0001108134-22-000008.txt : 20220408 0001108134-22-000008.hdr.sgml : 20220408 20220408161822 ACCESSION NUMBER: 0001108134-22-000008 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 34 CONFORMED PERIOD OF REPORT: 20220518 FILED AS OF DATE: 20220408 DATE AS OF CHANGE: 20220408 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BERKSHIRE HILLS BANCORP INC CENTRAL INDEX KEY: 0001108134 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTIONS, NOT FEDERALLY CHARTERED [6036] IRS NUMBER: 043510455 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-15781 FILM NUMBER: 22817230 BUSINESS ADDRESS: STREET 1: 60 STATE STREET STREET 2: 38TH FLOOR CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 617-641-9206 MAIL ADDRESS: STREET 1: 60 STATE STREET STREET 2: 38TH FLOOR CITY: BOSTON STATE: MA ZIP: 02109 DEF 14A 1 a2022proxy.htm DEF 14A Document

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐
Check the appropriate box:
☐ Preliminary Proxy Statement
☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☒ Definitive Proxy Statement
☐ Definitive Additional Materials
☐ Soliciting Material Pursuant to §240.14a-12

Berkshire Hills Bancorp, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):
☒ No fee required.
☐ Fee paid previously with preliminary materials.
☐ Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.



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April 8, 2022
Dear Berkshire Hills Bancorp Shareholder:
It is our pleasure to invite you to attend the 2022 Annual Meeting of Shareholders, which will be held virtually on Wednesday, May 18, 2022 at 10:00 a.m. Eastern Time by visiting
www.virtualshareholdermeeting.com/BHLB2022, where you will be able to listen to the meeting live, submit questions and vote online. You will be asked to enter the 16-digit control number located on your proxy card.
CEO, Nitin J. MhatrePlease see the Notice of Annual Meeting on the next page for more information about our meeting procedures.
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We urge you to vote your proxy online, or by telephone, or by completing and returning a proxy card by mail as soon as possible, even if you plan to attend the Annual Meeting.
Your vote is important to us. Thank you for your attention to the enclosed materials, and for your continued support of our company.
Chairperson, David M. Brunelle
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Nitin J. Mhatre, Chief Executive Officer
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David M. Brunelle, Chairperson of the Board of Directors



Notice of Annual Meeting of Shareholders
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Purpose.
Performance.
Progress.
Notice of 2022 Annual Meeting of Shareholders of Berkshire Hills Bancorp, Inc.
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When:
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Where:
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Record Date:
Wednesday, May 18, 2022Virtual MeetingMarch 25, 2022
10:00 a.m.www.virtualshareholdermeeting.com/BHLB2022
We are holding this meeting for the following purposes:
1.    To elect as directors the nominees named in the Proxy Statement each to serve a one-year term or until their successors are duly elected and qualified;
2.    To provide an advisory vote on executive compensation practices;
3.    To ratify the appointment of the Company’s independent registered public accounting firm for fiscal year 2022; and
4.    To approve the Berkshire Hills Bancorp, Inc. 2022 Equity Incentive Plan;
5.    To transact any other Company business that may properly come before the meeting.

The Board of Directors unanimously recommends that you vote “FOR” each of the proposed director nominees and “FOR” the proposals to be presented at the annual meeting.

Shareholders of record at the close of business on March 25, 2022 are entitled to vote at the meeting, either at the virtual annual meeting or by proxy. There are several ways to vote. You can vote your shares online, by telephone, by regular mail or at the virtual annual meeting.

To access your proxy materials and vote online, please visit www.proxyvote.com and follow the instructions. The notice provided to you contains the necessary codes required to vote online. If you wish to vote by telephone, please call 1-800-690-6903 using a touch-tone phone and follow the prompted instructions. You may also vote by mail by requesting a paper proxy card using the instructions provided to you in the notice. Finally, you may vote at the virtual annual meeting, even if you have previously submitted a proxy.

Whatever method you choose, please vote in advance of the meeting to ensure that your shares will be voted as you direct.

Boston, Massachusetts
April 8, 2022
By order of the Board of Directors
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Wm. Gordon Prescott
EVP, General Counsel and Corporate Secretary

Admission Procedures

The meeting is open to shareholders of Berkshire Hills Bancorp, Inc. To participate and vote your shares at the Annual Meeting, you will need the 16-Digit Control Number included on your Notice of Internet Availability of the proxy materials, on your proxy card or on the instructions that accompanied your proxy materials. Whether or not you plan to attend the meeting, we urge you to vote by proxy in advance to ensure your vote is counted if you decide not to attend the virtual meeting.
IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 18, 2022:
The Notice of Annual Meeting, 2022 Proxy Statement, 2021 Summary Annual Report, and 2021 Annual Report on SEC Form 10-K are each available at www.proxyvote.com or ir.berkshirebank.com



Table of Contents
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Purpose.
Performance.
Progress.
Proxy Summary
2021 Company Performance
2021 Executive Compensation Highlights
Shareholder Engagement and Responsiveness
Environmental, Social, Governance (ESG) & Corporate Responsibility
Proposal 1 - Election of Directors
Information Regarding Directors and Director Nominees
Corporate Governance
Director Compensation
Proposal 2 - Advisory (Non-Binding) Vote on Executive Compensation
Compensation Discussion and Analysis
Compensation Committee Report
Executive Compensation
Summary Compensation and Other Tables
Proposal 3 - Ratification of the Appointment of the Independent Registered Public Accountant
Audit Committee Report
Proposal 4 - Approval of the Berkshire Hills Bancorp, Inc. 2022 Equity Incentive Plan
Additional Information
Stock Ownership
Information About Voting
Other Information Relating to Directors and Executive Officers
Submission of Business Proposals and Shareholder Nominations
Shareholder Communications
Miscellaneous
Other Matters
Appendix A
A-1
Berkshire Hills Bancorp, Inc. 2022 Equity Incentive Plan
A-1
Appendix B
B-1
Summary of and Reconciliation of Certain Non-GAAP Financial Measures
B-1
1    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


Berkshire Hills Bancorp, Inc. Proxy Statement
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Purpose.
Performance.
Progress.

Proxy Statement Summary

This summary gives you an overview of selected information in this year’s proxy statement. We encourage you to read the entire proxy statement carefully before voting. We have also provided you with the 2021 Summary Annual Report and the 2021 Annual Report on SEC Form 10-K.

Annual Meeting of Shareholders

Time and Date: 10:00 a.m. Eastern Time, Wednesday, May 18, 2022

Place: Virtual meeting at www.virtualshareholdermeeting.com/BHLB2022
    The only way to attend the meeting or vote at the meeting is through the internet.

Record Date: Shareholders as of the close of business on March 25, 2022 are entitled to vote

We are providing this proxy statement to you in connection with the solicitation of proxies for the 2022 Annual Meeting of Shareholders and to transact any other business that may properly come before the meeting. In this proxy statement, we also refer to Berkshire Hills Bancorp, Inc. as “Berkshire” or the “Company”. We also refer to its subsidiary, Berkshire Bank, as the “Bank”. We are mailing a notice of the annual meeting to shareholders of record as of March 25, 2022, beginning on April 8, 2022.

Summary of Proposals for 2022

1 - Election of Directors. The Company’s Board of Directors is presenting twelve (12) nominees for election as directors at our Annual Meeting. One current director is not standing for re-election. All nominees currently serve as directors on our Board of Directors. In 2021, all director nominees received at least 96% of the votes cast regarding their nomination. Provided with this proposal is information about our directors, director nominees, corporate governance, and director compensation.

2 - Advisory Vote on Executive Compensation. This advisory vote is for the approval of the Company’s Named Executive Officer compensation as set forth within this proxy statement. Berkshire strives to promote shareholder value and sound risk management by aligning executive pay and company performance. The Compensation Discussion and Analysis (“CD&A”) explains the Board’s processes and decisions with respect to executive compensation. In 2021, 97% of the votes cast were in favor of the proposal “FOR” the advisory approval of our Executive Compensation. Provided with this proposal is the Compensation Discussion and Analysis, the Compensation Committee Report, and Summary Compensation and Other Tables.

3 - Ratification of Independent Registered Public Accounting Firm. This advisory vote ratifies the selection of Crowe LLP (“Crowe”) as the Company’s independent registered public accounting firm for fiscal year 2022. Crowe has served in this capacity since fiscal year 2017. In 2021, 99% of the votes cast were in favor of the proposal for the appointment of Crowe.

4 - Berkshire Hills Bancorp, Inc. 2022 Equity Incentive Plan. This vote is for the approval of the proposed Berkshire Hills Bancorp, Inc. 2022 Equity Incentive Plan as set forth within the proxy statement. Provided with this proposal is a description of the proposed plan, and the plan is included as Appendix A.




2    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

2021 Company Performance

In 2021, Berkshire rebounded from the COVID-19 pandemic related loss in 2020 and posted higher earnings than in the prepandemic year of 2019. Earnings per share totaled $2.39 in 2021 increasing 21% over $1.97 reported in 2019, and were recovered from the loss of $10.60 per share in 2020. Return on equity nearly doubled to 10.18% in 2021, compared to 5.75% reported in 2019, and advanced more rapidly than peers. Earnings improvement reflected stronger credit performance and also included gains achieved in disposing of lower return business lines.

PROFITABILITY – PREPANDEMIC TO 2021
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Note: Source – S&P Global Market Intelligence. ROE for 2020 was a loss due to Berkshire goodwill write-down.
Peers are LTI Industry Index median.

Berkshire also reintroduced share repurchases in 2021, after suspending this program in 2020 due to the pandemic. Total shareholder distributions including stock buybacks and dividends in 2021 more than doubled year-over-year to 8.2% of tangible common equity, and also exceeded the peer average of 7.6% of tangible common equity.

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Note: Source – S&P Global Market Intelligence. Peers are LTI Industry Index median. Ratio is sum of common dividends and common stock repurchases divided by average tangible common equity.




3    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

With improved earnings generation and increased shareholder distributions, Berkshire’s share price grew strongly and resulted in a 69% total shareholder return (TSR), nearly twice the return registered by the KBW Regional Bank Index (KRX) and more than three times higher than the return of the New York Stock Exchange Composite Index (NYA).

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The 2021 stock price gain also included recognition of Berkshire’s Exciting Strategic Transformation (BEST) plan which was unveiled shortly before the 2021 Annual Shareholder Meeting This plan targets improved sustainable earnings and profitability, as well as a stronger franchise based on leading rankings for customer satisfaction and environmental, social and governance (ESG) matters. The plan is targeted towards the Company’s vision to be a high-performing, leading socially responsible community bank in New England and beyond.

2021 Executive Compensation Highlights

Included later in this report are compensation tables, including a Summary Compensation Table which details executive compensation provided in 2021, as well as a Compensation Discussion and Analysis which provides information about the compensation management process and compensation decisions.

2021 was the first year under the leadership of Nitin Mhatre, who joined the Company as President and CEO in January 2021. During the year, the Company also filled key leadership roles, namely Subhadeep Basu as the CFO, Lucia Bellomia as the Head of Retail Banking and Ellen Steinfeld as the Head of Consumer Lending and Payments.

The Compensation Committee took a balanced position towards compensation decisions in 2021, recognizing the challenges and uncertainties related to recent and expected performance due to the pandemic, while maintaining a compensation structure that supported management succession and incentivized improved performance. The Committee also recognized that the new CEO and the executive team should have near-term financial flexibility to invest in and initiate revised long-term strategies to achieve higher profitability.

There were no material changes in our NEO target direct compensation in 2021 compared to 2020 and 2019. Direct compensation includes salary, the cash-based short- term incentive, and the equity-based long-term incentive.

The cash-based short-term incentive earned by the NEO’s in 2021 exceeded the target due to the Company’s outperformance compared to goals set by the Board for executive management. Our performance reflected stronger credit performance as well as better operating efficiencies. In comparison, 2020 short-term incentives were paid below the original target due to the impact of the pandemic on Company performance.

The maturing three year long-term incentive performance compensation was forfeited in 2021 for the second year in a row due primarily to the 2020 pandemic impacts on relative performance. This reflects our continuing pay-for-performance philosophy.




4    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

The Committee’s decisions resulted in a compensation structure that rewarded outperformance where it was accomplished and decreased compensation where objectives were not met. The positive stock performance in 2021, resulting in a 69% total shareholder return, and the long-term programs initiated under the BEST plan were viewed as critical accomplishments aligned with shareholder interests.

Shareholder Engagement and Responsiveness

We have an active engagement program that reaches out annually to the governance and proxy voting teams of our largest institutional shareholders to solicit their feedback and answer their questions. This is in addition to our ongoing conversations with investors about the potential for our vision of purpose based performance to enhance value for all stakeholders. Further, we monitor position papers of proxy advisory firms and of our largest shareholders expressing current priorities and focus areas for corporate governance. We also spoke with advisors and other knowledgeable third parties, obtaining valuable additional feedback on our governance, compensation, and strategy. Based on these ongoing discussions, in recent years we have made several enhancements to our governance programs, including:
l
Declassified Board of Directors; all director positions are up for election in 2022
lIncreased Board diversity and added cyber-security and additional financial expertise
lIn 2019, adopted new corporate guidelines implementing age and tenure limits to facilitate consistent Board refreshment
lAdded new relative performance measures related to total shareholder return (“TSR”) and changes in return on equity to the long-term incentive plan
lIncreased the three-year performance-based shares portion of long-term incentive compensation to 60% from 50%
lMade changes to target performance metrics in the short-term incentive plan to better align these measures with shareholder value maximization
lIncreased the focus on long-term equity compensation
lCreated a new Board-level Corporate Responsibility and Culture Committee, strengthening the Board’s oversight of human capital management and diversity, equity and inclusion initiatives

During 2021, the most frequent topics in our governance-related discussions have included our Berkshire’s Exciting Strategic Transformation (“BEST”) plan; our BEST Community Comeback financing plan; our focus on human capital management including diversity, equity, and inclusion; our pandemic response; climate change initiatives; and cyber security management. There is discussion of these matters in the following section on Corporate Responsibility, as well as in our Summary Annual Report, our Annual Report on SEC Form 10-K, and our annual Corporate Social Responsibility Report. We believe that our top quartile ranking among U.S. Banks in our ESG ratings index evidences the recognition that we have earned through our response on many of these important issues. Additionally, based on the affirmative shareholder vote of 96% or higher for all items on last year’s annual meeting agenda and based on the strong outperformance of our stock in 2021, we believe that our investors are strongly supportive of our programs for governance and company performance.




5    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

Our Commitment to Environmental, Social, Governance (ESG) & Corporate Responsibility

Berkshire is committed to purpose-driven, community-centered banking that enhances value for all stakeholders as it pursues its vision of being a high performing, leading socially responsible community bank in New England and beyond. We’re a bank with a purpose: to empower the financial potential of individuals, families and businesses in our communities. We provide an ecosystem of socially responsible financial solutions, actively engage with our communities, and harness the power of our entire business to fuel the economy, promote thriving neighborhoods, foster financial access and success, and invest in a low-carbon future.

At Berkshire, our most important investment for 175 years has been the one we make in each other. We know that where you bank matters and building stronger communities requires a better approach to banking. As such, ESG factors are central to our vision, mission, risk management practices, and Berkshire’s Exciting Strategic Transformation (BEST).


BEST Community Comeback
In 2021, we launched the BEST Community Comeback, a transformational $5 billion commitment to empower our stakeholders’ financial potential. The plan focuses on four key areas: supporting small business growth; community financing and philanthropy; financial access and empowerment; and funding environmental sustainability. Through this far-reaching initiative, Berkshire aims to help create more businesses and jobs, help more families achieve the dream of owning a home, and aid communities in becoming more environmentally efficient and eco-friendly.

Ongoing Pandemic Support
As 2021 continued to present new challenges, we remained committed to serving our customers and communities. We’re guided by our Be FIRST Values of Belonging, Focusing, Inclusion, Respect, Service, and Teamwork. These values fueled our efforts to navigate the pandemic with the goal of supporting the health and economic resiliency of all our stakeholders. During the height of the pandemic, Berkshire created the You FIRST employee assistance fund to help staff impacted by unexpected financial hardships, provided additional paid sick time, flexible work schedules for remote staff, and maintained full pay for those with reduced schedules as a result of the pandemic. Small businesses and consumers were helped with loan forbearances and government assistance programs. We also launched a fund to assist businesses in the LGBTQIA+ and Black, Indigenous and People of Color (BIPOC) communities.

ESG Program & Business Integration
We’re committed to integrating social, environmental and reputational considerations into all business decision making through our strong foundation of governance systems, including:

Corporate Responsibility & Culture Committee of our Board of Directors,
Environmental, Social and Governance (ESG) Management Committee,
Diversity Equity & Inclusion Management Committee,
Responsible & Sustainable Business Policy,
Strong collection of Social & Environmental risk management practices, and
Senior managers of Corporate Responsibility and of Diversity

Berkshire engages directly with its stakeholders to share information about the progress we’ve made in our ESG and DEI performance, including through our Corporate Responsibility website, corporate annual report, and proxy statement. Additionally, our annual Corporate Responsibility Report, which is aligned with Sustainability Accounting Standards Board (“SASB”) commercial bank disclosure topics, details the Company's ESG efforts and programs.




6    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

ESG Oversight
The Board of Directors ultimately oversees the strategy and activities of the Company including ESG. In order to drive forward our vision to be a leading socially responsible community bank, we were one of the first banks in the country to establish a dedicated committee of our Board of Directors to oversee ESG matters.

The Corporate Responsibility and Culture Committee is responsible for overseeing the management of the Company’s enterprise-wide Corporate Responsibility/ESG, Environmental Sustainability, Climate Change, Diversity, Equity & Inclusion, and Culture programs. It complements other Committees of the Board who oversee material topics within their scope of responsibilities to provide full oversight to ESG matters.

In addition to the Board and its Committees, an ecosystem of management-level committees support various components of our ESG strategy. Our ESG Committee, which is comprised of members of the executive management team, monitors and approves strategies designed to identify, measure, control, and enhance the Company’s ESG/Corporate Responsibility performance.

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7    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

Climate Change
Climate change poses unprecedented risks and opportunities to the world, including Berkshire, its customers and communities. The impacts which can occur from climate change can directly and/or indirectly impact the Company and its stakeholders. As the transition to a low-carbon economy accelerates, new policy emerges, and market dynamics shift, Berkshire expects that its efforts to manage its environmental footprint, mitigate the risks associated with climate change, and support the transition will allow it to strengthen its positioning as a high performing, leading socially responsible community bank. The Company continues to evolve its practices to reflect its community bank mission as well as the size, scope, and complexity of its operations.

Berkshire enhanced its governance over material environmental matters in 2021 by formalizing an Environmental, Social and Governance management committee and completing a formal climate change risk assessment to evaluate the bank’s operations and lending activities for potential exposure to transition and physical risks resulting from climate change.
The results of the risk assessment guide Berkshire’s forward climate management and environmental sustainability strategies.
We have set targets to help finance the green transition, reduce its Greenhouse Gas (GHG) emissions and source 100% of our electricity from renewable sources by the end of 2024.
As the Company moves further along in its climate journey, it expects to continue to enhance its plans, disclosures, programs and initiatives to reduce its emissions as well as capitalize on the many business opportunities arising from the transition to a lower-carbon economy.

Ratings, Awards & Recognition
We’re proud to be recognized for our performance with local, regional, national, and international awards as well as leading third party ESG ratings* including:
MSCI ESG- BBB
ISS ESG Quality Score - Environment: 3, Social: 1, Governance: 2
Bloomberg ESG Disclosure- 47.81
The Company is also rated by Sustainalytics
Banking Northeast Community Champion Award
Communitas Award for Leadership in Corporate Social Responsibility
Bloomberg Gender-Equality Index
Human Rights Campaign Corporate Equality Index Best Place to Work for LGBTQ+ equality- 100% Score
*As of December 31, 2021






8    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

HUMAN CAPITAL MANAGEMENT
Berkshire’s people are the core of its ability to deliver on its Berkshire’s Exciting Strategic Transformation (BEST) plan and vision of being a high performing, leading socially responsible community bank in New England and beyond. The Company’s approach to human capital management is grounded in its Be FIRST values and focuses on:
Strong oversight and risk management practices
Recruitment
Compensation & Benefits
Retention, Training, Development & Engagement
Health & Wellness

Oversight
The Board of Directors has ultimate responsibility for the strategy of the Company. The Compensation Committee of the Board of Directors oversees executive compensation matters and the Corporate Responsibility & Culture committee oversees company culture, diversity, and employee engagement. The Company proactively identifies potential human capital related risks, such as the labor market shortage, rising labor costs, and employee retention and designs strategies to mitigate those risks. Strong human capital management is viewed as integral to the Company's strategic transformation.

Recruitment
Berkshire operates in a highly competitive labor market with strong competition for top talent. To help power Berkshire’s transformation, it relies on and continues to recruit employees with the right mix of skills, expertise and experiences. The Company leverages several strategies to support its talent pipeline and talent acquisition activities including internship placements, affinity group relationships, and the use of experienced recruiters for key management and specialized positions.

Berkshire continues to pursue a hybrid work model to expand its access to top talent and provide its employees with workplace flexibility. These strategies have proved effective in meeting the demand for talent demonstrated by the Company’s strong track record attracting new talent across retail, commercial, wealth management, business banking and operational areas. In addition, as market disruptions from mergers remain, Berkshire will continue to leverage its differentiated brand and unique market positioning to hire community-focused bankers from its competitors.

Compensation & Benefits
While the labor market shortage and other factors can contribute to increased labor costs, Berkshire continually evaluates its strategies and looks at best practices to provide competitive pay and benefits packages that reward performance and retain top talent at all levels of the Company. The Company offers comprehensive medical coverage, paid vacation and personal time, along with other benefits, all of which are available to married same-sex or different-sex couples as well as domestic partners. In addition to its compensation and health benefits, Berkshire offers volunteer-time off, an employee assistance program, regular performance reviews and the You FIRST Fund to help employees impacted by personal financial hardships.

Retention, Training, Development & Engagement
Strong employee retention will help reduce expense, create efficiencies and contribute to the success of BEST. In addition to compensation and benefits packages, Berkshire employs a collection of strategies to strengthen employee retention. The Company offers a menu of development and training programs consistent with one’s job responsibilities and professional goals including a mentoring program to pair high potential junior employees with senior staff. Berkshire continues to reskill and upskill employees from across the Company to take on new responsibilities and roles. For employees looking to expand their professional experience in the classroom, the Company offers an education assistance program. In 2021, Berkshire further enhanced its commitment to creating a strong workplace culture by rolling out a comprehensive employee engagement survey to identify strengthens and opportunity areas within the organization. Action plans were developed in areas that did not meet the Company’s high expectations. It expects to continue to enhance its efforts through intentional actions including offering a new employee rewards and recognition program.




9    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

Health & Wellness
Like all businesses, Berkshire has been impacted by the ongoing COVID-19 pandemic and continues to proactively manage impacts to protect the health and safety of its employees, customers and communities as well as retain and attract top talent. During the height of the pandemic, the Company provided protective equipment to front-line employees, including masks and gloves, and offered all additional paid sick time, paid vaccine time, paid quarantine/isolation leave, job protected personal leave, flexible work schedules for remote employees, premium pay for onsite employees and maintained full pay for employees with reduced schedules, as a result of the pandemic. The Company continues to maintain a largely hybrid working environment with the majority of non-branch staff working remotely at least part-time.

Future of the Workplace
Berkshire continues to evolve and enhance its human capital management strategies to help drive organizational growth in support of BEST while combating risks, such as the labor market shortage and rising labor costs. The Company intends to continue to evolve its workplace model into a hybrid environment over the long-term. It also plans to pursue its DigiTouch™ service delivery model, a powerful combination of personal service driven by bankers fused with the convenience of user-centric technology that combined, delivers a superior customer experience. While technology will play a bigger role in the future of Berkshire helping to improve processes and drive efficiencies, people will always be at the core of its ability to deliver value to its customers and communities. The Company remains confident that the Berkshire brand, value proposition and socially-responsible vision will continue to be a differentiator in the market and help overcome labor market disruptions.

Diversity, Equity & Inclusion
Creating a diverse, equitable, and inclusive workplace is a critical component to the success of Berkshire’s Exciting Strategic Transformation (BEST) and its BEST Community Comeback. At the core of Berkshire’s strategy is a goal to ensure that its workforce reflects the communities in which it operates, that its employees feel that they are valued and can reach their full potential and that it leverages its core business to improve the access and affordability of financial solutions to support economic growth of under-represented populations and communities.

The Company instituted a strong foundation of governance practices to ensure that diversity, equity and inclusion is embedded into Berkshire’s business activities. This includes the Corporate Responsibility & Culture Committee of the Board of Directors which has ultimate oversight responsibility. Berkshire’s Diversity, Equity & Inclusion Committee, which reports into the Board committee, provides additional management level oversight to the Company’s programming and performance. To further strengthen those efforts in 2021, Berkshire named a Senior Vice President/Chief Diversity Officer.

The Company continues to work to improve representation within its workplace leveraging a combination of strategies. Berkshire identifies opportunities in targeted markets and business lines, develops deeper partnerships with non-profit organizations and affinity groups and uses external recruitment professionals to ensure it receives candidate pools that reflect the rural and urban communities in which it operates. In addition, the Company regularly reviews the gender and ethnic diversity of its workforce at the employee, manager and executive management level.


Diversity & Inclusion*Percent of women in workforce 67 %
Percent of ethnic minorities in workforce 15 %
Percent of women on the Board25 %
Percent of ethnic minorities on the Board33 %
Percent of women in management (officer+)20 %
Percent of ethnic minorities in management (officer+)%
*Employee metrics reported are as of December 31, 2021. Board metrics based on 2022 Board nominees.




10    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROXY STATEMENT | PROXY STATEMENT SUMMARY

Berkshire provides a full suite of diversity, equity & inclusion trainings to build understanding and afford employees with strategies they can put into practice. All employees complete training annually. In addition, Berkshire offers seven Employee Resource Groups (ERGs) each playing an integral role for employees and the culture of the company. Every Employee Resource Group provides a safe space for dialogue, education, and collective action on topics relevant to their members and the Company. Through the ERGs, employees concerns and ideas to strengthen Berkshire’s culture are elevated to members of management and the Diversity, Equity & Inclusion Committee for action, empowering employees to collectively be engines of positive change within the workplace.


Find out more about Berkshire’s Commitment to Environmental, Social and Governance matters and our BEST Community Comeback in our 2021 Corporate Responsibility Report.


11    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement



Proposal 1:
Election of Directors for a One-Year Term
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Purpose.
Performance.
Progress.

The Company’s Board of Directors has nominated and recommends a vote “FOR” each of the twelve (12) nominees listed below for election as a director. All of the nominees currently serve on the Company’s Board of Directors.

Background. The Company’s Board of Directors is presenting twelve (12) nominees for election as directors at our Annual Meeting. Each of the nominees currently serve as a director on the Company's Board of Directors. Each director elected at the meeting will serve for a one-year term until our 2023 annual meeting or until a successor is duly elected and qualified. Each director nominee has consented to being named in this proxy statement and to serving as a director if elected. If a nominee is unable to be a candidate when the election takes place, the shares represented by valid proxies will be voted in favor of the remaining nominees. The Board of Directors does not currently anticipate that any of the nominees will be unable to be a candidate for election. Director Rheo A. Brouillard (age 68, 3 years of service) is not standing for re-election. Directors Nina A. Charnley, Mihir A. Desai, and Jeffrey W. Kip are new directors elected by the Board during the year and are standing for their first shareholder election.

Agreement with HoldCo Asset Management. On March 7, 2021, the Company entered into a cooperation agreement (the “Cooperation Agreement”) with HoldCo Asset Management, LP (“HoldCo”), an investment adviser which owns approximately 3.5% of the Company’s outstanding shares. Pursuant to the Cooperation Agreement, the Company agreed that it would nominate Michael Zaitzeff, Co-Founder and Managing Member of VM GP II LLC, the general partner of HoldCo, as a new independent director. Mr. Zaitzeff has agreed to stand for re-election in 2022. Pursuant to the Cooperation Agreement, Mr. Zaitzeff may select a replacement for his position, subject to the terms stated in the agreement.

The foregoing description is qualified in its entirety by reference to the Cooperation Agreement, a copy of which is attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 8, 2021.

Election. The affirmative vote of a plurality of the Company’s outstanding common stock present at the virtual annual meeting or by proxy at the Annual Meeting is required to elect the nominees for directors; provided, however, in the case of an uncontested election of directors, it is the Company’s policy that if a director is elected by a plurality but not a majority of the votes cast for such director, such director must submit his or her resignation to the Board of Directors, which will be subject to review by the Corporate Governance/Nominating Committee of the Board of Directors. The Corporate Governance/Nominating Committee will then make a recommendation to the Board of Directors as to whether to accept or reject the director’s resignation. Unless otherwise instructed, the proxy holders will vote the proxies received by them “FOR” the election of the nominees as directors.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF ITS DIRECTOR NOMINEES.


12    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES

Information Regarding Directors and Director Nominees

2022 Nominees for Election to the Board of Directors
BAYE ADOFO-WILSON, CEO OF BAW DEVELOPMENT, LLC
adofo-wilson.jpg
Mr. Adofo-Wilson, Esq. is CEO of BAW Development, LLC, a national real estate development company concentrating on redevelopment and consulting services in diverse communities. He is also Of Counsel at Post Polak, PA focusing on redevelopment law and specializing in New Jersey’s urban transitioning communities and municipalities, He has over 20 years of experience in law and business development, with a focus on community development, including the position of Deputy Mayor/Director, Economic and Housing Development for the City of Newark, New Jersey.
IndependentQualifications, Skills, and Experience:
Years of Service: 3Business Operations/StrategicRegulated Industry
Age: 53PlanningCorporate Responsibility/
Board Committees:Financial Expertise/LiteracyCommunity Leader
Audit Talent ManagementSmall Business Owner/Operator
Compliance & Regulatory Real EstateLegal Expertise
Corporate Responsibility
and Culture

DAVID M. BRUNELLE, CHAIRPERSON OF THE BOARD OF DIRECTORS OF BERKSHIRE HILLS BANCORP, INC., CO-FOUNDER AND MANAGING DIRECTOR OF NORTH POINTE WEALTH MANAGEMENT
brunelle.jpg
Mr. Brunelle is Co-Founder and Managing Director of North Pointe Wealth Management in Worcester, Massachusetts. He has over 20 years of experience in financial services working with businesses, individuals, families and charitable foundations. Mr. Brunelle is a former Director of Commerce Bancshares Corp. and Commerce Bank & Trust Company and served on Commerce’s audit and loan committees. He has also served as trustee or corporator for numerous non-profit entities in and around Worcester, including The Nativity School of Worcester, The Worcester Regional Research Bureau, The Worcester Educational Development Foundation, the UMass/Memorial Foundation, Becker College and the Greater Worcester Community Foundation.
IndependentQualifications, Skills, and Experience:
Years of Service: 4Public Company BoardTalent Management
Age: 51Business Operations/StrategicRegulated Industry
Board Committees:PlanningCorporate Responsibility/
Corporate Financial Expertise/LiteracyCommunity Leader
Governance/Nominating (Chair)Risk ManagementSmall Business Owner/Operator
CompensationWealth Management/Insurance
Corporate Responsibility &
Regulatory


13    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES

NINA A. CHARNLEY, FORMER SENIOR MANAGING DIRECTOR, TIAA
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Ms. Charnley was Senior Managing Director, Enterprise Customer Experience Executive at TIAA. Ms. Charnley led the strategy, development and execution of a significant portfolio of technology projects launching the company's mobile app and a digital bank, building digital capabilities enabling employees and customers. Previously, she was an executive at Bank of America managing diverse businesses including a de novo sustainable energy lending program and created the strategy, infrastructure, template and accountabilities matrix for Bank of America's Diversity and Inclusion program.



IndependentQualifications, Skills, and Experience:
Years of Service: <1Financial Institution ExecutiveTalent Management
Age: 66Business Operations and StrategicRegulated Industry
Board Committees: PlanningCorporate Responsibility/
CompensationFinancial Expertise/LiteracyCommunity Leader
Compliance & RegulatoryRisk ManagementInformation Technology/Cyber
Corporate Responsibility
& Culture

JOHN B. DAVIES, AGENT EMERITUS WITH MASSACHUSETTS MUTUAL LIFE INSURANCE
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Mr. Davies is a former Executive Vice President of Massachusetts Mutual Life Insurance and is currently an Agent Emeritus with Massachusetts Mutual, providing high net worth counseling with a focus on tax efficiency and intergenerational transfers of wealth. Mr. Davies currently serves on the Westfield State University Foundation Board. Mr. Davies is a former director of Woronoco Bancorp, Inc.

IndependentQualifications, Skills, and Experience:
Years of Service: 16Public Company BoardRegulated Industry
Age: 72Financial Institution ExecutiveWealth Management/Insurance
Board Committees:Business Operations/StrategicTalent Management
Compensation (Chair)PlanningCorporate Responsibility/
CorporateFinancial Expertise/LiteracyCommunity Leader
Governance/Nominating














14    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES




MIHIR A. DESAI, PROFESSOR OF FINANCE, HARVARD BUSINESS SCHOOL & PROFESSOR OF LAW, HARVARD LAW SCHOOL
desai.jpg
Dr. Desai is the Mizuho Financial Group Professor of Finance at Harvard Business School, and Professor of Law at Harvard Law School. Dr. Desai is an accomplished author and expert in finance and tax policy. He is a Research Associate in the National Bureau of Economic Research’s Public Economics and Corporate Finance Programs. In addition to his work at Harvard University, his professional experiences include CS First Boston, McKinsey & Co., and advising a number of firms and governmental organizations.
IndependentQualifications, Skills, and Experience:
Years of Service: <1Financial Expertise/LiteracyLegal Expertise
Age: 54Business Operations and StrategicCorporate Responsibility/
Board Committees:PlanningCommunity Leader
Risk Management & CapitalRisk Management
Compliance & Regulatory


WILLIAM H. HUGHES III, PRESIDENT OF EDUCATION DESIGN LAB
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Mr. Hughes is President of Education Design Lab, an innovation engine that applies human-centered design at the intersection of learning and work in order to provide alternative career pathways and close the skills gap. As a technology industry executive, Mr. Hughes has launched, led and advised multiple new ventures, providing expertise on strategy, innovation and product management. He has decades of experience advising senior executives at industry-leading multinationals on corporate strategy, partnerships and technology across several sectors, including education and financial services. He has led and advised multiple mergers, acquisitions and start-ups. Mr. Hughes has served on several corporate and not-for-profit boards. He is a trustee of Education Development Center, a director of FineTune Learning and a venture partner with 11 Tribes Ventures.

IndependentQualifications, Skills, and Experience:
Years of Service: 3Business Operations/StrategicTalent Management
Age: 58PlanningRegulated Industry
Board Committees:Information TechnologyCorporate Responsibility/
CompensationProduct ManagementCommunity Leader
Risk Management and Cybersecurity
Small Business Owner Operator
Capital (Chair)
Corporate Responsibility &
Culture



15    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES

JEFFREY W. KIP, CHIEF EXECUTIVE OFFICER OF ANGI INTERNATIONAL
kip.jpg
Mr. Kip is Chief Executive Officer of Angi International which provides internet tools and resources for home improvement, maintenance, and repair projects. Angi International is a subsidiary of IAC/InterActive Corp (NASDAQ: IAC), which owns and manages popular online brands and services. Prior to his role as Chief Executive Officer, Mr. Kip was the Chief Financial Officer of IAC/InterActive Corp from 2012-2016. Mr. Kip's previous positions include Chief Financial Officer of Panera Bread, LLC from 2006 – 2012. Mr. Kip has been designated by the Board of Directors as a financial expert under the rules of the Securities and Exchange Commission
IndependentQualifications, Skills, and Experience:
Years of Service: < 1Financial ExpertiseTalent Management
Age: 53Business Operations/StrategicInformation Technology/Cyber
Board Committees:Planning
AuditMarketing/Public Relations
Compensation

DR. SYLVIA MAXFIELD, DEAN OF THE PROVIDENCE COLLEGE SCHOOL OF BUSINESS
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Dr. Maxfield is Dean of the Providence College School of Business and was previously Chairman of the Faculty and MBA Program Director at Simmons University in Boston. Additionally, she serves as voting member of the Rhode Island State Investment Commission, which oversees fund performance, including asset allocation and investment-related contracting. Dr. Maxfield also votes on shareholder proxy activity on behalf of the State. Previously, she has served on the boards of the Greater Providence Chamber of Commerce, Social Enterprise Greenhouse and the 21st Century Fund. Dr. Maxfield has been designated by the Board of Directors as a financial expert under the rules of the Securities and Exchange Commission.
IndependentQualifications, Skills, and Experience:
Years of Service: 2Business Operations/StrategicTalent Management
Age: 63PlanningCorporate Responsibility/
Board Committees:Financial Expertise/LiteracyCommunity Leader
Audit (Chair)Marketing/PR
Corporate
Governance/Nominating
Risk Management and Capital



16    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES

NITIN J. MHATRE, PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR OF THE COMPANY
mhatre.jpg
Mr. Mhatre was appointed to the role of President and Chief Executive Officer of the Company and Chief Executive Officer of the Bank in January 2021. He was also appointed as a Director of the Company and the Bank. Prior to joining the Company, Mr. Mhatre was Executive Vice President, Community Banking, at Webster Bank, where he led consumer and business banking businesses. Before joining Webster in 2009, Mr. Mhatre spent 13 years at Citi Group in various leadership roles across consumer-related businesses globally.

Non-IndependentQualifications, Skills, and Experience:
Years of Service: 1Public Company CEORisk Management
Age: 51Financial Institution ExecutiveRegulated Industry
Business Operations/StrategicCorporate Responsibility/
PlanningCommunity Leader
Financial Expertise/LiteracyTalent Management


LAURIE NORTON MOFFATT, DIRECTOR & CEO OF THE NORMAN ROCKWELL MUSEUM
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Ms. Norton Moffatt is the Director and Chief Executive Officer of the Norman Rockwell Museum, Stockbridge, Massachusetts. Since 1986, Ms. Norton Moffatt has overseen the expansion of the museum’s facilities and the creation of a scholars’ research program. Her efforts resulted in the Museum receiving the National Humanities Medal, America’s highest humanities honor. Ms. Norton Moffatt is also an active community leader. She is a founder of 1Berkshire and Berkshire Creative Economy Council and serves as a trustee of Berkshire Health Systems and a director of Berkshire Health Systems, Inc. and Berkshire Medical Center, Inc.



IndependentQualifications, Skills, and Experience:
Years of Service: 8Business Operations/StrategicMarketing/PR
Age: 65PlanningSmall Business Owner/Operator
Board Committees:Financial Expertise/LiteracyCorporate Responsibility/
CorporateTalent ManagementCommunity Leader
Governance/ Nominating
Corporate Responsibility &
Culture (Chair)


17    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | INFORMATION REGARDING DIRECTORS AND DIRECTOR NOMINEES

JONATHAN I. SHULMAN, FORMER EVP AND TREASURER AT KEYCORP
shulman.jpg
Mr. Shulman was formerly Executive Vice President & Treasurer at KeyCorp, a publicly traded U.S. bank. Mr. Shulman possesses deep commercial banking experience that includes financial markets, governance, and balance sheet and risk management disciplines. He began his career with KeyCorp in 1989 and served in leadership roles in financial market strategy, asset liability management, wholesale funding and capital planning. Shulman has also held committee membership positions on KeyCorp’s Asset Liability Committee, Market Risk Committee, Model Risk Committee, and Funds Transfer Pricing Committee. Mr. Shulman has been designated by the Board of Directors as a financial expert under the rules of the Securities and Exchange Commission.

IndependentQualifications, Skills, and Experience:
Years of Service: 2Financial Institution ExecutiveRisk Management
Age: 59Business Operations/StrategicRegulated Industry
Board Committees:Planning
AuditFinancial Expertise/Literacy
Risk Management and Capital
Compliance and Regulatory
(Chair)

MICHAEL A. ZAITZEFF, MANAGING MEMBER OF VM GP II LLC
zaitseff.jpg
Mr. Zaitzeff is a co-founder and managing member of VM GP II LLC, the general partner of HoldCo Asset Management, LP. Mr. Zaitzeff has served as a member of numerous corporate boards, oversight committees and creditor committees. Mr. Zaitzeff served on the Trust Advisory Board of WMI Liquidating Trust, a trust created to implement the Chapter 11 Bankruptcy Plan of Washington Mutual, Inc.


IndependentQualifications, Skills, and Experience:
Years of Service: 1
Financial Expertise/Literacy
Marketing/PR
Age: 39
Regulated Industry
Small Business Owner/Operator
Board Committees(1):
Audit
Risk Management and Capital
(1)    Pursuant to the Company’s Cooperation Agreement with HoldCo Asset Management, LP, Mr. Zaitzeff was appointed to the Audit Committee and the Risk Management and Capital Committee, and serves as a non-voting observer on the Corporate Governance/Nomination Committee.


18    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Corporate Governance

The Company is committed to strong corporate governance policies, practices, and procedures designed to make the Board more effective in exercising its oversight role. The following sections provide an overview of our corporate governance structure, including independence and other criteria we use in selecting director nominees, our Board leadership structure, and the responsibilities of the Board and each of its Committees. Our Corporate Governance Policy, among other key governance materials, helps guide our Board and management in the performance of their duties and is regularly reviewed by the Board.

Key Corporate Governance Documents
Please visit our investor relations website at ir.berkshirebank.com to view the following documents:
Corporate Governance Policy
Code of Business Conduct
Anonymous Reporting Line Policy
Board Committee Charters
Certificate of Incorporation
Company By-Laws
These documents are available free of charge on our website or by writing to Berkshire Hills Bancorp, c/o Wm. Gordon Prescott, Executive Vice President, General Counsel and Corporate Secretary, 60 State Street, Boston, Massachusetts 02109.

The Board and management regularly review best practices in corporate governance and are committed to a program that serves the long-term interests of our shareholders. We believe good governance strengthens accountability and promotes responsible corporate citizenship. Several of our current best practices are highlighted below:
Independent Oversight Shareholder Orientation and AccountabilityGood Governance
Majority independent directors(1)
Declassified Board with all directors standing for election each year
Diverse board membership (skills, tenure, age); annual director education; active board replenishment program
Strong and engaged independent Board ChairRobust stock-ownership guidelinesAnnual evaluation of CEO and senior management and review of succession plans
All key committees are fully independentAnnual shareholder engagement programImplementation of a Corporate Responsibility & Culture Committee at both Board and employee level
Regular executive sessions of independent directorsPlurality voting standard for director elections, with director resignation policy in effect for uncontested electionsRisk oversight by full board and committees
Board Chair or Chair of Corporate Governance can call special meeting of the Board at any time for any reasonNo poison pill in place; annual election of all directorsFormal ethics code, reporting hotline and ethics training to all employees
(1)    11 out of 12 of the director nominees will be designated as independent directors; CEO/Director Mhatre is not independent.



19    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Board of Directors

The primary functions of Berkshire’s Board of Directors are:
To oversee management performance on behalf of shareholders;

To ensure that the interests of the shareholders are being served;

To monitor adherence to Berkshire’s standards and policies;

To promote the exercise of responsible corporate citizenship; and

To perform the duties and responsibilities assigned to the Board by the laws of Delaware, Berkshire’s state of incorporation.

Customarily, the Board elects its members to serve in identical capacities on the Board of Directors of Berkshire Bank, the Company's main operating subsidiary which is chartered in the Commonwealth of Massachusetts.

Talent Development and Succession Planning

One of the Board's primary responsibilities is to oversee the development and retention of key talent within the Company and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other senior executives. The Board meets regularly with senior management and periodically reviews the readiness of key employees to potentially assume additional roles and responsibilities, including in the event of unexpected circumstances. In addition, our Chief Executive Officer regularly discusses with our Corporate Governance/Nominating Committee recommendations and evaluations as to potential successors for senior positions. The Committee incorporates this feedback into its leadership development and contingency plans. While the Corporate Governance/Nominating Committee has primary responsibility for developing and maintaining a succession plan, the Committee regularly reports to the Board on this matter, and final decisions on senior leadership succession matters, other than the CEO, are made by the CEO in consultation with the full Board. The successful management of executive succession in 2021 was accomplished within the framework discussed above.

Identification of Candidates and Diversity

The Corporate Governance/Nominating Committee regularly reviews the composition of our Board and, as appropriate, recommends steps to be taken to ensure that the Board reflects the desired balance of skills, experience and diversity and meets the requirements of all applicable laws and regulations.

In accordance with our Corporate Governance Policy, the Corporate Governance/Nominating Committee and Board shall take into account diversity considerations. Diversity is broadly construed to mean not only diversity of gender, race, ethnicity and sexual orientation, but also diversity with respect to personal and professional experiences, backgrounds, opinions, beliefs, education and perspectives.

The Corporate Governance/Nominating Committee is committed to fostering an environment of diversity and inclusion, including among our directors, and is tasked as part of its annual evaluation with determining whether or not the Board is appropriately diverse. The Corporate Governance/Nominating Committee’s continued commitment to diversity is evidenced by the following:

58% of our director nominees are female and/or racially or ethnically diverse;
Half of our Board committees are chaired by diverse directors.




20    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Ongoing Board Refreshment

We believe that the Company benefits when the Board is comprised of a mix of experienced directors with diverse and fresh perspectives. To that end, the Board maintains an ongoing refreshment program to seek out highly qualified candidates with skills and experiences that are aligned with our long-term strategy. We have also adopted corporate governance guidelines providing both age and tenure limits, of 75 and 12 years, respectively, to facilitate appropriate transition and renewal. These guidelines as well as the Board’s general commitment to thoughtful refreshment has resulted in a number of changes in recent years.

In 2020, current Directors Sylvia Maxfield and Jonathan I. Shulman were appointed to the Board, effective February 24, 2020. Former Directors Pamela A. Massad and William J. Ryan did not stand for re-election and retired from the Board, effective as of the 2020 Annual Meeting. The number of members of the Board was thirteen (13) at both January 1, 2020 and December 31, 2020.

In 2021, Directors Cornelius D. Mahoney and D. Jeffrey Templeton did not stand for re-election and retired from the Board, effective as of the 2021 Annual Meeting. Directors Deborah P. Bailey and Michael A. Zaitzeff were elected to the Board for the first time at the 2021 Annual Meeting. Subsequently, J. Williar Dunlaevy and Ms. Bailey resigned from the Board in the second half of 2021, and Robert M. Curley passed away early in 2022. During the second half of 2021, the Board appointed Nina A. Charnley and Jeffrey W. Kip as directors, and the Board appointed Mihir A. Desai as a director in March 2022. The number of members of the Board was thirteen (13) at both January 1, and December 31, 2021. There are twelve Board nominees standing for reelection in 2022, reflecting the decision of director Rheo A. Brouillard to retire from the Board effective as of the 2022 Annual Meeting.

Shown below is the recent trend, showing the results of the board’s focus on refreshment, based on the Board nominees each year:
(years)2019202020212022
Average Nominee Age67.063.960.259.4
Average Nominee Tenure6.55.74.03.8

Board Meetings

During 2021, the Board of Directors held sixteen (16) meetings. The average attendance at meetings of the Board and Board Committees during 2021 was 97%. During this period, each of the current directors attended at least 75% of the aggregate total number of board meetings and committee meetings held on which such directors served.

In addition, the Board of Directors encourages each director to attend annual meetings of shareholders. Thirteen out of thirteen directors (100%) serving as of the date of the 2021 Annual Meeting of Shareholders attended the 2021 Annual Meeting.




21    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Board Leadership Structure

The Board has reviewed the current Board leadership structure of the Company, which consists of a separate Independent Chairperson of the Board and a Chief Executive Officer. The Independent Board Chairperson performs all duties and has all powers which are commonly incident to the office of Chairperson of the Board or which are delegated to that person by the Board of Directors, including presiding at all meetings of the Board of Directors. The Chief Executive Officer has responsibility for the management and control of the business and affairs of the Company and has general supervision of all other officers, employees and agents of the Company. The Board believes that separating these roles enhances the independence of the Board and its effectiveness in discharging its responsibilities and that this procedure is currently the most appropriate Board leadership structure for the Company.

From time to time, the Board may also appoint a Vice Chairperson in the manner and upon the criteria it deems appropriate. In the absence of the Board Chairperson, this position fulfills the responsibilities of the Board Chairperson and it may also fulfill any other responsibilities assigned by the Board of Directors. In 2021, on the retirement of Chairperson J. Williar Dunlaevy, the Board elected then Vice Chairperson David M. Brunelle to the Chairperson position.

Director Independence

All of the Company’s directors are independent under the listing requirements of The New York Stock Exchange (the “NYSE”), except for Mr. Mhatre who is an officer of the Company and the Bank, and except for Mr. Brouillard, who was CEO of SI Financial Group, Inc., which was acquired by the Company in 2019. Mr. Brouillard is not standing for re-election in 2022. Additionally, all of the members of the Audit, Compensation and Corporate Governance/Nominating Committees are independent in accordance with the listing standards of the NYSE, and, in the case of members of the Audit and Compensation Committees, applicable rules and regulations of the Securities and Exchange Commission (“SEC”) and the Federal Deposit Insurance Corporation (“FDIC”). In determining the independence of its directors, the Board considered transactions, relationships and arrangements between the Company and its directors that are not required to be disclosed in this proxy statement under the heading “Transactions with Related Persons,” including loans or lines of credit that the Bank has directly or indirectly made to Director Norton Moffatt.

Corporate Governance Policy

The Board of Directors has adopted a corporate governance policy to govern certain activities, including: the duties and responsibilities of directors; the composition, responsibilities and operation of the Board of Directors; the selection of a Chairperson of the Board of Directors; the selection time to time in the Board’s discretion of a Vice Chairperson of the Board of Directors; the operation of board committees; succession planning; convening executive sessions of independent directors; the Board of Directors’ interaction with management and third parties; director age limits; the maximum length of directors’ tenure on the Board; and the evaluation of the performance of the Board of Directors and of the Chief Executive Officer. A copy of the corporate governance policy is available in the Governance Documents portion of the Company’s Investor Relations website (ir.berkshirebank.com).

Commitment to Corporate Social Responsibility and Culture

Berkshire Bank is a purpose and values-driven community bank. Environmental, Social, and Governance factors are central to its community bank mission, risk management practices, reputation and competitive positioning. The Corporate Responsibility & Culture Committee of the Board of Directors is responsible for overseeing the management of the Company’s enterprise-wide Corporate Social Responsibility, Diversity & Inclusion, and Culture programs. The committee, led by Director Laurie Norton Moffatt, reviews program performance, examines related risks and ensures accountability for management’s efforts to integrate social, environmental, cultural, and reputational considerations through all aspects of the company for the benefit of all its stakeholders. Berkshire invites you to learn more about all the ways it is a socially responsible and values-driven community bank in this year’s Corporate Responsibility Report: Meaningful Moments: Answering the Call, available online at berkshirebank.com/csr. A summary of the Company’s 2021 social responsibility initiatives was provided in the introductory section of this Proxy Statement.



22    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Director Continuing Education

The Board of Directors conducts annual director education sessions, which include presentations by industry experts based on input from directors regarding topics of interest. Directors also receive an annual update on trending compliance and regulatory matters and new developments from the Bank’s outside compliance advisory firm. Our executive management meets with the Board at every regularly scheduled board meeting and annually to review the Company’s strategic plan.

Board and Committee Self Evaluation

The Corporate Governance/Nominating Committee oversees the annual self-evaluation of the performance of the Board of directors and its committees, the results of which are discussed with the full Board and each individual committee, as appropriate. The purpose of the evaluations is to improve the performance of the overall Board and each specific committee. The evaluations include a review of any areas in which Board or committee members believe the Board and the committees can make a better contribution to the governance and oversight of the Company. The Corporate Governance/Nominating Committee also utilizes the results of the Board and committee evaluation process in assessing and determining the characteristics and critical skills required of prospective candidates for election to the Board and appointment to each committee. The evaluation survey forms include open-ended questions in which directors are invited to share their written comments on a confidential basis.

Committees of the Board of Directors

The Board currently has six standing committees: the Audit Committee; the Compensation Committee; the Corporate Governance/Nominating Committee; the Corporate Responsibility and Culture Committee; the Risk Management and Capital Committee; and the Compliance/Regulatory Committee. The Board reviews the Committee Charters regularly to ensure it has an effective, efficient committee structure. The Board has determined that all members of the Audit Committee, the Compensation Committee and the Corporate Governance/Nominating Committee are independent in accordance with the listing requirements of the NYSE. Each committee operates under a written charter approved by the Board of Directors that governs its composition, responsibilities and operation. Each committee reviews and reassesses the adequacy of its charter annually or biannually. The current charters of all six committees are available in the Governance Documents portion of the Investor Relations section of the Company’s website (ir.berkshirebank.com).

The following table shows the structure of the Board of Directors as of the filing date of this Proxy Statement. It also shows the number of times each Committee met in 2021. With the exception of the appointment of Directors Charnley, Desai, and Kip, the resignations of Directors Dunlaevy and Bailey therefrom, and the death of Director Curley, there were no other changes to the board structure and board committees since the Proxy Statement for the 2021 annual meeting.




23    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Board Structure and Meetings
Director Name, Age & Primary OccupationDirector
Since
Director
Category
Audit(1)
CompCorp Gov & NomCorp Responsibility & CultureRisk & CapitalCompliance & Reg
Baye Adofo-Wilson, Age 53
CEO of BAW Development, LLC
2019IOOO
Rheo A. Brouillard(2), Age 68
Former Director, President, and CEO
SI Financial Group, Inc.
2019NOO
David M. Brunelle, Age 51
Chairperson of the Board of Directors of Berkshire Hills Bancorp, Inc.
Co-Founder and Managing Director of North Pointe Wealth Management
2017IOCO
Nina A. Charnley, Age 66
Former Senior Managing Director TIAA
2021IOOO
John B. Davies, Age 72
Agent Emeritus with Massachusetts Mutual Life Insurance
2005ICO
Mihir A. Desai, Age 54
Professor of Finance and Law
2022IOO
William H. Hughes III, Age 58
President of Education Design Lab
2019IOOC
Jeffrey W. Kip(1), Age 53
Chief Executive Officer Angi International
2021IOO
Dr. Sylvia Maxfield(1), Age 63
Dean Providence College School of Business
2020ICOO
Nitin J. Mhatre, Age 51
President and CEO of Berkshire Hills Bancorp, Inc.
2021N
Laurie Norton Moffatt, Age 65
Director & CEO of the Norman Rockwell Museum
2013IOC
Jonathan I. Shulman(1), Age 59
Former EVP and Treasurer KeyCorp
2020IOOC
Michael A. Zaitzeff(3), Age 39
Co-founder and managing member of VM GP II LLC
2021IOO
Number of Meetings in 2021
16
(Full Board)
15610555
N = Non-Independent DirectorI = Independent DirectorC = Chair O = Committee Member
(1)    Directors Kip, Maxfield, and Shulman have been designated by the Board as Financial Experts.
(2)    Director Brouillard is not standing for re-election in 2022.
(3)    Director Zaitzeff also serves as a non-voting observer on the Corporate Governance/Nominating Committee.








24    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

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25    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Board Committees and Responsibilities

The primary functions of each of the board committees are described below.
BOARD COMMITTEES
ROLES AND RESPONSIBILITIES
AUDIT COMMITTEEAssists the Board of Directors in its oversight of the Company’s accounting and reporting practices
All Members IndependentReviews the quality and integrity of the Company’s financial reports
Chair: Dr. MaxfieldEnsures the Company’s compliance with legal and regulatory requirements related to accounting and financial reporting
The Board of Directors has determined that Dr. Maxfield, Mr. Kip, and Mr. Shulman qualify as Audit Committee Financial Experts under the rules of the Securities and Exchange Commission.Oversees the Company’s internal audit function
Annually reviews and approves the internal and external audit plans
Engages with the Company’s independent registered public accounting firm (Crowe) and monitors its performance, reporting, and independence
COMPENSATION COMMITTEEApproves the compensation objectives for the Company and its subsidiaries and establishes the compensation for the Chief Executive Officer and other Named Executive Officers of the Company
All Members Independent
Reviews the Company’s incentive compensation and other equity plans and recommends changes to the plans as needed
Chair: Mr. Davies
Reviews all compensation components for the Company’s Chief Executive Officer and other Named Executive Officers, including base salary, short-term incentive, long-term incentives/equity, benefits, and other perquisites
See the “Compensation Discussion and Analysis” section for more information regarding the role of the Compensation Committee management and compensation consultants in determining and/or recommending the amount or form of named executive compensation.

Reviews competitive market factors and examines the total compensation mix, pay-for-performance relationship, and how all elements, in the aggregate, comprise the named executive officer’s total compensation package
Administers CEO employment agreement, change in control agreements, and equity incentive plans
COMPLIANCE & REGULATORY COMMITTEEOversees management’s implementation of compliance programs, policies, and procedures designed to identify and respond to the various compliance and regulatory risks of the Company and its subsidiaries
Most of Members IndependentMonitors the preparations for regulatory examinations of the Company and the Bank
Chair: Mr. Shulman
Oversees the Company’s information security program and monitors associated risks
Monitors significant legal or regulatory compliance exposure and oversees responses to material reports or inquiries from government or regulatory agencies
Ensures that the Company, Berkshire Bank and their affiliates have in place sound compliance management systems (“CMS”) as required by all applicable regulators and the Consumer Financial Protection Bureau (“CFPB”)


26    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

BOARD COMMITTEES
ROLES AND RESPONSIBILITIES
CORPORATE GOVERNANCE/NOMINATING COMMITTEEIdentifies qualified individuals to serve as Board members
Considers and recommends nominees for director to stand for election at the Company’s annual meeting of shareholders
All Members IndependentDetermines the composition of the Board of Directors and its committees
Chair: Mr. Brunelle
Annually reviews policy, procedures and criteria for identifying candidates for election or appointment to the Board of Directors
Monitors a process to assess Board effectiveness, including annual Board and committee self-evaluations
Develops and implements the Company’s corporate governance guidelines, including annual reviews of the Company’s Corporate Governance Policy and Code of Business Conduct
Regularly receives reports from executive officers heading the Company’s investor relations and compliance and regulatory programs and periodically receives reports from other committee chairpersons regarding the work being done by their committees
CORPORATE RESPONSIBILITY & CULTURAL COMMITTEE
Oversee management’s implementation of Corporate Social Responsibility/ESG, Diversity & Inclusion, and Culture programs to foster belonging, enhance reputation, mitigate risk, promote competitive advantage, engage employees, and meet stakeholder expectations
All Members Independent
Chair: Ms. Norton Moffatt
Review, approve, and recommend programs and policies to the Board that are designed to identify, measure, monitor, control, and enhance Corporate Social Responsibility/ESG, Diversity & Inclusion, and Culture performance;
Monitor the performance of Corporate Social Responsibility/ESG, Diversity & Inclusion, and Culture programs and policies by setting goals, examining social and culture risks, as well as reviewing opportunities and threats that could affect the Company
RISK MANAGEMENT & CAPITAL COMMITTEE
Oversees management’s program to limit or control the material business risks that confront the Company
Approves policies and procedures designed to lead to an understanding and to identify, control, monitor and measure the material business risks of the Company and its subsidiaries
Most of Members Independent
Chair: Mr. HughesPlans for future capital needs
Reviews material business risks including, but not limited to, credit risk, interest rate risk, liquidity risk, regulatory risk, legal risk, operational risk, strategic risk, cyber-security risk, and reputation risk
Monitors the Company’s enterprise governance, risk management and compliance (“EGRC”) program, including development and implementation of risk management processes in the area of vendor management, data loss prevention, business continuity, policy management and testing and assessment of operational controls
Ensures compliance with regulations pertaining to capital structure and levels


27    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Audit Committee

For information about the Audit Committee and Berkshire’s Audit Committee financial experts, please see table above and the discussion related to the Ratification of the Public Accounting Firm in this proxy statement.

Identification and Evaluation of Director Candidates

The Corporate Governance/Nominating Committee is responsible for identifying and recommending to the Board of Directors candidates for Board membership. For purposes of identifying nominees, the Corporate Governance/Nominating Committee may rely on professional networks and contacts of the committee members and other members of the Board of Directors, outside search firms, and its knowledge of members of the communities served by the Company and its subsidiaries. The Corporate Governance/Nominating Committee will also consider director candidates recommended by shareholders in accordance with the policy and procedures set forth below. From time to time the Corporate Governance/Nominating Committee may also use an independent search firm to identify potential nominees.

In evaluating potential nominees, the Corporate Governance/Nominating Committee determines whether the candidate is eligible and qualified for service on the Board of Directors by evaluating the candidate under certain criteria, which are described below under “Director Eligibility Requirements.” If an individual fulfills these criteria, the Corporate Governance/Nominating Committee will conduct a background check and interview the candidate to further assess the qualities of the prospective nominee and the contributions they would make to the Board.

Criteria for Nomination to the Board of Directors

The Corporate Governance/Nominating Committee has adopted a set of criteria that it considers when it selects individuals to be nominated for election to the Board of Directors. A candidate must meet the eligibility requirements set forth in the Company’s bylaws, including a requirement that the candidate not have been subject to certain criminal or regulatory actions. A candidate also must meet any qualification requirements set forth in any Board or committee governing documents.

If the candidate is deemed eligible and qualified for election to the Board of Directors, the Corporate Governance/Nominating Committee will then evaluate the following criteria in selecting nominees:
financial, regulatory, and business experience;
expertise in areas that the board considers important to advancing the company’s strategies;
in most cases, familiarity with and participation in the local communities;
integrity, honesty, and reputation in connection with upholding a position of trust with respect to customers;
dedication to the Company and its shareholders; and
independence.

The Committee will consider a candidate’s background, training, leadership ability and related skills across a broad spectrum of business, professional, entrepreneurial, educational and creative endeavors, as well as technical skills, experience and know-how in fields and professions outside the financial services industry (such as, by way of example, but without limitation, cyber-security, information technology and management, marketing, business and human capital development) that may assist the Company in strengthening, protecting or promoting its business. The Committee also will consider any other factors the Corporate Governance/Nominating Committee deems relevant, including age, diversity, size of the Board of Directors and regulatory disclosure obligations. We do not maintain a specific diversity policy, but diversity is considered in our review of candidates. Diversity is considered in terms of how a candidate’s background, experience, qualifications, attributes, and skills may complement, supplement or duplicate those of the Board.

With respect to nominating an existing director for re-election to the Board of Directors, the Corporate Governance/Nominating Committee will consider and review an existing director’s Board and committee attendance and performance; length of Board service; the experience, skills, and contributions that the existing director brings to the Board; and independence.



28    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Director Eligibility Requirements:

No person shall be eligible for election or appointment to the Board of Directors: (i) if such person has, within the previous ten years, been the subject of supervisory action by a financial regulatory agency that resulted in a cease and desist order or an agreement or other written statement subject to public disclosure under 12 U.S.C. 1818(u), or any successor provision; (ii) if such person has been convicted of a crime involving dishonesty or breach of trust which is punishable by imprisonment for a term exceeding one year under state or federal law; or (iii) if such person is currently charged in any information, indictment, or other complaint with the commission of or participation in such a crime.
No person shall be eligible for election or appointment to the Board of Directors if such person is the nominee or representative of a company, as that term is defined in Section 10 of the Home Owners’ Loan Act or any successor provision, of which any director, partner, trustee or shareholder controlling more than 10% of any class of voting stock would not be eligible for election or appointment to the Board of Directors.
No person may serve on the Board of Directors and at the same time be a director of more than two other public companies, or their subsidiaries.
No person shall be eligible for election to the Board of Directors if such person is the nominee or representative of a person or group, or of a group acting in concert (as defined in 12 C.F.R Section 303.81(b)), that includes a person who is ineligible for election to the Board of Directors.
The Board of Directors shall have the power to construe and apply the provisions of the Company’s bylaws and other governance documents, and to make all determinations necessary or desirable to implement such provisions, including but not limited to determinations as to whether a person is a nominee or representative of a person, a company or a group, whether a person or company is included in a group, and whether a person is the nominee or representative of a group acting in concert.
Pursuant to our Corporate Governance Policy, individuals first appointed or elected to the Board of Directors on or after January 1, 2019 will no longer be eligible for re-election to the Board of Directors after their 75th birthday or the completion of their 12th year of service on the Board. For Directors serving before January 1, 2019, who have surpassed or are approaching either or both of these age and service time limits, the Chairperson of the Board and the Corporate Governance/Nominating Committee shall work with any such Board members approaching mandatory retirement to ensure that timing issues are given due consideration and an appropriate transition and renewal of the Board occurs.

Consideration of Recommendations by Shareholders. It is the policy of the Corporate Governance/ Nominating Committee of the Board of Directors of the Company to consider director candidates recommended by shareholders who appear to be qualified to serve on the Company’s Board of Directors. The Corporate Governance/Nominating Committee may choose not to consider an unsolicited recommendation if no vacancy exists on the Board of Directors and the Corporate Governance/ Nominating Committee does not perceive a need to increase the size of the Board of Directors. Recommended candidates will generally be considered along with other potential nominees as part of the Board’s annual review process. To avoid the unnecessary use of the Corporate Governance/Nominating Committee’s resources, the Corporate Governance/Nominating Committee will consider only those director candidates recommended in accordance with the procedures set forth below.




29    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Procedures to be Followed by Shareholders. To submit a recommendation of a director candidate to the Corporate Governance/Nominating Committee, a shareholder must submit the following information in writing, addressed to the Chairman of the Corporate Governance/Nominating Committee, care of the Corporate Secretary, at 60 State Street, Boston, Massachusetts 02109:
1.    The name of the person recommended as a director candidate;
2.    All information relating to such person that is required to be disclosed in solicitations of proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934;
3.    The written consent of the person being recommended as a director candidate to being named in the proxy statement as a nominee and to serving as a director if elected;
4.    As to the shareholder making the recommendation, the name and address of such shareholder as it appears on the Company’s books; provided, however, that if the shareholder is not a registered holder of the Company’s common stock, the shareholder should submit their name and address along with a current written statement from the record holder of the shares that reflects ownership of the Company’s common stock; and
5.    A statement disclosing whether such shareholder is acting with or on behalf of any other person and, if applicable, the identity of such person.

In order for a director candidate to be considered for nomination at the Company’s annual meeting of shareholders, the recommendation must be received by the Corporate Governance/Nominating Committee at least 120 calendar days before the date the Company’s proxy statement was released to shareholders in connection with the previous year’s annual meeting, advanced by one year. The Company has not received any recommendations from shareholders for director candidates to be considered for election at the Company’s 2022 Annual Meeting of Shareholders.

Board Risk Oversight

The Board oversees the Company’s risk profile and management’s processes for assessing and managing risk, both as a whole board and through its committees. At least annually, the Board reviews strategic risks and opportunities facing the company and certain of its businesses. Other important categories of risk are assigned to designated Board committees that report back to the full Board. In general, the committees oversee the following risks:
Audit CommitteeAccounting and Financial Reporting
Compliance with Legal and Regulatory Requirements Related to Accounting and Financial Reporting
Compensation CommitteeCompensation Programs
Corporate Governance/ Nominating CommitteeGovernance Policies and Procedures
Board Organization and Membership
Committee Membership and Periodic Rotation of Chairpersons
Corporate Responsibility & Culture CommitteeCustomer, Community, and Employee Engagement
Reputational Risk and Business Development
Talent and Culture Development
Environmental Sustainability, Including Climate Risk
Risk Management & Capital
Committee
Credit Risk
Interest Rate Risk
Liquidity and Capital Risk
Operational and Strategic Risk
Cyber-security
Regulatory & ComplianceLegal, Regulatory, and Compliance Risk
Information Security



30    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | CORPORATE GOVERNANCE

Code of Business Conduct and Anonymous Reporting Line Policy

The Company has adopted a Code of Business Conduct that is designed to promote the highest standards of ethical conduct by the Company’s directors, executive officers and employees. The Code of Business Conduct, sets forth the ethical rules and standards ("code of ethics") by which all employees, officers and directors of the Company and its subsidiaries must conduct themselves, and addresses, among other things, conflicts of interest, the treatment of confidential information, general employee conduct and compliance with applicable laws, rules and regulations. The Code of Business Conduct, which also strictly prohibits harassment of any kind in the workplace, is designed to deter wrongdoing and promote honest and ethical conduct, the avoidance of conflicts of interest, a zero tolerance culture and safe environment free from harassment of any kind, full and accurate disclosure and compliance with all applicable laws, rules and regulations.

Paired with the Code of Business Conduct, the Company has also adopted a related Anonymous Reporting Line (also known as the Whistleblower Reporting Line) Policy, under which the Audit Committee maintains and monitors an anonymous “whistleblower” reporting hotline service that all Berkshire personnel are encouraged to use for reporting actual or potential wrongdoing, apparent or suspected violations of the Code of Business Conduct, or other misconduct by any corporate actors. Both the Code of Business Conduct and the Anonymous Reporting Line Policy are reviewed and acknowledged annually by all of Berkshire’s directors, officers and employees, and both are written and implemented to ensure that no retaliation is permitted against any Company personnel who report an incident of harassment or any other misconduct in good faith. Copies of the Company’s Code of Business Conduct and Anonymous Reporting Line (Whistleblower Reporting Line) Policy are available at the Company’s investor relations website (ir.berkshirebank.com).

Anti-Hedging and Pledging Restriction Policy

The Company has adopted a policy that prohibits hedging of Company common stock for all officers of the Company with the title of vice president or higher, all directors, and all persons in the accounting, executive, finance and legal departments (the “Restricted Group”). While there is no prohibition against employees who are not in the Restricted Group to hedge Company common stock, these employees are prohibited from trading Company common stock while in the possession of material non-public information. Under the policy, no person in the Restricted Group may at any time engage in (i) any short sale of Company common stock or other sale of any equity securities of the Company that they do not own, or (ii) any transactions in publicly-traded options, such as puts, calls and other derivative securities based on Company common stock, including, but not limited to, any hedging, monetization or similar transactions designed to decrease the risks associated with holding Company common stock, such as zero-cost collars and forward sales contracts. Generally, a short sale means any transaction whereby one may benefit from a decline in the Company's stock price. In addition, employees, officers and directors are discouraged from pledging Company common stock as collateral for margin purchases or a loan. However, exceptions to this pledging limitation may be granted, if good cause is shown.




31    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | DIRECTOR COMPENSATION

Director Compensation

The Company uses a combination of cash and restricted stock to attract and retain qualified candidates to serve on the Board. Restricted stock grants are intended to align directors’ interests with those of the Company’s shareholders. The Compensation and Corporate Governance/Nominating Committees review director compensation and benefits annually and make recommendations to the Board. The following table provides the compensation received by individuals who served as directors of the Company during the 2021 fiscal year. Mr. Mhatre does not receive separate compensation for his service on the Board.

Name
Fees Earned or Paid in Cash
($)(1)
Stock Awards
($)(2)
Option Awards
($)
All Other Compensation
($)(3)
Total
($)
Baye Adofo-Wilson68,000 50,000 — 414 118,414 
Deborah P. Bailey(4)
43,050 46,350 — — 89,400 
Rheo A. Brouillard(5)
56,000 50,000 — 9,227 115,227 
David M. Brunelle(6)
90,550 50,000 — 2,271 142,821 
Nina A. Charnley1,753 34,050 — — 35,803 
Robert M. Curley(7)
56,000 50,000 — 126,315 232,315 
John B. Davies62,000 50,000 — 2,109 114,109 
J. Williar Dunlaevy(8)
112,000 50,000 — 2,153 164,153 
William H. Hughes III70,000 50,000 — 414 120,414 
Jeffrey W. Kip10,849 37,850 — — 48,699 
Cornelius D. Mahoney(9)
31,000 50,000 — 2,109 83,109 
Sylvia Maxfield60,000 50,000 — 2,109 112,109 
Laurie Norton Moffatt70,000 50,000 — 2,109 122,109 
Jonathan I. Shulman60,000 50,000 — 2,109 112,109 
D. Jeffrey Templeton(9)
28,000 50,000 — 2,109 80,109 
Michael A. Zaitzeff36,900 46,350 — — 83,250 
(1)    On December 10, 2020, the Board of Directors, acting at the recommendation of the Compensation Committee, adopted a New Director Compensation Program, pursuant to which the Board has the discretion to award newly elected or appointed directors pro rata cash fees and equity compensation as of the date they begin their service on the Board. As a result of this program, the following directors received additional cash fees and stock awards in either July 2021 or January 2022 that are reported in this table:

a.Following her election to the Board of Directors for the first time on May 20, 2021, Ms. Bailey was paid a pro rata amount of cash fees in the amount of $8,050 on July 15, 2021, for the period from May 20 to June 30, 2021, and awarded 1,571 shares of Company stock on July 1, 2021, at a value of $46,350, for the period from May 20 to December 31, 2021, which were scheduled to vest in three equal installments on January 30, 2022, January 30, 2023 and January 30, 2024. Ms. Bailey subsequently resigned from the Board of Directors on October 26, 2021, at which time she forfeited the restricted shares awarded to her on July 1, 2022.
b.Following her appointment to the Board for the first time on December 16, 2021, Ms. Charnley was paid a pro rata amount of cash fees in the amount of $1,753 on January 15, 2022, for the period from December 16 to December 31, 2021, and awarded 1,178 shares of Company stock on January 30, 2022, at a value of $34,050, for the period from December 16, 2021 to December 31, 2021, of which 392 shares vested immediately on January 30, 2022, and the remaining 786 shares will vest in equal installments on January 30, 2023 and January 30, 2024.
c.Following his appointment to the Board for the first time on September 22, 2021, Mr. Kip was paid a pro rata amount of cash fees in the amount of $10,849 on January 15, 2022, for the period from September 22 to December 31, 2021, and awarded 1,309 shares of Company stock on January 30, 2022, at a value of $37,850, for the period from December 16, 2021 to December 31, 2021, of which 436 shares vested immediately on January 30, 2022, and the remaining 873 shares will vest in equal installments on January 30, 2023 and January 30, 2024.
d.Following his election to the Board of Directors for the first time on May 20, 2021, Mr. Zaitzeff was paid a pro rata amount of cash fees in the amount of $6,900 on July 15, 2021, for the period from May 20 to June 30, 2021, and awarded 1,571 shares of Company stock on July 1, 2021, at a value of $46,350, for the period from May 20 to December 31, 2021, of which 523 shares vested on January 30, 2022, and the remaining 1,048 shares will vest in equal installments on January 30, 2023 and January 30, 2024. Mr. Zaitzeff has informed the Company that a fund managed by HoldCo received the economic benefits of the cash fees and vested shares of the stock award, and that a fund managed by HoldCo and VM GP II LLC will receive their proportionate amounts of the economic benefits of the remaining unvested shares from the stock award.





32    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


PROPOSAL 1: ELECTION OF DIRECTORS | DIRECTOR COMPENSATION

(2)    Represents the grant date fair value of the restricted stock awards which has been computed in accordance with the stock based accounting rules under FASB ASC Topic 718. Amounts shown are the aggregate grant date fair value of restricted stock awards, with the grant date fair value based on the closing price of the Company’s common stock on the applicable grant date. See Note 20 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the Year Ended December 31, 2021. Since January 30, 2004, no stock options have been granted to any directors. Directors serving as of December 31, 2021, had the following number of unvested shares of restricted stock and stock options outstanding as of that date:

NameUnvested Restricted StockStock Options Outstanding
Baye Adofo-Wilson4,699 
Rheo A. Brouillard4,699 
David M. Brunelle4,699 
Nina A. Charnley— 
Robert M. Curley4,699 
John B. Davies4,699 
William H. Hughes III4,699 
Jeffrey W. Kip— 
Sylvia Maxfield4,162 
Laurie Norton Moffatt4,699 
Jonathan I. Shulman4,162 
Michael A. Zaitzeff1,571 
(3)    Reflects dividends paid when restricted stock becomes vested.
(4)    Ms. Bailey resigned from the Company and Bank Boards of Directors, effective as of October 26, 2021.
(5)    Includes $8,813 in imputed income on split dollar insurance recognized by Mr. Brouillard.
(6)    Includes $162 in imputed income on split dollar insurance recognized by Mr. Brunelle.
(7)    The total amount included in “All Other Compensation” reflects Mr. Curley’s annual salary in the amount of $120,000 as Chairman of the New York region of Berkshire Bank and club dues of $4,206.
(8)    Includes $44 in imputed income on split dollar insurance recognized by Mr. Dunlaevy. Mr. Dunlaevy retired from the Company and Bank Boards of Directors, effective as of September 22. 2021.
(9)    Messrs. Mahoney and Templeton retired from the Company and the Bank Boards of Directors, effective as of the 2021 Annual Meeting on May 20, 2021.

Retainers for Non-Employee Directors. The following table sets forth the applicable retainers that will be paid to our non-employee directors for their service on our Board of Directors during 2022.
Annual Cash Retainer for Board Service$40,000 
Annual Cash Retainer for Board Chair$95,000 
Annual Cash Retainer for Board Vice Chair(1)
$65,000 
Annual Equity Retainer for Board Service(2)
$65,000 
Annual Cash Retainer for Audit Committee Chair$13,000 
Annual Cash Retainer for all other Committee Chairs$6,000 
Annual Cash Retainer for Attendance at Audit Committee Meetings$12,000 
Annual Cash Retainer for Attendance at all other Committee Meetings$8,000 
(1)     This role is not filled at this time.
(2)    Beginning in 2022, restricted equity grants awarded to non-employee directors will vest in full after one year.



33    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement



Proposal 2:
Advisory Vote on Executive Compensation
image23.jpg
Purpose.
Performance.
Progress.

Background. In accordance with Section 14A of the Securities Exchange Act of 1934, shareholders are being given the opportunity to vote on an advisory (non-binding) resolution at the annual meeting to approve our executive compensation as described below in the Compensation Discussion and Analysis, compensation tables and narrative discussion of NEO compensation presented in this proxy statement. This proposal, commonly known as a “say-on-pay” proposal, gives shareholders the opportunity to endorse or not endorse the Company’s executive pay program.

The purpose of our compensation policies and procedures is to attract and retain experienced, highly qualified executives critical to the Company’s long-term success and enhancement of shareholder value. The Board of Directors believes the Company’s compensation policies and procedures achieve this objective, and therefore recommend shareholders vote “FOR” the proposal.

“Resolved, that the compensation paid to the Company’s Named Executive Officers, as disclosed in this proxy statement pursuant to Item 402 of Securities and Exchange Commission Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby approved.”

Is the Shareholder Vote Binding on the Company? This is an advisory vote only, and neither the Company nor the Board of Directors will be bound to take action based upon the outcome. The Compensation Committee will consider the vote of the shareholders when considering future executive compensation arrangements.

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THIS PROPOSAL.


34    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement




Compensation Discussion and Analysis
image23.jpg
Purpose.
Performance.
Progress.

In this section we explain our compensation philosophy, describe the material components of our executive compensation program, and review the 2021 compensation for our Named Executive Officers (“NEOs”) listed below. Their compensation is set forth in the Summary Compensation Table and other compensation tables contained in this Proxy Statement. The following Compensation Discussion and Analysis (“CD&A”) focuses on the key factors we believe shareholders should focus on in their evaluation of our “Say-on-Pay” proposal. This section also discusses the role of the Compensation Committee (“the Committee”).
Named Executive Officers(1)
Nitin J. MhatrePresident, Chief Executive Officer, and Director
George F. BacigalupoExecutive Vice President, Head of Commercial Banking
Subhadeep BasuSenior Executive Vice President, Chief Financial Officer
Sean A. GraySenior Executive Vice President, Chief Operating Officer
Gregory D. LindenmuthExecutive Vice President, Chief Risk Officer
Deborah A. StephensonExecutive Vice President, Chief Compliance and Regulatory Officer
James M. Moses Former Senior Executive Vice President and Chief Financial Officer
(1)    Titles shown are positions held at Berkshire Hills Bancorp, and in some cases are different from titles held at Berkshire Bank, a fully owned subsidiary of Berkshire Hills Bancorp. Ms. Stephenson became an NEO for the first time at the end of 2021. Ms. Stephenson’s compensation in 2021 was primarily managed by Mr. Lindenmuth.


35    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Executive Summary
Executive performance and compensation in 2021 were focused on transitioning executive management, setting out a new strategic plan to improve Company performance and franchise value, and executing on 2021 goals while also managing the ongoing impacts of the global COVID-19 pandemic. The compensation program is managed so that pay depends on performance against targets and is aligned with shareholder interests. The Committee considers market data and advice from its independent compensation consultant when making its decisions.

Named Executive Officers – A Year of Significant Leadership Transitions

The Board approved the appointment of Nitin J. Mhatre to serve as the new President and Chief Executive Officer of the Company and the Bank effective January 29, 2021. The terms of Mr. Mhatre’s employment with the Company were disclosed in his Employment Agreement, which is attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 26, 2021.

Mr. Mhatre is a senior banking executive with 25 years of community and global banking experience. He served most recently, as Executive Vice President, Community Banking at Webster Bank. In this role, he was responsible for profitable growth of the Community Banking segment at the $31 billion bank and led a diverse team of more than 1,500 employees. Previously, he spent more than 13 years at Citi Group in various leadership roles across consumer-related businesses globally. Following Mr. Mhatre’s employment, Acting CEO Sean Gray resumed his full time focus on his ongoing responsibilities as the President and Chief Operating Officer of the Bank.

Following the resignation of James Moses as Senior Executive Vice President/Chief Financial Officer of the Company and the Bank in March 2021, the Company recruited Subhadeep Basu to assume these responsibilities. Mr. Basu is a senior executive with more than 20 years of global banking, financial and risk management expertise leading transformation and growth. He served most recently as Senior Vice President of Global Institutional Services at State Street, and prior to that he was Senior Vice President of Finance, leading global regulatory reporting, capital strategy and optimization and finance and risk infrastructure. Before joining State Street, he spent more than 15 years at Citigroup, Bank of America, and Ally Financial.

During 2021, Tami Gunsch resigned from her position as Senior Executive Vice President/Head of Consumer Banking. Her position was divided into two positions. Lucy Bellomia was recruited as Executive Vice President/Head of Retail Banking and Ellen Steinfeld was recruited as Executive Vice President/Head of Consumer Lending and Payments. Deborah Stephenson, existing Senior Executive Vice President/Chief Compliance and Regulatory Officer, was designated as a Named Executive Officer pursuant to SEC guidelines and appears as an NEO for the first time in the compensation tables.

The above transitions were handled seamlessly, reflecting the excellent succession plan and transitions protocols in place. Transitions also benefited from strong recruitment and retention of other management and integration of leadership around common goals of charting a new strategic direction and exceeding expectations in delivering on current year objectives. Compensation payments shown in the compensation tables include pro rating of compensation amounts based on time in service in the designated roles.




36    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
New Strategic Plan

In May 2021, the Company announced its Berkshire’s Exciting Strategic Transformation (BEST) plan. The comprehensive BEST plan is targeted to improve the customer experience, deliver profitable growth, enhance stakeholder value and strengthen Berkshire’s community impact with improved focus on long-term efficiency, its customers, and its communities. The plan has three major pillars; optimize, digitize, and enhance. The BEST plan has five major goals to enhance shareholder value over the three-year plan period:

Return On Tangible Common Equity (ROTCE): 10 -12%

Return on Assets (ROA): 1.00 - 1.05%

Annual Pre-tax Pre-Provision Net Revenue (PPNR): $180 - 200 million

Net Promoter Score (NPS) in top quartile among New England banks

ESG ranking in the top quartile nationally based on composite metrics tracked by the Company

2021 Financial Results and Operations

The Company rebounded strongly from the pandemic impacted performance in 2020. Earnings per share recovered to $2.39 from a loss of $10.60 per share in 2020 and were up 21% over $1.97 reported in 2019. Return on equity nearly doubled to 10.18% in 2021, compared to 5.75% reported in 2019, and advanced more rapidly than peers. Earnings improvement reflected stronger credit performance and also included gains achieved in disposing of lower return business lines.

The Company’s 2021 pandemic support of its markets included processing of loan forgiveness for the Paycheck Protection Program (“PPP”) phase I loans, and facilitating PPP phase II loans in 2021 in partnership with a third party. Collectively, these loans provided more than $1 billion in support to Berkshire’s markets. The Company also continued to work with borrowers needing COVID related loan modifications, which originally totaled more than $1.5 billion, gradually helping nearly all of the borrowers to return to regular payment schedules by year-end 2021. The related improvement in the Company’s credit profile contributed strongly to the reduction in the loan loss provision compared to 2020. The Company’s earnings also benefited from processing of PPP loan forgiveness and loan applications, together with a decrease in nonperforming loans.

The Company supported its workforce with remote work while maintaining physical and digital customer access despite managing branch operating reductions during pandemic surges. The Company’s emphasis on technology and virtual customer service facilitated branch consolidations and other efficiencies that enhanced customer engagement and supported improved profitability.

Under its new executive leadership, the Company is expanding its frontline bankers, its digital technologies, and its fintech partnerships in support of its vision to be a high performing, leading socially responsible community bank in New England and beyond.

2021 Say on Pay Voting Results.

At the last annual meeting of shareholders on May 20, 2021, shareholders voted 97% in the affirmative to approve the NEO compensation as set forth in the Proxy Statement. The Compensation Committee values shareholder feedback and considers such feedback as part of its review and considerations related to executive pay programs.




37    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Summary of 2021 Compensation Decisions

Our executive compensation program targets median NEO pay compared to our peer group when we achieve our goals, with actual pay designed to vary below or above target based on our performance against our goals. Our target direct compensation for 2021 was not materially changed from the last two years.

As in the past, short-term incentive compensation was paid in cash and varies to reflect our performance of annual goals/budget. Long-term compensation was granted in the form of restricted stock which continued to consist of 60% performance-based shares with a three-year cliff vesting schedule, and 40% time-based restricted stock with 3 year incremental vesting (i.e. 1/3 each year).

Actual 2021 performance exceeded internal objectives and most external sell-side consensus estimates early in the year, as the Compensation Committee set challenging, yet achievable goals. As a result, the short-term incentive compensation was paid at 150% of target. This compares to 2020 NEO short-term incentive compensation which was paid 50% below the original target due to pandemic impacts on the Company.

The three year long-term incentive performance grants for the performance period 2019 – 2021 did not achieve threshold goals due to the Company’s relative underperformance primarily in 2020, and this component of incentive compensation was forfeited. This compensation had constituted approximately 24% of total direct compensation when granted in 2019. The maturing long-term performance compensation in 2020 was also forfeited in that year.

Compensation earned in 2021 rewarded our performance improvement over 2020 and achievement exceeding our budget and first year BEST goals. In comparison, compensation earned in 2020 was significantly lower than the prior year, as a reflection of 2020 performance and associated challenges. This reflects our continued pay-for-performance philosophy.

The Compensation Committee believes the compensation program provided appropriate performance incentives against pre-established strategic goals and in consideration of the Company’s 69% total shareholder return in 2021, as well as the development of the BEST plan for future franchise enhancement.




38    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS

Highlights of our Compensation and Governance Programs
WHAT WE DO
Pay for Performance: A significant portion of each NEO’s annual direct compensation target is variable and tied to company and individual performance results. The Company uses a mix of performance metrics and our short- and long-term plans provide a balanced timeframe for incentive opportunities. Our long-term incentive program grants the majority (i.e., 60%) as performance shares that vest based on pre-defined performance goals.
Link Performance Measures with Strategic Objectives: Performance measures and individual goals for incentive compensation are linked to strategic, operating and financial goals approved by our Board and designed to create long-term shareholder value.
Annual Say-on-Pay Vote: We conduct an annual Say-on-Pay advisory vote and evaluate voting results.
Shareholder Engagement: As part of the Company’s shareholder outreach program, members of the Committee and members of management welcome engagement with shareholders to better understand their perceptions and views on our executive compensation program.
Independent Compensation Consultant: The Committee engages its own independent compensation consultant to review the Company’s executive compensation program and practices.
Stock Ownership Guidelines: We have significant stock ownership guidelines requiring our executives and directors to hold substantial equity ownership.
Clawback Policy: The clawback policy allows the Board to recover incentive compensation paid to an executive if the financial results that the compensation was based on are materially restated due to fraud, intentional misconduct or gross negligence.
Incentivize Sound Risk Management: Our compensation program includes features intended to discourage employees from taking unnecessary and excessive risks, including balanced performance metrics, emphasis on long-term shareholder value creation, and clawback provisions. The Chief Risk Officer conducts an annual risk assessment which is used by the Committee in assessing the soundness of the compensation program.
WHAT WE DON'T DO
Gross-ups for Excise Taxes: We have not provided change-in-control tax gross-ups clauses since 2008, nor do we have any intention to include this feature in future contracts. At this time, one legacy NEO change in control agreement remains in place with this feature; the potential impact of this contract clause is not material.
Hedging and Pledging: All of our officers with the title of vice president or higher, directors, and all persons in the accounting, executive, finance and legal departments are prohibited from engaging in hedging, monetization, derivative or similar transactions with Company securities. We also have a policy that discourages pledging of company securities, with very limited exceptions.
Employment Contracts: Our executives, with the exception of the CEO, are all employed “at will” and the relationship may be terminated by the Company or the employee at any time without any severance payments. The CEO is employed under a three year contract. Documented change-in-control arrangements align management and shareholder interests.
Dividends on Unvested Equity Awards: We do not pay dividends on any restricted stock compensation until vested.




39    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Compensation Philosophy and Decision Making Process

The primary philosophy and objective of our compensation program is to align the interests of our executives with shareholders by rewarding performance against established corporate financial and strategic goals, solid executive leadership and strong individual executive performance. We strive to attract, motivate and retain a highly qualified and talented team of executives who will lead Berkshire to maximize long-term performance and earnings growth. The Committee regularly reviews executive compensation program elements to ensure they are consistent with safe and sound business practices, regulatory requirements, emerging industry best practices and shareholder interests.

Executive Compensation Key Principles

Our philosophy is to provide an executive compensation program that rewards long-term value for our shareholders and promotes sound risk management. The key principles that support our philosophy are:

ü Attract and retain highly talented executives committed to our success

ü Pay for performance

ü Align executive interests with those of our shareholders

ü Manage risk through oversight and compensation design features and practices

Important features of our program are:

ü A significant portion of direct pay is variable and performance based

ü A meaningful portion of pay is equity-based to align our executives with shareholder interests

ü The long-term incentive is 60% based on performance and 40% based on time

The charts below illustrate our 2021 target direct compensation for the NEOs named at year-end. The direct compensation structure is targeted towards the peer median, and NEO highlights include:

44% Variable Performance Based

32% Equity Based


charts.jpg



40    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Key Principles That Support Our Philosophy
Attract and retain highly talented executives committed to our successl
Provide competitive total compensation that enables us to attract and retain highly talented executives with experience and leadership abilities to grow and sustain our business
l
Target total compensation opportunities to reflect the median of market; defined as banks similar in size and business model to Berkshire
Pay for performance alignmentlMeasure our success through a balanced portfolio of performance metrics that rewards corporate and individual success
lA significant portion of total compensation is “at risk” and based on short and long-term performance
lFinancial performance results fund our annual incentive plan and determine a portion of long-term equity vesting
lLong-term equity compensation was granted with 60% of the grant tied to 3-year performance and 40% time-based with vesting over 3 years
Align executive interests with those of our shareholderslPerformance goals are directly aligned with our strategic and operating objectives targeted towards long-term shareholder value
lRigorous stock ownership requirements to ensure our executives hold stock throughout their tenure as executives
lA significant portion of executive compensation, consisting of our long-term incentive, is in the form of Company shares
Manage risk through oversight and compensation design features and practiceslTotal compensation program incorporates a balanced approach that includes pay that is fixed and variable, short- and long-term, and in the form of both cash and equity
lMultiple goals in our incentive plans to reinforce financial, operational, risk, and shareholder considerations
lCommittee can apply discretion to negatively adjust incentive compensation in consideration of risk management objectives
lBalance of short-term and long-term incentives, cash and equity, annual and multi-year performance periods, with 3 year performance in the long-term plan
lIncentive plan caps for maximum payments
lClawback policy that allows for recoupment of compensation for financial restatement or misconduct
Compensation
Drivers
lIncentive plans designed to encourage achievement of our strategic business goals and reinforce our business values
lPay levels that are fair, competitive and internally equitable
lA focus on the attainment of our vision, business strategy, operating imperatives, and results
lRecognition of Company and individual performance
lConsideration of market and best practices



41    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Decision-Making Process

Our Committee, which is composed solely of independent directors, is responsible for establishing, implementing and continually monitoring all elements of compensation for the NEOs.
Setting Performance Goals
Each year the Committee reviews our compensation program to determine competitiveness and effectiveness, and evaluates whether any changes should be made for the next fiscal year.
Annually, the Committee establishes Company financial and CEO individual performance goals which are set to be challenging, yet achievable. The CEO sets individual performance goals for each of the other NEOs, subject to the review of the Committee. The individual goals are designed to drive our strategic corporate goals.
The Committee meets regularly throughout the year, both with management and in executive session to review Company performance against the performance goals.

Determining Compensation
In the first quarter of each fiscal year, the Committee approves the components of compensation for each NEO. As part of the planning process, performance goals are set for each corporate performance measure.
The Committee annually conducts a review of each NEO and the Company’s performance measured against established financial and individual performance goals. As part of this review process, the CEO reviews with the Committee the performance of each NEO relative to the individual goals and presents his compensation recommendations based on his review. The Committee then independently reviews and, if desired, modifies any compensation recommendations prior to approving all compensation decisions for the NEOs.
The CEO’s performance is reviewed by the Committee in conjunction with a self-assessment and a formal CEO evaluation process and discussion with other independent directors. The CEO is not present when the Committee makes decisions on his compensation. The Committee meets with the CEO to present its decisions and review the Board’s assessment of his performance.
The Committee’s objective is to ensure that total compensation paid to the NEOs is fair, reasonable and performance based, while aligning with shareholder interests. In addition, the Committee annually conducts an executive compensation review with the compensation consultant to set compensation opportunities and ensure market competitiveness. The consultant also provides periodic assessment of pay-performance alignment.
Contribution from the Independent Compensation Consultant
Each year the Committee meets with the compensation consultant to review industry compensation trends and review current market compensation data. During 2021, the Committee’s independent compensation consultant provided consultations, data and advice to the Committee on request. The Compensation Committee Chair has regular contact with the independent consultant who also meets in executive session with the Committee on request.


42    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Factors Considered in Compensation Decision Process

The Committee considers many factors when making pay decisions throughout the year. In addition to the market data provided by the independent consultant, the Committee also considers various analyses, information, and input, which may include:

> Overall operational and financial performance
> Total shareholder return on an absolute and relative basis and stock price performance
> Executive individual performance results relative to their individual financial and strategic goals
> Strategic plan progress and performance relative to annual budget
> Demonstration of behaviors that support our culture and brand
> Support of corporate responsibility and environment, social and governance (ESG) goals
> Support of human capital and diversity, equity & inclusion (DEI) activities
> Executive stock ownership levels
> Qualitative input from the Committee and other independent directors
> External influences, economic conditions and industry factors
> Risk review considerations
> Income tax factors
> Internal equity
> CEO pay ratio
> Compensation trends and best practices
> Advisory Say on Pay voting results

Due to the pandemic and the CEO transition, the Committee endeavored to be particularly attentive to input from internal and external sources in order to have the most comprehensive understanding and communications related to Company performance and executive compensation.


43    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Benchmarking Analysis - Compensation Peer Group

The Committee considers the structure of compensation programs and pay levels at other publicly traded banks similar in size and business model to Berkshire when evaluating our compensation program. Typically the Committee’s independent compensation consultant conducts a comprehensive competitive market analysis annually using the peer group and other industry survey data. However, given the uncertainty resulting from the pandemic, the Committee decided not to request a full formal update from its independent compensation consultant since the pay program and targets were remaining generally the same.

2019 Peer Group: The peer group developed in 2019 by the consultant in conjunction with management and approved by the Committee is shown below. This is the peer group used to update CEO benchmarking for reference when hiring the new CEO in January 2021. (Note: one 2019 peer bank, CenterState Bank was excluded due to its acquisition by South State Corporation). When it was developed, this group of 24 banks reflected banks approximately ½ to 2x Berkshires’ size and had a median asset size of $13.3 billion, placing Berkshire Hills Bancorp at the 54th percentile compared to this peer group. The peer group is listed below.
Ameris BancorpHome BancShares, Inc.
Atlantic Union Bankshares CorporationIndependent Bank Corp.
BancorpSouth BankNBT Bancorp, Inc.
CenterState Bank CorporationOld National Bancorp
Community Bank System, Inc.Renasant Corporation
Customers Bancorp, Inc.Simmons First National Corporation
First Financial BancorpSouth State Corporation
First Merchants CorporationTowneBank
First Midwest Bancorp, Inc.Trustmark Corporation
Fulton FinancialUnited Bankshares, Inc.
Great Western Bancorp, Inc.United Community Banks, Inc.
Heartland Financial USA, Inc.WesBanco, Inc.

2021 Peer Group: In June 2021 the consultant updated the peer group. The criteria reflected exchange traded banks in the Northeast of similar size (i.e. approximately ½ to 2x Berkshires’ size). Banks involved with mergers, banks with different business models, and smaller banks were excluded. The result was a peer group of 18 banks with a median asset size of $12.2 billion, positioning Berkshire at the 50th percentile based on asset size. The peer group is listed below:
Brookline BancorpLakeland Bancorp
Community Bank SystemNBT Bancorp
Customers BancorpNorthwest Bancshares
Eagle BancorpOceanFirst Financial Corp.
First Commonwealth FinancialProvident Financial Services
Flushing FinancialS&T Bancorp
Fulton FinancialSandy Spring Bancorp
Independent Bank Corp.Tompkins Financial
Investors BancorpWSFS Financial



44    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Compensation Program Elements and Pay Decisions


Direct compensation consists of three main components: Base Salary, cash based Short-Term Incentive (“STI”), and stock based Long-Term Incentive (“LTI”). Total compensation includes a fourth component of Other Compensation which includes Benefits and Perquisites. Incentive based compensation includes the use of non-GAAP performance measures. For a reconciliation of non-GAAP measures to their most directly comparable GAAP financial measures, please see Appendix A. Compensation program elements and pay decisions are determined in a balanced framework to achieve program objectives.

Base Salary
The Company’s base salary program is designed to provide competitive base pay reflective of an executive’s role, responsibilities, contributions, experience, leadership and performance. Salaries are generally targeted to be within the range of market median and are expected to sufficiently discourage inappropriate risk taking by executives. Incentive compensation targets are tied to base salary, so salary changes flow through to other compensation program components.

2021 Salary Summary. Base salaries are typically reviewed at the beginning of each year based on the Committee’s review of market data, executive performance and internal equity. There were no changes to the 2021 salaries compared to 2020 salaries for each role shown below. Actual salaries paid in 2021 were prorated based on time in position for the new CEO and CFO.

2020
2021
Role
Salary
Salary
President and Chief Executive Officer
$725,000
$725,000
Chief Operating Officer
$550,000
$550,000
Chief Financial Officer
$430,000
$430,000
Head of Commercial Banking
$375,000
$375,000
Chief Risk Officer
$300,000
$300,000
Chief Compliance and Regulatory Officer
$275,000
$275,000
Note: Table does not include adjustments for the COO’s service as Acting CEO in 2020 & 2021, although such pay is reflected in the Summary Compensation values.





45    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Short-Term Incentive Program (STI)
The Company’s short-term incentive compensation program is designed to compensate executives for executing the Company’s strategic plan and achieving critical annual performance goals. The STI program provides meaningful “pay-at-risk” that is earned each year based on performance results. It also seeks to motivate and reward achievement of specific Company, business unit and individual performance goals with competitive compensation when performance goals are achieved; above or below median pay when performance results are above or below goals.

2021 Short-Term Incentive Summary: There were no material changes to target short-term incentive opportunities, which remained unchanged as a percentage of salaries (also unchanged for 2020). Actual incentive payouts were earned at 150% of target in 2021 due to outperformance on all targets. In comparison, payouts were only 50% of the original target in 2020, reflecting our pay-for-performance philosophy with underperformance during the pandemic. Individual performance was not used to vary payouts in recognition of the teamwork approach to the Company’s transformation.

Overview of Process. The Company’s executive STI program includes a group of executive and senior managers, including the NEOs. The Committee sets and approves incentive award targets for each participant (defined as a percentage of salary) at the start of each year, based on competitive market data. An incentive pool is established based on the total of the targets of plan participants.

The actual STI pool funding is determined based on a formulaic calculation of Company performance against defined quantitative financial metric goals, without discretion (“the Corporate Scorecard”). The Committee sets target, threshold and stretch goals for each incentive metric based on the business plan and Board approved budget. Target goals (reflective of our budget) are expected to have some stretch and not be “guaranteed”. Threshold performance goals and awards are intended to reward solid performance but at reduced payout levels. Stretch performance is expected to represent strong performance that is unlikely, but possible, if we exceed all our goals.

Each metric (see table below) is equally weighted (i.e. 20% for each of the five financial metrics) The incentive pool funding at year-end is based on actual corporate performance against the performance targets, with the total pool funding ranging from 0% - 150% of target. The weighted metrics are referred to as the Corporate Scorecard. Additionally, one metric is chosen as a trigger or gate, with no funding of the pool if that trigger is not met.

The Committee approves the Corporate Scorecard as well as the President and Chief Executive Officer’s individual goals. The CEO prepares goals for NEOs; the Committee can modify the goals at its discretion and approves the final goals. Once the Corporate Scorecard results and pool funding are known, individual performance is assessed to determine and allocate the actual awards from the amount that has been funded to the pool. The Committee determines individual awards in consideration of Individual performance but with the discretion to consider other factors such as Company performance shortfalls and/or regulatory and safety and soundness concerns and/or based on risk management considerations. The maximum award for any participant, in consideration of Corporate and Individual performance, is capped at 150% of target.




46    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Target Incentive Opportunities. For 2021, as in previous years, individual NEO STI target amounts were established at and defined as a percent of salary. There were no material changes in 2021 annual incentive targets compared to the original 2020 incentive targets. In 2020, STI target amounts were reduced by 50% from the original target amounts due to the impacts of the emergence of the COVID 19 pandemic. The table below illustrates the annual incentive target amounts, expressed as a percentage of salary.

2020 Original 2021
RoleTarget % of SalaryTarget % of Salary
President and Chief Executive Officer75%75%
Chief Operating Officer60%60%
Chief Financial Officer45%45%
Head of Commercial Banking45%45%
Chief Risk Officer 30%30%
Chief Compliance and Regulatory Officer30%30%
Note: Table does not include adjustments for the COO’s service as Acting CEO in 2020 & 2021.

Company Measures and Funding of the Incentive Pool

The Committee establishes performance goals for the Corporate Scorecard that determine the pool available for payout of incentive compensation. The Committee also establishes a minimum trigger or gate level of performance, which is defined as 75% of targeted core earnings per share, which must be achieved in order for the plan to fund any compensation. Once the minimum is achieved, the incentive pool funding is determined based on Company performance relative its performance goals.

The Committee established five corporate performance metrics, evenly weighted, to constitute the performance measures for the operation of the 2021 STI (the “Corporate Scorecard”). This is similar to the approach in years prior to 2020. The five measures chosen for 2021 are shown below. These goals were established in the second quarter of 2021 in order to include consideration of input and plans from new executive management that joined the Company in the first quarter.

The Committee also established the plan trigger at 75% of the EPS target shown below, or $0.79 per share. A Core EPS result below this trigger would result in no funding for the plan.

Plan Goals
Performance MeasureDefinitionWeightThresholdTargetStretch
EPS ($)Core Earnings Per Share20%$0.84$1.05$1.26
ROE (%)Core Return on Equity20%3.63%4.54%5.45%
ROA (%)Core Return on Assets20%0.37%0.46%0.55%
Efficiency Ratio (%)Core Efficiency Ratio20%80.10%76.10%72.10%
Asset Quality - NCO (%)Net Charge-offs/Avg Loans %20%0.77%0.64%0.51%
Note: The measures identified as Core are non-GAAP financial measures. These measures are identified as “Adjusted” measures in the SEC Form 10-K. They exclude items not viewed as related to ongoing operations. Their use, definitions, and reconciliations to GAAP measures are discussed more fully in the Form 10-K. For a summary of the reconciliation of these non-GAAP performance measures, please see Appendix B.

The measures used in the prepandemic year of 2019 also included Core EPS, Core Return on Assets, and the Efficiency Ratio. The previous asset quality metric measured the level of criticized assets. This metric was changed in 2021 to more directly focus on the loan charge-off ratio as a measure impacting financial condition. The Committee added a fifth metric of Core Return on Equity in 2021 to introduce a measure more correlated with the market valuation of the Company’s stock.




47    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
For the earnings measures, the thresholds were set at 80% of target and stretch goals were set at 120%. The efficiency ratio ranges were set at approximately 5% above or below target. The charge-off ratio ranges were set at approximately 20% above or below target. These ranges were broadened out from the prepandemic year of 2019 to reflect the greater range of strategies, outcomes, and uncertainties in the current environment. For the efficiency and charge-off ratios, a lower result is better.

The 2021 core earnings related targets reflected expected improvement from 2020 results. They also reflected prevailing trends and conditions, and were generally consistent with mean consensus estimates of Company 2021 performance at the time that the targets were set.

The Core EPS and efficiency targets anticipated that near term impacts of new strategic initiatives might require higher investment in expenses and delays in revenue growth as transformational initiatives were implemented while loan runoff was still ongoing. Additionally, these targets allowed management flexibility to accumulate liquid short term investments which held back 2021 earnings, in order to benefit from anticipated interest rate increases in 2022 and beyond.

The net charge-off target reflected the elevated credit loss allowance and uncertainties about pandemic impacts on problem loan collections. The charge-off target was generally similar to the consensus estimates based on the Company’s credit profile and industry expectations. It was also within a range consistent with the allowance for credit losses on loans in the Company’s audited statement of financial condition at year-end 2020.

The 2021 STI performance and payout results are shown below. Management outperformed the stretch goals on all five measures and achieved a 150% pool funding as a result.

This was primarily due to stronger credit performance as economic conditions improved and management’s programs for credit administration of loans to COVID-sensitive industries resulted in most credit related metrics improving to prepandemic levels by the end of 2021.
This improvement resulted in lower credit loss provision expense than anticipated, which contributed to outperformance of the earnings based measures, along with the asset quality measure.
The efficiency ratio also outperformed the stretch goal, and initiatives to lower funding costs and operating costs resulted in stronger operating earnings compared to plan and consensus.

By the end of the year, our performance contributed to an improved outlook for future loan growth and interest income growth. The Company’s improved results and condition were supportive of further stock repurchases and the Company announced a new stock repurchase program in January 2022. The Company’s relative stock outperformance continued after 2021 performance results were announced, with its stock price reaching near two year highs.

Plan Goals
Performance MeasureDefinitionWeightResultPayout FundingPool Allocation
EPS ($)Core Earnings Per Share20%$1.691.50%30.00%
ROE (%)Core Return on Equity20%7.20%1.50%30.00%
ROA (%)Core Return on Assets20%0.70%1.50%30.00%
Efficiency Ratio (%)Core Efficiency Ratio20%69.96%1.50%30.00%
Asset Quality - NCO (%)Net Charge-offs/Avg Loans %20%0.29%1.50%30.00%
Total Payout150.00%

In addition to performance exceeding 2021 targets, management announced a three year strategic transformative plan intended to achieve double digit return on tangible common equity and an ROA over 100 basis points, along with other franchise enhancing targets such as customer satisfaction and ESG performance. Together with assessing financial performance results, the Committee also considered any risk, regulatory or shareholder issues and determined that there was no basis for adjusting the pool funding downward in 2021.




48    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Individual Performance Considerations. Once the pool funding was determined, the Committee evaluated individual incentive fundings for each NEO. As it did in 2020, the Committee decided to provide all NEO’s awards at the Corporate pool funding rate, which was 150% of target in 2021. This reflected the goal of recognizing leadership teamwork in a transformative year while also responding to the ongoing pandemic challenges and the interconnections between short-term and long-term initiatives and seamless execution in serving the Company’s communities. The Committee noted the following NEO contributions to 2021 results:

Mr. Mhatre, President and Chief Executive Officer
Joined the Company and led Berkshire to outperformance and superior shareholder returns in his first year.
Successfully accomplished executive recruitment while maintaining strong senior management retention and performance.
Engaged throughout the year with investors to communicate the Company’s vision and transformational plan, and responded to input about capital management strategies.
Focused the Company on core strengths, recruiting new front-line bankers across many business lines, and selling and realizing capital value of less core insurance operations..
Led development of DigiTouchTM strategy combining leading edge technology initiatives with personal service as central approach to banking service.
Led rollout of Berkshire Community Comeback $5 billion community lending and financing plan to support economic recovery, access to services, and evolution of our communities.
Oversaw deepening of ESG programs and improvements to ESG ratings with the objective of being the leading socially responsible bank in New England and beyond.

Mr. Bacigalupo, Head of Commercial Banking
Oversaw successful Paycheck Protection Program (“PPP”) Phase II for critical business support during pandemic. Also managed SBA forgiveness procedure for PPP borrowers.
Managed down credit exposure to COVID sensitive industries while working with borrowers to graduate from pandemic related loan modifications back to scheduled debt service payments.
Oversaw recruitment and expansion in New Haven, Providence, Asset-Based Lending, and other targeted markets.
Maintained solid credit performance through processes of credit selection and administration.

Mr. Basu, Chief Financial Officer
Joined company and successfully led financial aspects of Company outperformance of objectives
Recruited and strengthened key functions within financial division.
Worked with new investor relations officer to deepen relationships with investment community and expand research coverage of BHLB stock.
Developed and implemented stock repurchase program in 2021 and announcement of new program in 2022.
Oversaw new procurement management function to target improved procurement, efficiency, and resource management across the company.
Introduced new analytics and reporting to support business lines.


49    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Mr. Gray, Chief Operating Officer
Successfully led Company through completion of the transition of the CEO role.
Completed sale of Mid-Atlantic branch operations and consolidated 16 branch offices on time and on plan to support improved focus and efficiency of Company operations. Executed sale of insurance operations while maintaining a referral partnership.
Managed shifts in operations due in response to changing pandemic conditions.
Oversaw technology and strategic planning functions in year of transformation.
Oversaw expansion of targeted business lines including SBA lending, wealth management, and private banking.
Provided leadership for human capital management, corporate responsibility, and internal and external communications in support of all stakeholder relationships.
Supported development of Berkshire Community Comeback and supported deepening of ESG programs and development of ESG Committee.

Mr. Lindenmuth, Chief Risk Officer
Outperformed net loan charge-off objective, contributing to asset quality and earnings outperformance.
Achieved pre-pandemic levels for most asset quality metrics.
Oversaw regulatory relations and approvals of shareholder distributions.
Expanded and deepened enterprise risk management processes.

Ms. Stephenson, Chief Compliance & Regulatory Officer
Maintained strong ongoing compliance profile.
Supported evolution of compliance program to support new initiatives in strategic transformation program.
Upgraded compliance training and compliance programs.
Managed compliance oversight through shifting regulatory and state directives during the pandemic response.




50    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Long-term Incentive Plan (LTI)

The Company’s long-term incentive/equity compensation program is designed to align senior executives with long-term interests of the Company and shareholders through stock-based compensation. The program also seeks to provide reward for targeted multi-year performance, encourage stock ownership, and enhance our ability to retain our top performers.

2021 Long-Term Incentive Summary. As in recent years, the 2021 long-term incentive program was comprised of 60% performance shares that cliff-vest after three years based on pre-defined goals, and 40% time-based restricted shares which vest over three years, with 1/3 vesting at the end of each year. There were no major changes in the amount of the LTI grants for the last two years.

LTI Program Overview. Each year in the first quarter the Committee determines the terms of the long-term incentive program, including participants, target opportunities for each role (defined as % of base salary), and the form and amount of compensation granted. These determinations included input and consideration of peer market data and practices as well as recommendations provided by the compensation consultant.

Long-term incentive compensation is intended to:
Provide a meaningful portion of total compensation in stock-based awards
Align executives with our shareholders
Reward long-term performance and avoid excessive risk taking
Encourage retention of our key senior executives
Balance compensation rewards with risk through long-term vesting tied to performance

The Committee also considered incentives provided by different award types, shareholder returns, avoiding excessive risk taking and encouraging and maximizing employee retention. As in recent years, the Committee decided that performance shares and time-based restricted stock grants with three-year vesting schedules were the most appropriate form of equity compensation for the long-term incentive grant. The total award granted is split into two components: 60% performance shares and 40% time-based shares.

grantcomponents.jpg




51    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Compensation Targets and Grants. The target long-term incentive compensation is set as a percentage of salary utilizing peer market data and input from the compensation consultant. The target percentages are listed below. Actual grant values may be by higher or lower than the target opportunity, to a maximum of up to 150% of the target incentive opportunity, based on the Committee’s assessment of a variety of factors, including Company performance, individual performance, retention considerations and affordability. For 2021, the annual grants to the NEO’s were made at target. The table below describes each executive’s target long-term incentive opportunity as a percentage of salary.

Title
2020 Target Long-Term Incentive Opportunity2021 Target Long-Term Incentive Opportunity
President and Chief Executive Officer105%95%
Chief Operating Officer80%85%
Chief Financial Officer60%60%
Head of Commercial Banking60%60%
Chief Risk Officer40%40%
Chief Compliance and Regulatory Officer40%40%
    Note: Table does not include adjustments for the COO’s service as Acting CEO in 2020 & 2021.


The former CFO received a grant at target in January which was subsequently forfeited at the time of his resignation. The new CFO joined the Company after the LTI program grants were made in January. The new CFO received a one-time $100,000 (23% of salary) stock grant when he joined the Company. The grant vests 50% in annual increments over 3 years and 50% cliff vest after 3 years’ service.

LTI Vesting

Once the grant value is determined, 60% is granted as performance shares and 40% is granted as time-based restricted stock. Time-based restricted stock vests 1/3 each year over three years. Performance shares cliff-vest at the end of the three-year performance period based on actual performance compared to predefined goals as described below.

Performance Share Metrics and Goals

The performance shares are tied to performance metrics and goals approved by the Committee in the first quarter of 2021 for a three-year performance period (i.e., 2021 - 2023). In 2021, the Committee maintained the same two performance goal categories from 2020: Relative Change in Core ROTCE and Relative TSR. Each performance metric was assigned a 50% weight for determining future performance against goals. The actual number of performance shares that vest will be determined at the end of the three-year period depending on Company performance against the three-year goals. Both of the performance measures evaluate our relative performance compared to an objective Industry Index.

The first measure, relative Change in Core ROTCE, is a relative measure of growth in core return on tangible common equity (“Core ROTCE”), which is one of the most significant financial measures utilized by shareholders in valuing the Company. Positioning this goal as a relative measure incentivizes our NEOs to grow Core ROTCE at a rate that exceeds our peer group to achieve targeted compensation, thereby rewarding outperformance.

The second measure, relative TSR, is formulated to measure our ability to deliver superior share price returns relative to our peer group over the defined three-year time period. The threshold, target, and stretch performance levels are set at 30th percentile, 50th percentile, and 75th percentile for the relative TSR.




52    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Our performance is measured relative to a defined Industry Index comprised of all publicly-traded banks and thrifts between $7 billion and $30 billion in assets located in the United States. The Company ranked in the 47th percentile of this group when it was defined. In order to be counted in the final calculations, a peer company must remain a publicly-traded institution at the end of the performance period ending at year-end 2023. The Committee did not significantly change the index criteria for the 2021 grant from the criteria used for the 2020 grant.

2019 to 2021 Long-Term Incentive Plan Results

The 2021 year concludes the performance grant made under the 2018 Long-term Incentive Plan which was established in the first quarter of 2019 and was intended to reward performance results over the three-year period, 2019 to 2021. The final number of shares earned pursuant to those awards was determined based on the Company’s actual results for the three-year period. For the second year in a row, there was no payout under the long-term performance incentive due to the impact of the pandemic on the Company’s performance.

The terms of the 2019 LTI grant were discussed in the 2020 Proxy Statement. The two equally weighted performance measures were relative improvement in Core Return on Tangible Common Equity and relative Total Shareholder Return (TSR).

The Company’s relative performance based on these two measures was compared to the Industry Index and due to performance impacted by the pandemic, actual results did not achieve our threshold level of performance and as a result, the grant was forfeited.

The performance based LTI incentive compensation constituted 24% of the NEO direct compensation granted in 2019. All of this compensation was forfeited for NEOs remaining in the plan and the plan operated as intended to withhold compensation that does not achieve Company objectives.

Benefits and Perquisites

The Company’s benefits program is designed to be competitive and cost-effective. All employees are provided core benefits including medical, retirement, life insurance, paid time off, and leaves of absence. The Company provides NEOs with perquisites and other benefits that the Committee believes are reasonable and consistent with its overall compensation philosophy. The Committee reviews the NEOs’ total benefits package on a regular basis to determine the competitiveness and appropriateness of providing executive benefits.

In 2019, the Company entered into a supplemental executive retirement agreement with Mr. Gray and in 2021 the Company entered into a supplemental executive retirement agreement with Mr. Mhatre. The Company does not offer other NEOs or any other executive a supplemental retirement arrangement or other non-qualified deferred compensation program. For additional information regarding the supplemental retirement arrangements, please see the section headed “Executive Compensation - Non-qualified Deferred Compensation.”

Some of the Named Executive Officers are eligible for modest perquisites such as automobile allowance, financial planning and membership fees. No membership fees were paid in 2021. The Company also maintains a long-term care insurance plan to supplement the Company’s disability plan for Mr. Gray. Overall perquisites are a relatively modest element of the compensation program. Benefits and perquisites are reported under All Other Compensation in the Summary Compensation Table,




53    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Potential Post Termination or Change in Control Benefits

An important consideration in our ability to attract and retain key personnel is our ability to minimize the impact on our management team of the possible disruption associated with our analysis of strategic opportunities and to be completely aligned with shareholder interests. Accordingly, we believe that it is in the best interest of the Company and its shareholders to provide our NEOs with reasonable financial arrangements in the event of termination of employment following a change in control or involuntary termination of employment for reasons other than cause following a change in control. The Company maintains an employment agreement with its Chief Executive Officer and change in control arrangements with the other NEOs. The employment agreement was intended to ensure that the CEO devotes his energy and attention to the long-term interest of the shareholders. The Company does not have any employment agreements with any other NEO or employee.

Since 2009, the Company no longer enters into an employment or change in control agreement that provides for a tax indemnification payment in the event that the payment under the agreement results in additional tax liability under Section 280G of the Internal Revenue Code (a “Tax Indemnification Payment”). However, the Company maintains one legacy change in control agreement, with Mr. Gray, which was entered into in 2007, prior to 2009 change, which provides for a potential Tax Indemnification Payment. For additional details, please see section titled “Potential Payments upon Termination of Employment or a Change-In-Control” of this proxy statement.





54    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Additional Compensation Information

Risk Assessment and Related Considerations

The Chief Risk Officer conducts an annual risk review of the Company’s incentive compensation plans (the short-term and long-term incentive plans) as approved by the Committee for all eligible employee within the Company. This review for 2021 reported that the plans fit within established risk parameters and strategic plans. Based on this risk review, the Committee concluded that the incentive compensation plans do not motivate excessive risk taking, and are not reasonably likely to have a material adverse effect on the Company.

The review determines if these plans encourage behaviors that exposed the Company to unacceptable levels of risk. The review evaluates the balance of compensation elements between cash, performance shares, restricted stock grants, fixed versus variable compensation, and long-term versus short-term compensation. The plans consider the level of potential cash incentive compensation as compared to base salary, the focus of individual and corporate goals, as well as the weighting and balance of goals, and internal controls in place to mitigate possible excessive risk taking. Additionally, the plans include mechanisms for “deferral of payment” and/or “forfeiture of payment” relating to ethical business standards and clawback policies, as approved by the Committee, under which the Company may recover and/or revoke payments of incentive compensation attributable to certain trigger events, including employee misconduct and/or financial restatement.

During 2021 the Committee continued to reinforce its risk-based approach to total compensation in various ways, such as incenting on adjusted core profitability metrics and shareholder return, retaining a risk-based performance measure for Asset Quality and providing risk adjustment features that allows the Committee to reduce incentive awards in light of risk or regulatory concerns. The Committee remains committed to continuing to review and evolve compensation plans and ensure they represent sound and balanced risk management practices. The proper application of risk and governance, within the context of established strategic objectives, remain the driving factors in establishing the incentive compensation plans.

Role of the Compensation Committee, Management and Compensation Consultant

Role of the Compensation Committee. At year-end 2021, the Committee consisted of five members, all of whom are independent. The Chairperson of the Committee regularly reports on material committee actions at Board meetings.

The Committee ensures that the total compensation paid to the senior executives is fair, reasonable and performance-based while aligning with shareholder interests. The Committee is responsible for establishing, implementing and continually monitoring all elements of compensation for the NEOs. Elements of compensation are reviewed individually and in the aggregate, including base salary, annual cash incentives, long-term incentives/equity awards, total direct compensation, and benefits and perquisites. Additionally, the Committee annually reviews its charter, philosophy and executive compensation practices, as well as industry compensation trends and best practices using market data and input from the compensation consultant.

The Committee has the sole authority and resources to obtain advice and assistance from internal or external legal, human resource, accounting, compensation or other advisors or consultants as it deems desirable or appropriate. The Committee has direct access to, communicates, and meets regularly with the compensation consultant independently of management.





55    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
The Committee’s major duties and responsibilities are as follows:
Review and benchmarking of overall compensation, benefit and perquisites
Review all compensation components for CEO and each NEO
Evaluate CEO and other NEOs’ individual performance
Ensure executive overall pay is aligned with corporate performance results
Review, evaluate and modify as needed, executive compensation plans
Ensure executives are not encouraged or rewarded for taking excessive risk
Approve annual cash incentive payments, annual equity grants, and vesting of performance shares for the CEO and other NEOs in accordance with the terms of the Executive Short-Term and Executive Long-Term Incentive Plans
Provide oversight to ensure compliance with all regulations related to executive compensation
Approve the annual Compensation Discussion and Analysis and make a Report to the Board
Participate with the Board in matters relating to management succession

Role of Management. Although the Committee makes independent determinations on all matters related to compensation of the NEOs, certain members of management may be requested to attend or provide input to the Committee. Input may be sought from the CEO, President, Chief Human Resources and Culture Officer, Chief Financial Officer, Chief Risk Officer, Investor Relations Officer, or others to ensure the Committee has the information and perspective it needs to carry out its duties.

In particular, the Committee seeks input from the Chief Executive Officer on matters relating to strategic objectives, Company performance goals and annual business plan. In addition, the CEO provides the Committee summaries of senior executive officer performance and recommendations relating to their compensation. The CEO is not present when the Committee discusses his performance and decides on his compensation. The Committee meets with the CEO to present its compensation decisions and discuss the evaluation of his performance.

The EVP/Chief Human Resources and Culture Officer assists the Committee on matters of design, administration and operation of the Company’s compensation programs. The EVP/Chief Human Resources and Culture Officer may be requested, on the Committee’s behalf, to provide proposals or work with their independent compensation consultant to develop proposals for the Committee’s consideration. The EVP/Chief Human Resources and Culture Officer reports to the Committee directly on such matters. The Committee also receives updates from the Company’s Chief Risk Officer, Chief Financial Officer and Investor Relations Officer throughout the year as appropriate.

Although the senior executives may provide insight, suggestions or recommendations regarding senior executive compensation, they are not present during the Committee’s deliberations or vote. Only Committee members vote on decisions regarding NEO compensation. The Committee regularly meets in executive session without management present.

Role of the Compensation Consultant. The Committee has the authority to retain a compensation consultant to advise on executive compensation matters, as well as access to outside legal counsel and other experts as needed. For 2021, the Committee renewed the engagement with Meridian Compensation Partners, LLC (“Meridian” or “the Consultant”) to serve as independent advisor to the Committee. During 2021, Meridian provided data, advice and counsel on executive compensation matters and responded to other ad hoc requests of the Committee.

The Consultant reported directly to the Committee and carried out its responsibilities to the Committee in coordination with the Company’s Human Resources Department, as requested by the Committee. The Committee Chair has regular contact with the Consultant outside of meetings as appropriate. The Committee has reviewed Meridian’s services and determined that Meridian is independent with respect to SEC standards, as well as Company policy, and provides no other services to the company other than compensation consulting.




56    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Other Compensation and Governance Policies and Practices

Stock Ownership and Holding Guidelines. The Company maintains Stock Ownership Guidelines for its SEC-reporting senior executives and directors and all other executives, which requires the following minimum investment in Company common stock:
Independent DirectorsFive times (5.0x) annual cash retainer
President and Chief Executive OfficerFour and a half times (4.5x) annual base salary
Chief Operating OfficerThree and a half times (3.5x) annual base salary
Senior Executive Vice PresidentsTwo and a half times (2.5x) annual base salary
Executive Vice PresidentsOne and a half times (1.5x) annual base salary

Shares that satisfy the stock ownership guidelines include Company stock owned outright and restricted stock whether or not vested. Stock options are not included in calculating ownership until they are converted into actual shares owned.

Newly hired senior executives, executives, directors and current employees of the Company that first become a senior executive, executive, or director are expected to satisfy the stock ownership guidelines within five years, or such other term approved by the Committee, of the date such individual first becomes a senior executive, executive or director. In order to expedite this, a minimum of 50% of shares (net of taxes) will be required to be held upon each vesting until ownership guidelines are met. Senior executives, executives and directors that maintain sufficient stock holdings, but due to an increase in base salary, annual cash retainer, selling Company stock to cover tax withholding or for a reason approved by the Committee, no longer meet the stock ownership guidelines, shall have 18 months to acquire additional Company stock and during this term such individuals will be deemed to satisfy the ownership guidelines.

Stock ownership for senior executives, executives and directors is reviewed annually. Share holdings are evaluated based on the average stock price for the three-year period prior to the Board’s review. These guidelines will allow for extenuating circumstances and discretion in the evaluation process and the Committee reserves the right to make exceptions as appropriate. The Committee shall be responsible for the periodic review of the policy. Any changes to the policy will require the approval of the Board of Directors. The Committee monitors ownership annually. The NEOs and directors comply with the Company’s stock ownership policy within the approved grace period to satisfy the stock ownership and holding guidelines.

Clawback Policy. As a condition to receiving incentive compensation from the Company and Berkshire Bank, each executive officer has signed an agreement whereby the executive officer agrees to reimburse the Company or Berkshire Bank an amount up to the entire incentive award made to such executive officer on the basis of having met or exceeded specific targets for performance periods if (1) the Company or Berkshire Bank is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirement under the securities laws as a result of Financial Misconduct (as determined by the members of the Board of Directors who are considered “independent” for purposes of the listing standards of the NYSE), or as may be required by applicable laws, regulations, NYSE listing standards or as further required under the Company’s policies, as adopted from time to time, or (2) the Company’s Board of Directors determines that the executive officer committed Personal Misconduct (as defined below). For purposes of this policy, (i) the term “incentive awards” means awards under the Company’s long-term and short-term incentive compensation plans, the amount of which is determined in whole or in part upon specific performance targets relating to the financial results of the Company; (ii) the term executive officer means the CEO and executives who are eligible to receive incentive awards; and (iii) the term Personal Misconduct means fraud, commission of a felony, material violation of any written agreement with or policies of the Company or Berkshire Bank, or any other material breach of fiduciary duty injurious to the Company or Berkshire Bank.



57    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


COMPENSATION DISCUSSION AND ANALYSIS
Impact of Taxation on the Form of Compensation. The Committee considers a variety of factors, including the Company’s tax position, the materiality of the payments and tax deductions involved, the objectives of the executive compensation programs and the Company’s compensation philosophy in structuring compensation programs and making compensation decisions. In general, the Company may not take an annual deduction for NEO compensation in excess of $1 million unless an exception applies. Due to the continued importance and benefit to the Company and our shareholders of awarding compensation that is structured to properly incentivize our executive officers, the Committee believes that it is in our best interests to retain flexibility in awarding compensation, even if some awards may be non-deductible compensation expenses to the Company.


The Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis that is required by the rules established by the Securities and Exchange Commission, and has discussed it with management. Based on such review and discussion, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.

The Compensation Committee of the Board of Directors of Berkshire Hills Bancorp, Inc.
John B. Davies, Chair
David M. Brunelle
Nina A. Charnley
William H. Hughes III
Jeffrey W. Kip


58    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement




Executive Compensation
image23.jpg
Purpose.
Performance.
Progress.

Summary Compensation Table

The following table provides the total compensation earned by or paid to the Named Executive Officers for the fiscal years ended December 31, 2021, 2020, and 2019, respectively.
Name and Principal Position(1)
YearSalary ($)Bonus ($)
Stock Awards ($)(2)
Option Awards
($)
Non-Equity Incentive Plan Compensation ($)
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings(3)
($)
All Other Compensation(4) ($)
Total
($)
Nitin J. Mhatre, President, Chief Executive Officer2021644,135 — 688,766 — 815,625 — 144,326 2,292,852 
George F. Bacigalupo, Executive Vice President, Head of Commercial Banking
2021375,000 — 225,007 — 253,125 — 27,943 881,075 
2020375,000 — — — 84,375 — 80,695 540,070 
2019375,000 — 225,010 — 115,000 — 51,463 766,473 
Subhadeep Basu, Senior Executive Vice President, Chief Financial Officer2021325,808 — 100,000 — 290,250 — 13,059 729,117 
Sean A. Gray, Senior Executive Vice President, Chief Operating Officer2021550,000 — 574,895 — 495,000 — 193,561 1,813,456 
2020621,500 — 500,027 — 201,988 — 169,938 1,493,453 
2019550,000 — 500,008 — 124,000 — 178,998 1,353,006 
Gregory D. Lindenmuth, Executive Vice President, Chief Risk Officer2021300,000 — 120,006 — 135,000 — 14,648 569,654 
2020300,000 — 160,024 — 45,000 — 19,214 524,238 
2019300,000 — 150,016 — 36,750 — 12,949 499,715 
Deborah A. Stephenson, Executive Vice President, Chief Compliance and Regulatory Officer
2021275,000 — 110,008 — 123,750 — 13,794 522,552 
James M. Moses, Former SEVP and Chief Financial Officer
2021107,500 — 258,001 — — — 13,771 379,272 
2020430,000 — 360,018 — 96,750 — 45,275 932,043 
2019400,000 — 250,108 — 105,000 — 38,751 793,859 
(1)Messrs. Mhatre, Basu and Ms. Stephenson are Named Executive Officers for the first time in 2021 and, pursuant to SEC rules, compensation for prior years is not required to be reported. Mr. Moses’ 2021 salary reflects the period from January 1, 2021 through March 19, 2021, which was the date of his resignation.
(2)The amounts reported are the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718 and
represent an award under the Company’s performance-based, long-term incentive compensation program. Awards consist of restricted stock, a portion of which vests ratably over three years and a portion that vests based on the achievement of certain performance criteria. Since all awards vest after the year in which they are granted, none of the Named Executive Officers recognized any income from the awards in the year they were made. Amounts shown are the aggregate grant date fair value of restricted stock awards. For those restricted stock awards that are subject to performance conditions, the grant date fair values are based on the outcome of such conditions at target level. Total values for stock awards reported in this table may not match other tables due to rounding. See Note 20 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the Year Ended December 31, 2021. Based on the fair value at grant date, the following are the maximum potential values of the performance shares for the 2021-2023 performance period assuming maximum level of performance is achieved: Mr. Mhatre, $619,875; Mr. Gray, $517,400; Mr. Bacigalupo $202,500; Mr. Lindenmuth, $108,000; and Ms. Stephenson, $99,000. For each year shown in the above table, the amounts in the Stock Awards column are determined by multiplying the number of restricted stock awards granted on a particular date by the fair value at that date, and a breakdown for each individual is as follows:


59    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Number of Restricted Stock Awards Granted
Grant DateGrant Date Closing PriceNitin J. MhatreGeorge F Bacigalupo
Subhadeep Basu
Sean A. GrayGregory B. LindenmuthDeborah A. StephensonJames M. Moses
January 30, 2021$16.58 41,542 13,571 — 34,674 7,238 6,635 15,561 
April 30, 2021$22.40 — — 4,465 — — — — 
January 30, 2020$29.09 — — — 17,189 5,500 — 12,370 
January 30, 2019$27.91 — 8,062 — 17,915 5,375 — 8,958 
(3)    The Supplemental Executive Retirement Agreements do not provide for above-market earnings and therefore amounts are not included in this column.
(4)    Details of the amounts reported in the “All Other Compensation” column for 2021 are provided in the following table:

Name401(k) Employer Contribution ($)Dividends on Restricted Stock
($)
Automobile
($)
Financial Planning
($)
Membership Fees
($)
Long-Term Care Premiums and Imputed Income on Life Insurance
($)
Long-Term Disability
($)
Other **
($)
Total
($)
Nitin J. Mhatre— — 15,992 — — — 3,334 125,000 144,326 
George F. Bacigalupo7,500 2,704 15,000 525 — — 2,214 — 27,943 
Subhadeep Basu1,323 — 11,366 — — — 370 — 13,059 
Sean A. Gray11,600 9,057 15,000 — — 440 2,471 154,993 193,561 
Gregory D. Lindenmuth11,600 2,581 — — — — 467 — 14,648 
Deborah A. Stephenson11,000 2,327 — — — — 467 — 13,794 
James M. Moses4,845 5,464 3,462 — — — — — 13,771 

**    The Company credited Mr. Mhatre and Mr. Gray’s Supplemental Executive Retirement Agreement account balances with $125,000 and $100,000, respectively, pursuant to the terms of the agreements.



60    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Grants of Plan-Based Awards

The following table provides information concerning the award opportunities granted to the Company’s NEOs in 2021, and the amounts, if any, that may be paid in future years.
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(1)
Estimated Future Payouts Under
Equity Incentive Plan Awards(2)
All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#)
Grant Date
Fair Value
of Stock
and
Option
Awards(3)
($)
NameGrant DateThreshold ($)Target ($)Maximum ($)Threshold (#)Target (#)Maximum (#)
Nitin J. Mhatre
1/30/2021— 543,750 — — — — — — 
1/30/2021— — — — — — 16,617 275,510 
1/30/2021— — — 12,462 24,925 37,388 — — 
George F. Bacigalupo1/30/2021— 168,750 — — — — — — 
1/30/2021— — — — — — 5,429 90,012 
1/30/2021— — — 4,071 8,142 12,213 — — 
Subhadeep Basu
1/30/2021— — — — — — — — 
1/30/2021— — — — — — — — 
1/30/2021— — — — — — — — 
Sean A. Gray1/30/2021— 330,000 — — — — — — 
1/30/2021— — — — — — 13,870 229,965 
1/30/2021— — — 10,402 20,804 31,206 — — 
Gregory D. Lindenmuth1/30/2021— 90,000 — — — — — — 
1/30/2021— — — — — — 2,896 48,016 
1/30/2021— — — 2,171 4,342 6,513 — — 
Deborah A. Stephenson
1/30/2021— 82,500 — — — — — — 
1/30/2021— — — — — — 2,654 44,003 
1/30/2021— — — 1,991 3,981 5,972 — — 
James M. Moses1/30/2021— — — — — — — — 
1/30/2021— — — — — — 6,225 103,211 
1/30/2021— — — 4,668 9,336 14,004 — — 
(1)Amount represents awards granted for future payment to the Named Executive Officers under the Short-Term Incentive Plan (STI). Please see the section titled “Compensation Discussion and Analysis - Short-Term Incentive Compensation” for a discussion of the STI.
(2)Amount shown reflects the number of restricted stock awards, subject to performance-based vesting, that may be earned under the Long-Term Incentive Plan (LTI). Performance below threshold may result in no award payable to the Named Executive Officer. Please see the section titled “Compensation Discussion and Analysis - Long-term Incentive Plan” for a discussion of the LTI.
(3)The amounts reported are the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718. The grant date per share fair value for the restricted stock award was $16.58.




61    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Employment and Change in Control Arrangements

Employment Agreement.
The Company, the Bank and Mr. Mhatre entered into an employment agreement effective as of January 29, 2021 (the “Employment Agreement”). The term of the Employment Agreement is three years and the term may be extended by mutual consent. The base salary for Mr. Mhatre is $725,000. In addition to base salary, the Employment Agreement provides for, among other things, participation in bonus programs and other benefit plans and arrangements applicable to executive employees.

The Bank may terminate Mr. Mhatre’s employment for “cause” (as defined in the Employment Agreement) at any time, in which event Mr. Mhatre would have no right to receive compensation or other benefits for any period after his termination of employment. Certain events resulting in Mr. Mhatre’s termination of employment entitle him to severance benefits. In the event of Mr. Mhatre’s involuntary termination of employment without “cause” or in the event of a voluntary termination for “good reason” (as defined in the Employment Agreement), Mr. Mhatre would become entitled to a severance payment in the form of a cash lump sum equal to the base salary and the greater of (i) the average cash incentive earned in the prior three years, or (ii) the cash incentive which Mr. Mhatre would have earned during the remaining unexpired term of the agreement. In addition, Mr. Mhatre and his dependents would become entitled, at no expense to him, to the continuation of non-taxable medical and dental coverage for the remaining unexpired term of the Employment Agreement, or if the coverage is not permitted by applicable law or if providing the benefits would subject the Bank to penalties, he will receive a cash lump sum payment equal to the value of the benefits.

In the event of a “change in control” (as defined in the Employment Agreement) of the Company or Bank followed within twenty-four months by the executive’s involuntary termination of employment for a reason other than for cause or upon his voluntary termination for good reason, Mr. Mhatre would become entitled to a severance payment in the form of a cash lump sum equal to three times his base salary and three times the greater of the (i) average cash incentive earned in the prior three calendar years, or (ii) the cash incentive that would be paid at target for the fiscal year in which such termination occurs and full vesting of any equity awards. In addition, Mr. Mhatre would become entitled, at no expense to him, to the continuation of life insurance and non-taxable medical and dental coverage for thirty-six (36) months following his termination of employment, or if the coverage is not permitted by applicable law or if providing the benefits would subject the Bank to penalties, he will receive a cash lump sum payment equal to the value of the benefits.

Upon termination of the executive’s employment (other than following a change in control), Mr. Mhatre will be subject to certain restrictions on his ability to compete or to solicit business or employees of the Bank and the Company for a period of one year following his termination of employment. The Employment Agreement also includes provisions protecting the Company’s and Bank’s confidential business information.

Change in Control Arrangements.
The Company and Berkshire Bank entered into change in control agreements with Messrs. Gray and Bacigalupo. Each change in control agreement has a term of three years and is renewable annually for an additional year at the sole discretion of the boards of directors of the Company and Berkshire Bank. Mr. Basu, Mr. Lindenmuth, and Ms. Stephenson participate in the Berkshire Bank Enhanced Change in Control Severance Plan. See “Potential Payments Upon Termination or Change in Control” for a discussion of the benefits and payments under these agreements.



62    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Outstanding Equity Awards at December 31, 2021

The following table provides information concerning unvested stock awards for each Named Executive Officer as of December 31, 2021. The NEOs do not hold any stock options
Option AwardsStock Awards
NameGrant DateNumber of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)
Number of
Shares or
Units of
Stock That
Have Not
Vested
(#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(7)
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested($)(7)
Nitin J. Mhatre1/30/2019— — — — — — 
1/30/2020— — — — — — 
1/30/2021— — 
16,617 (3)
472,421 
24,925 (6)
706,618 
George F. Bacigalupo
1/30/2019— — 
1,075 (1)
30,562 
4,837 (4)
137,516 
1/30/2020— — 
3,619 (2)
102,888 — — 
1/30/2021— — 
5,429 (3)
154,346 
8,142 (6)
231,477 
Subhadeep Basu1/30/2019— — — — — — 
1/30/2020— — — — — — 
1/30/2021— — 
4,465 (3)
126,940 — — 
Sean A. Gray1/30/2019— — 
2388 (1)
67,891 
10,749 (4)
305,594 
1/30/2020— — 
4,584 (2)
130,323 
10,313 (5)
293,199 
1/30/2021— — 
13,870 (3)
394,324 
20,804 (6)
591,458 
Gregory D. Lindenmuth
1/30/2019— — 716 20,356 
3,225 (4)
91,687 
1/30/2020— — 1,467 41,707 
3,300 (5)
93,819 
1/30/2021— — 2,896 82,333 
4,342 (6)
123,443 
Deborah A. Stephenson1/30/2019— — 
716 (1)
20,356 
3,225 (4)
91,687 
1/30/2020— — 
1,009 (2)
28,686 
2,269 (5)
64,508 
1/30/2021— — 
2,654 (3)
75,453 
3,981 (6)
113,180 
James M. Moses
1/30/2019— — — — — — 
1/30/2020— — — — — — 
1/30/2021— — — — — — 
(1)Remaining shares granted on January 30, 2019 will vest ratably on each January 30th through 2022.
(2)Remaining shares granted on January 30, 2020 will vest ratably on each January 30th through 2023.
(3)Remaining shares granted on January 30, 2021 will vest ratably on each January 30th through 2024.
(4)These shares are subject to vesting based upon the achievement of specific goals. The amounts shown assume the target level of performance is achieved. The actual award, if any, will be determined and vest on the first compensation committee meeting following January 30, 2022 based on the 2019-2021 performance period.
(5)These shares are subject to vesting based upon the achievement of specific goals. The amounts shown assume the target level of performance is achieved. The actual award, if any, will be determined and vest on the first compensation committee meeting following January 30, 2023 based on the 2020-2022 performance period.
(6)These shares are subject to vesting based upon the achievement of specific goals. The amounts shown assume the target level of performance is achieved. The actual award, if any, will be determined and vest on the first compensation committee meeting following January 30, 2024 based on the 2021-2023 performance period.
(7)Computed using the fair market value of the shares based on the Company’s closing stock price of $28.43 on December 31, 2021.




63    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Option Exercises and Stock Vesting

The following table provides information concerning the vesting of restricted stock awards for each Named Executive Officer, on an aggregate basis, during 2021. The NEOs do not hold any stock options.
Option AwardsStock Awards
NameNumber of
Shares Acquired
on Exercise
(#)
Value Realized
on Exercise
 ($)
Number of Shares Acquired on Vesting
(#)
Value Realized on Vesting
($)
Nitin J. Mhatre— — — — 
George F. Bacigalupo — — 1,429 23,693 
Subhadeep Basu— — — — 
Sean A. Gray— — 6,009 99,929 
Gregory D. Lindenmuth— — 1,783 29,562 
Deborah A. Stephenson— — 1,519 25,185 
James M. Moses— — 3,731 61,860 
(1)Represents the aggregate value realized in 2021 upon the vesting of restricted stock awards granted in prior years under the Company’s long-term incentive plan and based on the value of the Company’s stock on the applicable vesting dates for each award. The value realized by the NEO upon vesting is also the amount reported as 2021 taxable income.

Executive Compensation

Non-qualified Deferred Compensation

The following table provides information for the nonqualified deferred compensation plans in which Messrs. Mhatre and Gray participated in 2021.
NamePlan Name
Registrant
Contributions
in Last Fiscal
Year ($)(1)
Aggregate
Earnings in
2019 ($)
Aggregate Balance at
Last Fiscal Year End
($)(2)
Nitin J. Mhatre
Supplemental Executive Retirement Agreement125,000 — 125,000 
Sean A. Gray
Supplemental Executive Retirement Agreement100,000 — 550,000 
(1)Contributions included in the “Registrant Contributions in Last Fiscal Year” column are included as compensation for the Named Executive Officer in the Summary Compensation Table.
(2)Amounts included in the “Aggregate Balance at Last Fiscal Year End” have been reported as compensation for the Named Executive Officer in the Summary Compensation Table.


On April 1, 2021, Berkshire Bank entered into a supplemental executive retirement agreement with Mr. Mhatre. Under the terms of the agreement, Mr. Mhatre is entitled to the value of the vested account balance upon his termination of employment or death. Berkshire Bank will credit the account balance with an annual amount of $125,000 as of April 1, 2021 and each subsequent April 1, commencing April 1, 2022, provided that Mr. Mhatre is employed with the Berkshire Bank on the date of such contribution. The account balance is subject to a five year vesting schedule, with 20% of the account balance vesting each year, commencing on April 1, 2022, subject to full vesting in the event of death, disability or a termination of employment within two years following a change in control. In the event of Mr. Mhatre’s termination of employment for a reason other than for cause prior to normal retirement age (age 65) and in connection with or within two years following a change in control (as defined in the agreement), Mr. Mhatre’s account balance shall become fully vested and the amount of the account balance shall be increased to equal the amount that Berkshire Bank would have otherwise credited Mr. Mhatre’s account through the calendar year in which Mr. Mhatre would have attained normal retirement age. Upon a termination of employment or death, the account balance will be paid in a lump sum payment to Mr. Mhatre or his beneficiary, as applicable. See “Potential Payments Upon Termination or Change-in-Control” for a discussion of payments under this agreement.




64    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
Berkshire Bank and Sean A. Gray entered into a supplemental executive retirement agreement effective as of January 1, 2019. Under the terms of the agreement, Berkshire Bank will credit the account balance with $100,000 commencing on January 1, 2019 and on each January 1st through 2028, provided that the executive is employed with Berkshire Bank on the date of such contribution. Berkshire Bank will make a final contribution as of January 1, 2028 for a total potential contribution of $1.0 million. Mr. Gray is entitled to the value of the vested account balance upon his termination of employment or death. The account balance is subject to a five-year vesting schedule, with 20% of the account balance vesting each year, commencing January 1, 2020 and the executive will be 100% vested on January 1, 2024, subject to full vesting in the event of death, disability or a termination of employment within two years following a change in control. Upon a termination of employment or death, the account balance will be paid in a lump sum payment to the Executive or his beneficiary, as applicable. In the event the Executive's employment is terminated within two years following a change in control (as defined in the agreement), an amount equal to $1.0 million will be paid to the Executive in a single payment. See “Potential Payments Upon Termination or Change-in-Control” for a discussion of payments under this agreement.

Potential Payments Upon Termination or Change-in-Control

The following table summarizes the estimated payments that would be made to the NEOs upon termination of employment as of December 31, 2021, pursuant to each executive’s employment agreement, change in control arrangement, equity awards, benefit plans and other arrangements. The amounts shown do not include the executive’s vested account balance in the Bank’s 401(k) Plan, non-qualified deferred compensation plans and the value of continued long-term care insurance, if applicable. The amounts shown relating to unvested restricted stock awards are based on the fair market value of the Company’s common stock on December 31, 2021, which was $28.43. The actual amounts to be paid to an executive can only be determined at the time of such executive’s separation from service with the Company.

The following table provides the estimated amount of compensation payable to Mr. Mhatre for each of the termination events listed below.

Termination for Cause ($)(1)
Termination Without Cause or for Good Reason ($)(2)
Payments Due Upon Change in Control With Termination of Employment ($)(3)
Disability($)(4)
Death($)(5)
Cash severance — 3,806,250 3,806,250 — — 
In-kind benefits— 63,030 65,755 42,020 — 
Restricted stock vesting(8)
— — 1,181,039 1,181,039 1,181,039 
SERP(4)
— — 2,000,000 — — 




65    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
The following table provides the estimated amount of compensation payable to Messrs. Gray, Basu, Bacigalupo, Lindenmuth, and Ms. Stephenson upon their termination of employment in connection with a change in control. The change in control agreements entered into with the executives do not provide for any severance payments or benefits in the event of a termination of employment that is not in connection with or subsequent to a change in control.Termination for Cause ($)(1)for Cause ($)(1)
George F.
Bacigalupo(7)
Subhadeep Basu(7)
Sean A. Gray(8)(10)
Gregory D.
Lindenmuth(7)
Deborah A. Stephenson(7)
Cash severance 1,631,250 1,870,500 3,144,042 1,170,000 1,072,500 
In-kind benefits56,386 2,700 43,668 26,718 7,137 
Restricted stock vesting(8)
553,902 63,456 1,782,788 473,758 393,869 
SERP(9)
— — 760,000 — — 
(1)Upon a termination for “cause” (as defined in the applicable agreements), the executive will have no right to receive compensation or other benefits under the employment agreement and SERP. In addition, he will forfeit all non-vested restricted stock awards.
(2)Under the executive’s employment agreement, upon an involuntary termination for a reason other than for cause or if the executive voluntarily resigns for “good reason” (as defined in the employment agreement), the executive (or, upon death, his beneficiary) would be entitled to receive a severance payment in the form of a cash lump sum equal to the base salary and the greater of the (i) average cash incentive earned in the prior three calendar years, or (ii) the cash incentive that would be paid or payable to the executive receiving the annual incentive at target for the fiscal year in which the date of termination occurs (or for the prior fiscal year if the incentive opportunity has not yet been determined), as if the executive and Berkshire Bank were to satisfy all performance-related conditions, which the executive would have earned during the remaining unexpired term of the agreement. In addition, he and his dependents would become entitled, at no cost to the executive, to the continuation of non-taxable medical and dental coverage for the remaining unexpired term of the employment agreement. Upon termination of the executive’s employment under these circumstances, the executive must adhere to a one-year non-competition and non-solicitation restriction. The amount shown in this column assumes the remaining term of the contract is three years. Under the executive’s supplemental executive retirement agreement, if Mr. Mhatre separates from service for a reason other than cause, he will receive his vested benefit at the time of separation from service in a lump sum. If Mr. Mhatre is a “specified employee” (as defined in Section 409A of the Code), the amounts payable under the employment agreement and supplemental executive retirement agreement will be paid six months after his separation from service.
(3)Under the executive’s employment agreement, upon an involuntary termination, other than for cause, or voluntary termination (upon the occurrence of circumstances specified in the agreements) in connection with or following a change in control of the Company or the Bank, the executive would be entitled to a cash severance payment equal to three times base salary and cash incentive, plus the annual cash incentive pro-rated through the date of termination, and life insurance and non-taxable medical and dental coverage substantially identical to the coverage maintained for the executive prior to termination of employment for 36 months at no cost to the executive. Under the supplemental executive retirement agreement, in the event of Mr. Mhatre separates from service for a reason other than for cause prior to normal retirement age (age 65) and in connection with or within two years following a change in control (as defined in the agreement), Mr. Mhatre’s account balance will become fully vested and the amount of the account balance shall be increased to equal the amount that the Bank would have otherwise credited Mr. Mhatre’s account through the calendar year in which Mr. Mhatre would have attained normal retirement age. If Mr. Mhatre is a “specified employee” (as defined in Section 409A of the Code), the amounts payable under the employment agreement and supplemental executive retirement agreement will be paid six months after his separation from service. The above table does not include the vested benefit under the supplemental executive retirement agreement since the value of the vested benefit is set forth in the table presented above under “ - Non-qualified Deferred Compensation.”
(4)Under the executive’s employment agreement, upon a termination due to “disability” (as defined in the employment agreement), the executive would be entitled to continued non-taxable medical and dental insurance, at no cost to the executive, until the earlier of the second anniversary of the date of termination or age sixty-five (65). This column shows the value of two years of continued insurance. Additionally, the executive would be entitled to receive benefits under the provisions of disability insurance coverage in effect for Berkshire Bank employees and executives. Upon termination due to disability, restricted stock awards granted pursuant to our equity incentive plans automatically vest. The executive does not hold any stock options.
(5)Under the executive’s employment agreement, upon death, the executive’s beneficiary will receive any earned but unpaid compensation and vested benefits due the executive as of the date of death. In addition, the executive’s estate or beneficiary would be entitled to receive benefits under the provisions of any life insurance coverage in effect for Berkshire Bank employees and executives. Upon termination due to death, restricted stock awards granted pursuant to our equity incentive plans automatically vest. The executive does not hold any stock options.
(6)Mr. Gray’s change in control agreement provides that upon an involuntary termination, other than for cause, or voluntary termination (upon the occurrence of circumstances specified in the agreements) following a change in control of the Company or the Bank, the executive would be entitled to a cash severance payment equal to three times his average annual compensation for the five years preceding the change in control, and life insurance and non-taxable medical, dental and disability coverage substantially identical to the coverage maintained for the executive prior to his termination of employment for 36 months following the executive’s termination of employment. The executive would also be entitled to receive a tax indemnification payment if payments under the change in control agreement trigger liability under Section 280G of the Code for the excise tax applicable to “excess parachute payments.” The estimated amount of the tax indemnification payment is $2,619,285 and this amount is not reflected in the above table. Beginning in 2009, the Company determined that it would no longer enter into change in control agreements that provide for a tax gross-up for any taxes as a result of “excess parachute payments” under Section 280G of the Code and Mr. Gray’s change in control agreement was entered into before the Company adopted this position.


66    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement


EXECUTIVE COMPENSATION
(7)The change in control arrangements entered into with Messrs. Basu, Bacigalupo, Lindenmuth and Ms. Stephenson provide that upon an involuntary termination, other than for cause, or voluntary termination (upon the occurrence of circumstances specified in the agreements) in connection with or following a change in control of the Company or the Bank, the executive would be entitled to a cash severance payment equal to three times base salary and cash incentive, plus the annual cash incentive pro-rated through the date of termination, and life insurance and non-taxable medical and dental coverage substantially identical to the coverage maintained for the executive prior to termination of employment for 36 months following termination of employment, with the executive paying his or her share of the premiums. Under the agreements with Messrs. Basu, and Bacigalupo, severance payments will be reduced to avoid liability under Section 280G of the Code for the excise tax applicable to “excess parachute payments” only if such reduction will result in the executive receiving a greater total payment as measured on an after-tax basis, and accordingly, the amount shown in this column may be reduced. It is estimated that Messrs. Basu and Bacigalupo’s payments would not be reduced under this provision. For Mr. Lindenmuth and Ms. Stephenson, severance payments will be reduced to avoid liability under Section 280G of the Code for the excise tax applicable to “excess parachute payments” and it is estimated that Mr. Lindenmuth’s payments and Ms. Stephenson’s payments will be reduced by $460,363 and $327,711, respectively, under this provision. The estimated reductions of severance are not reflected in the above table. None of the change in control arrangements entitle the executives to any tax indemnification payment (a “tax gross-up”) if payments trigger liability under Sections 280G and 4999 of the Internal Revenue Code for an excise tax on “excess parachute payments.”
(8)In the event of a change in control of the Company or the Bank, equity awards subject to time-based vesting automatically vest only if an executive experiences a qualifying termination of employment following a change in control (a “double trigger”). The amount shown reflects the value of such awards as well as equity awards subject to performance-based vesting.
(9)The supplemental executive retirement agreement entered into with Mr. Gray provides that upon an involuntary termination, other than for cause, or voluntary termination (upon the occurrence of circumstances specified in the agreement) in connection with or following a change in control of the Company or the Bank, death or disability, the executive would become entitled to a payment in the amount of $1 million. The executive’s benefit is subject to a five year vesting schedule, with twenty percent (20%) of the account vesting each year, commencing on January 1, 2020. The amount shown reflects the non-vested portion that would become vested upon a qualifying termination of employment following a change in control.
(10)To supplement the Bank’s disability programs, the Bank implemented a long-term care plan (“LTC Plan”) in 2015. Mr. Gray participates in the LTC Plan. Mr. Gray will become vested upon the earliest of  (i) the executive attaining age 62 with ten years of service; (ii) the executive attaining age 55 with 20 years of service; (iii) a change in control; (iv) or disability. Once vested, an individual and his spouse are generally eligible for long-term care benefits during their lifetime, at no cost to the covered individual, and with the Bank paying the cost of such coverage. The above table does not reflect the value of such continued coverage.


Mr. Moses did not receive any severance or additional payments in connection with his resignation effective as of March 19, 2021.

CEO Pay Ratio

Pursuant to Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are providing the following information about the relationship of the annual total compensation of our median compensated employee and the annual total compensation of Nitin J. Mhatre, our CEO as of December 31, 2021.

The 2021 annual total compensation of our median employee, other than Mr. Mhatre, was $54,367and the 2021 annual total compensation of Mr. Mhatre, as reported in the 2021 Summary Compensation Table, was $2,292,852. Based on this information, for 2021 we estimate the ratio of the annual total compensation of Mr. Mhatre to the annual total compensation of our median employee was 42 to 1. This ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. In accordance with Item 402(u), we identified our median employee based on compensation paid during 2021 to all our employees, other than Mr. Mhatre, who were employed by us on December 31, 2021. For the 2022 proxy statement, we determined the 2021 annual total compensation of our median employee based on total cash compensation, which included base pay, commissions and bonuses, and we included all employees, whether employed on a full-time, part-time or seasonal basis, and no full-time equivalent adjustments were made for part-time employees. We then identified and calculated the elements of this employee’s total compensation for 2021 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K. With respect to the annual total compensation of Mr. Mhatre, we used the amount reported in the “Total” column of our 2021 Summary Compensation Table, which is included in this Proxy Statement.

The SEC’s rules regarding the identification of the median compensated employee and the process of the calculating the pay ratio, allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.


67    BERKSHIRE HILLS BANCORP, INC. | 2022 Proxy Statement



Proposal 3:
Ratification of the Appointment of the Independent Registered Public Accounting Firm
image23.jpg
Purpose.
Performance.
Progress.

The Board of Directors recommends ratification of the Audit Committee’s appointment of Crowe LLP as our independent registered public accounting firm for fiscal year 2022.

Background. The Company’s independent registered public accounting firm (“Accounting Firm”) for the year ended December 31, 2021 was Crowe LLP (“Crowe”). The Audit Committee has appointed Crowe as the independent registered public accounting firm for the year ending December 31, 2022, subject to ratification by the shareholders at the annual meeting. A representative of Crowe is expected to be present at the annual meeting to respond to appropriate questions from shareholders and will have the opportunity to make a statement should they desire to do so.

Shareholder ratification of the appointment of Crowe is not required by the Company’s bylaws or otherwise. However, the Board of Directors is submitting the appointment of the Accounting Firm to the shareholders for ratification as a matter of good corporate practice. If the ratification of the appointment of the firm is not approved by a majority of the votes cast by shareholders at the annual meeting, other independent registered public accounting firms may be considered by the Audit Committee of the Board of Directors.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF CROWE LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2022 FISCAL YEAR.

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee is responsible for selecting and managing compensation of the accounting firm and overseeing its work. The Audit Committee approves, in advance, all audit and permissible non-audit services to be performed by the Accounting Firm. This process is intended to ensure that the accounting firm does not provide any non-audit services that are prohibited by law or regulation. Requests for services by the Accounting Firm must be specific as to the particular services to be provided for compliance with the auditor services policy. The request may be made with respect to either specific services or a type of service for predictable or recurring services. During the years ended December 31, 2021 and 2020, respectively, all services were approved, in advance, by the Audit Committee in compliance with these procedures.

Audit Fees

The following table sets forth the fees billed to the Company for the fiscal years ended December 31, 2021 and 2020, respectively, by Crowe:
Fees20212020