ex10-17.htm


     

    Exhibit
      10.17


    BERKSHIRE
      BANK

    THREE
      YEAR CHANGE IN CONTROL AGREEMENT

    


    


    This
      AGREEMENT is made effective as of
      February 16, 2006, by and among Berkshire Bank (the
“Institution”), a state chartered
      savings institution with its principal
      administrative offices at 24 North Street, Pittsfield, Massachusetts 01201,
      Berkshire Hills Bancorp,
      Inc.
(the “Holding Company”), a corporation organized under the laws of the
      state of Delaware, which is the stock holding company of the Institution, and
      Michael J. Oleksak
      (“Executive”).

    


    WHEREAS,
      the Institution recognizes the
      substantial contributions Executive has made to the Institution and wishes
      to
      protect Executive’s position with the Institution for the period provided in
      this Agreement; and

    


    WHEREAS,
      Executive has agreed to serve
      in the employ of the Institution.

    


    NOW,
      THEREFORE, in consideration of the
      contributions and responsibilities of Executive, and upon the other terms and
      conditions hereinafter provided, the parties hereto agree as
      follows:

    


    1.           
      TERM OF
      AGREEMENT.

    


    The
      period of this Agreement shall be
      deemed to have commenced as of the date first above written and shall continue
      for a period of thirty-six (36) full calendar months
      thereafter.  Commencing on the first anniversary date of this
      Agreement, and continuing on each anniversary thereafter, the Board of Directors
      (the “Board”) may act to extend the term of this Agreement for an additional
      year, such that the remaining term of this Agreement would be three years,
      unless Executive elects not to extend the term of this Agreement by giving
      written notice to the Institution, in which case the term of this Agreement
      will
      expire on the third anniversary of this Agreement.

    


    2.           
      CHANGE IN
      CONTROL.

    


    (a)           
      Upon the occurrence of a Change in Control of the Institution or the Holding
      Company (as herein defined) followed at any time during the term of this
      Agreement by the involuntary termination of Executive’s employment or the
      voluntary termination of Executive’s employment in accordance with the terms of
      this Agreement, other than for Cause, as defined in Section 2(c) of this
      Agreement, the provisions of Section 3 of this Agreement shall
      apply.

    


    
      	
               

            	
              (i)

            	
              Upon
                the occurrence of a Change in Control, Executive shall have the right
                to
                elect to voluntarily terminate his employment at any time during
                the term
                of this Agreement following any demotion, loss of title, office or
                significant authority, reduction in annual compensation or benefits,
                or
                relocation of his principal place of employment by more than twenty-five
                (25) miles from its location immediately prior to the Change in Control.
                

            


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    
      	
               

            	
              (ii)

            	
              Notwithstanding
                the foregoing clause (i), in the event, however, that the Chief Executive
                Officer of the Institution immediately prior to the Change in Control
                is
                the Chief Executive Officer of the resulting entity with similar
                responsibilities and duties and Executive’s position with the resulting
                entity does not result in: (A) a reduction in annual compensation
                or
                benefits, (B) a material change in work schedule, or (C) relocation
                of his
                principal place of employment by more than fifty (50) miles, then
                Executive may not voluntarily terminate his employment during the
                one-year
                period following the Change in Control and receive any payments or
                benefits under this Agreement. For the avoidance of doubt, with respect
                to
                the immediately foregoing limitation on voluntary termination, Executive
                may voluntarily terminate employment in accordance with this Section
                2(a)
                effective upon the expiration of said one-year period, and for a
                period of
                30 days thereafter, if one of the events set forth in clause (i)
                has
                occurred, either at the time of the Change in Control or during the
                one-year period following the time of the Change in Control.  If
                one of the events described in clause (i) occurs more than one year
                following the date of the Change in Control, but during the remaining
                term
                of the Agreement, then Executive may terminate his employment in
                accordance with the provisions of this Agreement, notwithstanding
                this
                clause (ii). 

            


    

    


    
      	
               

            	
              (iii)

            	
              Notwithstanding
                any other provision of this Agreement to the contrary, Executive
                may
                consent in writing to any demotion, loss, reduction or relocation
                and
                waive his ability to voluntarily terminate his employment under the
                terms
                of this Agreement. The effect of any written consent of Executive
                under
                this Section 2(a) shall be strictly limited to the terms specified
                in such
                written consent. 

            


    

    


    (b)          
      For purposes of this Agreement, a “Change in Control” of the Institution or
      Holding Company shall mean an event of a nature that: (i) would be required
      to
      be reported in response to Item 1(a) of the current report on Form 8-K, as
      in
      effect on the date hereof, pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934 (the “Exchange Act”); or (ii) results in a Change in
      Control of the Institution or the Holding Company within the meaning of the
      Bank
      Change in Control Act and the Rules and Regulations promulgated by the Federal
      Deposit Insurance Corporation (“FDIC”) at 12 C.F.R. § 303.4(a) with respect to
      the Bank and the Board of Governors of the Federal Reserve System (“FRB”) at 12
      C.F.R. § 225.41(b) with respect to the Holding Company, as in effect on the date
      hereof; or (iii) results in a transaction requiring prior FRB approval under
      the
      Bank Holding Company Act of 1956 and the regulations promulgated thereunder
      by
      the FRB at 12 C.F.R. § 225.11, as in effect on the date hereof except for the
      Holding Company’s acquisition of the Institution; or (iv) without limitation
      such a Change in Control shall be deemed to have occurred at such time as (A)
      any “person” (as the term is used in Sections 13(d) and 14(d) of the Exchange
      Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
      Exchange Act), directly or indirectly, of securities of the Institution or
      the
      Holding Company representing 20% or more of the Institution’s or the Holding
      Company’s outstanding securities except for any securities of the Institution
      purchased by the Holding Company in connection with the conversion of the
      Institution to the stock form and any securities purchased by any tax-qualified
      employee benefit plan of the Institution; or (B) individuals who constitute
      the
      Board of Directors on the date hereof (the “Incumbent Board”) cease for any
      reason to constitute at least a majority thereof, provided that any person
      becoming a director subsequent to the date hereof whose election was approved
      by
      a vote of at least three


    
      
        
        

      

      
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    quarters
      (3/4) of the directors comprising the Incumbent Board, or whose nomination
      for
      election by the Holding Company’s stockholders was approved by the same
      Nominating Committee serving under an Incumbent Board, shall be, for purposes
      of
      this clause (B), considered as though he were a member of the Incumbent Board;
      or (C) a plan of reorganization, merger, consolidation, sale of all or
      substantially all the assets of the Institution or the Holding Company or
      similar transaction occurs in which the Institution or Holding Company is not
      the resulting entity; or (D) solicitations of shareholders of the Holding
      Company, by someone other than the current management of the Holding Company,
      seeking stockholder approval of a plan of reorganization, merger or
      consolidation of the Holding Company or Institution or similar transaction
      with
      one or more corporations as a result of which the outstanding shares of the
      class of securities then subject to the plan or transaction are exchanged for
      or
      converted into cash or property or securities not issued by the Institution
      or
      the Holding Company shall be distributed; or (E) a tender offer is made for
      20%
      or more of the voting securities of the Institution or the
      Institution.

    


    (c)           
      Executive shall not have the right to receive termination benefits pursuant
      to
      Section 3 of this Agreement upon Termination for Cause. The term “Termination
      for Cause” shall mean termination because of: (i) Executive’s personal
      dishonesty, willful misconduct, breach of fiduciary duty involving personal
      profit, intentional failure to perform stated duties, willful violation of
      any
      law, rule, regulation (other than traffic violations or similar offenses),
      final
      cease and desist order or material breach of any provision of this Agreement
      which results in a material loss to the Institution or the Holding Company,
      or
      (ii) Executive’s conviction of a crime or act involving moral turpitude or a
      final judgment rendered against Executive based upon actions of Executive which
      involve moral turpitude.  For the purposes of this Section, no act, or
      the failure to act, on Executive’s part shall be “willful” unless done, or
      omitted to be done, not in good faith and without reasonable belief that the
      action or omission was in the best interests of the Institution or its
      affiliates.  Notwithstanding the foregoing, Executive shall not be
      deemed to have been Terminated for Cause unless and until there shall have
      been
      delivered to him a Notice of Termination which shall include a copy of a
      resolution duly adopted by the affirmative vote of not less than a majority
      of
      the members of the Board at a meeting of the Board called and held for that
      purpose (after reasonable notice to Executive and an opportunity for him,
      together with counsel, to be heard before the Board), finding that in the good
      faith opinion of the Board, Executive was guilty of conduct justifying
      Termination for Cause and specifying the particulars thereof in
      detail.  Executive shall not have the right to receive compensation or
      other benefits for any period after Termination for Cause.  During the
      period beginning on the date of the Notice of Termination for Cause pursuant
      to
      Section 4 of this Agreement through the Date of Termination, stock options
      granted to Executive under any stock option plan shall not be exercisable nor
      shall any unvested stock awards granted to Executive under any stock-based
      incentive plan of the Institution, the Holding Company or any subsidiary or
      affiliate thereof vest.  At the Date of Termination, such stock
      options and such unvested stock awards shall become null and void and shall
      not
      be exercisable by or delivered to Executive at any time subsequent to such
      Date
      of Termination for Cause.


    
      
        
        

      

      
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    3.           
      TERMINATION
      BENEFITS.

    


    (a)           
      Upon the occurrence of a Change in Control, followed at any time during the
      term
      of this Agreement by the involuntary termination of Executive’s employment
      (other than for Termination for Cause), or voluntary termination during the
      term
      of this Agreement as provided by Section 2(a) of this Agreement, the Institution
      shall be obligated to pay Executive, or in the event of his subsequent death,
      his beneficiary or beneficiaries, or his estate, as the case may be, a sum
      equal
      to three (3) times Executive’s average annual compensation for the five most
      recent taxable years that Executive has been employed by the Institution or
      such
      lesser number of years in the event that Executive shall have been employed
      by
      the Institution for less than five years.  For this purpose, such
      annual compensation shall include base salary and any other taxable income,
      including, but not limited to, amounts related to the granting, vesting or
      exercise of restricted stock or stock option awards, commissions, bonuses,
      pension and profit sharing plan contributions or benefits (whether or not
      taxable), severance payments, retirement benefits, and fringe benefits paid
      or
      to be paid to Executive or paid for Executive’s benefit during any such
      year.  At the election of Executive, which election is to be made
      prior to a Change in Control, such payment shall be made in a lump sum or on
      an
      annual basis in approximately equal installments over a three (3) year
      period.

    


    (b)           
      Upon the occurrence of a Change in Control of the Institution or the Holding
      Company followed at any time during the term of this Agreement by Executive’s
      voluntary or involuntary termination of employment in accordance with paragraph
      (a) of this Section 3, other than for Termination for Cause, the Institution
      shall cause to be continued life, medical and disability coverage substantially
      identical to the coverage maintained by the Institution for Executive prior
      to
      his severance, except to the extent such coverage may be changed in its
      application to all employees on a nondiscriminatory basis.  Such
      coverage and payments shall cease upon the expiration of thirty-six (36) full
      calendar months from the Date of Termination.

    


    (c)           
      Notwithstanding the provisions
      of
      this Section 3, in no event shall the aggregate payments or benefits to be
      made
      or afforded to Executive under said paragraphs (the “Termination Benefits”)
      constitute an “excess parachute payment” under Section 280G of the Internal
      Revenue Code of 1986, as amended, or any successor thereto, and in order to
      avoid such a result, Termination Benefits will be reduced, if necessary, to
      an
      amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00)
      less than an amount equal to three (3) times Executive’s “base amount,” as
      determined in accordance with said Section 280G.  The allocation of
      the reduction required hereby among the Termination Benefits shall be determined
      by Executive.

    


    4.           
      NOTICE OF
      TERMINATION.

    


    (a)           
      Any purported termination by the Institution or by Executive in connection
      with
      a Change in Control shall be communicated by a Notice of Termination to the
      other party. For purposes of this Agreement, a “Notice of Termination” shall
      mean a written notice which indicates the specific termination provision in
      this
      Agreement relied upon and shall set forth in


    
      
        
        

      

      
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    reasonable
      detail the facts and circumstances claimed to provide a basis for termination
      of
      Executive’s employment under the provision so indicated.

    


    (b)           
      “Date of Termination” shall mean the date specified in the Notice of Termination
      (which, in the instance of Termination for Cause, shall not be less than thirty
      (30) days from the date such Notice of Termination is given); provided, however,
      that if a dispute regarding the Executive’s termination exists, the “Date of
      Termination” shall be determined in accordance with Section 4(c) of this
      Agreement.

    


    (c)           
      If, within thirty (30) days after any Notice of Termination is given, the party
      receiving such Notice of Termination notifies the other party that a dispute
      exists concerning the termination, the Date of Termination shall be the date
      on
      which the dispute is finally determined, either by mutual written agreement
      of
      the parties, by a binding arbitration award, or by a final judgment, order
      or
      decree of a court of competent jurisdiction (the time for appeal therefrom
      having expired and no appeal having been perfected) and provided further that
      the Date of Termination shall be extended by a notice of dispute only if such
      notice is given in good faith and the party giving such notice pursues the
      resolution of such dispute with reasonable diligence. Notwithstanding the
      pendency of any such dispute in connection with a Change in Control, in the
      event that the Executive is terminated for reasons other than Termination for
      Cause, the Institution will continue to pay Executive the payments and benefits
      due under this Agreement in effect when the notice giving rise to the dispute
      was given (including, but not limited to, his annual salary) until the earlier
      of: (i) the resolution of the dispute in accordance with this Agreement; or
      (ii)
      the expiration of the remaining term of this Agreement as determined as of
      the
      Date of Termination.

    


    5.           
      SOURCE OF
      PAYMENTS.

    


    It
      is intended by the parties hereto
      that all payments provided in this Agreement shall be paid in cash or check
      from
      the general funds of the Institution.  Further, the Holding Company
      guarantees such payments and provision of all amounts and benefits due hereunder
      to Executive and, if such amounts and benefits due from the Institution are
      not
      timely paid or provided by the Institution, such amounts and benefits shall
      be
      paid or provided by the Holding Company.

    


    6.           
      EFFECT ON PRIOR
      AGREEMENTS AND EXISTING BENEFIT PLANS.

    


    This
      Agreement contains the entire
      understanding between the parties hereto and supersedes any prior agreement
      between the Institution and Executive, except that this Agreement shall not
      affect or operate to reduce any benefit or compensation inuring to Executive
      of
      a kind elsewhere provided.  No provision of this Agreement shall be
      interpreted to mean that Executive is subject to receiving fewer benefits than
      those available to him without reference to this Agreement.

    


    Nothing
      in this Agreement shall confer
      upon Executive the right to continue in the employ of the Institution or shall
      impose on the Institution any obligation to employ or retain Executive in its
      employ for any period.


    
      
        
        

      

      
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    7.           
      NON-COMPETITION
      AND
      NON-DISCLOSURE.

    


    (a)           
      For a period of one (1) year following the payment of termination benefits
      to
      Executive under this agreement, Executive agrees not to compete with the
      Institution or its affiliates in any city, town or county in which Executive’s
      normal business office is located and the Institution or its affiliates has
      an
      office or has filed an application for regulatory approval to establish an
      office, determined as of the effective date of such termination, except as
      agreed to pursuant to a resolution duly adopted by the Board of
      Directors.  Executive agrees that during such one (1) year period and
      within said cities, towns and counties, Executive shall not work for or advise,
      consult or otherwise serve with, directly or indirectly, any entity whose
      business materially competes with the depository, lending or other business
      activities of the Institution.  The parties hereto, recognizing that
      irreparable injury will result to the Institution, its business and property
      in
      the event of Executive’s breach of this Section 7(a), agree that in the event of
      any such breach by Executive, the Institution will be entitled, in addition
      to
      any other remedies and damages available, to an injunction to restrain the
      violation hereof by Executive, Executive’s partners, agents, servants, employees
      and all persons acting for or under the direction of
      Executive.  Executive represents and admits that, in the event of the
      termination of his employment following a Change in Control, Executive’s
      experience and capabilities are such that Executive can obtain employment in
      a
      business engaged in other lines and/or of a different nature than the
      Institution, and that the enforcement of a remedy by way of injunction will
      not
      prevent Executive from earning a livelihood.  Nothing herein will be
      construed as prohibiting the Institution from pursuing any other remedies
      available for such breach or threatened breach, including the recovery of
      damages from Executive.

    


    (b)           
      Executive recognizes and acknowledges that the knowledge of the business
      activities and plans for business activities of the Institution, as it may
      exist
      from time to time, is a valuable, special and unique asset of the business
      of
      the Institution. Executive will not, during or after the term of his employment,
      disclose any knowledge of the past, present, planned or considered business
      activities of the Institution or its affiliates to any person, firm,
      corporation, or other entity for any reason or purpose whatsoever, unless
      expressly authorized by the Board of Directors or required by law.
      Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
      financial and/or economic principles, concepts or ideas which are not solely
      and
      exclusively derived from the business plans and activities of the Institution
      or
      its affiliates. In the event of a breach or threatened breach by Executive
      of
      the provisions of this Section 7, the Institution will be entitled to an
      injunction restraining Executive from disclosing, in whole or in part, the
      knowledge of the past, present, planned or considered business activities of
      the
      Institution or its affiliates or from rendering any services to any person,
      firm, corporation or other entity to whom such knowledge, in whole or in part,
      has been disclosed or is threatened to be disclosed. Nothing herein will be
      construed as prohibiting the Institution from pursuing other remedies available
      for such breach or threatened breach, including the recovery of damages from
      Executive.

    


    8.           
      NO
      ATTACHMENT.

    


    (a)           
      Except as required by law, no right to receive payments under this Agreement
      shall be subject to anticipation, commutation, alienation, sale, assignment,
      encumbrance, charge,


    
      
        
        

      

      
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    pledge,
      or hypothecation, or to execution, attachment, levy, or similar process or
      assignment by operation of law, and any attempt, voluntary or involuntary,
      to
      affect any such action shall be null, void, and of no effect.

    


    (b)           
      This Agreement shall be binding upon, and inure to the benefit of, Executive,
      the Institution and their respective successors and assigns.

    


    9.           
      MODIFICATION AND
      WAIVER.

    


    (a)           
      This Agreement may not be modified or amended except by an instrument in writing
      signed by the parties hereto.

    


    (b)           
      No term or condition of this Agreement shall be deemed to have been waived,
      nor
      shall there be any estoppel against the enforcement of any provision of this
      Agreement, except by written instrument of the party charged with such waiver
      or
      estoppel. No such written waiver shall be deemed a continuing waiver unless
      specifically stated therein, and each such waiver shall operate only as to
      the
      specific term or condition waived and shall not constitute a waiver of such
      term
      or condition for the future or as to any act other than that specifically
      waived.

    


    10.           
      REQUIRED REGULATORY
      PROVISIONS.

    


    Any
      payments made to Executive pursuant
      to this Agreement, or otherwise, are subject to and conditioned upon compliance
      with 12 U.S.C. §1828(k) and any rules and regulations promulgated thereunder,
      including 12 C.F.R. Part 359.

    


    11.           
      SEVERABILITY.

    


    If,
      for any reason, any provision of
      this Agreement, or any part of any provision, is held invalid, such invalidity
      shall not affect any other provision of this Agreement or any part of such
      provision not held so invalid, and each such other provision and part thereof
      shall, to the full extent consistent with law, continue in full force and
      effect.

    


    12.           
      HEADINGS FOR REFERENCE
      ONLY.

    


    The
      headings of sections and paragraphs
      herein are included solely for convenience of reference and shall not control
      the meaning or interpretation of any of the provisions of this
      Agreement.

    


    13.           
      GOVERNING
      LAW.

    


    The
      validity, interpretation,
      performance, and enforcement of this Agreement shall be governed by the laws
      of
      the Commonwealth of Massachusetts.

    



    
      
        
        

      

      
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    14.           
      ARBITRATION.

    


    Any
      dispute or controversy arising
      under or in connection with this Agreement shall be settled exclusively by
      arbitration, conducted before a panel of three arbitrators sitting in a location
      selected by Executive within fifty (50) miles from the location of the
      Institution’s main office, in accordance with the rules of the American
      Arbitration Association then in effect.  Judgment may be entered on
      the arbitrator’s award in any court having jurisdiction; provided, however, that
      Executive shall be entitled to seek specific performance of his right to be
      paid
      until the Date of Termination during the pendency of any dispute or controversy
      arising under or in connection with this Agreement.

    


    15.           
      PAYMENT OF COSTS
      AND
      LEGAL FEES.

    


    All
      reasonable costs and legal fees
      paid or incurred by Executive pursuant to any dispute or question of
      interpretation relating to this Agreement shall be paid or reimbursed by the
      Institution if Executive is successful with respect to such dispute or question
      of interpretation pursuant to a legal judgment, arbitration or
      settlement.

    


    16.           
      INDEMNIFICATION.

    


    The
      Institution shall provide Executive
      (including his heirs, executors and administrators) with coverage under a
      standard directors’ and officers’ liability insurance policy at its expense and
      shall indemnify Executive (and his heirs, executors and administrators) to
      the
      fullest extent permitted under Massachusetts law against all expenses and
      liabilities reasonably incurred by him in connection with or arising out of
      any
      action, suit or proceeding in which he may be involved by reason of his having
      been a director or officer of the Institution (whether or not he continues
      to be
      a director or officer at the time of incurring such expenses or liabilities);
      such expenses and liabilities to include, but not to be limited to, judgments,
      court costs and attorneys’ fees and the costs of reasonable
      settlements.

    


    17.           
      SUCCESSOR TO THE
      INSTITUTION.

    


    The
      Institution shall require any
      successor or assignee, whether direct or indirect, by purchase, merger,
      consolidation or otherwise, to all or substantially all the business or assets
      of the Institution, to expressly and unconditionally assume and agree to perform
      the Institution’s obligations under this Agreement in the same manner and to the
      same extent that the Institution would be required to perform such obligations
      if no such succession or assignment had taken place.


    
      
        
        

      

      
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    SIGNATURES

    


    IN
      WITNESS WHEREOF, Berkshire Bank and
      Berkshire Hills Bancorp, Inc. have caused this Agreement to be executed by
      their
      duly authorized officers, and Executive has signed this Agreement, on the 16th
      day of February, 2006.

    


    


    
      	
              ATTEST:

            	 	
              BERKSHIRE
                BANK

            
	 	 	 	 
	 	 	 	 
	
              /s/
                Sally J. Chavarry

            	 	
              By:

            	
              /s/
                Michael P. Daly

            
	 	 	 	
              Michael
                P. Daly, President and CEO

            
	 	 	 	 
	 	 	 	 
	
              ATTEST:

            	 	
              BERKSHIRE
                HILLS BANCORP, INC.

            
	 	 	
              (Guarantor)

            	 
	 	 	 	 
	 	 	 	 
	
              /s/
                Sally J. Chavarry

            	 	
              By:

            	
              /s/
                Michael P. Daly

            
	 	 	 	
              Michael
                P. Daly, President and CEO

            
	 	 	 	 
	
              SEAL

            	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              WITNESS:

            	 	
              EXECUTIVE

            	 
	 	 	 	 
	 	 	 	 
	
              /s/
                Sally J. Chavarry

            	 	
              /s/
                Michael J. Oleksak

            
	 	 	
              Michael
                J. Oleksak

            


    

    


    


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