s death
his family should have the benefit of the compensation provided in this
Agreement even though Smith would not be available to serve the Company.

        References to a “Macatawa Entity” in this Agreement include the Company,
the Bank and any other entity controlled by the Company or the Bank.

        Accordingly, the parties have entered into this Agreement.

         1.         Commitment. At such time as Smith retires from employment
with the Bank and the Company, the Company shall engage Smith as a consultant to
the Company and Smith agrees to serve as a consultant to the Company on the
terms set forth in this Agreement.

         2.         Term. The term of the consulting arrangement shall begin on
the date (“Commencement Date”) that Smith retires from employment with the Bank
and the Company. This arrangement will expire six (6) years after the
Commencement Date (“Expiration Date”) unless terminated earlier as provided in
this Agreement.

         3.         Services. During the term that the consulting services are
to be performed, Smith shall provide consulting services to Company as requested
by the Board of Directors or senior management of the Company from time to time.
Such services may include advice and consultation with respect to any and all
phases or aspects of the Company’s business or operations. The Company has no
obligation to use such consulting services.

         4.         Availability. Smith shall make himself available for
consultation at reasonable times during ordinary business hours. It being
understood and agreed, however, that such consultation shall not require Smith’s
full-time or his physical presence at the Company office but shall be sufficient
if provided by telephone, by letter or e-mail advice or by meetings with Company
officials and others at such place or places as may be mutually convenient and
acceptable to the Company and Smith.

         5.         Compensation. As compensation for Smith holding himself
available for and performing consulting services during the consulting term of
this Agreement, the Company shall pay to Smith, Twelve Thousand Five Hundred
Dollars ($12,500) per month beginning as of the Commencement Date. In the event
of Smith’s death before the Expiration Date, these payments shall be continue to
be made until the Expiration Date to Smith’s wife, or if she is deceased to
Smith’s living children in equal shares. The Company shall also promptly
reimburse Smith for reasonable expenses that he incurs in connection with
performing his consulting services upon submission of proper verification to the
Company as to the nature and amount of those expenses.

         6.         Termination. The consulting obligations of Smith and the
Company’s payment obligations shall terminate:

                     (a)         Immediately upon the Expiration Date;

                     (b)         Immediately upon mutual written agreement of
Company and Smith; or

                     (c)         At the option of Company for “cause” as defined
below. For purposes of this Agreement, “cause” shall be any of the following
reasons:

                                  (i)         Smith’s personal dishonesty
materially and adversely affecting a Macatawa Entity;

                                  (ii)         Willful misconduct materially and
adversely affecting a Macatawa Entity;

                                  (iii)         Willful breach of a fiduciary
duty to a Macatawa Entity involving personal profit; or

                                  (iv)         The order of any supervising
agency with jurisdiction over the affairs of a Macatawa Entity or a court order
obtained at the request of any such agency.

        For purposes of this Agreement, no act or failure to act on Smith’s
behalf shall be considered “willful” unless done, or admitted to be done, by him
not in good faith and unless he knew or should have known that his action or
admission was not in, or was opposed to, the best interests of a Macatawa
Entity; provided, that any act or omission to act on Smith’s behalf in reliance
upon an opinion of counsel to the Company or counsel to Smith shall not be
deemed to be willful. Smith shall not be deemed to have been terminated for
cause unless or until there shall have been delivered to him a copy of the
certification of a majority of the non-officer members of the Company’s Board of
Directors finding that, in the good faith opinion of such majority, Smith was
guilty of conduct deemed to be cause and specifying the details thereof, after
reasonable notice to Smith and an opportunity for him, together with his
counsel, to be heard before such majority.

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        Notwithstanding any other provision of this Agreement, if this Agreement
is terminated pursuant to this Section 6, the Company shall not be liable to
Smith for any cost or obligation, except as may have been earned by Smith prior
to the date of the termination.

         7.         Status of Smith. From and after the Commencement Date, Smith
shall be an independent contractor and nothing in this Agreement shall cause
Smith to be treated as an employee, agent, or partner of Company.

         8.         Severability. The parties believe that every provision of
this Agreement is effective and valid under applicable law, and whenever
possible, each provision of this Agreement shall be interpreted in such a manner
as to be effective and valid. If any provision of this Agreement is held, in
whole or in part, to be invalid, the remainder of such provision and this
Agreement shall remain in full force and effect, with the offensive term or
condition being stricken to the extent necessary to comply with any conflicting
law.

         9.         Waiver. No provision of this Agreement shall be waived by
any party hereto, unless such waiver is in a writing, signed by a duly
authorized representative of the party against whom such waiver is sought to be
enforced. A waiver by either party of any breach or failure to comply with any
provision of this Agreement by the other party shall not be construed as or
constitute a continuing waiver of such provision or a waiver of any other breach
of or failure to comply with any other provision of this Agreement.

         10.         Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the parties and their respective heirs, personal
representatives, successors and assigns.

         11.         Amendment. This Agreement may not be amended or modified
except by the further written agreement of Company and Smith.

         12.         Notice. All notices hereunder shall be sent by telefax or
by U.S. Mail, by mailing such notice in the Untied States mail, first-class
postage prepaid, registered or certified mail, return receipt requested to the
other party at the last known address of such party or at such other address as
a party shall from time to time designate in writing to the other party.

         13.         Applicable Law; Jurisdiction; Venue. The terms and
conditions of this Agreement shall be governed, construed, interpreted and
enforced in accordance with the domestic laws of the State of Michigan, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Michigan or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Michigan.
Any and all actions concerning any dispute arising hereunder shall be filed and
maintained in the Circuit Court of Ottawa County, Michigan or the federal
district court for the Western District of Michigan. The parties specifically
consent and submit to the jurisdiction and venue of such state or federal court.

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         14.         Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter of this
Agreement. The provisions of this Agreement shall supersede all contemporaneous
oral agreements, communications and understandings and all prior oral and
written communications, agreements and understandings between the parties with
respect to the subject matter of this Agreement. Each party acknowledges that no
representation, inducement or condition not set forth herein has been made or
relied upon by either party.

        IN WITNESS WHEREOF, Company and Smith have executed this Agreement as of
the Effective Date, intending to be legally bound.

  SMITH

  /s/ Benj. A. Smith III

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Benj. A. Smith III
 
 
 

  MACATAWA BANK CORPORATION

  By: /s/ Philip Koning

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        Philip Koning
        Its: Secretary-Treasurer

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