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   ibc2-corres_121709.htm - Generated by SEC Publisher for SEC Filing

December 17, 2009

Filed Via Edgar

Ms. Kathryn McHale

Staff Attorney

Division of Corporation Finance

Securities and Exchange Commission

100 F Street NE

Washington, DC 20549

             Re:

   Independent Bank Corporation

   Preliminary Revised Proxy Statement on Schedule 14A

   Filed December 10, 2009

   File No. 000-07818

Dear Ms. McHale:

       This letter is provided by Independent Bank Corporation, a Michigan corporation (the "Company"), in response to the Staff's comment letter dated December 11, 2009 with respect to the Company's Preliminary Proxy Statement filed in connection with a planned special meeting of the Company's shareholders (the "Proxy Statement"). We have set forth below each question contained in the Staff's comment letter, followed by our response.

General

1.

     Please be sure to include page numbers in future filings.

        This error has been corrected. All future filings will include page numbers.

No. of Shares to be Issued in Transactions Under Consideration High Range Alternative

     2.
     We note that footnote 4 to this table "assumes that Treasury will agree to exchange all CPP Preferred Shares (with an aggregate liquidation preference of $72 million) for common stock with a value equal to the $72 liquidation value." Please correct this error to reflect the "$72 million" liquidation value.

              We have corrected this error.

December 17, 2009

Page 2

Appendix A: Pro Forma Financial Information

     3.

We note that your pro forma financial information reflects a "High Range Alternative -With Discount (75% TP Exchange and 100% CPP Exchange at 25% discount to par"; however, your disclosure states that you have only engaged in preliminary discussions with the Treasury and have not received any indication of Treasury's willingness to exchange the preferred shares at a discount. It does not appear the assumption underlying these pro formas is factually supportable. Please remove the discount or explain to the staff why this assumption complies with Article 11 of Regulation S X.

         We have revised the pro forma financial information included as Appendix A to remove any pro forma financial information reflecting the occurrence of the CPP Exchange Offer at a discount.

* * * * *

           In addition, we have made additional revisions to the Proxy Statement in order to maintain flexibility in the future to increase exchange ratios for the Institutional TP Exchange Offer and the Retail TP Exchange Offer. The Company currently has no intention to increase the applicable exchange ratios, but wants to maintain flexibility going forward.

            Enclosed with this letter are the specific blacklined pages of the revised preliminary Proxy Statement showing the changes made, as described in this letter and as otherwise necessary to update information in the Proxy Statement.

            The Company acknowledges that it is responsible for the adequacy and accuracy of the disclosure in all Company filings. The Company understands that neither the Staff’s comments nor changes the Company makes to its disclosure in response to Staff comments foreclose the Commission from taking any action with respect to its filings and that the Company may not assert Staff comments as a defense in any proceedings initiated by the Commission or any person under the federal securities laws of the United States.

             Please feel free to call me at (616) 522-1765, or the Company's legal counsel, Kimberly Baber, at (616) 336-6851, with any questions or if we can be of any assistance in completing your review of these responses.

Very truly yours,

Independent Bank Corporation

/s/ Robert N. Shuster

Robert N. Shuster

Executive Vice President and

Chief Financial Officer

Enclosures

     No. of Shares to be Issued in Transactions Under Consideration

     Low Range Alternative (25% Participation in Exchange Offers,

     No CPP Exchange and $50 Million Cash Offering)

     (Based on Assumptions in Footnotes to Table)

     Institutional TP

     Retail TP Exchange

     CPP Preferred
     Cash
     % of Total

     Relevant Price (1)
     Exchange Offer (2)
     Offer
     (3
     )
     Exchange Offer (4)
     Offering (5)
     Outstanding (6)

     $
     1.00
     7,9009,875,000

     10,12012,650,000

     0
     51,429,747
     74.29%75.48%

     $
     0.95
     8,315,79010,394,737

     10,652,63213,315,790

     0
     54,136,576
     75.26%76.41%

     $
     0.90
     8,777,77810,972,223

     11,244,44514,055,556

     0
     57,144,164
     76.25%77.37%

     $
     0.85
     9,294,11811,617,648

     11,905,88314,882,353

     0
     60,505,585
     77.27%78.36%

     $
     0.80
     9,875,00012,343,750

     12,650,00015,812,500

     0
     64,287,184
     78.32%79.37%

     $
     0.75
     10,533,33413,166,667

     13,493,33416,866,667

     0
     68,572,996
     79.40%80.41%

     $
     0.70
     11,285,71514,107,143

     14,457,14318,071,429

     0
     73,471,068
     80.50%81.47%

     $
     0.65
     12,153,84715,192,308

     15,569,23119,461,539

     0
     79,122,688
     81.64%82.56%

     $
     0.60
     13,166,66716,458,334

     16,866,66721,083,334

     0
     85,716,245
     82.81%83.69%

     (1)
     Relevant Price is the price per share of our common stock used to determine the number of shares that would be issued in exchange for the tendered trust preferred securities and the CPP Preferred Shares. The actual price used in the exchange offers for the trust preferred securities is proposed to be the mathematical average of the volume weighted average price of common shares for the five consecutive trading days ending on and including the second trading day immediately preceding the expiration date of the applicable exchange offer.

     The actual price used in any exchange of common stock for the CPP Preferred Shares will be as negotiated with Treasury, but is likely to be based on the market value our common stock. The actual price used in any Cash Offering in which we offer to sell shares of our common stock to the public is likely to be at some discount to the market value of our common stock. For purposes of the table above, we have assumed the Cash Offering would be conducted at a price equal to 97.22% of the market value of our common stock. The table contains only an estimated range of potential values for our common shares. The closing price of our common shares on the Nasdaq Global Select Market on December 78, 2009, was $0.7370 per share.

     (2)
     Assumes that 25% of the outstanding Institutional Trust Preferred Securities will be tendered for exchange and that for each $1,000 liquidation amount of Institutional Trust Preferred Securities tendered, a holder would receive common stock with a value equal to $8001,000, which is equal to 80100% of the $1,000 liquidation amount.

     (3)
     Assumes that 25% of the outstanding Retail Trust Preferred Securities will be tendered for exchange and that for each $25 liquidation amount of Retail Trust Preferred Securities tendered, a holder would receive common stock with a value equal to $2025, which is equal to 80100% of the $25 liquidation amount.

     (4)
     Assumes that Treasury will not agree to exchange any CPP Preferred Shares for common stock.

     (5)
     Assumes we raise aggregate gross proceeds of $50 million.

     (6)
     Assumes the number of shares of common stock outstanding excluding shares to be issued in these transactions would be 24,029,125 (the number of shares of IBC common stock outstanding on October 30December 10, 2009).

     No. of Shares to be Issued in Transactions Under Consideration

     High Range Alternative (75% Participation in Exchange Offers,

     100% Participation in CPP Exchange Offer and $150 Million Cash Offering)

     (Based on Assumptions in Footnotes to Table)

     Institutional TP

     Retail TP Exchange

     CPP Preferred

     Cash
     % of Total

     Relevant Price (1)

     Exchange Offer (2)

     Offer (3)

     Exchange Offer (4)

     Offering (5)
     Outstanding (6)

     $
     1.00

     23,70029,625,000

     30,36037,950,000

     72,000,000

     154,289,241
     92.11
     %44%

     $
     0.95

     24,947,36931,184,211

     31,957,89539,947,369

     75,789,474

     162,409,728
     92.47
     %79%

     $
     0.90

     26,333,33432,916,667

     33,733,33442,166,667

     80,000,000

     171,432,490
     92.84%93.15%

     $
     0.85

     27,882,35334,852,942

     35,717,64844,647,059

     84,705,883

     181,516,754
     93.21
     %50%

     $
     0.80

     29,625,00037,031,250

     37,950,00047,437,500

     90,000,000

     192,861,552
     93.58
     %86%

     $
     0.75

     31,60039,500,000

     40,48050,600,000

     96,000,000

     205,718,988
     93.96%94.22%

     $
     0.70

     33,857,14342,321,429

     43,371,42954,214,286

     102,857,143

     220,413,202
     94.34
     %59%

     $
     0.65

     36,461,53945,576,924

     46,707,69358,384,616

     110,769,231

     237,368,063
     94.72
     %95%

     $
     0.60

     39,50049,375,000

     50,60063,250,000

     120,000,000

     257,148,735
     95.11
     %32%

     (1)
     Relevant Price is the price per share of our common stock used to determine the number of shares that would be issued in exchange for the tendered trust preferred securities and the CPP Preferred Shares. The actual price used in the exchange offers for the trust preferred securities is proposed to be the mathematical average of the volume weighted average price of common shares for the five consecutive trading days ending on and including the second trading day immediately preceding the expiration date of the applicable exchange offer.

     The actual price used in any exchange of common stock for the CPP Preferred Shares will be as negotiated with Treasury, but is likely to be based on the market value our common stock. The actual price used in any Cash Offering in which we offer to sell shares of our common stock to the public is likely to be at some discount to the market value of our common stock. For purposes of the table above, we have assumed the Cash Offering would be conducted at a price equal to 97.22% of the market value of our common stock. The table contains only an estimated range of potential values for our common shares. The closing price of our common shares on the Nasdaq Global Select Market on December 78, 2009, was $0.7370 per share.

     (2)
     Assumes that 75% of the outstanding Institutional Trust Preferred Securities will be tendered for exchange and that for each $1,000 liquidation amount of Institutional Trust Preferred Securities tendered, a holder would receive common stock with a value equal to $8001,000, which is equal to 80100% of the $1,000 liquidation amount.

     (3)
     Assumes that 75% of the outstanding Retail Trust Preferred Securities will be tendered for exchange and that for each $25 liquidation amount of Retail Trust Preferred Securities tendered, a holder would receive common stock with a value equal to $2025, which is equal to 80100% of the $25 liquidation amount.

     (4)
     Assumes that Treasury will agree to exchange all CPP Preferred Shares (with an aggregate liquidation preference of $72 million) for common stock with a value equal to the $72 million liquidation value.

     (5)
     Assumes we raise aggregate gross proceeds of $150 million.

     (6)
     Assumes the number of shares of common stock outstanding excluding shares to be issued in these transactions would be 24,029,125 (the number of shares of IBC common stock outstanding on October 30December 10, 2009).

_________________________________

     Based on the assumptions described in the footnotes to the tables above, upon completion of the Institutional TP Exchange Offer, the Retail TP Exchange Offer, the CPP Exchange Offer, and the Cash Offering (if all of such transactions are pursued and completed), our existing shareholders would own between only 4.8968% and 25.7124.52% of our outstanding common stock. However, we have reserved the right to issue an even greater number of shares of our common stock (i.e., in the event one or more of the assumptions in the tables set forth above prove not to be true). We have reserved the right to issue up to 63.279 million shares of common stock in the Institutional TP Exchange Offer and up to 144 million shares of common stock in the CPP Exchange Offer. In addition, we expect the maximum number of shares we may issue in the Retail TP Exchange Offer to be 80.96101.2 million. Using these maximum numbers and the highest number of shares shown in the tables above for the Cash Offering, our current shareholders may end up owning only approximately 4.223.97% of our outstanding common stock.

     In addition, the initiatives under consideration and referenced above or through other means, including the exchange offers for the trust preferred securities and the CPP Preferred Shares, may trigger an ownership change that would negatively affect our ability to utilize net operating loss and capital loss carryforwards and other deferred tax assets in the future. As a result, we may suffer higher-than-anticipated tax expense, and consequently lower net income and cash flow, in those future years. As of December 31, 2008, we had a domestic federal net operating loss carryforwards of approximately $36.2 .8 million, and such amounts may grow significantly prior to the expiration of the capital raising initiatives described in this proxy statement. Companies are subject to a change of ownership test under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"), that, if met, would limit the annual utilization of thetax losses and credits carrying forward from pre-change of ownership carryforwardperiods, as well as the ability to use certain unrealized built-in losses. This change of ownership test

9

will be met if, for example, a sufficient number of the holders of the trust preferred securities exchange such securities for our common shares and Treasury exchanges its CPP Preferred Shares for our common shares.. We believe it is likelypossible that thethis test willcould be met if there is substantial participation in the exchange offers or if other capital raising initiatives under consideration and referenced above or through other means are consummated. Generally, under Section 382, the yearly limitation on our ability to utilize such deductions will be equal to the product of the applicable long-term tax exempt rate (presently %)4.16%) and the sum of the values of our common shares and of our outstanding CPP Preferred Shares, immediately before the ownership change. OurIn addition to limits on the use of net operating loss carryforwards, our ability to utilize deductions related to creditbad debts and other losses during thefor up to a five-year period following such an ownership change would also be limited under Section 382, together with net operating loss carryforwards, to the extent that such deductions reflect a net loss that was "built-in" to our assets immediately prior to the ownership change. Similar rules under Section 383 of the Code will also limit utilization of ourany capital loss and tax credit carryforwards. These The amount of these carryforwards amounted to approximately $36.2 millionwas not material at December 31, 2008, and such amountbut may grow significantly prior to the expiration of the offers.

The Retail TP Exchange Offer

     Both the Institutional TP Exchange Offer and the CPP Exchange Offer are discussed in further detail below under Proposal 3 below. The following is a brief description of the Retail TP Exchange Offer.

     Purpose of the Retail TP Exchange Offer. As described above, we believe th