EXHIBIT 10.19

SETTLEMENT AGREEMENT

          This Settlement Agreement (the “Settlement Agreement”) is entered into
as of October 12, 2010 by and between Berkshire Hills Bancorp, Inc., a Delaware
corporation (“BHB”), the Berkshire Bank, a wholly-owned subsidiary of BHB, Rome
Bancorp, Inc. (“Rome”), a Delaware corporation, The Rome Savings Bank (the
“Bank”), a wholly-owned subsidiary of Rome, and Charles M. Sprock (the
“Executive”).

          WHEREAS, the Executive and Rome are parties to an Amended and Restated
Employment Agreement as of November 28, 2007 (“Rome Agreement”), and the
Executive and the Bank are parties to an Amended and Restated Employment
Agreement as of November 28, 2007 (“Bank Agreement, and together with the Rome
Agreement, the “Agreements”), and the Executive is the sole participant in the
Benefit Restoration Plan of Rome Bancorp, Inc. (the “BRP”); and

          WHEREAS, BHB and Rome have entered into an Agreement and Plan of
Merger, dated as of October 12, 2010 (the “Merger Agreement”), pursuant to which
Rome will be merged into BHB (the “Merger”); and

          WHEREAS, it is contemplated that Executive’s employment shall be
terminated as of the Closing Date and such termination shall constitute a
“separation from service” within the meaning of Section 409A of the Internal
Revenue Code of 1986 (the “Code”); and

          WHEREAS, Section 7.6.7 of the Merger Agreement provides that Rome,
subject to BHB’s approval, shall enter into this Settlement Agreement which
shall terminate the Agreements as of the closing date of the Merger (the
“Closing Date”), and in lieu of any payment or benefits under the Agreements and
the BRP, the Executive shall be entitled to the settlement benefits set forth
herein; and

          WHEREAS, for purposes of Section 409A of the Code, the payments under
Section 3(a) of this Settlement Agreement shall be deemed to be payments in
substitution of the payments under the Agreement, within the meaning of Treasury
Regulation 1.409A-3(f).

          NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Settlement Agreement, BHB, the Berkshire Bank, Rome,
the Bank and the Executive hereby agree as follows:

          Section 1. Termination of the Agreements.

          (a) Termination. The Executive, BHB, the Berkshire Bank, Rome and the
Bank hereby agree that the Agreements shall be terminated without any further
action of any parties hereto, and agree that the BRP shall be terminated,
effective as of the Closing Date. The Executive, in lieu of any payment or
benefits under the Agreement or the BRP, shall be entitled to the settlement
benefits set forth in Section 3 hereof.

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          (b) The Executive, BHB, the Berkshire Bank, Rome and the Bank hereby
agree that Section 12(b) of each of the Agreements shall not apply from the date
of this Settlement Agreement through the earlier of the Closing Date or the date
of termination, if any, of the Merger Agreement (such period, the “Interim
Period”), and that the Agreements shall otherwise remain in effect during the
Interim Period, including Section 10 of each of the Agreements.

          Section 3. Settlement Benefits.

          (a) Cash Severance Payment. The parties hereto acknowledge that the
Merger qualifies as a “Change of Control” as defined under the Agreements and
further acknowledge that Executive is a “specified employee” within the meaning
of Code Section 409A who will have a “separation from service” within the
meaning of Code Section 409A on the Closing Date (“Separation Date”).
Immediately before the Effective Time under the Merger Agreement, Rome shall pay
to the Executive, a cash lump sum equal to $1,383,627 (the “Cash Severance
Payment”), which payment shall be subject to income withholding taxes,
representing:

 

 

 

 

 

 

 

                   Payment Source

 

Payment Amount

 

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1.

Agreements:

 

$

1,025,067

 

2.

BRP:

 

$

358,560

 

 

 

 

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Total Payments

 

$

1,383,627

 

Accordingly, BHB shall pay the Cash Severance Payment to the Executive on the
first day of the seventh month following the Separation Date.

          (b) Rabbi Trust. Since the Cash Severance Payment is to be paid on the
first day of the seventh month following the Separation Date, the Cash Severance
Payment shall be deposited into an irrevocable grantor trust which meets the
requirements of Internal Revenue Service Revenue Procedure 92-65 (as amended or
superseded from time to time), the trustee of which shall be a financial
institution selected by Rome with the approval of the Executive (which approval
shall not be unreasonably withheld or delayed), and payment to the Executive
under this Settlement Agreement shall be adjusted for investment experience of
the investments made with the assets of such trust, as determined by the trustee
without election by the Executive, which investments shall consist of short-term
investment-grade fixed-income securities or units of interest in mutual funds or
other pooled investment vehicles designed to invest primarily in such
securities.

          Section 4. Waiver and Release.

          (a) The Executive hereby agrees that payment of the Cash Severance
Payment and Additional Compensation, if any, to the Executive will be in full
satisfaction of all obligations of BHB, Berkshire Bank, Rome, and the Bank to
the Executive under the Agreement and this Settlement Agreement.

          (b) The Executive, on behalf of himself, his heirs and assigns,
irrevocably and unconditionally releases BHB, Berkshire Bank, Rome and the Bank
(which, for purpose of this

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Section 4 shall be defined to include all of BHB’s, Rome’s, and the Bank’s
related and affiliated entities, their predecessors, successors, heirs or
assigns, and any past, present or future officers, board of director members,
agents, attorneys, and employees) from all claims, controversies, liabilities,
demands, causes of action, debts, obligations, promises, acts, agreements, and
damages of whatever kind or nature, whether known or unknown, suspected or
unsuspected, foreseen or unforeseen, liquidated or contingent, actual or
potential, jointly and individually, that the Executive has had or now has,
based upon and/or arising out of the Agreements. Notwithstanding the above, it
is understood that the Executive does not waive any rights that the Executive
may have to vested benefits under any tax-qualified retirement, restricted stock
or stock option awards.

          (c) The Executive waives the rights and claims to the extent set forth
above, and the Executive also agrees not to institute, or have instituted, a
lawsuit against BHB, Berkshire Bank, Rome, and/or the Bank based on any such
waived claims or rights.

          (d) BHB, Berkshire Bank, Rome, the Bank (the “Parties”) and the
Executive each agree that the Parties and the Executive shall not at any time,
either before or after the Closing Date, make or cause to be made any derogatory
or disparaging statement to anyone about the other party, or the Parties’
products, services, financial condition or proposals or about any of the
directors, officers or employees of the Parties or regarding the Executive’s
employment.

          Section 5. Miscellaneous.

           (a) Successors. The terms of this Settlement Agreement shall be
binding upon all parties hereto and their respective heirs, successors, and
assigns.

          (b) Final Agreement. This Settlement Agreement represents the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all prior understandings, written or oral. The terms of this
Settlement Agreement may be changed, modified or discharged only by an
instrument in writing signed by the parties hereto. The Executive acknowledges
that the Executive has carefully read the foregoing, has had sufficient
opportunity to review the Settlement Agreement with legal counsel of the
Executive’s own choosing, knows and understands this Settlement Agreement
contents, and freely and independently signs this Settlement Agreement. No
inducements, representations, or agreements have been made or relied upon to
make this Settlement Agreement except as stated in this Settlement Agreement.

          (c) Governing Law. The validity, interpretation, construction and
performance of this Settlement Agreement shall be governed by the laws of the
Commonwealth of Massachusetts without regard to principles of conflicts of laws
thereof.

           (d) Statutory Changes. All references to sections of the Code shall
be deemed also to refer to any successor provisions to such sections.

           (e) Validity. The invalidity or unenforceability of any provision of
this Settlement Agreement shall not affect the validity or enforceability of any
other provision of this Settlement Agreement, which shall remain in full force
and effect.

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           (f) No Assignment of Benefits. Except as otherwise provided herein or
by law, no right or interest of the Executive under the Settlement Agreement
shall be assignable or transferable, in whole or in part, either directly or by
operation of law or otherwise.

           (g) Counterparts. This Settlement Agreement may be signed in
counterparts, and all of the counterpart copies shall be treated as a single
agreement.

          Section 6. Effectiveness.

          This Settlement Agreement shall be effective as of the Closing Date,
provided, however, that Section 1(b) hereof shall be effective from the day and
year first set forth above. In the event the Merger Agreement is terminated for
any reason, this Settlement Agreement shall be deemed null and void.

[Signature Page to Follow]

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IN WITNESS WHEREOF, the parties hereto have duly executed this Settlement
Agreement as of the day and year first written above.

 

 

 

 

 

 

EXECUTIVE

 

 

 

/s/ Charles M. Sprock

 

 

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Charles M. Sprock

 

 

 

 

BERKSHIRE HILLS BANCORP, INC.

 

 

 

 

By: 

/s/ Michael P. Daly

 

 

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Michael P. Daly

 

 

President and Chief Executive Officer

 

 

 

 

BERKSHIRE BANK

 

 

 

 

By:

/s/ Michael P. Daly

 

 

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Michael P. Daly

 

 

President and Chief Executive Officer

 

 

 

 

ROME BANCORP, INC.

 

 

 

 

By:

/s/ David C. Nolan

 

 

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David C. Nolan

 

 

Executive Vice-President and Chief Financial Officer

 

 

 

 

THE ROME SAVINGS BANK

 

 

 

 

By:

/s/ David C. Nolan

 

 

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David C. Nolan

 

 

Executive Vice-President and Chief Financial Officer

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