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<TYPE>10-Q
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<PERIOD>20020930
<FILING-DATE>20021114
<FILER>
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<CONFORMED-NAME>BERKSHIRE HILLS BANCORP INC
<CIK>0001108134
<ASSIGNED-SIC>6036
<IRS-NUMBER>043510455
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<FILE-NUMBER>001-15781
<FILM-NUMBER>02822142
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<STREET1>24 NORTH ST.
<CITY>PITTSFIELD
<STATE>MA
<ZIP>01201
<PHONE>4134435601
</BUSINESS-ADDRESS>
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<CITY>PITTSFIELD
<STATE>MA
<ZIP>01201
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<FILENAME>form10q-47515.txt
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


(Mark One)

[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 2002

                                       or

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

          For the transition period from _____________ to ____________


                         Commission File Number 1-15781


                          BERKSHIRE HILLS BANCORP, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


Delaware                                                      04-3510455
--------------------------------------------------------------------------------
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                               Identification No.)


24 North Street, Pittsfield, Massachusetts                             01201
--------------------------------------------------------------------------------
(Address of principal executive offices)                             (Zip Code)


                                 (413) 443-5601
--------------------------------------------------------------------------------
                (Issuer's telephone number, including area code)

                                 Not Applicable
--------------------------------------------------------------------------------
 (Former name, former address and former fiscal year, if changed since last
report)


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

     Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]

     The Issuer had 6,110,227 shares of common stock, par value $0.01 per share,
outstanding as of November 12, 2002.


<PAGE>



                          BERKSHIRE HILLS BANCORP, INC.
                                    FORM 10-Q

                                      INDEX

                                                                          Page
PART I.          FINANCIAL INFORMATION

Item 1.  Financial Statements (unaudited)

         Consolidated Balance Sheets as of                                 1
         September 30, 2002 and December 31, 2001

         Consolidated Statements of Income for the Three and Nine          2
         Months Ended September 30, 2002 and 2001

         Consolidated Statements of Changes in Stockholders' Equity        3
         for the Nine Months Ended September 30, 2002 and 2001

         Consolidated Statements of Cash Flows for the                     4
         Nine Months Ended September 30, 2002 and 2001

         Notes to Consolidated Financial Statements                        6

Item 2.  Management's Discussion and Analysis of Financial                 8
                 Condition and Results of Operations

Item 3.  Qualitative and Quantitative Disclosures About Market Risk       17

Item 4.  Controls and Procedures                                          19

PART II:        OTHER INFORMATION

Item 1.  Legal Proceedings                                                20
Item 2.  Changes in Securities and Use of Proceeds                        20
Item 3.  Defaults Upon Senior Securities                                  20
Item 4.  Submission of Matters to a Vote of Security Holders              20
Item 5.  Other Information                                                20
Item 6.  Exhibits and Reports on Form 8-K

Signatures                                                                21

Certifications                                                            22

<PAGE>



                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

<TABLE>
<CAPTION>

                       BERKSHIRE HILLS BANCORP, INC. AND SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEETS


                                                                                 September 30,     December 31,
                                                                                    2002               2001
                                                                                 -----------       -----------
                                                                                        (In thousands)
                                                                                           Unaudited
<S>                                                                              <C>               <C>
Assets:
     Cash and due from banks                                                     $    24,320       $    22,652
     Short term investments                                                           35,109            19,471
                                                                                 -----------       -----------
          Total cash and cash equivalents                                             59,429            42,123
     Securities available for sale, at fair value                                    131,147           104,446
     Securities held to maturity, at amortized cost                                   42,040            33,263
     Federal Home Loan Bank stock, at cost                                             7,440             7,027
     Savings Bank Life Insurance stock, at cost                                        2,043             2,043
     Loans                                                                           786,687           800,414
     Loans held for sale, at lower of cost or fair value                                  --             2,540
     Allowance for loan losses                                                       (10,676)          (11,034)
                                                                                 -----------       -----------
               Net loans                                                             776,011           791,920
     Premises and equipment, net                                                      13,478            14,213
     Foreclosed real estate                                                            2,000                --
     Accrued interest receivable                                                       5,479             5,873
     Goodwill and other intangibles                                                   10,068            10,592
     Other assets                                                                     17,507            19,201
                                                                                 -----------       -----------
                Total assets                                                     $ 1,066,642       $ 1,030,701
                                                                                 ===========       ===========
Liabilities and Stockholders' Equity:
     Deposits                                                                        774,721           742,729
     Federal Home Loan Bank advances                                                 146,947           133,964
     Securities sold under agreements to repurchase                                    1,250             1,890
     Net deferred tax liability                                                        1,878             4,573
     Accrued expenses and other liabilities                                            6,080             5,099
                                                                                 -----------       -----------
          Total liabilities                                                          930,876           888,255
                                                                                 -----------       -----------
     Minority Interests                                                                2,823             3,123
     Stockholders' Equity:
         Preferred stock  ($.01 par value;  1,000,000 shares authorized;
            None issued or outstanding)                                                   --                --
         Common stock  ( $.01 par value: 26,000,000 shares authorized;
           shares issued:  7,673,761 at September 30, 2002 and
           December 31, 2000; shares outstanding: 6,113,527 at
           September 30, 2002 and 6,425,140 at December 31, 2001)                         77                77
         Additional paid-in capital                                                   74,524            74,146
         Unearned compensation                                                        (9,927)          (11,101)
         Retained earnings                                                            84,652            80,657
         Accumulated other comprehensive income                                       13,821            18,836
         Treasury stock, at cost (1,560,234  shares at September 30, 2002
             and 1,248,621 shares at December 31, 2001)                              (30,204)          (23,292)
                                                                                 -----------       -----------
               Total stockholders' equity                                            132,943           139,323
                                                                                 -----------       -----------
     Total liabilities and stockholders' equity                                  $ 1,066,642       $ 1,030,701
                                                                                 ===========       ===========

</TABLE>

     See accompanying notes to unaudited consolidated financial statements

                                       1

<PAGE>

<TABLE>
<CAPTION>


                               BERKSHIRE HILLS BANCORP, INC. AND SUBSIDIARIES
                                      CONSOLIDATED STATEMENTS OF INCOME


                                                                                 Unaudited                  Unaudited
                                                                             Three Months Ended         Nine Months Ended
                                                                               September 30,              September 30,
                                                                          ----------------------      ---------------------
                                                                            2002          2001          2002          2001
                                                                          --------      --------      --------      -------
                                                                                (In thousands, except per share amounts)
<S>                                                                       <C>           <C>           <C>           <C>
Interest and dividend income:
      Bond interest                                                       $  1,368      $  1,286      $  3,940      $ 4,250
      Stock dividends                                                          411           393         1,031        1,143
      Short term investment interest                                           121           128           326          272
      Loan interest                                                         14,551        17,289        44,282       51,831
                                                                          --------      --------      --------      -------
Total interest and dividend income                                          16,451        19,096        49,579       57,496
                                                                          --------      --------      --------      -------
Interest expense:
      Interest on deposits                                                   4,425         6,749        13,556       20,999
      Interest on FHLB advances                                              1,463         1,703         4,307        5,077
      Interest on securities sold under agreements
           to repurchase and other borrowings                                    4            11            18          251
                                                                          --------      --------      --------      -------
Total interest expense                                                       5,892         8,463        17,881       26,327
                                                                          --------      --------      --------      -------
Net interest income                                                         10,559        10,633        31,698       31,169
Provision for loan losses                                                    1,050           945         3,875        2,625
                                                                          --------      --------      --------      -------
Net interest income, after provision for loan losses                         9,509         9,688        27,823       28,544
                                                                          --------      --------      --------      -------

Noninterest income:
      Customer service fees                                                    557           434         1,666        1,357
      Trust department fees                                                    411           428         1,365        1,303
      Loan fees                                                                 79           235           394          486
      Gain (loss) on  securities, net                                          (29)          (11)          (37)         266
      License maintenance and processing fees                                1,098         1,006         3,268        1,006
      License sales and other fees                                           1,075         1,390         1,984        1,390
      Other income                                                              69           124           450          355
                                                                          --------      --------      --------      -------
         Total noninterest income                                            3,260         3,606         9,090        6,163
                                                                          --------      --------      --------      -------
Operating expenses:
      Salaries and benefits                                                  5,411         5,063        16,261       12,665
      Occupancy and equipment                                                1,236         1,291         3,932        3,332
      Marketing and advertising                                                177           120           389          409
      Data processing                                                          148           424           494          864
      Professional services                                                    337           429           942          859
      Office supplies                                                          154           162           531          682
      Foreclosed real estate and other loans, net                              581           604         1,822        1,840
      Amortization of other intangibles                                        175           196           524          445
      Minority Interests                                                       (43)           29          (300)          29
      Other expenses                                                         1,268         1,111         3,343        2,879
                                                                          --------      --------      --------      -------
         Total operating expenses                                            9,444         9,429       27,938        24,004
                                                                          --------      --------      --------      -------

 Income before taxes                                                         3,325         3,865         8,975       10,703
      Provision  for income taxes                                            1,081         1,258         2,917        3,511
                                                                          --------      --------      --------      -------
Net income                                                                $  2,244      $  2,607      $  6,058      $ 7,192
                                                                          ========      ========      ========      =======
Earnings per share:
      Basic                                                               $   0.42      $   0.42      $   1.11      $  1.12
      Diluted                                                             $   0.38      $   0.40      $   1.03      $  1.06
Weighted average shares outstanding:
      Basic                                                                  5,378         6,196         5,457        6,432
      Diluted                                                                5,850         6,568         5,907        6,755

</TABLE>

See accompanying notes to unaudited consolidated financial statements


                                       2
<PAGE>

<TABLE>
<CAPTION>


                       BERKSHIRE HILLS BANCORP, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                    FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                          UNAUDITED
                                                                                               Accumulated
                                                            Additional                            Other
                                                   Common    Paid-in      Unearned    Retained Comprehensive Treasury
                                                   Stock     Capital    Compensation  Earnings    Income      Stock        Total
                                                 --------    --------   ------------  --------    -------    --------    --------
                                                                                   (In thousands)
<S>                                              <C>         <C>         <C>         <C>         <C>         <C>         <C>
Balance at December 31, 2000                     $     77    $ 74,054    $ (7,187)   $ 74,554    $19,824     $     --    $161,322

Comprehensive income :
   Net income                                          --          --          --       7,192         --           --       7,192
   Change in net unrealized gain  on
   securities available for sale, net of
   re-classification adjustments and  tax effects      --          --          --          --     (1,729)          --      (1,729)
                                                                                                                         --------
     Total comprehensive income                        --          --          --          --         --           --       5,463

Cash dividends declared                                --          --          --      (2,147)        --           --      (2,147)

Treasury stock purchased                               --          --          --          --         --      (15,428)    (15,428)

Purchase of common stock -  MRP                        --          --      (5,453)         --         --           --      (5,453)

Change in unearned compensation - MRP                  --          --         727          --         --           --         727

Change in unearned compensation - ESOP                 --         167         411          --         --           --         578
                                                 --------    --------    --------    --------    -------     --------    --------
Balance at September 30, 2001                    $     77    $ 74,221    $(11,502)   $ 79,599    $18,095     $(15,428)   $145,062
                                                 ========    ========    ========    ========    =======     ========    ========


Balance at December 31, 2001                     $     77    $ 74,146    $(11,101)   $ 80,657    $18,836     $(23,292)   $139,323

Comprehensive income:
   Net Income                                          --          --          --       6,058         --           --       6,058
   Change in net unrealized gain  on
   securities available for sale, net of
   re-classification adjustments and tax effects       --          --          --          --     (5,015)          --      (5,015)
                                                                                                                         --------
     Total comprehensive income                                                                                             1,043

Cash dividends declared ($.36 per share)               --          --          --      (2,063)        --           --      (2,063)

Treasury stock purchased                               --          --          --          --         --       (6,912)     (6,912)

Change in unearned compensation - MRP                  --          74         818          --         --           --         892

Change in unearned compensation - ESOP                 --         304         356          --         --           --         660
                                                 --------    --------    --------    --------    -------     --------    --------
Balance at September 30, 2002                    $     77    $ 74,524    $ (9,927)   $ 84,652    $13,821     $(30,204)   $132,943
                                                 ========    ========    ========    ========    =======     ========    ========

</TABLE>

See accompanying notes to unaudited consolidated financial statements.


                                       3
<PAGE>


<TABLE>
<CAPTION>

                    BERKSHIRE HILLS BANCORP AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                                                              Unaudited
                                                                                    Nine Months Ended September 30,
                                                                                      --------------------------
                                                                                        2002              2001
                                                                                      ---------         --------
                                                                                            (In thousands)
<S>                                                                                   <C>               <C>
Cash flows from operating activities:
        Net income                                                                    $   6,058         $  7,192
        Adjustments to reconcile net income to net cash provided by operating
           activities:
               Provision for loan losses                                                  3,875            2,625
               Net amortization of securities                                               593              131
               Depreciation and amortization expense                                      1,797            1,441
               Amortization of other intangibles                                            524              445
               Management Rewards Plan Expense                                              892              727
               ESOP Plan Expense                                                            660              578
               Gain on sales and dispositions of securities, net                           (310)            (266)
               Loss on impairment of securities                                             347               --
               Loss on sale of equipment                                                     --               35
               Deferred tax provision                                                        --                9
               Net change in loans held for sale                                             --           (1,265)
               Minority interest                                                           (300)              29
               Changes in operating assets and liabilities:
                   Accrued interest receivable and other assets                           2,088              395
                   Accrued expenses and other liabilities                                   981            2,250
                                                                                      ---------         --------
                        Net cash provided by operating activities                        17,205           14,326
                                                                                      ---------         --------


Cash flows from investing activities:
        Activity in available for sale securities:
               Sales                                                                      9,067            8,315
               Maturities                                                                43,123           22,369
               Principal payments                                                        17,963           11,280
               Purchases                                                               (105,046)         (38,624)
        Activity in held to maturity securities:
               Maturities                                                                 9,431           11,597
               Principal payments                                                        17,693           16,462
               Purchases                                                                (36,049)         (23,130)
        Purchase of Federal Home Loan Bank stock                                           (413)          (1,376)
        Loan originations, net of principal payments                                     10,034          (23,613)
        Additions to banking premises and equipment                                      (1,062)          (1,836)
        Proceeds from sales of foreclosed real estate                                        --               76
        Proceeds from sale of equipment                                                      --               20
        Payment for purchase of EastPoint Technologies, LLC                                  --           (7,300)
                                                                                      ---------         --------
               Net cash used by investing activities                                    (35,259)         (25,760)
                                                                                      ---------         --------
</TABLE>

                                   (continued)


                                       4
<PAGE>

<TABLE>
<CAPTION>

                            BERKSHIRE HILLS BANCORP AND SUBSIDIARIES
                              CONSOLIDATED STATEMENTS OF CASH FLOWS
                                           (Concluded)

                                                                                              Unaudited
                                                                                    Nine Months Ended September 30,
                                                                                      --------------------------
                                                                                        2002             2001
                                                                                      --------         ---------
                                                                                             (In thousands)
<S>                                                                                   <C>              <C>
Cash flows from financing activities:
        Net increase  in deposits                                                     $ 31,992         $  14,298
        Net decrease in securities sold under agreements
            to repurchase                                                                 (640)             (180)
        Proceeds from Federal Home Loan Bank advances with maturities
          in excess of three months                                                     75,172           122,000
        Repayments of Federal Home Loan Bank advances with maturities
             in excess of three months                                                 (62,189)          (87,516)
        Proceeds of borrowings with maturities of three months or less, net of
          Repayments                                                                        --                --
        Net decrease in loans sold with recourse                                            --            (7,740)
        Treasury stock purchased                                                        (6,912)          (15,428)
        Purchase of common stock in connection with employee and
          non-employee directors benefit programs                                           --            (5,453)
        Dividends paid                                                                  (2,063)           (2,147)
                                                                                      --------         ---------
               Net cash provided by financing activities                                35,360            17,834
                                                                                      --------         ---------

Net change in cash and cash equivalents                                                 17,306             6,400

Cash and cash equivalents at beginning of period                                        42,123            43,612
                                                                                      --------         ---------
Cash and cash equivalents at end of period                                            $ 59,429         $  50,012
                                                                                      ========         =========

Supplemental cash flow information:
        Interest paid on deposits                                                     $ 13,551         $  21,060
        Interest paid on borrowed funds                                                  4,352             5,146
        Income taxes paid                                                                1,675             2,316
        Transfers from loans to foreclosed real estate                                   2,000                26
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


                                       5
<PAGE>






                 BERKSHIRE HILLS BANCORP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           September 30, 2002 and 2001
                                   (Unaudited)


Note 1. Basis of Presentation
-----------------------------

     The consolidated  interim financial  statements of Berkshire Hills Bancorp,
Inc.  ("Berkshire  Hills" or the "Company")  and its wholly owned  subsidiaries,
Berkshire Bank (the "Bank"),  Berkshire Hills Funding Corp., and Berkshire Hills
Technology,  Inc. herein  presented are intended to be read in conjunction  with
the  consolidated  financial  statements  presented in the Company's most recent
Securities  and  Exchange  Commission  Form 10-K and  accompanying  notes to the
Consolidated  Financial  Statements  filed by the  Company  for the  year  ended
December 31, 2001. The consolidated  financial information at September 30, 2002
and for the three and nine month periods  ended  September 30, 2002 and 2001 are
derived from unaudited  consolidated financial statements but, in the opinion of
management,  reflect all adjustments necessary to present fairly the results for
these  interim  periods  in  accordance  with  accounting  principles  generally
accepted in the United  States of America.  These  adjustments  consist  only of
normal recurring adjustments. The interim results are not necessarily indicative
of the results of operations that may be expected for the entire year.

Note 2. Commitments
-------------------

     At September 30, 2002, the Company had outstanding commitments to originate
new  residential  and commercial  loans  totaling  $27.0 million,  which are not
reflected on the  consolidated  balance sheet. In addition,  unadvanced funds on
home equity  lines  totaled  $40.6  million  and  unadvanced  commercial  lines,
including unadvanced construction loan funds, totaled $62.3 million. The Company
anticipates it will have sufficient funds to meet these commitments.

Note 3. Earnings Per Share
--------------------------

     Basic  earnings  per share  represents  net income  divided by the weighted
average number of common shares outstanding during the period.  Diluted earnings
per share reflect  additional  common shares that would have been outstanding if
potential dilutive shares, such as stock options,  had been issued.  Unallocated
shares of common stock held by the Bank's  employee  stock  ownership  plan (the
"ESOP")  are not  included  in the  weighted  average  number of  common  shares
outstanding  for  either  basic or  diluted  earnings  per  share  calculations.
Earnings  per  share  data is  presented  for the three  and nine  months  ended
September 30, 2002 and 2001, respectively.

     Basic earnings per share equaled $0.42 for the quarter ending September 30,
2002, based on 5,378,371 average shares outstanding as compared to $0.42 for the
quarter ending September 30, 2001 based on 6,196,013 average shares outstanding.
Diluted  earnings per share equaled $0.38 for the quarter  ending  September 30,
2002, based on 5,849,618 average shares outstanding as compared to $0.40 for the
quarter ending September 30, 2001 based on 6,567,976 average shares outstanding.

     Basic and diluted  earnings per share for the nine months ending  September
30, 2002 were $1.11 and $1.03  respectively,  based on 5,457,271  average shares
outstanding  and  5,907,230  average  shares  outstanding,   respectively.  This
compares  to basic and  diluted  earnings  per share for the nine  months  ended
September 30, 2001 of $1.12 and $1.06  respectively,  based on 6,432,179 average
shares outstanding and 6,754,663 average shares outstanding, respectively.

Note 4. Book Value
------------------

     The book value per share of Berkshire  Hills' common stock at September 30,
2002 was $21.75,  based on total equity of $132.9 million and outstanding shares
of  6,113,527.  The book value at December  31,  2001 was $21.68  based on total
equity of $139.3 million and total outstanding shares of 6,425,140.


                                       6
<PAGE>




Note 5. Dividend
-----------------

     On July 24, 2002, the Company's Board of Directors  approved the payment of
a cash dividend of $0.12 per share,  payable on August 23, 2002, to stockholders
of record on August 8, 2002.

Note 6. Stock Repurchase Program
--------------------------------

     During the third quarter of 2002, the Company  continued its fifth 5% stock
repurchase program  purchasing 28,200 shares at a cost of $618,000.  The Company
has 172,416 shares available for repurchase under this program.  The Company has
repurchased 311,613 shares at a cost of $6.9 million during 2002.

Note 7.   Recent Accounting Pronouncements
------------------------------------------

     On  June  30,  2001,  the  Financial   Accounting  Standards  Board  issued
Statements  of  Financial   Accounting  Standards  ("SFAS")  No.  141,  Business
Combinations,  and No. 142, Goodwill and Other Intangible  Assets.  SFAS No. 141
requires all business combinations initiated after June 30, 2001 to be accounted
for using the purchase method of accounting.  With the adoption of SFAS No. 142,
effective  January 1, 2001,  goodwill is no longer subject to amortization  over
its  estimated  useful  life.  Rather,  goodwill  will be subject to at least an
annual   assessment  for  impairment  by  applying  a  fair  value  based  test.
Additionally,   under  SFAS  No.  142,  acquired  intangible  assets  should  be
separately recognized if the benefit of the intangible asset is obtained through
contractual  or other  legal  rights,  or if the  intangible  asset can be sold,
transferred, licensed, rented, or exchanged, regardless of intent to do so. As a
result of the Company's investment in EastPoint Technologies,  LLC, $4.3 million
of goodwill was recorded on the books of the Company.  An annual  evaluation  of
this  goodwill was completed in June 2002 and resulted in no impairment in 2002,
as of the evaluation date.

Note 8.   Real Estate Investment Trust (REIT)
---------------------------------------------

     Berkshire Hills  established a real estate  investment  trust (REIT) in the
second quarter of 2001. As a result of its  operations,  the Company was able to
reduce its tax obligations by an estimated $205,000 in the third quarter of 2002
and  $346,000 for the first nine months of 2002.  Similarly,  for the year ended
December  31,  2001,  it is  estimated  the  operations  of the REIT reduced the
Company's net tax liability by $494,000.  Recently, the Massachusetts Department
of Revenue has questioned the applicability of allowing a deduction on dividends
upstreamed from a bank-established REIT to a parent company.  While the ultimate
resolution of the matter is uncertain  and no  assurances  can be made that such
deductions will be deemed to be appropriate for state tax purposes,  the Company
believes the  deductions it has taken to date are  appropriate  and thus has not
taken  any  provision  in its  financial  statements  for any  amounts  that the
Department of Revenue may assess in the future.


                                       7
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                RESULTS OF OPERATIONS.

     The following  analysis  discusses  changes in the financial  condition and
results of operations  at and for the three and nine months ended  September 30,
2002 and 2001, and should be read in conjunction  with Berkshire  Hills Bancorp,
Inc.'s  Consolidated  Financial  Statements and the notes thereto,  appearing in
Part I, Item 1 of this document.

Forward Looking Statements

     This  report  contains  forward  looking   statements  that  are  based  on
assumptions  and may describe  future plans,  strategies,  and  expectations  of
Berkshire  Hills and  Berkshire  Bank.  These  forward  looking  statements  are
generally  identified  by  use  of  the  words  "believe,"  "expect,"  "intend,"
"anticipate,"  "estimate,"  "project," or similar expressions.  Berkshire Hills'
and Berkshire  Bank's ability to predict  results or the actual effect of future
plans or strategies is inherently uncertain. Factors which could have a material
adverse  effect  on the  operations  of  Berkshire  Hills  and its  subsidiaries
include,  but are not  limited  to,  changes in  interest  rates,  national  and
regional economic conditions,  legislative and regulatory changes,  monetary and
fiscal policies of the U.S. Government,  including policies of the U.S. Treasury
and the  Federal  Reserve  Board,  the quality  and  composition  of the loan or
investment  portfolios,  demand for loan products,  deposit flows,  competition,
demand for financial  services in Berkshire  Hills' and Berkshire  Bank's market
area,  changes in real estate  market  values in Berkshire  Hills' and Berkshire
Bank's  market  area,  and  changes  in  relevant   accounting   principles  and
guidelines.  These risks and  uncertainties  should be  considered in evaluating
forward  looking  statements  and undue  reliance  should  not be placed on such
statements. Except as required by applicable law or regulation,  Berkshire Hills
does not  undertake,  and  specifically  disclaims any  obligation,  to publicly
release the result of any  revisions  which may be made to any  forward  looking
statements to reflect events or  circumstances  after the date of the statements
or to reflect the occurrence of anticipated or unanticipated events.

General

     Berkshire  Hills is a Delaware  corporation  and the  holding  company  for
Berkshire  Bank, a  state-chartered  savings bank  headquartered  in Pittsfield,
Massachusetts.  Established  in 1846,  Berkshire  Bank is one of  Massachusetts'
oldest and largest  independent  banks.  With eleven full service branch offices
serving communities  throughout Berkshire County,  Berkshire Bank is the largest
banking   institution   based   in   Western   Massachusetts.   The  Bank  is  a
community-based financial institution that originates a variety of loan products
including real estate loans,  commercial  loans, and consumer loans primarily in
Berkshire  County,  Massachusetts  and its surrounding  areas. The Bank offers a
wide variety of deposit  products and other  investment  products and  financial
services  to its  customers,  including  asset  management  and trust  services.
Berkshire Hills, through its wholly owned subsidiary Berkshire Hills Technology,
Inc., owns a 60.3% interest in EastPoint Technologies, LLC ("EastPoint"), a data
and financial services provider for financial institutions.

Recent Developments

     On October 17, 2002,  Berkshire  Hills  announced that Michael P. Daly, who
previously  served as Executive  Vice President of the Company and the Bank, was
appointed to serve as President,  Chief Executive  Officer and a Director of the
Company and the Bank and that Lawrence A. Bossidy was appointed as Non-Executive
Chairman of the Board of Directors of the Company.

     On October 17, 2002, the Company also announced that James A. Cunningham,
Jr. resigned as President, Chief Executive Officer and a Director of the Company
and the Bank, effective October 16, 2002. In connection with his resignation,
the Company, the Bank and Mr. Cunningham entered into a severance agreement to
resolve the obligation owed Mr. Cunningham under his existing employment
agreements which provided severance payments and benefits. Such severance
agreement also provides the Company and Bank with a release from certain other
claims related to Mr. Cunningham's employment and impose certain restrictions on
him, including non-competition and confidentiality requirements.The Company
expects to incur a $2.4 million (after-tax) charge in the fourth quarter in
connection with the severance agreement.

     Berkshire Hills named Michael J. Ferry as Senior Vice President of
Commercial Lending of Berkshire Bank and Linda A. Johnston had been named Senior
Vice President of Human Resources of Berkshire Bank. Mr. Ferry and Ms. Johnston
had each previously served as a vice president of Berkshire Bank. Additionally,
Berkshire Hills announced that the responsibilities of Gayle P. Fawcett, Senior
Vice President of Systems and Operations, had been expanded to include oversight
over branch administration, marketing and facilities.

     The individuals listed above have assumed the responsibilities of Susan M.
Santora, Executive Vice President of Berkshire Hills and Berkshire Bank, who
will resign effective November 15, 2002, and John A. Davidson, Senior Vice
President of Berkshire Bank, who will resign effective December 20, 2002.
Additionally, Charles F. Plungis, Jr., Senior Vice President, Treasurer and
Chief Financial Officer of Berkshire Hills and Berkshire Bank, will be resigning
effective upon the earlier of February 28, 2003 or as Berkshire Hills and
Berkshire Bank may determine to be appropriate after the fiscal year-end
reporting is completed. Berkshire Hills and Berkshire Bank entered into
severance agreements with such departing officers to resolve obligations owed
under existing employment agreements or change-in-control agreements which
provided severance payments and benefits to such officers. Such severance
agreements also provide the Company and Bank with a release from certain other
claims related to their employment and impose certain restrictions on such
individuals, including non-competition and confidentiality requirements.
Berkshire Hills expects to incur an after-tax charge of approximately $2.0
million in the fourth quarter in connection with these severance agreements.


Comparison of Financial Condition at September 30, 2002 and December 31, 2001

     Total assets at September 30, 2002 were $1.07 billion, an increase of $35.9
million, or 3.5%, from $1.03 billion at December 31, 2001. Securities, including
Federal  Home Loan Bank stock and Savings  Bank Life  Insurance  stock,  totaled
$182.7 million at September 30, 2002, a $35.9 million,  or 24.4%,  increase from
$146.8  million at December 31, 2001.  Short-term  investments  increased  $15.6
million,  or 80.3%, to $35.1 million at September 30, 2002. A $16.3 million,  or
2.0%,  decrease in loans outstanding,  which totaled $786.7 million at September
30, 2002, as well as a $32.0 million increase in deposits to $774.7 million at



                                       8
<PAGE>

September  30,  2002 and a $13.0  million  increase  in  Federal  Home Loan Bank
advances,  which  totaled  $146.9  million at  September  30,  2002,  funded the
securities and short term investments increases.

Loans

     Total loans outstanding decreased $16.3 million, or 2.0%, to $786.7 million
during the first nine months of 2002. The lower total  outstanding  was due to a
decrease in sub-prime  automobile loans resulting from the Company's strategy to
exit the sub-prime automobile loan business and lower balances in the commercial
land  development  and  construction  loan  category  outpaced  increases in the
commercial real estate and residential land  development and  construction  loan
portfolios.  The consumer loan portfolio fell $30.1 million, or 11.1%, to $241.0
million at September  30, 2002.  The  automobile  loan portion of the  portfolio
decreased by $29.0  million  during the first nine months of 2002 and  comprised
23.78% of total  loans  outstanding  at  September  30, 2002 down from 26.90% at
December 31, 2001. The Company has decided to exit the sub-prime automobile loan
business by allowing its existing sub-prime  automobile loans to pay down and by
discontinuing  the  origination of new sub-prime  loans.  In  implementing  this
strategy  during the first nine months of 2002,  the  Company saw its  sub-prime
automobile  loans fall from $113.9 million at December 31, 2001 to $88.2 million
at September 30, 2002. It is estimated that the balance of sub-prime  automobile
loans held by the  Company on  December  31,  2002 will be  approximately  $79.0
million.

     Residential  one-to  four-family  loans  declined  $2.9  million  to $226.5
million at  September  30, 2002 as mortgage  originations  did not fully  offset
monthly   amortization  and   prepayments.   Residential  land  development  and
construction loans increased $3.8 million, or 107.4%, to $7.4 million reflecting
a strong local new housing market.

     Commercial  land  development  and  construction  loans  decreased  by $9.5
million  as  several  large  projects  converted  to  permanent  financing.  The
conversion of these loans as well as the origination of $12.0 million in net new
business  resulted in a $21.5  million,  or 25.5%,  increase in commercial  real
estate loans.

<TABLE>
<CAPTION>

                                                          At September 30, 2002      At December 31, 2001
                                                         ----------------------     -----------------------
                                                                        Percent                    Percent
                                                           Balance     of total      Balance       of total
                                                         -----------   --------     -----------   ---------
                                                                       (Dollars in thousands)
<S>                                                       <C>           <C>          <C>            <C>
                Real estate loans:
                     Residential one-to four-family       $ 226,525     28.81%       $ 229,432      28.57%
                     Residential land development
                        and construction                      7,434      0.94%           3,585       0.45%
                     Commercial one-to four-family           10,768      1.37%          11,517       1.43%
                     Commercial real estate                 106,074     13.48%          84,538      10.53%
                     Commercial  land development
                        and construction                      9,832      1.25%          19,351       2.41%
                     Multi-family                            14,973      1.90%          13,183       1.64%
                                                         -----------   --------     -----------   ---------
                         Total real estate loans            375,606     47.75%         361,606      45.03%

                Commercial loans                            170,130     21.62%         170,305      21.21%

                Consumer loans:
                     Automobile                             187,025     23.78%         216,026      26.90%
                     Home equity loans                       38,645      4.91%          34,439       4.30%
                     Other                                   15,281      1.94%          20,578       2.56%
                                                         -----------   --------     -----------   ---------
                         Total consumer loans               240,951     30.63%         271,043      33.76%

                Total loans                                 786,687                    802,954

                Less:  Allowance for loan losses           (10,676)      1.36%        (11,034)       1.37%
                                                         -----------                -----------
                     Loans, net                           $ 776,011                  $ 791,920
                                                         ===========                ===========
</TABLE>


                                       9
<PAGE>


Allowance for Loan Losses

     All banks that manage loan  portfolios  will  experience  losses to varying
degrees.  The allowance for loan losses is the amount  available to absorb these
losses and  represents  management's  evaluation  of the risks  inherent  in the
portfolio including the collectibility of the loans, changing collateral values,
past loan loss  history,  specific  borrower  situations,  and general  economic
conditions.  Management  continually  assesses the adequacy of the allowance for
loan losses and makes  monthly  provisions in an amount  considered  adequate to
cover losses in the loan  portfolio.  Because  future events  affecting the loan
portfolio cannot be predicted with complete accuracy, there can be no assurances
that management's estimates are correct and that the existing allowance for loan
losses is adequate.  However,  management believes that based on the information
available to it on September 30, 2002,  the Company's  allowance for loan losses
is sufficient to cover losses inherent in the Company's current loan portfolio.

     The allowance  consists of allocated,  general and unallocated  components.
The allocated component relates to loans that are classified as either doubtful,
substandard  or special  mention.  For such loans  that are also  classified  as
impaired,  an  allowance  is  established  when the  discounted  cash  flows (or
collateral value or observable  market price) of the impaired loan is lower than
the carrying value of that loan.  The general  component  covers  non-classified
loans  and is based on  historical  loss  experience  adjusted  for  qualitative
factors such as the credit history and credit quality of the borrower,  the type
and geographic  concentration of loans in the portfolio,  and the local economic
environment.  An unallocated component is maintained to cover uncertainties that
could affect management's estimate of probable losses. The unallocated component
of the allowance  reflects the margin of imprecision  inherent in the underlying
assumptions used in the methodologies for estimating losses in the portfolio.

     On September 30, 2002, the allowance for loan losses totaled $10.7 million,
or 1.36% of total loans outstanding,  as compared to $11.0 million,  or 1.37% of
total loans  outstanding,  at December 31, 2001.  Charged-off loans totaled $6.8
million  during the first nine months this year as compared to $2.6 million last
year primarily due to continued  weakness in the indirect  automobile  portfolio
and the  institution of a new, more  aggressive  policy in the fourth quarter of
2001 regarding the  charge-off of automobile  loans.  Under the new policy,  all
delinquent  automobile  loans  remain on accrual  status until they are 120 days
past due at which time they are charged  off,  except for loans to  customers in
bankruptcy proceedings, which are transferred to nonaccrual status. In addition,
two commercial real estate loans totaling $510,000 were charged off in the first
nine months of 2002 versus none last year.  Recoveries  totaled $2.6 million for
the nine months this year as compared to $591,000 for the nine months last year,
an increase of $2.0 million, as the Company  aggressively pursued the collection
of previously  charged-off loans. On September 30, 2002, the allowance expressed
as a percentage of  nonperforming  loans was 424.66% while on September 30, 2001
it was 179.58%.


                                       10
<PAGE>



     The following table sets forth information regarding the allowance for loan
losses for the nine month periods ended September 30, 2002 and 2001.

<TABLE>
<CAPTION>

                                                                    Nine Months Ended
                                                         ------------------------------------------
                                                         September 30, 2002     September 30, 2001
                                                         ------------------     -------------------
                                                                   (Dollars in thousands)
     <S>                                                       <C>                   <C>
     Allowance for loan losses, beginning of period            $11,034               $10,216

     Charge-offs:
          Residential one-to four-family                            --                    33
          Residential land development and construction             --                    --
          Commercial one-to four-family                             --                    --
          Commercial real estate                                   510                    --
          Commercial land development and construction              --                    --
          Multi-family                                              --                    --
          Commercial                                               204                   139
          Consumer (1)                                           6,115                 2,419
                                                               -------               -------
              Total charge-offs                                  6,829                 2,591
                                                               -------               -------

     Recoveries:
          Residential one-to four-family                            --                    --
          Residential land development and construction             --                    --
          Commercial one-to four-family                             --                    --
          Commercial real estate                                    --                    --
          Commercial land development and construction              --                    --
          Multi-family                                              --                    --
          Commercial                                               133                   225
          Consumer (1)                                           2,463                   366
                                                               -------               -------
              Total recoveries                                   2,596                   591
                                                               -------               -------

     Net charge offs                                             4,233                 2,000

     Provision                                                   3,875                 2,625
                                                               -------               -------

     Allowance for loan losses, end of period                  $10,676               $10,841
                                                               =======               =======

     Net loans charged-off to total loans                         0.54%                 0.24%
     Allowance for loan losses to total loans                     1.36%                 1.33%
     Allowance for loan losses to nonperforming loans           424.66%               179.58%
     Recoveries to charge-offs                                   38.01%                22.81%

     (1) Consists primarily of automobile loans

</TABLE>


                                       11
<PAGE>

Nonperforming Assets

     The following table sets forth information  regarding  nonperforming assets
as of September 30, 2002 and December 31, 2001.

<TABLE>
<CAPTION>
                                            At September 30, 2002     At December 31, 2001
                                            ---------------------     ---------------------
                                                        (Dollars in thousands)
     <S>                                           <C>                        <C>
     Nonaccruing loans:
          Residential one-to four-family           $  166                     $  250
          Residential land development
             and construction                          --                         --
          Commercial one-to four-family                --                         60
          Commercial real estate                       --                         --
          Commercial land development
             and construction                          --                         --
          Multi-family                                 --                         --
          Commercial                                1,490                      2,077
          Automobile                                  858                        315
          Home equity                                  --                         --
          Other consumer                               --                         --
                                                   ------                     ------
              Total                                 2,514                      2,702
                                                   ------                     ------

     Other real estate owned                        2,000                         --
                                                   ------                     ------

     Total nonperforming assets                    $4,514                     $2,702
                                                   ======                     ======

     Total nonperforming loans to total loans        0.32%                      0.34%

     Total nonperforming assets to total assets      0.42%                      0.26%

</TABLE>


     Generally, the Company ceases accruing interest on all loans when principal
or interest payments are 90 days or more past due unless  management  determines
the principal and interest to be fully secured and in the process of collection.
Once management  determines that interest is  uncollectible  and ceases accruing
interest on a loan, all previously  accrued interest is reversed against current
interest income.  However,  in the last quarter of 2001, the Company initiated a
new policy for automobile  loans whereby all delinquent  automobile loans remain
on  accrual  status  until  they are 120 days  past due at which  time  they are
charged off, except for loans to customers in bankruptcy proceedings,  which are
transferred  to nonaccrual  status.  At September 30, 2002, the Company had $1.2
million in  automobile  loans that were 90 days past due and still  accruing  as
compared to $1.3 million at December 31, 2001.

     Total nonaccruing  loans amounted to $2.5 million,  a decrease of $188,000,
or 7.0%,  from $2.7 million at December 31, 2001.  This  decrease was due to the
decrease in  commercial  nonaccruing  loans,  which  declined to $1.5 million at
September  30, 2002 from $2.1 million at December 31, 2001 as  collections  more
than  offset new loans added to the  commercial  nonaccruing  totals.  Partially
offsetting  this  decrease was an increase in  automobile  nonaccruing  loans of
$543,000 as all previous nonaccural  automobile loans remain on nonaccrual until
such loans are current for a period of six  months.  The ratio of  nonperforming
loans as a percentage  of total loans  decreased to 0.32% at September  30, 2002
from 0.34% as of December 31, 2001.  Foreclosed  real estate was $2.0 million at
September  30,  2002  versus  zero at  December  31,  2001 as the  Company  took
possession of one commercial property.

Investment Securities

     Securities,  including  Federal  Home Loan Bank stock and Savings Bank Life
Insurance stock,  totaled $182.7 million at September 30, 2002, a $35.9 million,
or 24.4%,  increase from $146.8 million at December 31, 2001.  This increase was
primarily due to an increase in investments in callable  agency  securities with
final maturities of five years or less. The net unrealized gain in the portfolio
decreased by $5.0 million  from  December 31, 2001 to $13.8  million due to this
year's decline in equity prices. This change was recognized in accumulated other
comprehensive  income on the consolidated  statement of changes in stockholders'
equity.


                                       12
<PAGE>

Miscellaneous Assets

     Miscellaneous assets, which include premises and equipment, foreclosed real
estate, accrued interest receivable,  goodwill and other intangibles,  and other
assets, totaled $48.5 million at September 30, 2002, a decrease of $1.3 million,
or 2.7%, from $49.9 million at December 31, 2001. The decrease in  miscellaneous
assets was primarily due to a $477,000 decrease in repossessed  automobiles from
December 31, 2001, as repossessed  automobiles totaled $2.1 million at September
30,  2002 and a  $524,000  decrease  in other  intangible  assets  due to normal
amortization.

Deposits

     Customers' deposits are the primary funding vehicle for the Company's asset
base. The following table sets forth the Company's deposit  stratification as of
September 30, 2002 and December 31, 2001.

<TABLE>
<CAPTION>
                                                 At September 30, 2002           At December 31, 2001
                                             ---------------------------     ---------------------------
                                                               Percent                         Percent
                                                Balance      of deposits       Balance       of deposits
                                             -----------     -----------     -----------     -----------
                                                              (Dollars in thousands)

                <S>                            <C>              <C>         <C>                <C>
                Demand deposits                 $84,829         10.95%        $82,758          11.14%
                NOW accounts                     84,208         10.87%         80,970          10.90%
                Savings accounts                158,510         20.46%        151,565          20.41%
                Money market accounts           117,002         15.10%        110,199          14.84%
                Certificates of deposit         330,172         42.62%        317,237          42.71%
                                             -----------                   -----------
                     Total deposits           $ 774,721                     $ 742,729
                                             ===========                   ===========
</TABLE>


     Total  deposits  were $774.7  million on September 30, 2002, an increase of
$32.0 million for the first nine months of the year as deposits  rebounded  well
in  the  second  and  third  quarters  from a  seasonally  slow  first  quarter.
Certificates  of deposit and  savings  accounts  increased  $19.9  million  from
December 31, 2001 while demand deposit  accounts  increased $2.1 million.  Money
market and NOW  accounts  increased  $10.0  million.  Core  deposits,  which the
Company  considers to be all but  certificates  of deposit,  were 57.4% of total
deposits on September 30, 2002 as compared to 57.3% on December 31, 2001.

Borrowings

     Borrowings from the Federal Home Loan Bank of Boston totaled $146.9 million
at September 30, 2002, a $13.0 million, or 9.7%, increase from $134.0 million at
December  31,  2001,  as the  Company has looked to extend  maturities  and take
advantage of low cost funds.  The  Company's  borrowing  capacity at the Federal
Home Loan Bank of Boston is in excess of $175 million.

Stockholders' Equity

     At September  30,  2002,  the Company had $132.9  million in  stockholders'
equity  compared to $139.3  million at  December  31,  2001.  The  decrease  was
primarily due to the purchase of 311,613  shares of the  Company's  common stock
under this year's  repurchase  programs at a cost of $6.9  million.  The Company
also  declared and paid cash  dividends  of $0.36 per common share  amounting to
$2.1 million during the first nine months of 2002.  The net  unrealized  gain in
the  securities  portfolio  decreased by $5.0 million from  December 31, 2001 to
$13.8 million.  This change was recognized in  accumulated  other  comprehensive
income  on the  consolidated  statement  of  changes  in  stockholders'  equity.
Partially  offsetting these decreases in stockholders'  equity was net income of
$6.1 million.

Comparison  of Operating  Results for the Three Months Ended  September 30, 2002
and 2001

     Net Interest  Income.  Net interest income is the largest  component of the
Company's  revenue  stream  and is  the  difference  between  the  interest  and
dividends earned on the loan and investment  portfolios and the interest paid on
the Company's funding sources, primarily customer deposits and advances from the
Federal Home Loan Bank of Boston. Net interest income,  before the provision for
loan losses,  decreased $74,000, or 0.7%, to $10.6 million for the third quarter
of 2002.  The  Company's  net  interest  margin was 4.21% for the quarter  ended
September 30, 2002 compared to 4.36% for the same quarter last year as customers
refinanced  loans at lower  rates and pay downs for higher rate  automobile  and
other loans were reinvested in lower yielding securities.

                                       13
<PAGE>


     Total interest and dividend  income  decreased $2.6 million,  or 13.9%,  to
$16.5  million for the third quarter of 2002 as compared to the same period last
year. Loan interest dropped to $14.6 million in the current quarter,  a decrease
of $2.7 million,  or 15.8%,  due to lower average loan balances  compared to the
third quarter last year and due to lower yields as rates have remained at levels
below those experienced in 2001.

     Total interest expense fell $2.6 million, or 30.4%, to $5.9 million for the
third  quarter  due to lower  rates  paid on all  interest-bearing  liabilities.
Deposit  expense  fell by $2.3  million  for the third  quarter  of 2002 to $4.4
million while interest on FHLB advances  decreased $240,000 to $1.5 million from
$1.7 million  last year as lower rates paid on new  borrowings  replaced  higher
cost advances.

     The  Company's  provision  for loan  losses  was $1.1  million in the third
quarter of this year as compared to $945,000 in the same quarter  last year.  In
assessing  the provision  for the third  quarter of 2002,  management  took into
consideration  a $14.6  million  increase  in  commercial  loans  from the third
quarter of last year. This increase in commercial  loans directly  resulted in a
$714,000  increase in the commercial  loan reserve  requirement.  However,  this
increase in reserve  requirement was more than offset by a $1.3 million decrease
in the consumer loan reserve requirement as consumer loan balances dropped $40.5
million to $241.0 million at September 30, 2002 from $281.4 million at September
30, 2001. The Company also looks closely at loan  charge-offs,  which  increased
$738,000  to $1.8  million in the third  quarter of this year from $1.1  million
last year.  Foremost in this increase was consumer loan  charge-offs  which rose
$723,000 to $1.7 million at September  30, 2002 from  $965,000 at September  30,
2001. In establishing  the provision for loan losses,  the Company also examined
nonperforming  loans  which  decreased  significantly,   from  $6.0  million  at
September  30, 2001 to $2.5  million at  September  30,  2002.  The Company also
evaluates  current  recoveries  and the  likelihood for recoveries of previously
charged-off loans, among other items.

     After the provision for loan losses,  net interest  income was $9.5 million
for the quarter  ending  September 30, 2002, as compared to $9.7 million for the
same period last year, a decrease of $179,000, or 1.8%.

     Noninterest  Income.  For  the  three  months  ended  September  30,  2002,
noninterest  income  totaled $3.3 million,  a decrease of $346,000 from the same
quarter last year. A large one-time  incremental license fee earned by EastPoint
of $1.1 million  inflated  last year's total.  Excluding  that $1.1 million fee,
revenues for  EastPoint  were $2.2 million for the three months ended  September
30, 2002 compared to $1.3 million for the three months ended September 30, 2001.

     Higher ATM and debit card usage  helped  produce an increase of $123,000 to
$557,000 in 2002's third  quarter  customer  service  fees.  However,  loan fees
dropped  $156,000 to $79,000 as the Company  decided earlier this year to retain
in portfolio all loans that it originates and thus is now servicing fewer loans.

     Noninterest  Expenses.  Noninterest  (operating)  expenses amounted to $9.4
million for the three months  ending  September  30,  2002,  an increase of only
$15,000 from last year's third  quarter  totals.  Salaries and benefits  expense
rose  $348,000,  or 6.9%, to $5.4 million in the third quarter of this year from
$5.1  million in the third  quarter of last year.  However,  this  increase  was
partially offset by a $276,000 decrease in data processing  expenses as a switch
in ATM network  vendors  resulted in lower operating costs for the third quarter
this  year.  The data  processing  expense  for the third  quarter  of last year
included $173,000 in nonrecurring costs. In addition, professional services fees
decreased $92,000.

     Income  Taxes.  Income taxes were $1.1 million in this year's third quarter
with an effective tax rate of 32.5%, the same tax rate as the third quarter last
year.

     Berkshire Hills  established a real estate  investment  trust (REIT) in the
second quarter of 2001. As a result of its  operations,  the Company was able to
reduce its tax obligations by an estimated $205,000 in the third quarter of 2002
and  $346,000 for the first nine months of 2002.  Similarly,  for the year ended
December  31,  2001,  it is  estimated  the  operations  of the REIT reduced the
Company's net tax liability by $494,000.  Recently, the Massachusetts Department
of Revenue has questioned the applicability of allowing a deduction on dividends
upstreamed from a bank-established REIT to a parent company.  While the ultimate
resolution of the matter is uncertain  and no  assurances  can be made that such
deductions will be deemed to be appropriate for state tax purposes,  the Company
believes the  deductions it has taken to date are  appropriate  and thus has not
taken  any  provision  in its  financial  statements  for any  amounts  that the
Department of Revenue may assess in the future.


                                       14
<PAGE>



Comparison of Operating Results for the Nine Months Ended September 30, 2002 and
2001

     Net Interest  Income.  Net interest  income,  before the provision for loan
losses,  totaled  $31.7  million for the first nine months of 2002,  up $529,000
from $31.2  million  over the same period last year.  Both  interest  income and
interest  expense have  declined  over the first nine months of this year due to
the lower market  interest rate  environment,  however,  the decline in interest
income was more than offset by the decline in interest  expense.  The  Company's
net  interest  margin  equaled  4.32% over the first nine  months of 2002 versus
4.31% last year.  The increase in net interest  margin was  primarily due to the
elimination  of interest rate floors on certain  deposit  accounts in the second
half of  2001.  The  Company's  Asset/Liability  committee  strives  to keep the
Company's net interest  margin as unaffected as possible by market interest rate
fluctuations.  This was  accomplished  as  declines  in the rates  earned on the
Company's  loan and securities  portfolios  over the first nine months this year
were more than  offset  by  decreases  in the  rates  paid on  deposits  and the
refinancing  of  advances  from the  Federal  Home  Loan Bank of Boston at lower
rates.

     Total interest and dividend income totaled $49.6 million for the first nine
months of 2002, a $7.9 million,  or 13.8%,  decrease from $57.5 million over the
first nine months last year. The interest earned on the Company's loan portfolio
dropped $7.5 million to $44.3  million for the nine months ended  September  30,
2002 as loan yields fell due to heavy  refinancing  activity  resulting from the
sharp decline in interest rates and a competitive local marketplace.

     Total interest expense dropped $8.4 million, or 32.1%, to $17.9 million for
the nine months ended September 30, 2002 due to lower rates paid on all interest
bearing liabilities. Interest paid on deposits totaled $13.6 million, a decrease
of $7.4  million  from  $21.0  million  over the  comparable  period  last year.
Interest  on FHLB  advances  dropped  $770,000  as  lower  rates  offset  higher
balances.

     The  provision for loan losses  increased  $1.3 million to $3.9 million for
the first three  quarters of 2002 from $2.6 million for the first nine months of
2001.  In assessing  the Company's  provision,  management  looks closely at the
balances  and  rate of loan  growth  in the  various  Company  loan  portfolios,
especially its consumer loan and commercial loan portfolios. Due to increases in
the  balance  of the  commercial  loan  portfolio,  the  Company  increased  the
provision by $714,000 from where it was one year ago. Offsetting this is a lower
balance in the consumer loan portfolio and in particular, the sub-prime indirect
automobile  loan portfolio,  which allowed  management to lower the provision by
$1.3 million.  The Company also  evaluates loan  charge-offs in determining  the
provision  for loan losses.  Loan  charge-offs  increased by $4.3 million in the
first nine  months of 2002 over the same period  last year.  Of these,  consumer
loan  charge-offs  increased  $3.7 million to $6.1 million at September 30, 2002
from $2.4 million at September 30, 2001. Management also considers the level and
trend of  nonperforming  loans in  determining  the  provision  for loan losses.
Nonperforming  loans  totaled $2.5 million at September 30, 2002, a $3.5 million
decrease from $6.0 million at September 30, 2001. Among other items, the Company
also  evaluates  current   recoveries  and  the  likelihood  for  recoveries  of
previously charged off loans.

     After the provision for loan losses,  net interest income was $27.8 million
for the first nine months of 2002,  as  compared  to $28.5  million for the same
period last year, a decrease of $721,000, or 2.5%.

     Noninterest   Income.  For  the  nine  months  ended  September  30,  2002,
noninterest  income  totaled $9.1  million,  a $2.9 million  increase  from $6.2
million for the same period last year.  Substantially  all of this  increase was
related to the  operations  of  EastPoint,  as nine months worth of license fees
totaling  $5.3 million were  included in 2002's  results while only three months
worth of license fees  totaling  $2.4 million were  included in 2001's  results.
Excluding  EastPoint's  contribution,  noninterest income increased $71,000,  or
1.9%,  over last  year's  $3.8  million.  During the first  nine  months of 2002
customer  service fees increased  $309,000 to $1.7 million due to higher ATM and
debit card usage and deposit account service charges. Trust department fees rose
$62,000 to $1.4 million  versus the same period last year.  Somewhat  offsetting
these  increases  was a  $37,000  loss on the sale of  securities  this  year as
opposed to a gain of $266,000  last year,  a difference  of $303,000.  Loan fees
decreased $92,000 for the first nine months of 2002 versus the first nine months
last year as the Company  decided to retain new  originations  and is  servicing
fewer loans.

     Noninterest Expenses. Noninterest (operating) expense totaled $27.9 million
for the nine months ended  September 30, 2002,  an increase of $3.9 million,  or
16.4%,  from $24.0  million for the same period last year.  As was the case with
noninterest income, substantially all of the increase in expenses was due to the
operations  of  EastPoint.  Total  salaries and benefits  expense  equaled $16.3
million at September  30, 2002,  an increase of $3.6 million from $12.7  million
last year while  occupancy and equipment  expenses  totaled $3.9 million for the
nine months ended September 30, 2002, an increase of $600,000. Included in these
increases  were  expenses of $3.9 million  related to EastPoint and $1.0 million
related to EastPoint's occupancy and equipment totals.  Excluding the operations
of EastPoint,  noninterest  expenses


                                       15
<PAGE>

equaled  $22.1  million,  an  increase  of only  $52,000  from last  year.  Data
processing expenses dropped $370,000 to $494,000 for the first three quarters of
2002 due to a switch in ATM network vendors last year.

     Income  Taxes.  Income taxes were $2.9 million for the first nine months of
this year  versus  $3.5  million  for the same nine  months  as last  year.  The
effective  tax rates  were 32.5% and 32.8%  respectively.  The lower tax rate in
2002 was due to the operation of the Company's  REIT for the full nine months of
this year versus only a portion of the first nine months of last year.

Regulatory Capital

     The Company's  capital to assets ratios for September 30, 2002 and December
31, 2001 were 12.46% and 13.52%,  respectively.  The various  regulatory capital
ratios for the Company and the Bank at September  30, 2002 and December 31, 2001
were as follows:

<TABLE>
<CAPTION>
                                                                         At September 30, 2002
                                            ---------------------------------------------------------------------------------------
                                                                                                             Minimum To Be Well
                                                                                  Minimum                     Capitalized Under
                                                                                  Capital                     Prompt Corrective
                                                      Actual                    Requirement                   Action Provisions
                                            -------------------------     -------------------------       -------------------------
                                               Amount        Ratio          Amount         Ratio             Amount        Ratio
                                            -----------   -----------     -----------   -----------       -----------   -----------
                                                                            (Dollars in thousands)
<S>                                          <C>             <C>           <C>             <C>             <C>             <C>
Total capital to risk weighted assets:
    Berkshire Hills Bancorp, Inc.            $128,802        15.34 %           N/A          N/A                N/A            N/A
    Berkshire Bank                            114,678        13.77         $66,612         8.00 %          $83,265          10.00 %

Tier I capital to risk weighted assets:
    Berkshire Hills Bancorp, Inc.             109,055        12.98             N/A          N/A                N/A            N/A
    Berkshire Bank                             95,020        11.41          33,306         4.00             49,959           6.00


Tier I capital to average assets:
    Berkshire Hills Bancorp, Inc.             109,055        10.83             N/A          N/A                N/A            N/A
    Berkshire Bank                             95,020         9.48          40,098         4.00             50,122           5.00

</TABLE>


<TABLE>
<CAPTION>
                                                                           At December 31, 2001
                                            ---------------------------------------------------------------------------------------
                                                                                                             Minimum To Be Well
                                                                                  Minimum                     Capitalized Under
                                                                                  Capital                     Prompt Corrective
                                                      Actual                    Requirement                   Action Provisions
                                            -------------------------     -------------------------       -------------------------
                                               Amount        Ratio          Amount         Ratio             Amount        Ratio
                                            -----------   -----------     -----------   -----------       -----------   -----------
                                                                          (Dollars in thousands)
Total capital to risk weighted assets:
<S>                                          <C>             <C>           <C>             <C>             <C>             <C>
    Berkshire Hills Bancorp, Inc.            $133,240        15.73 %           N/A          N/A                N/A            N/A
    Berkshire Bank                            111,640        13.38         $66,749         8.00 %          $83,437          10.00 %

Tier I capital to risk weighted assets:
    Berkshire Hills Bancorp, Inc.             109,895        12.98             N/A          N/A                N/A            N/A
    Berkshire Bank                             88,450        10.60          33,375         4.00             50,062           6.00


Tier I capital to average assets:
    Berkshire Hills Bancorp, Inc.             109,895        11.02             N/A          N/A                N/A            N/A
    Berkshire Bank                             88,450         9.05          39,108         4.00             48,885           5.00

</TABLE>

                                       16
<PAGE>


     As  of  September  30,  2002,  Berkshire  Bank  met  the  conditions  to be
classified  as well  capitalized  under  the  regulatory  framework  for  prompt
corrective  action. To be categorized as well  capitalized,  an institution must
maintain  minimum  total  risk-based,  Tier I  risk-based,  and Tier I  leverage
ratios.  As part of  management's  revised  strategy  to  address  the  level of
sub-prime  automobile  loans and the  overall  credit  risk to  Berkshire  Bank,
management has  determined to maintain  capital levels in an amount in excess of
the regulatory  requirements  and in amounts which  management will determine in
consideration of the amount of lower quality  sub-prime  automobile loans in the
loan portfolio.

Liquidity

     Liquidity is the ability to meet current and future  financial  obligations
of a short term nature.  Berkshire Bank further defines liquidity as the ability
to respond to the needs of depositors and borrowers as well as  maintaining  the
flexibility to take advantage of investment opportunities.

     Berkshire  Bank's  primary   investing   activities  are:  (1)  originating
residential  one-to  four-family  mortgage loans,  commercial  business and real
estate loans,  multi-family  loans,  home equity loans and lines of credit,  and
consumer loans; and (2) investing in mortgage-and asset-backed securities,  U.S.
Government  and agency  obligations,  and corporate  equity  securities and debt
obligations.  Outstanding  commitments for all loans and unadvanced construction
loans and lines of credit  totaled  $129.9  million at September  30, 2002.  The
Company's investments in mortgage-and  asset-backed securities, U. S. Government
and  agency  obligations,   corporate  debt  obligations  and  corporate  equity
securities  totaled $182.7 million at September 30, 2002.  These  activities are
funded  primarily by principal  and interest  payments on loans,  maturities  of
securities,  deposits  and  Federal  Home Loan Bank of  Boston  advances.  While
maturities and scheduled  amortization  of loans and securities are  predictable
sources of funds,  deposit flows and mortgage prepayments are greatly influenced
by interest rates, economic conditions, and competition.  Additionally,  deposit
flows are affected by the overall level of interest  rates,  the interest  rates
and products  offered by  Berkshire  Bank and its local  competitors,  and other
factors.  Berkshire  Bank  closely  monitors its  liquidity  position on a daily
basis.  If Berkshire  Bank should  require  funds beyond its ability to generate
them internally, additional sources of funds are available through advances or a
line of  credit  with the  Federal  Home  Loan  Bank and  through  a  repurchase
agreement with the Depositors Insurance Fund, the Bank's excess deposit insurer.

     Berkshire Bank relies primarily on competitive rates, customer service, and
long-standing  relationships  with customers to retain  deposits.  Occasionally,
Berkshire Bank will also offer special  competitive  promotions to its customers
to increase  retention and promote deposit growth.  Based upon Berkshire  Bank's
historical experience with deposit retention, management believes that, although
it is not  possible to predict  future  terms and  conditions  upon  renewal,  a
significant   portion  of  such  deposits  will  remain  with  Berkshire   Bank.
Certificates  of deposit that were  scheduled to mature in one year or less from
September 30, 2002 were approximately $227.1 million.

     The primary source of funding for Berkshire Hills is dividend payments from
Berkshire Bank, sales and maturities of investment  securities,  and to a lesser
extent,  earnings on investments and deposits held by Berkshire Hills.  Dividend
payments by  Berkshire  Bank have  primarily  been used to pay  holding  company
obligations,  including  the  payment  of  dividends  and the  funding  of stock
repurchase  programs.  The Bank's  ability to pay  dividends  and other  capital
distributions  to  Berkshire  Hills is  generally  limited by the  Massachusetts
banking  regulations  and  the  regulations  of the  Federal  Deposit  Insurance
Corporation.  Additionally,  the Massachusetts  Banking Commissioner and Federal
Deposit  Insurance  Corporation  may prohibit the payment of dividends which are
otherwise  permissible  by regulation  for safety and soundness  reasons.  As of
September  30,  2002,  the Bank had the  ability  to  declare  $4.9  million  of
dividends to the Company without regulatory approval.

ITEM 3.  QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK.

     Qualitative Aspects of Market Risk.  Berkshire Bank's most significant form
of market risk is interest  rate risk.  The  principal  objectives  of Berkshire
Bank's  interest  rate risk  management  are to evaluate the interest  rate risk
inherent  in  certain  balance  sheet  accounts,  determine  the  level  of risk
appropriate  given its business  strategy,  operating  environment,  capital and
liquidity  requirements  and  performance   objectives,   and  manage  the  risk
consistent   with  its  established   policies.   Berkshire  Bank  maintains  an
Asset/Liability  Committee that is responsible for reviewing its asset/liability
policies and interest rate risk position,  which meets  quarterly and reports to
the  Executive   Committee  of  the  Bank  and  the  Board  of  Directors.   The

                                       17
<PAGE>

Asset/Liability  Committee  consists of  Berkshire  Bank's  President  and Chief
Executive Officer; Senior Vice President, Treasurer and Chief Financial Officer;
Senior Vice President-Lending Officer; and Senior Vice President-Retail Banking.
The extent of the movement of interest rates is an uncertainty that could have a
negative impact on the earnings of Berkshire Bank.

      Berkshire Bank manages interest rate risk by:

          o    emphasizing  the  origination of adjustable  rate loans and, from
               time to time,  selling a portion  of its  longer  term fixed rate
               loans as market interest rate conditions dictate;

          o    originating shorter term commercial and consumer loans;

          o    investing in a high quality,  liquid  securities  portfolio  that
               provides the flexibility to take advantage of opportunities  that
               may arise from fluctuations in market interest rates, the overall
               maturity  and  duration of which is  monitored in relation to the
               repricing of its loan portfolio;

          o    promoting  lower cost  liability  accounts such as core deposits;
               and

          o    using  Federal  Home  Loan  Bank  advances  to  better  structure
               maturities of its interest rate sensitive liabilities.

     For  Berkshire  Bank,  market  risk also  includes  price  risk,  primarily
security price risk. The securities  portfolio had unrealized gains before taxes
of $21.2  million at September 30, 2002.  Changes in this figure are  reflected,
net of taxes, in accumulated other comprehensive  income as a separate component
of  Berkshire  Hills'  equity.  Since  December  31, 2001,  this  component  has
decreased $5.0 million. It is not possible to predict with complete accuracy the
direction  and  magnitude  of  securities  price  changes.   Unfavorable  market
conditions  or other  factors  could  cause  price  declines  in the  securities
portfolio.

     Quantitative  Aspects of Market  Risk.  Berkshire  Hills uses a  simulation
model to measure the  potential  change in net  interest  income,  incorporating
various  assumptions  regarding  the  shape  of the  yield  curve,  the  pricing
characteristics  of loans,  deposits and  borrowings,  prepayments  on loans and
securities  and changes in the balance  sheet mix.  The model  assumes the yield
curve  is  derived  from  the  interpolated  Treasury  yield  curve  and that an
instantaneous  increase  or  decrease  of market  interest  rates  would cause a
simultaneous  parallel shift along the entire yield curve.  Loans,  deposits and
borrowings  are  expected to reprice at the new market  rate on the  contractual
review or maturity date. The Company closely monitors its loan prepayment trends
and uses  prepayment  guidelines set forth by Freddie Mac and Fannie Mae as well
as Company generated  figures where  applicable.  All prepayments are assumed to
roll over into new loans  originated in the same loan category at the new market
rate.   Berkshire  Hills  further  assumes  that  its  securities'  cash  flows,
especially its mortgage backed  securities  cash flows,  are such that they will
generally  follow industry  standards and that prepayments will be reinvested in
the same category at the  prevailing  market rate.  Finally,  the model presumes
that the balance sheet mix will remain relatively  unchanged throughout the next
calendar year.

     The tables below set forth, as of September 30, 2002 and December 31, 2001,
estimated net interest  income and the estimated  changes in Berkshire Hills net
interest  income  for the next  twelve  month  period  which  may  result  given
instantaneous  increases or decreases  in market  interest  rates of 100 and 200
basis points.

<TABLE>
<CAPTION>


             Increase/
            (decrease)
             in market                   At September 30, 2002                  At December 31, 2001
          interest rates        ---------------------------------------   ------------------------------------
          in basis points                       Dollar         Percent                   Dollar       Percent
           (rate shock)            Amount       Change         change       Amount       change        change
        --------------------    -----------   -----------    ----------   ----------   ----------    ----------

             <S>                  <C>            <C>           <C>         <C>            <C>          <C>
                200               $ 40,855       $ 349          0.86 %     $ 45,863       $  64         0.14 %
                100                 39,971        (535)       (1.32)         45,209        (590)       (1.29)
              Static                40,506          --           --          45,799          --          --
               (100)                40,796         290          0.72         46,332         533         1.16
               (200)                39,436      (1,070 )       (2.64 )       44,955        (844 )      (1.84)
</TABLE>


     At September 30, 2002,  for small  movements in market  interest rates (+/-
100 basis points), Berkshire Hills was liability sensitive as it was at December
31, 2001.  Thus,  in the event of a sudden and  sustained  decline in prevailing
market  rates of 100 basis  points,  the  September  30, 2002 chart  indicates a
$290,000  increase in net  interest  income  while the  December  31, 2001 chart
indicates an increase of $533,000.  Likewise,  in the event of a 100 basis point
increase,  the  September  30, 2002 chart  indicates a decrease in net  interest
income of $535,000  compared to a $590,000  decrease  in the  December  31, 2001
chart.  The  Company  was less  liability  sensitive  at  September  30, 2002 as
continuing  loan pay downs and  funds  from new  certificate  of  deposits  were
invested in short-term securities.

                                       18
<PAGE>



     In the  event of a sudden  and  sustained  decrease  in  prevailing  market
interest  rates of 200 basis points,  the  September 30, 2002 table  indicates a
decline in net interest income of $1.1 million compared to a $844,000 decline in
the December 31, 2001 chart. A sudden and sustained increase of 200 basis points
in market  interest  rates  would lead to a $349,000  increase  in net  interest
income in the September  30, 2002 scenario  while the December 31, 2001 scenario
shows an increase of $64,000.  The Company's  net interest  income is negatively
impacted  in the  case  of a 200  basis  point  drop  as  deposit  accounts  hit
predetermined  floors while net interest income is enhanced in the case of a 200
basis point increase because these same deposit accounts hit Company  determined
caps.

     Computation of prospective  effects of  hypothetical  interest rate changes
are  based on a number of  assumptions  including  the level of market  interest
rates,  the  degree  to  which  certain  assets  and  liabilities  with  similar
maturities or periods to repricing  react to changes in market  interest  rates,
the  expected  prepayment  rates on loans and  investments,  the degree to which
early withdrawals occur on certificates of deposit,  and other deposit flows. As
a result,  these computations  should not be relied upon as indicative of actual
results.  Further,  the  computations do not reflect any actions that management
may undertake in response to changes in interest rates.

Impact of Inflation and Changing Prices

     The consolidated  financial statements and related data presented have been
prepared in conformity  with generally  accepted  accounting  principles,  which
require the measurement of financial  position and operating results in terms of
historical dollars, without considering changes in the relative purchasing power
of  money  over  time  due  to  inflation.  Unlike  many  industrial  companies,
substantially  all of the assets and  liabilities of the Company are monetary in
nature.  As a  result,  interest  rates  have a more  significant  impact on the
Company's performance than the general level of inflation. Over short periods of
time,  interest rates may not  necessarily  move in the same direction or in the
same magnitude as inflation.

ITEM 4.  CONTROLS AND PROCEDURES.

     (a)  Evaluation  of  disclosure   controls  and  procedures.   The  Company
          maintains controls and procedures  designed to ensure that information
          required  to be  disclosed  in the reports  that the Company  files or
          submits  under  the  Securities  Exchange  Act of  1934  is  recorded,
          processed,  summarized and reported within the time periods  specified
          in the rules  and forms of the  Securities  and  Exchange  Commission.
          Based upon their evaluation of those controls and procedures performed
          within 90 days of the filing date of this report,  the chief executive
          officer and the chief financial  officer of the Company concluded that
          the Company's disclosure controls and procedures were adequate.

     (b)  Changes in internal controls.  The Company made no significant changes
          in its internal controls or in other factors that could  significantly
          affect these  controls  subsequent  to the date of the  evaluation  of
          those  controls by the chief  executive  officer  and chief  financial
          officer.


                                       19
<PAGE>


PART II.  OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.

     The Company is not  involved in any legal  proceedings  other than  routine
legal  proceedings  occurring  in the normal  course of  business.  Such routine
proceedings,  in the  aggregate,  are believed by management to be immaterial to
the Company's financial condition or results of operations.


ITEM 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS.

               None.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES.

               None.

ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

               None.

ITEM 5.    OTHER INFORMATION.

               None.

ITEM 6.    EXHIBITS AND REPORTS OF FORM 8-K (ss.249.308 OF THIS CHAPTER).


            (a)  Exhibits

                    3.1  Certificate  of   Incorporation   of  Berkshire   Hills
                         Bancorp, Inc. (1)
                    3.2  Bylaws of Berkshire Hills Bancorp, Inc.
                    4.0  Stock Certificate of Berkshire Hills Bancorp, Inc. (1)
                   10.1  Severance Agreement, dated October 16, 2002, by and
                         among James A. Cunningham, Jr.,
                         Berkshire Hills Bancorp, Inc. and Berkshire Bank (2)
                   10.2  Severance Agreement, dated November 13, 2002, by and
                         among Charles F. Plungis, Jr., Berkshire Hills
                         Bancorp, Inc. and Berkshire Bank
                   10.3  Severance Agreement, dated November 13, 2002, by and
                         among Susan M. Santora, Berkshire Hills
                         Bancorp, Inc. and Berkshire Bank
                   99.1  Certifications of Chief Executive Officer and Chief
                         Financial Officer pursuant to 18 U.S.C. Section 1350


            (b) Reports on Form 8-K

                 None

_____________________________

(1)  Incorporated  by reference  into this document from the Exhibits filed with
     the  Registration  Statement  on  Form  S-1,  and any  amendments  thereto,
     Registration No. 333-32146.

(2)  Incorporated  by reference  into this document from the Exhibits filed with
     the Company's Form 8-K on October 18, 2002.


                                       20
<PAGE>


                                   SIGNATURES

     Pursuant to the  requirements  of the  Securities and Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                   BERKSHIRE HILLS BANCORP, INC.


Dated: November 12, 2002       By: /s/ Michael P. Daly
                                   ---------------------------------------
                                   Michael P. Daly
                                   President, Chief Executive Officer
                                   and Director
                                   (principal executive officer)

Dated: November 12, 2002       By: /s/ Charles F. Plungis, Jr.
                                   ----------------------------------------
                                   Charles F. Plungis, Jr.
                                   Senior Vice President, Treasurer
                                   and Chief Financial Officer
                                   (principal financial and accounting officer)


                                       21
<PAGE>




                                  CERTIFICATION

I, Michael P. Daly, certify, that:

1.   I have  reviewed  this  quarterly  report of Form 10-Q of  Berkshire  Hills
     Bancorp, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statements of a material fact or omit to state a material fact necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a.   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b.   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c.   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a.   all  significant  deficiencies  in  the  design  or  operation  of the
          internal  controls  which  could  adversely  affect  the  registrant's
          ability to record  process,  summarize and report  financial  data and
          have identified for the registrant's  auditors any material weaknesses
          in internal controls; and

     b.   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls or in other factors that could  significantly  affect the internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.




Date:  November 12, 2002                  /s/ Michael P. Daly
                                          -------------------------------------
                                          Michael P. Daly
                                          President and Chief Executive Officer


                                       22
<PAGE>


                                  CERTIFICATION

I, Charles F. Plungis, Jr., certify, that:

1.   I have  reviewed  this  quarterly  report of Form 10-Q of  Berkshire  Hills
     Bancorp, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statements of a material fact or omit to state a material fact necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


     a.   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b.   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c.   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a.   all  significant  deficiencies  in  the  design  or  operation  of the
          internal  controls  which  could  adversely  affect  the  registrant's
          ability to record  process,  summarize and report  financial  data and
          have identified for the registrant's  auditors any material weaknesses
          in internal controls; and

     b.   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls or in other factors that could  significantly  affect the internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.



Date:  November 12, 2002                  /s/ Charles F. Plungis, Jr.
                                          ------------------------------------
                                          Charles F. Plungis, Jr.
                                          Senior Vice President, Treasurer and
                                          Chief Financial Officer



                                       23

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.2
<SEQUENCE>3
<FILENAME>exhibit3-2.txt
<TEXT>

                          BERKSHIRE HILLS BANCORP, INC.

                           Amended and Restated Bylaws


                            ARTICLE I - STOCKHOLDERS

     Section 1. Annual Meeting.

     An annual  meeting of the  stockholders,  for the  election of Directors to
succeed those whose terms expire and for the  transaction of such other business
as may properly  come before the meeting,  shall be held at such place,  on such
date, and at such time as the Board of Directors shall each year fix, which date
shall be within  thirteen  (13)  months  subsequent  to the later of the date of
incorporation or the last annual meeting of stockholders.

     Section 2. Special Meetings.

     Subject  to the rights of the  holders of any class or series of  preferred
stock of the  Corporation,  special  meetings of stockholders of the Corporation
may be called only by the Board of Directors pursuant to a resolution adopted by
a majority of the total number of Directors which the Corporation  would have if
there  were no  vacancies  on the Board of  Directors  (hereinafter  the  "Whole
Board").

     Section 3. Notice of Meetings.

     Written  notice  of the  place,  date,  and  time  of all  meetings  of the
stockholders  shall be given,  not less than ten (10) nor more than  sixty  (60)
days  before the date on which the  meeting is to be held,  to each  stockholder
entitled  to vote at such  meeting,  except  as  otherwise  provided  herein  or
required by law (meaning, here and hereinafter, as required from time to time by
the Delaware General  Corporation Law or the Certificate of Incorporation of the
Corporation).

     When a meeting is adjourned to another place, date or time,  written notice
need not be given of the adjourned  meeting if the place,  date and time thereof
are  announced  at the  meeting  at which the  adjournment  is taken;  provided,
however, that if the date of any adjourned meeting is more than thirty (30) days
after the date for which the meeting was originally  noticed, or if a new record
date is fixed for the adjourned meeting,  written notice of the place, date, and
time of the  adjourned  meeting shall be given in  conformity  herewith.  At any
adjourned  meeting,  any  business  may be  transacted  which  might  have  been
transacted at the original meeting.

     Section 4. Quorum.

     At any meeting of the stockholders, the holders of a majority of all of the
shares of the stock  entitled  to vote at the  meeting,  present in person or by
proxy (after giving effect to the provisions of Article IV of the  Corporation's
Certificate  of  Incorporation),  shall  constitute  a quorum for all  purposes,
unless or except to the  extent  that the  presence  of a larger  number  may be

<PAGE>

required  by law.  Where a separate  vote by a class or classes is  required,  a
majority of the shares of such class or classes present in person or represented
by  proxy  (after  giving  effect  to  the  provisions  of  Article  IV  of  the
Corporation's  Certificate of Incorporation)  shall constitute a quorum entitled
to take action with respect to that vote on that matter.

     If a quorum shall fail to attend any  meeting,  the chairman of the meeting
or the  holders of a majority  of the shares of stock  entitled  to vote who are
present,  in person or by proxy, may adjourn the meeting to another place, date,
or time.

     If a notice of any adjourned special meeting of stockholders is sent to all
stockholders  entitled to vote thereat,  stating that it will be held with those
present in person or by proxy  constituting  a quorum,  then except as otherwise
required by law, those present in person or by proxy at such  adjourned  meeting
shall constitute a quorum,  and all matters shall be determined by a majority of
the votes cast at such meeting.

     Section 5. Organization.

     Such person as the Board of Directors may have designated or, in his or her
absence  of such a person,  the  President  and Chief  Executive  Officer of the
Corporation  or,  in his or her  absence,  such  person  as may be chosen by the
holders of a majority of the shares entitled to vote who are present,  in person
or by proxy,  shall  call to order any  meeting of the  stockholders  and act as
chairman of the meeting. In the absence of the Secretary of the Corporation, the
secretary  of the meeting  shall be such  person as the  chairman of the meeting
appoints.

     Section 6. Conduct of Business.

     (a) The chairman of any meeting of  stockholders  shall determine the order
of business and the procedures at the meeting,  including such regulation of the
manner of voting and the conduct of  discussion  as seem to him or her in order.
The date and time of the  opening  and closing of the polls for each matter upon
which  the  stockholders  will vote at the  meeting  shall be  announced  at the
meeting.

     (b) At any annual meeting of the stockholders,  only such business shall be
conducted  as shall  have been  brought  before  the  meeting:  (i) by or at the
direction  of  the  Board  of  Directors  or  (ii)  by  any  stockholder  of the
Corporation  who is entitled to vote with respect  thereto and who complies with
the  notice  procedures  set forth in this  Section  6(b).  For  business  to be
properly  brought before an annual  meeting by a stockholder,  the business must
relate to a proper subject  matter for  stockholder  action and the  stockholder
must have  given  timely  notice  thereof in  writing  to the  Secretary  of the
Corporation. To be timely, a stockholder's notice must be delivered or mailed to
and received at the principal executive offices of the Corporation not less than
ninety  (90) days prior to the date of the annual  meeting;  provided,  however,
that in the event that less than one hundred  (100) days' notice or prior public
disclosure of the date of the meeting is given or made to  stockholders,  notice
by the  stockholder  to be timely must be  received  not later than the close of
business on the 10th day  following  the day on which such notice of the date of
the  annual   meeting  was  mailed  or  such  public   disclosure  was  made.  A
stockholder's  notice to the  Secretary  shall set forth as to each  matter such
stockholder proposes to bring before


                                       2
<PAGE>

the annual meeting: (i) a brief description
of the business  desired to be brought before the annual meeting and the reasons
for conducting such business at the annual  meeting;  (ii) the name and address,
as they appear on the  Corporation's  books, of the  stockholder  proposing such
business;  (iii)  the class and  number of shares of the  Corporation's  capital
stock that are  beneficially  owned by such  stockholder;  and (iv) any material
interest of such stockholder in such business. Notwithstanding anything in these
Bylaws to the contrary,  no business  shall be brought before or conducted at an
annual  meeting  except in accordance  with the provisions of this Section 6(b).
The Officer of the Corporation or other person presiding over the annual meeting
shall,  if the facts so  warrant,  determine  and  declare to the  meeting  that
business  was not properly  brought  before the meeting in  accordance  with the
provisions of this Section 6(b) and, if he or she should so determine,  shall so
declare to the meeting and any such  business so  determined  to be not properly
brought before the meeting shall not be transacted.

     At any special  meeting of the  stockholders,  only such business  shall be
conducted as shall have been brought  before the meeting by or at the  direction
of the Board of Directors.

     (c) Only persons who are nominated in accordance  with the  procedures  and
meet the qualifications set forth in these Bylaws shall be eligible for election
as Directors.  Nominations  of persons for election to the Board of Directors of
the  Corporation may be made at a meeting of stockholders at which directors are
to be elected only:  (i) by or at the  direction of the Board of  Directors;  or
(ii) by any stockholder of the Corporation  entitled to vote for the election of
Directors at the meeting who complies  with the notice  procedures  set forth in
this  Section  6(c).  Such  nominations,  other  than  those  made  by or at the
direction of the Board of  Directors,  shall be made by timely notice in writing
to the Secretary of the Corporation.  To be timely, a stockholder's notice shall
be delivered or mailed to and received at the principal executive offices of the
Corporation  not less than  ninety  (90) days prior to the date of the  meeting;
provided,  however,  that in the event that less than one  hundred  (100)  days'
notice  or  prior  disclosure  of the  date of the  meeting  is given or made to
stockholders,  notice by the  stockholder  to be timely must be so received  not
later than the close of business on the 10th day following the day on which such
notice of the date of the meeting was mailed or such public disclosure was made.
Such  stockholder's  notice  shall set forth:  (i) as to each  person  whom such
stockholder proposes to nominate for election or re-election as a Director,  all
information  relating  to  such  person  that is  required  to be  disclosed  in
solicitations of proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities  Exchange Act of 1934,
as amended  (including such person's written consent to being named in the proxy
statement as a nominee and to serving as a director if elected);  and (ii) as to
the  stockholder  giving the notice (x) the name and address,  as they appear on
the  Corporation's  books,  of such  stockholder and (y) the class and number of
shares of the  Corporation's  capital stock that are beneficially  owned by such
stockholder.  At the request of the Board of Directors,  any person nominated by
the Board of Directors for election as a Director shall furnish to the Secretary
of the Corporation that information  required to be set forth in a stockholder's
notice of nomination which pertains to the nominee.  No person shall be eligible
for election as a Director of the  Corporation  unless  nominated in  accordance
with the  provisions of this Section  6(c).  The Officer of the  Corporation  or
other person presiding at the meeting shall, if the facts so warrant,  determine
that a nomination was not made in accordance  with such provisions and, if he or
she  shall so  determine,  he or she shall so  declare  to the  meeting  and the
defective nomination shall be


                                       3
<PAGE>

disregarded.  No  nomination  shall  be made or  voted  upon if the  nominee  is
ineligible for election to the Board of Directors under these Bylaws.

     (d) No person shall be eligible for election or appointment to the Board of
Directors:  (i) if such  person  has,  within the  previous  10 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;  (iii)  if such  person  is  currently  charged  in any
information,   indictment,   or  other  complaint  with  the  commission  of  or
participation in such a crime; and (iv) except for persons serving as members of
the of the initial  Board of Directors  or except as  otherwise  approved by the
Board of  Directors,  unless such person has been,  for a period of at least one
year immediately prior to his or her nomination or appointment,  a resident of a
county in which the Corporation or its  subsidiaries  maintains a banking office
or a county  contiguous  to any such  county.  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  under this Section 6. 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 574
4(d)),  that  includes a person who is  ineligible  for election to the Board of
Directors  under this Section 6. The Board of Directors  shall have the power to
construe  and  apply  the   provisions  of  this  Section  6  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.

     (e)  Notwithstanding any other provision of these Bylaws, in no event shall
any  person,  group or company  that would not be eligible  for  election to the
Board of Directors or to have his or its  representative or nominee eligible for
election to the Board of Directors under Section 6 of this Article I be entitled
or  permitted  to  vote  his or  its  shares  with  respect  to  any  amendment,
modification or repeal of Section 6 of this Article I.

     Section 7. Proxies and Voting.

     At any meeting of the stockholders,  every stockholder entitled to vote may
vote in person or by proxy  authorized  by an  instrument  in  writing  filed in
accordance  with  the  procedure  established  for the  meeting.  Any  facsimile
telecommunication or other reliable  reproduction of the writing or transmission
created  pursuant to this  paragraph may be  substituted  or used in lieu of the
original writing or transmission for any and all purposes for which the original
writing  or  transmission  could be used,  provided  that such  copy,  facsimile
telecommunication or other reproduction shall be a complete  reproduction of the
entire original writing or transmission.

     All voting,  including  on the election of Directors  but  excepting  where
otherwise required

                                       4
<PAGE>

by law or by the governing documents of the Corporation,  may be made by a voice
vote; provided,  however, that upon demand therefor by a stockholder entitled to
vote or his or her proxy, a stock vote shall be taken. Every stock vote shall be
taken by ballot,  each of which shall state the name of the stockholder or proxy
voting  and such  other  information  as may be  required  under the  procedures
established for the meeting. The Corporation shall, in advance of any meeting of
stockholders,  appoint one or more  inspectors  to act at the meeting and make a
written report  thereof.  The  Corporation  may designate one or more persons as
alternate  inspectors to replace any inspector who fails to act. If no inspector
or alternate is able to act at a meeting of  stockholders,  the person presiding
at the meeting shall appoint one or more inspectors to act at the meeting.  Each
inspector, before entering upon the discharge of his duties, shall take and sign
an oath  faithfully to execute the duties of inspector with strict  impartiality
and according to the best of his ability.

     All elections  shall be  determined  by a plurality of the votes cast,  and
except as otherwise  required by law or the  Certificate of  Incorporation,  all
other matters shall be determined by a majority of the votes cast.

     Section 8. Stock List.

     A  complete  list  of  stockholders  entitled  to vote  at any  meeting  of
stockholders, arranged in alphabetical order for each class of stock and showing
the address of each such stockholder and the number of shares  registered in his
or her name, shall be open to the examination of any such  stockholder,  for any
purpose germane to the meeting,  during ordinary  business hours for a period of
at least ten (10) days prior to the  meeting,  either at a place within the city
where the meeting is to be held, which place shall be specified in the notice of
the  meeting,  or if not so  specified,  at the place where the meeting is to be
held.

     The stock list shall  also be kept at the place of the  meeting  during the
whole time thereof and shall be open to the examination of any such  stockholder
who is present.  This list shall  presumptively  determine  the  identity of the
stockholders  entitled  to vote at the  meeting and the number of shares held by
each of them.

     Section 9. Consent of Stockholders in Lieu of Meeting.

     Subject  to the rights of the  holders of any class or series of  preferred
stock of the  Corporation,  any action  required or permitted to be taken by the
stockholders of the Corporation must be effected at an annual or special meeting
of  stockholders  of the  Corporation  and may not be effected by any consent in
writing by such stockholders.

                         ARTICLE II - BOARD OF DIRECTORS

     Section 1. General Powers, Number, Term of Office and Limitations.

     The business and affairs of the Corporation shall be under the direction of
its Board of Directors.  The number of Directors who shall  constitute the Whole
Board  shall be such  number as the Board of  Directors  shall from time to time
have  designated,  except  that in the  absence  of


                                       5
<PAGE>

such  designation  shall be eighteen (18). The Board of Directors shall annually
elect a Chairman of the Board from among its members  who shall,  when  present,
preside at its meetings.

     No person shall be  qualified to continue to serve as a Director  after the
annual  meeting  immediately  following  his  or  her  seventy-second  birthday;
provided,  however,  that any  Director  serving  on the date  these  Bylaws are
adopted may not be re-elected  following his or her seventy-second  birthday but
shall be qualified to serve as a Director  until the expiration of the last term
he or she is elected to serve prior to his or her seventy-second birthday.

     The  Directors,  other than those who may be elected by the  holders of any
class or series of Preferred Stock,  shall be divided,  with respect to the time
for which they  severally  hold  office,  into three  classes,  with the term of
office of the first class to expire at the first annual meeting of stockholders,
the term of  office of the  second  class to expire  at the  annual  meeting  of
stockholders  one year  thereafter  and the term of office of the third class to
expire at the annual meeting of  stockholders  two years  thereafter,  with each
Director to hold office until his or her successor  shall have been duly elected
and qualified.  At each annual  meeting of  stockholders,  Directors  elected to
succeed those  Directors  whose terms then expire shall be elected for a term of
office to expire at the third  succeeding  annual meeting of stockholders  after
their  election,  with each  Director to hold office until his or her  successor
shall have been duly elected and qualified.

     Section 2. Vacancies and Newly Created Directorships.

     Subject  to the rights of the  holders of any class or series of  Preferred
Stock,  and unless the Board of Directors  otherwise  determines,  newly created
directorships  resulting from any increase in the authorized number of directors
or any vacancies in the Board of Directors  resulting  from death,  resignation,
retirement,  disqualification,  removal from office or other cause may be filled
only by a majority  vote of the  Directors  then in office,  though  less than a
quorum,  and  Directors so chosen  shall hold office for a term  expiring at the
annual meeting of stockholders at which the term of office of the class to which
they have been elected  expires and until such  Director's  successor shall have
been duly  elected  and  qualified.  No  decrease  in the  number of  authorized
directors  constituting  the  Board  shall  shorten  the  term of any  incumbent
Director.

     Section 3. Regular Meetings.

     Regular  meetings of the Board of Directors  shall be held at such place or
places,  on such  date or dates,  and at such  time or times as shall  have been
established  by the Board of Directors and  publicized  among all  Directors.  A
notice of each regular meeting shall not be required.

     Section 4. Special Meetings.

     Special meetings of the Board of Directors may be called by one-third (1/3)
of the Directors then in office (rounded up to the nearest whole number),  or by
the Chairman of the Board or the President or, in the event that the Chairman of
the Board or the President are  incapacitated  or otherwise  unable to call such
meeting, by the Secretary, and shall be held at such



                                       6
<PAGE>

place,  on such date, and at such time as they, or he or she, shall fix.  Notice
of the place,  date,  and time of each such special  meeting shall be given each
Director by whom it is not waived by mailing  written  notice not less than five
(5) days before the  meeting or by  telegraphing  or  telexing  or by  facsimile
transmission  of the  same not less  than  twenty-four  (24)  hours  before  the
meeting.  Unless otherwise indicated in the notice thereof, any and all business
may be transacted at a special meeting.

     Section 5. Quorum.

     At any  meeting of the Board of  Directors,  a majority  of the Whole Board
shall constitute a quorum for all purposes. If a quorum shall fail to attend any
meeting,  a majority of those present may adjourn the meeting to another  place,
date, or time, without further notice or waiver thereof.

     Section 6. Participation in Meetings By Conference Telephone.

     Members  of the  Board  of  Directors,  or of any  committee  thereof,  may
participate  in a meeting  of such  Board or  committee  by means of  conference
telephone  or similar  communications  equipment  by means of which all  persons
participating  in the meeting can hear each other and such  participation  shall
constitute presence in person at such meeting.

     Section 7. Conduct of Business.

     At any meeting of the Board of Directors,  business  shall be transacted in
such  order and  manner as the  Board may from time to time  determine,  and all
matters shall be determined by the vote of a majority of the Directors  present,
except as otherwise  provided  herein or required by law. Action may be taken by
the Board of Directors  without a meeting if all members thereof consent thereto
in  writing,  and the  writing  or  writings  are  filed  with  the  minutes  of
proceedings of the Board of Directors.

     Section 8. Powers.

     The Board of Directors may, except as otherwise  required by law,  exercise
all such powers and do all such acts and things as may be  exercised  or done by
the  Corporation,  including,  without limiting the generality of the foregoing,
the unqualified power:

     (1)  To declare dividends from time to time in accordance with law;

     (2)  To purchase or otherwise acquire any property, rights or privileges on
          such terms as it shall determine;

     (3)  To authorize the creation, making and issuance, in such form as it may
          determine,  of  written  obligations  of  every  kind,  negotiable  or
          non-negotiable,  secured or unsecured,  and to do all things necessary
          in connection therewith;

     (4)  To remove any Officer of the  Corporation  with or without cause,  and
          from time to time to devolve the powers and duties of any Officer upon
          any other person for the time being;

                                       7
<PAGE>


     (5)  To confer  upon any Officer of the  Corporation  the power to appoint,
          remove and suspend subordinate Officers, employees and agents;

     (6)  To adopt from time to time such stock, option,  stock purchase,  bonus
          or other  compensation  plans for Directors,  Officers,  employees and
          agents of the Corporation and its subsidiaries as it may determine;

     (7)  To adopt  from  time to time  such  insurance,  retirement,  and other
          benefit  plans for  Directors,  Officers,  employees and agents of the
          Corporation and its subsidiaries as it may determine;

     (8)  To adopt from time to time  regulations,  not inconsistent  with these
          Bylaws, for the management of the Corporation's  business and affairs;
          and

     (9)  To fix the  Compensation  of officers and employees of the Corporation
          and its subsidiaries as it may determine.

     Section 9. Compensation of Directors.

     Directors,  as such,  may receive,  pursuant to  resolution of the Board of
Directors,  fixed fees and other  compensation  for their services as Directors,
including,  without  limitation,  their services as members of committees of the
Board of Directors.

                            ARTICLE III - COMMITTEES

     Section 1. Committees of the Board of Directors.

     The Board of Directors,  by a vote of a majority of the Board of Directors,
may from time to time  designate  committees  of the Board,  with such  lawfully
delegable powers and duties as it thereby  confers,  to serve at the pleasure of
the Board and shall,  for these  committees and any others  provided for herein,
elect a Director or Directors to serve as the member or members, designating, if
it desires,  other Directors as alternate  members who may replace any absent or
disqualified member at any meeting of the committee. Any committee so designated
may  exercise  the power and  authority  of the Board of  Directors to declare a
dividend,  to  authorize  the  issuance  of stock or to adopt a  certificate  of
ownership and merger pursuant to Section 253 of the Delaware General Corporation
Law  if  the  resolution  which  designates  the  committee  or  a  supplemental
resolution  of the  Board of  Directors  shall so  provide.  In the  absence  or
disqualification  of any member of any committee and any alternate member in his
or her place, the member or members of the committee  present at the meeting and
not  disqualified  from  voting,  whether or not he or she or they  constitute a
quorum,  may by unanimous vote appoint  another member of the Board of Directors
to act at the meeting in the place of the absent or disqualified member.


                                       8
<PAGE>

     Section 2. Conduct of Business.

     Each  committee  may  determine  the  procedural   rules  for  meeting  and
conducting  its  business  and  shall  act in  accordance  therewith,  except as
otherwise  provided herein or required by law. Adequate  provision shall be made
for notice to members of all  meetings.  The quorum  requirements  for each such
committee shall be a majority of the members of such committee  unless otherwise
determined  by the  Board  of  Directors  by a  majority  vote of the  Board  of
Directors  which such quorum  determined  by a majority of the Board may be one-
third of such members and all matters  considered  by such  committees  shall be
determined by a majority vote of the members present. Action may be taken by any
committee  without a meeting if all members  thereof consent thereto in writing,
and the writing or writings  are filed with the  minutes of the  proceedings  of
such committee.

     Section 3. Nominating Committee.

     The Board of Directors  shall appoint a Nominating  Committee of the Board,
consisting  of not less than three (3)  members of the Board of  Directors.  The
Nominating  Committee  shall have  authority:  (a) to review any nominations for
election to the Board of  Directors  made by a  stockholder  of the  Corporation
pursuant to Section  6(c)(ii) of Article I of these Bylaws in order to determine
compliance with such Bylaw; and (b) to recommend to the Whole Board nominees for
election to the Board of Directors to replace those Directors whose terms expire
at the annual meeting of stockholders next ensuing.

                              ARTICLE IV - OFFICERS

     Section 1. Generally.

     (a) The Board of Directors as soon as may be  practicable  after the annual
meeting of  stockholders  shall choose a Chairman of the Board,  a President and
Chief  Executive  Officer,  one or  more  Vice  Presidents,  a  Secretary  and a
Treasurer  and from time to time may choose  such other  officers as it may deem
proper. The Chairman of the Board shall be chosen from among the Directors.  Any
number of offices may be held by the same person.

     (b) The term of office  of the  Chairman  of the Board and of all  Officers
shall be until the next annual  election of Officers and until their  respective
successors  are chosen but any Officer may be removed from office at any time by
the  affirmative  vote of a majority of the authorized  number of Directors then
constituting the Board of Directors or the Chief Executive Officer.

     (c) All Officers  chosen by the Board of  Directors or the Chief  Executive
Officer  shall  have such  powers  and  duties  as  generally  pertain  to their
respective Offices,  subject to the specific provisions of this Article IV. Such
officers  shall  also have such  powers  and  duties as from time to time may be
conferred by the Board of Directors or by any committee thereof.


                                       9
<PAGE>


     Section 2. Chairman of the Board of Directors.

     The Chairman of the Board shall  perform such duties  designated  to him or
her by the Board of Directors and which are delegated to him or her by the Board
of Directors by resolution of the Board of Directors. The Chairman of the Board,
when  present,  or his or her  designee  shall  preside at all  meetings  of the
stockholders of the Corporation.


     Section 3. President and Chief Executive Officer.

     The President and Chief Executive Officer shall have general responsibility
for the  management  and control of the business and affairs of the  Corporation
and shall perform all duties and have all powers which are commonly  incident to
the office of President  and Chief  Executive  Officer or which are delegated to
him or her by the Board of  Directors.  Subject to the direction of the Board of
Directors,  the President and Chief  Executive  Officer shall have power to sign
all stock certificates, contracts and other instruments of the Corporation which
are authorized  and shall have general  supervision of all of the other Officers
(other than the Chairman of the Board), employees and agents of the Corporation.

     Section 4. Vice President.

     The Vice  President  or Vice  Presidents  shall  perform  the duties of the
President in his absence or during his  inability to act. In addition,  the Vice
Presidents  shall perform the duties and exercise the powers usually incident to
their respective  offices and/or such other duties and powers as may be properly
assigned  to them by the Board of  Directors,  the  Chairman of the Board or the
President.  A Vice  President or Vice  Presidents may be designated as Executive
Vice President or Senior Vice President.

     Section 5. Secretary.

     The Secretary or Assistant Secretary shall issue notices of meetings, shall
keep their minutes, shall have charge of the seal and the corporate books, shall
perform such other duties and exercise such other powers as are usually incident
to such office  and/or  such other  duties and powers as are  properly  assigned
thereto by the Board of Directors,  the Chairman of the Board or the  President.
Subject to the direction of the Board of Directors, the Secretary shall have the
power to sign all stock certificates.

     Section 6. Treasurer.

     The Treasurer  shall be the  Comptroller of the  Corporation and shall have
the responsibility for maintaining the financial records of the Corporation.  He
or she shall  make such  disbursements  of the funds of the  Corporation  as are
authorized  and  shall  render  from  time  to  time  an  account  of  all  such
transactions and of the financial  condition of the  Corporation.  The Treasurer
shall also perform such other duties as the Board of Directors  may from time to
time  prescribe.  Subject  to the  direction  of the  Board  of  Directors,  the
Treasurer shall have the power to sign all stock certificates.

                                       10
<PAGE>


     Section 7. Assistant Secretaries and Other Officers.

     The Board of  Directors or the Chief  Executive  Officer may appoint one or
more  Assistant  Secretaries  and such other Officers who shall have such powers
and shall  perform  such  duties as are  provided  in these  Bylaws or as may be
assigned  to them by the Board of  Directors,  the  Chairman of the Board or the
President and the Chief Executive Officer.

     Section 8. Action with Respect to Securities of Other Corporation.

     Unless otherwise  directed by the Board of Directors,  the President or any
Officer of the Corporation  authorized by the President shall have power to vote
and otherwise act on behalf of the  Corporation,  in person or by proxy,  at any
meeting of  stockholders of or with respect to any action of stockholders of any
other corporation in which this Corporation may hold securities and otherwise to
exercise  any and all rights and powers  which this  Corporation  may possess by
reason of its ownership of securities in such other corporation.

                                ARTICLE V - STOCK

     Section 1. Certificates of Stock.

     Each  stockholder  shall be entitled to a certificate  signed by, or in the
name of the Corporation  by, the Chairman of the Board or the President,  and by
the  Secretary  or  an  Assistant  Secretary,  or  any  Treasurer  or  Assistant
Treasurer,  certifying  the number of shares  owned by him or her. Any or all of
the signatures on the certificate may be by facsimile.

     Section 2. Transfers of Stock.

     Transfers  of stock  shall be made  only  upon  the  transfer  books of the
Corporation  kept  at  an  office  of  the  Corporation  or by  transfer  agents
designated to transfer  shares of the stock of the  Corporation.  Except where a
certificate is issued in accordance with Section 4 of Article V of these Bylaws,
an  outstanding   certificate  for  the  number  of  shares  involved  shall  be
surrendered for cancellation before a new certificate is issued therefor.

     Section 3. Record Date.

     In order that the  Corporation may determine the  stockholders  entitled to
notice of or to vote at any meeting of  stockholders,  or to receive  payment of
any dividend or other distribution or allotment of any rights or to exercise any
rights in respect of any  change,  conversion  or  exchange  of stock or for the
purpose of any other  lawful  action,  the Board of  Directors  may fix a record
date,  which  record  date shall not  precede  the date on which the  resolution
fixing the record date is adopted  and which  record date shall not be more than
sixty  (60)  nor less  than ten (10)  days  before  the date of any  meeting  of
stockholders,  nor more than  sixty  (60) days  prior to the time for such other
action as hereinbefore described;  provided,  however, that if no record date is
fixed by the Board of Directors,  the record date for  determining  stockholders
entitled  to notice of or to vote at a meeting of  stockholders  shall be at the
close of business on the day next


                                       11
<PAGE>

preceding the day on which notice is given or, if notice is waived, at the close
of business on the next day preceding the day on which the meeting is held, and,
for  determining  stockholders  entitled to receive  payment of any  dividend or
other  distribution  or allotment or rights or to exercise any rights of change,
conversion or exchange of stock or for any other purpose,  the record date shall
be at the close of business on the day on which the Board of Directors  adopts a
resolution relating thereto.

     A determination  of stockholders of record entitled to notice of or to vote
at a meeting of  stockholders  shall apply to any  adjournment  of the  meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.

     Section 4. Lost, Stolen or Destroyed Certificates.

     In the event of the loss, theft or destruction of any certificate of stock,
another may be issued in its place pursuant to such  regulations as the Board of
Directors may establish  concerning proof of such loss, theft or destruction and
concerning the giving of a satisfactory bond or bonds of indemnity.

     Section 5. Regulations.

     The issue,  transfer,  conversion and registration of certificates of stock
shall be  governed  by such  other  regulations  as the Board of  Directors  may
establish.

                              ARTICLE VI - NOTICES

     Section 1. Notices.

     Except as otherwise  specifically  provided  herein or required by law, all
notices required to be given to any stockholder,  Director, Officer, employee or
agent shall be in writing and may in every instance be effectively given by hand
delivery  to the  recipient  thereof,  by  depositing  such notice in the mails,
postage paid, or by sending such notice by prepaid telegram or mailgram or other
courier.  Any such notice  shall be  addressed  to such  stockholder,  Director,
Officer,  employee or agent at his or her last known address as the same appears
on the books of the Corporation.  The time when such notice is received, if hand
delivered,  or  dispatched,  if  delivered  through  the mails or by telegram or
mailgram or other courier, shall be the time of the giving of the notice.

     Section 2. Waivers.

     A written waiver of any notice, signed by a stockholder, Director, Officer,
employee  or  agent,  whether  before  or after  the time of the event for which
notice is to be given,  shall be deemed  equivalent to the notice required to be
given to such stockholder,  Director,  Officer,  employee or agent.  Neither the
business  nor the purpose of any  meeting  need be  specified  in such a waiver.
Attendance of a person at a meeting shall constitute a waiver of notice of such


                                       12
<PAGE>

meeting,  except when the person  attends a meeting  for the express  purpose of
objecting at the beginning of the meeting to the transaction of business because
the meeting is not lawfully called or convened.

                           ARTICLE VII - MISCELLANEOUS

     Section 1. Facsimile Signatures.

     In addition to the  provisions  for use of facsimile  signatures  elsewhere
specifically authorized in these Bylaws,  facsimile signatures of any officer or
officers of the  Corporation may be used whenever and as authorized by the Board
of Directors or a committee thereof.

     Section 2. Corporate Seal.

     The Board of Directors may provide a suitable seal,  containing the name of
the Corporation, which seal shall be in the charge of the Secretary. If and when
so directed by the Board of Directors or a committee thereof,  duplicates of the
seal may be kept and used by the  Treasurer or by an  Assistant  Secretary or an
assistant to the Treasurer.

     Section 3. Reliance Upon Books, Reports and Records.

     Each  Director,  each member of any  committee  designated  by the Board of
Directors,  and each Officer of the Corporation shall, in the performance of his
or her  duties,  be fully  protected  in relying in good faith upon the books of
account or other records of the Corporation and upon such information, opinions,
reports or  statements  presented to the  Corporation  by any of its Officers or
employees,  or  committees  of the Board of Directors so  designated,  or by any
other person as to matters  which such Director or committee  member  reasonably
believes are within such other person's  professional  or expert  competence and
who has been selected with reasonable care by or on behalf of the Corporation.

     Section 4. Fiscal Year.

     The  fiscal  year of the  Corporation  shall be as  fixed  by the  Board of
Directors.

     Section 5. Time Periods.

     In applying any  provision of these  Bylaws which  requires  that an act be
done or not be done a specified  number of days prior to an event or that an act
be done  during  a period  of a  specified  number  of days  prior to an  event,
calendar days shall be used,  the day of the doing of the act shall be excluded,
and the day of the event shall be included.

                            ARTICLE VIII - AMENDMENTS

     The Board of  Directors  may  amend,  alter or repeal  these  Bylaws at any
meeting of the Board,  provided notice of the proposed change was given not less
than two (2) days prior to the meeting.  The stockholders  shall also have power
to amend,  alter or repeal these Bylaws at any



                                       13
<PAGE>

meeting of stockholders  provided notice of the proposed change was given in the
notice  of the  meeting;  provided,  however,  that,  notwithstanding  any other
provisions of the Bylaws or any provision of law which might otherwise  permit a
lesser vote or no vote, but in addition to any  affirmative  vote of the holders
of any  particular  class or series of the voting  stock  required  by law,  the
Certificate of  Incorporation,  any Preferred Stock Designation or these Bylaws,
the affirmative  votes of the holders of at least 80% of the voting power of all
the  then-outstanding  shares of the Voting Stock,  voting  together as a single
class,  shall be  required  to alter,  amend or repeal any  provisions  of these
Bylaws.

     The above  Amended  and  Restated  Bylaws  amend and  restate the Bylaws of
Berkshire  Hills  Bancorp,  Inc.,  effective  as of January  10,  2000,  and are
effective as of October 16, 2002.



                                       14



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>exhibit10-2.txt
<TEXT>
                 [LETTERHEAD OF BERKSHIRE HILLS BANCORP, INC.]

November 13, 2002




Charles F. Plungis. Jr.
6 Heberts Drive
Great Barrington, MA  01230


Dear Charlie:

This letter agreement (the "Agreement") sets forth the agreement that we have
reached regarding your resignation from your regular, full-time employment and
all offices and positions you hold with Berkshire Bank ("Berkshire Bank") and
Berkshire Hills Bancorp, Inc. (the "Holding Company") and their related and
affiliated entities (collectively, "Berkshire").

In exchange for the promises set forth below, you and Berkshire agree as
follows:

     1.   Resignation

     You agree to resign effective as of February 28, 2003 or on such earlier
date as Berkshire may determine to be appropriate after year-end financial
reporting is completed (the "Resignation Date") as Senior Vice President,
Treasurer and Chief Financial Officer of the Holding Company and of Berkshire
Bank and from all other positions, including any offices, directorships or
employment that you hold with Berkshire or any subsidiary or affiliate of
Berkshire. Berkshire shall pay your base salary through your Resignation Date
and will credit you with pro rata vacation to reflect the number of days that
you work in 2003 in calculating the amount of pay that you are due for accrued
but unused vacation as of the Resignation Date.

     2.   Continued Employment; Payments Prior to Resignation Date

     You agree to continue to serve in your capacity as Senior Vice President,
Treasurer and Chief Financial Officer of the Holding Company and of Berkshire
Bank and in all other positions, including any offices, directorships or
employment that you hold with Berkshire or any subsidiary or affiliate of
Berkshire until the Resignation Date. You agree to work diligently and in good
faith on behalf of Berkshire until your Resignation Date and understand that
Berkshire's obligations to you under this Agreement are conditioned upon your
faithful performance of duties through the Resignation Date. Berkshire will
continue to provide you with your base salary as well as regular benefits,
including an annual contribution to the ESOP for 2002 which will be made in the
ordinary course until your Resignation Date. You will receive a bonus for 2002
equal to $12,237 when bonuses are paid to other employees.

<PAGE>



     3.   Post Resignation Payment

     Berkshire will make a lump sum payment within thirty (30) days of the
Resignation Date equal to the sum of the amounts set forth or determined
pursuant to Sections 3(a) through (d).

          (a) Severance Pay. Berkshire shall pay you $502,815 which is the total
     of (i) three times your base salary rate of $152,967 and (ii) three times
     your most recent bonus payment of $14,638.

          (b) 401(k) and ESOP. In addition to the annual contribution to the
     ESOP for 2002 which will be made in the ordinary course as set forth in
     Section 2 above, Berkshire will also pay you $76,005.42, which represents
     the total of (i) three times the total annual contribution of $10,707.69
     that it made to your 401(k) and (ii) three times the total annual
     contribution of $14,627.45 that it made to the ESOP.

          (c) Stock Options. Berkshire shall pay you $89,015.50 which equals the
     difference between $24.00 and the option exercise price of $16.75
     multiplied by 12,278 which is the number of shares of stock which you had
     an unvested option to purchase as of the Resignation Date. You agree that
     notwithstanding any provisions of the January 30, 2001 Incentive Stock
     Option Award Agreement between you and the Holding Company, any unvested
     options are hereby cancelled as of the Effective Date (as defined in
     Section 16(c) hereof) and any rights you may have with respect to your
     vested options will be determined by the terms of the Incentive Stock
     Option Award Agreement.

          (d) Restricted Stock. Berkshire shall pay you $412,512 which equals
     $24.00 multiplied by 17,188, which is the number of shares of unvested
     restricted stock in the Holding Company that have been issued to you.
     Berkshire will also pay you $17,703.64 which represents an amount equal to
     the value of the accumulated dividends for the unvested shares from the
     date of the initial award of the restricted stock through your Resignation
     Date. You agree that notwithstanding any provisions of the January 30, 2001
     Restricted Stock Award Agreement between you and the Holding Company, any
     unvested restricted stock award outstanding as of the Effective Date shall
     be forfeited and cancelled on the Effective Date.

     4.   Benefit Continuation

     To the extent permitted by the respective benefit plans, you will be
permitted to participate in medical and dental insurance plans for a period of
three years after the Resignation Date or until you become eligible for
comparable benefits, whichever is earlier. Since the terms of the life insurance
and disability plans do not permit you to participate after the Resignation
Date, Berkshire will pay you $4,043.16, an amount equal to three times the
annual premiums of $1,347.72 for such benefits. Your rights to medical and
dental coverage under COBRA will run


<PAGE>


concurrently with the coverage provided under this Agreement from the
Resignation Date. Your co-payment obligation for the continuation of medical and
dental coverage will be withheld from the lump sum payment. The co-payment
obligation that will be withheld is $4,444.44 which represents three times your
annual co-payment of $1,481.48. In the event that you become eligible for
comparable benefits prior to three years after the Resignation Date, Berkshire
shall reimburse you appropriately to the extent that the co-payment amount
withheld proves to have been excessive.

     5.   Tax Treatment

     Berkshire shall undertake to make deductions, withholdings and tax reports
with respect to payments and benefits under this Agreement to the extent that it
reasonably and in good faith determines that it is required to make such
deductions, withholdings and tax reports. Payments under this Agreement shall be
in amounts net of any such deductions or withholdings. Nothing in this Agreement
shall be construed to require Berkshire to make any payments to compensate you
for any adverse tax effect associated with any payments or benefits or for any
deduction or withholding from any payment or benefit.

     6.   Return of Property

     You agree to return to Berkshire, on or before the Resignation Date, all of
its property, including, without limitation, computer equipment, software, keys
and access cards, credit cards, files and any other documents (including
computerized data and any copies made of any computerized data or software)
containing information concerning Berkshire, its business or its business
relationships (in the latter two cases, actual or prospective). In the event
that you discover that you continue to retain any such property after the
Resignation Date, you shall return it to Berkshire immediately.

     7.   Confidential Information

     You recognize and acknowledge that knowledge of the business activities and
plans for business activities of Berkshire is a valuable, special and unique
asset of Berkshire's business. You agree that you will not disclose at any time
any knowledge of the past, present, planned or considered business activities of
Berkshire to any person, firm, corporation, or other entity for any reason or
purpose whatsoever unless expressly authorized by the Board of Directors or
required by law. Notwithstanding the foregoing, you may disclose any knowledge
of banking, financial and/or economic principles, concepts or ideas which are
not solely and exclusively derived from the business plans and activities of
Berkshire. In the event that you breach or threaten to breach this Section 7,
Berkshire will be entitled to an injunction restraining you from disclosing, in
whole or in part, the knowledge of the past, present, planned or considered
business activities of Berkshire or from rendering any services to any person,
firm, corporation


<PAGE>


or other entity to whom such knowledge, in whole or in part, has been disclosed
or is threatened to be disclosed. Nothing herein will be construed as
prohibiting Berkshire from pursuing any other remedies available to Berkshire
for such breach or threatened breach, including the recovery of damages from
you.

     8.   Noncompetition

     You agree not to compete with Berkshire for a period of one (1) year
following the Resignation Date in any city, town or county in which your normal
business office is located or in which Berkshire has an office or has filed an
application for regulatory approval to establish an office, determined as of the
Resignation Date, except as agreed to pursuant to a resolution duly adopted by
the Board of Directors. You agree that during such period and within said
cities, towns and counties, you shall not work for or advise, consult or
otherwise serve with, directly or indirectly, any entity whose business
materially competes with the depository, lending or other business activities of
Berkshire. Recognizing that irreparable injury will result to Berkshire, its
business and property in the event of your breach of this Section 8, you agree
that in the event of any such breach by you, Berkshire will be entitled, in
addition to any other remedies and damages available, to an injunction to
restrain the violation hereof by you, your partners, agents, servants, employees
and all persons acting for or under your direction. You represent and admit that
your experience and capabilities are such that you can obtain employment in a
business engaged in other lines and/or of a different nature than Berkshire, and
that the enforcement of a remedy by way of injunction will not prevent you from
earning a livelihood. Nothing herein will be construed as prohibiting Berkshire
or its subsidiaries from pursuing any other remedies available to it for such
breach or threatened breach, including the recovery of damages from you.

     9.   Release Claims

     (a) By You. In consideration for, among other terms, the payments and
benefits described in Sections 3 and 4, you voluntarily release and forever
discharge Berkshire, its affiliated and related entities, its and their
respective predecessors, successors and assigns, its and their respective
employee benefit plans and fiduciaries of such plans, and the current and former
officers, directors, shareholders, employees, attorneys, accountants and agents
of each of the foregoing in their official and personal capacities (collectively
referred to as the "Releasees") generally from all claims, demands, debts,
damages and liabilities of every name and nature, known or unknown ("Claims")
that, as of the date when you sign this Agreement, you have, ever had, now claim
to have or ever claimed to have had against any or all of the Releasees. This
release includes, without limitation, all Claims:


          o    relating to your employment by and resignation from employment
               with Berkshire;


<PAGE>


          o    arising from or out of the June 27, 2000 employment agreement
               between you and the Holding Company and/or the June 27, 2000
               employment agreement between you and Berkshire Bank (collectively
               referred to herein as the "Employment Agreements");

          o    of wrongful discharge;

          o    of breach of contract;

          o    of retaliation or discrimination under federal, state or local
               law (including, without limitation, Claims of age discrimination
               or retaliation under the Age Discrimination in Employment Act,
               Claims of disability discrimination or retaliation under the
               Americans with Disabilities Act, and Claims of discrimination or
               retaliation under Title VII of the Civil Rights Act of 1964);

          o    under any other federal or state statute (including, without
               limitation, Claims under the Family Medical Leave Act and Claims
               under the Worker Adjustment and Retraining Notification Act);

          o    of defamation or other torts;

          o    of violation of public policy;

          o    for wages, bonuses, incentive compensation, vacation pay or any
               other compensation or benefits; and

          o    for damages or other remedies of any sort, including, without
               limitation, compensatory damages, punitive damages, injunctive
               relief and attorney's fees;

provided, however, that this release shall not affect your rights under this
Agreement or your rights to receive a distribution of your vested account
balances under the 401(k) Plan and ESOP.

You agree that you shall not seek or accept damages of any nature, other
equitable or legal remedies for your own benefit, attorney's fees, or costs from
any of the Releasees with respect to any Claim. As a material inducement to
Berkshire to enter into this Agreement, you represent that you have not assigned
to any third party and you have not filed with any agency or court any Claim
released by this Agreement.

     (b) By Berkshire. Berkshire, on behalf of itself and its predecessors,
successors, assign, directors (but only in their capacities as directors of
Berkshire) and officers


<PAGE>


(but only in their capacities as officers of Berkshire) voluntarily and
irrevocably release and discharge you and your successors, assigns, heirs, and
survivors from any and all charges, complaints, claims, promises, agreements,
causes of action, damages and debts (including attorney's fees and costs
actually incurred) which any of them have, claim to have, ever had or ever
claimed to have had against you through the date hereof, known or unknown, which
relate to good faith acts or omissions by you during the course of your
employment with Berkshire undertaken or not undertaken in the reasonable belief
that such acts or omissions were in the best interest of Berkshire.

     10.  Nondisparagement

     You agree not to make any disparaging statements concerning Berkshire or
any of its affiliates or current or former officers, directors, shareholders,
employees or agents. You further agree not to take any actions or conduct
yourself in any way that would reasonably be expected to affect adversely the
reputation or goodwill of Berkshire or any of its affiliates or any of its
current or former officers, directors, shareholders, employees or agents.
Berkshire will instruct the members of its Board of Directors and its executive
management not to take any action or make any statement, written or oral, which
disparages or criticizes you or your management and business practices. The
provisions of this Section 10 shall not apply to any truthful statement required
to be made by you or Berkshire, as the case may be, in any legal proceeding or
governmental or regulatory investigation or any truthful statements made by
Berkshire in connection with the public disclosure of your resignation from
Berkshire.

     11.  Future Cooperation

     You agree to cooperate reasonably with Berkshire and all of its affiliates
(including its outside counsel) in connection with the contemplation,
prosecution and defense of all phases of existing, past and future litigation,
regulatory or administrative actions about which Berkshire believes you may have
knowledge or information. You further agree to make yourself available at
mutually convenient times during and outside of regular business hours as
reasonably deemed necessary by Berkshire's counsel. Berkshire shall not utilize
this Section 10 to require you to make yourself available to an extent that
would unreasonably interfere with full-time employment responsibilities that you
may have. You agree to appear without the necessity of a subpoena to testify
truthfully in any legal proceedings in which Berkshire calls you as a witness.
Berkshire shall also reimburse you for any pre-approved reasonable business
travel expenses that you incur on Berkshire's behalf as a result of your
litigation cooperation services, after receipt of appropriate documentation
consistent with Berkshire's business expense reimbursement policy. You further
agree that you shall not voluntarily provide information to or otherwise
cooperate with any individual or entity that is contemplating or pursuing
litigation against any of the Releasees or that is undertaking any investigation
or review of any of the Releasees' activities or



<PAGE>


practices; provided, however, that you may participate in or otherwise assist in
any investigation or inquiry conducted by the EEOC or the Massachusetts
Commission Against Discrimination.

     12.  Suspension or Termination of Payments

     In the event that you fail to comply with any of your obligations under
this Agreement, in addition to any other legal or equitable remedies it may have
for such breach Berkshire shall have the right to terminate or suspend its
payments to you under this Agreement. The termination or suspension of such
payments in the event of such breach by you will not affect your continuing
obligations under this Agreement. Notwithstanding the foregoing, this provision
shall not apply to the extent that your breach of this Agreement consists of
initiating a legal action in which you contend that the release set forth in
Section 9(a) is invalid, in whole or in part, due to the provisions of 29 U.S.C.
ss. 626(f).

     13.  Legal Representation

     This Agreement is a legally binding document and your signature will commit
you to its terms. You acknowledge that you have been advised to discuss all
aspects of this Agreement with your attorney, that you have in fact retained a
personal attorney who has reviewed this Agreement and represented you concerning
it, that you have carefully read and fully understand all of the provisions of
this Agreement and that you are voluntarily entering into this Agreement.
Berkshire represents and warrants to you that all requisite company authority,
and all other consents necessary for the execution of this Agreement, have been
duly adopted and obtained, and Berkshire has the full right, power and authority
to execute, deliver, and carry out the terms and conditions of this Agreement
and all other documents to be executed pursuant to, or in connection with, this
Agreement.

     14.  Enforcement

     (a) Jurisdiction. You and Berkshire hereby agree that the Superior Court of
the Commonwealth of Massachusetts and the United States District Court for the
District of Massachusetts shall have the exclusive jurisdiction to consider any
matters related to this Agreement, including without limitation any claim for
violation of this Agreement. With respect to any such court action, you (i)
submit to the jurisdiction of such courts, (ii) consent to service of process,
and (iii) waive any other requirement (whether imposed by statute, rule of court
or otherwise) with respect to personal jurisdiction or venue.

     (b) Relief. You agree that it would be difficult to measure any harm caused
to Berkshire that might result from any breach by you of your promises set forth
in Sections 6, 7, 8 and 10 and that in any event money damages would be an
inadequate remedy for any such breach. Accordingly, you agree that if you
breach, or propose to breach, any portion of your


<PAGE>


obligations under Sections 6, 7, 8 and 10, Berkshire shall be entitled, in
addition to all other remedies it may have, to an injunction or other
appropriate equitable relief to restrain any such breach, without showing or
proving any actual damage to Berkshire and without the necessity of posting a
bond. In the event that Berkshire prevails in any action to enforce Section 6,
7, 8 and 10, then you also shall be liable to Berkshire for attorney's fees and
costs incurred by Berkshire in enforcing such provision(s). In addition, in the
event that you breach any portion of Section 7, you agree that the restrictions
of Section 8 shall remain in effect for the period of such breach
notwithstanding the period of one (1) year set forth above and you further agree
that the same restrictions shall apply for a period of one (1) year commencing
effective upon the cessation of any such breach.

     15.  Indemnification

     Berkshire shall indemnify you (and your heirs, executors and
administrators) to the fullest extent permitted under Delaware law against all
expenses and liabilities reasonably incurred by you in connection with or
arising out of any action, suit, or proceeding in which you may be involved by
reason of your having been a director or officer of Berkshire (whether or not
incurred before or after the Resignation Date). Such expenses and liabilities
will include, but will not be limited to, judgments, court costs and attorneys'
fees and the cost of reasonable settlements. Any payments made to you pursuant
to this Section 15 are subject to and conditioned on compliance with 12 U.S.C.
ss. 1828(k) and 12 C.F.R. Part 359 and any rules or regulations promulgated
thereunder.

     16.  Notices, Acknowledgments and Other Terms

     (a) You are advised to consult with an attorney before signing this
Agreement.

     (b) You acknowledge and agree that Berkshire's promises in this Agreement
constitute consideration in addition to anything of value to which you are
otherwise entitled by reason of your resignation from employment. The parties
agree that this Agreement and the payments set forth herein are derived from the
Employment Agreements and that this Agreement represents a compromise of
disputed claims that you could have made under the Employment Agreements,
including without implication of limitation, your claims under Section
4(a)(ii)(B) of the Employment Agreements as well as a compromise of the other
claims which you have released as set forth in Section 9(a) of this Agreement.
The parties agree that none of the payments herein are contingent upon any
change in the ownership or effective control of the Berkshire Bank or the
Holding Company or any change in ownership of any substantial portion of the
assets of the Berkshire Bank or the Holding Company.



<PAGE>


     (c) You acknowledge that you have been given the opportunity, if you so
desired, to consider this Agreement for twenty-one (21) days before executing
it. If not signed by you and returned to Gerald A. Denmark so that it is
received by close of business on the twenty-second (22nd) day after your receipt
of the Agreement, this Agreement will not be valid. In addition, if you breach
any of the conditions of the Agreement within the twenty-one (21) day period,
the offer of this Agreement will be withdrawn and your execution of the
Agreement will not be valid. In the event that you execute and return this
Agreement within twenty-one (21) days or less of the date of its delivery to
you, you acknowledge that such decision was entirely voluntary and that you had
the opportunity to consider this letter agreement for the entire twenty-one (21)
day period. Berkshire acknowledges that for a period of seven (7) days from the
date of the execution of this Agreement, you shall retain the right to revoke
this Agreement by written notice delivered to Gerald A. Denmark before the end
of such period. This Agreement shall become effective upon the expiration of
such revocation period (the "Effective Date"). You acknowledge that the Bank may
elect to accept your resignation and announce it publicly at any time after you
tender a signed copy of this Agreement.

     (d) By signing this Agreement, you acknowledge that you are doing so
voluntarily and knowingly, fully intending to be bound by this Agreement. You
also acknowledge that you are not relying on any representations by us or any
other representative of Berkshire concerning the meaning of any aspect of this
Agreement. You understand that this Agreement shall not in any way be construed
as an admission by Berkshire of any liability or any act of wrongdoing
whatsoever by Berkshire against you and that Berkshire specifically disclaims
any liability or wrongdoing whatsoever against you on the part of itself and its
respective officers, directors, shareholders, employees and agents. You
understand that if you do not enter into this Agreement and bring any claims
against Berkshire, Berkshire will dispute the merits of those claims and contend
that it acted lawfully and for good business reasons with respect to you.

     (e) In the event of any dispute, this Agreement will be construed as a
whole, will be interpreted in accordance with its fair meaning, and will not be
construed strictly for or against either you or Berkshire.

     (f) Except to the extent that the law of Delaware will establish the scope
of Berkshire's obligations to indemnify you pursuant to Section 15 of this
Agreement, the law of the Commonwealth of Massachusetts will govern any dispute
about this Agreement, including any interpretation or enforcement of this
Agreement.

     (g) In the event that any provision or portion of a provision of this
Agreement shall be determined to be illegal, invalid or unenforceable, the
remainder of this Agreement shall be enforced to the fullest extent possible and
the illegal, invalid or unenforceable provision or portion of a provision will
be amended by a court of competent jurisdiction to reflect the parties' intent
if possible. If such amendment is not possible, the illegal, invalid or
unenforceable


<PAGE>


provision or portion of a provision will be severed from the remainder of this
Agreement and the remainder of this Agreement shall be enforced to the fullest
extent possible as if such illegal, invalid or unenforceable provision or
portion of a provision was not included.

     (h) This Agreement may be modified only by a written agreement signed by
you and authorized representatives of Berkshire.

     (i) This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior agreements
between the parties with respect to any related subject matter.

     (j) This Agreement shall be binding upon each of the parties and upon their
respective heirs, administrators, representatives, executors, successors and
assigns, and shall inure to the benefit of each party and to their heirs,
administrators, representatives, executors, successors, and assigns.

Please indicate your agreement to the terms of this Agreement by signing and
returning to me the original of this letter within the time period set forth
above.

Very truly yours,

BERKSHIRE BANK



By:        /s/ Michael P. Daly                          November 13, 2002
           --------------------------------        -----------------------------
           Michael P. Daly                                    Date
           President and CEO


BERKSHIRE HILLS BANCORP, INC.

By:        /s/ Michael P. Daly                          November 13, 2002
           --------------------------------        -----------------------------
           Michael P. Daly                                    Date
           President and CEO

You are advised to consult with an attorney before signing this Agreement. The
foregoing is agreed to and accepted by:

/s/ Charles F. Plungis, Jr.                             November 13, 2002
---------------------------                        -----------------------------
    Charles F. Plungis, Jr.                                   Date




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>5
<FILENAME>exhibit10-3.txt
<TEXT>


                  [LETTERHEAD OF BERKSHIRE HILLS BANCORP, INC.]

November 13, 2002



Susan Santora
30 Commonwealth Avenue
Great Barrington, MA  01230


Dear Susan:

This letter agreement (the "Agreement") sets forth the agreement that we have
reached regarding your resignation from your regular, full-time employment and
all offices and positions you hold with Berkshire Bank ("Berkshire Bank") and
Berkshire Hills Bancorp, Inc. (the "Holding Company") and their related and
affiliated entities (collectively, "Berkshire").

In exchange for the promises set forth below, you and Berkshire agree as
follows:

     1.   Resignation

     You hereby resign effective as of November 15, 2002 (the "Resignation
Date") as Executive Vice President of the Holding Company and Executive Vice
President-Retail Banking of Berkshire Bank and from all other positions,
including any offices, directorships or employment that you hold with Berkshire
or any subsidiary or affiliate of Berkshire. Berkshire shall pay you your base
salary through the Resignation Date as well as any accrued but unused vacation
as of the Resignation Date. Said resignations are hereby accepted by Berkshire.

     2.   Post Resignation Payment

     Berkshire will make a lump sum payment within thirty (30) days of the
Effective Date (as defined in Section 15(c)) equal to the sum of the amounts set
forth or determined pursuant to Sections 2(a) through (d).

     (a) Severance Pay. Berkshire shall pay you $452,289 which represents three
times the sum of (i) your base salary rate of $137,710 plus (ii) incentive
compensation of $13,053, which represents an amount equal to your most recent
bonus payment.

     (b) 401(k) and ESOP. Berkshire will pay you $68,075.16, which represents
three times the sum of (i) the total annual contribution of $9,639.70 that it
made to your 401(k) and (ii) the total annual contribution of $13,052.02 that it
made to the ESOP.

     (c) Stock Options. Berkshire shall pay you $133,516 which equals the
difference between $24.00 and the option exercise price of $16.75 multiplied by
18,416 which


<PAGE>


is the number of shares of stock which you had an unvested option to purchase as
of the Resignation Date.

     (d) Restricted Stock. Berkshire shall pay you $412,512 which equals $24.00
multiplied by 17,188, which is the number of shares of unvested restricted stock
in the Holding Company that have been issued to you. Berkshire will also pay you
$14,168.80 which represents an amount equal to the value of the accumulated
dividends for the unvested shares from the date of the initial award of the
restricted stock through your Resignation Date.

     3.   Benefit Continuation

     Since the terms of the life insurance and disability plans do not permit
you to participate after the Resignation Date, Berkshire will pay you $3,901.32,
an amount equal to three times the annual premiums of $1,300.44 for such
benefits. You will continue to be eligible for participation in the dental plan
until November 15, 2005 or until you become eligible for comparable benefits,
whichever is earlier. In addition, Berkshire will reimburse you for up to $1,000
per year for the cost of an annual physical examination at the Lahey Clinic in
2003, 2004 and 2005 to the extent that such cost is not covered by your health
insurance plan. This will confirm that you are not otherwise participating in
any other benefit plans.

     4.   Tax Treatment

     Berkshire shall undertake to make deductions, withholdings and tax reports
with respect to payments and benefits under this Agreement to the extent that it
reasonably and in good faith determines that it is required to make such
deductions, withholdings and tax reports. Payments under this Agreement shall be
in amounts net of any such deductions or withholdings. Nothing in this Agreement
shall be construed to require Berkshire to make any payments to compensate you
for any adverse tax effect associated with any payments or benefits or for any
deduction or withholding from any payment or benefit.

     5.   Return of Property

     You agree to return to Berkshire, on or before the Resignation Date, all of
its property, including, without limitation, computer equipment, software, keys
and access cards, credit cards, files and any other documents (including
computerized data and any copies made of any computerized data or software)
containing information concerning Berkshire, its business or its business
relationships (in the latter two cases, actual or prospective). In the event
that you discover that you continue to retain any such property after the
Resignation Date, you shall return it to Berkshire immediately.


<PAGE>


     6.   Confidential Information

     You recognize and acknowledge that knowledge of the business activities and
plans for business activities of Berkshire is a valuable, special and unique
asset of Berkshire's business. You agree that you will not disclose at any time
any knowledge of the past, present, planned or considered business activities of
Berkshire to any person, firm, corporation, or other entity for any reason or
purpose whatsoever unless expressly authorized by the Board of Directors or
required by law. Notwithstanding the foregoing, you may disclose any knowledge
of banking, financial and/or economic principles, concepts or ideas which are
not solely and exclusively derived from the business plans and activities of
Berkshire. In the event that you breach or threaten to breach this Section 6,
Berkshire will be entitled to an injunction restraining you from disclosing, in
whole or in part, the knowledge of the past, present, planned or considered
business activities of Berkshire or from rendering any services to any person,
firm, corporation or other entity to whom such knowledge, in whole or in part,
has been disclosed or is threatened to be disclosed. Nothing herein will be
construed as prohibiting Berkshire from pursuing any other remedies available to
Berkshire for such breach or threatened breach, including the recovery of
damages from you.

     7.   Noncompetition

     You agree not to compete with Berkshire for a period of one (1) year
following the Resignation Date in any city, town or county in which your normal
business office is located or in which Berkshire has an office or has filed an
application for regulatory approval to establish an office, determined as of the
Resignation Date, except as agreed to pursuant to a resolution duly adopted by
the Board of Directors. You agree that during such period and within said
cities, towns and counties, you shall not work for or advise, consult or
otherwise serve with, directly or indirectly, any entity whose business
materially competes with the depository, lending or other business activities of
Berkshire. Recognizing that irreparable injury will result to Berkshire, its
business and property in the event of your breach of this Section 7, you agree
that in the event of any such breach by you, Berkshire will be entitled, in
addition to any other remedies and damages available, to an injunction to
restrain the violation hereof by you, your partners, agents, servants, employees
and all persons acting for or under your direction. You represent and admit that
your experience and capabilities are such that you can obtain employment in a
business engaged in other lines and/or of a different nature than Berkshire, and
that the enforcement of a remedy by way of injunction will not prevent you from
earning a livelihood. Nothing herein will be construed as prohibiting Berkshire
or its subsidiaries from pursuing any other remedies available to it for such
breach or threatened breach, including the recovery of damages from you.



<PAGE>


     8.   Release Claims

     (a) By You. In consideration for, among other terms, the payments and
benefits described in Sections 2 and 3, you voluntarily release and forever
discharge Berkshire, its affiliated and related entities, its and their
respective predecessors, successors and assigns, its and their respective
employee benefit plans and fiduciaries of such plans, and the current and former
officers, directors, shareholders, employees, attorneys, accountants and agents
of each of the foregoing in their official and personal capacities (collectively
referred to as the "Releasees") generally from all claims, demands, debts,
damages and liabilities of every name and nature, known or unknown ("Claims")
that, as of the date when you sign this Agreement, you have, ever had, now claim
to have or ever claimed to have had against any or all of the Releasees. This
release includes, without limitation, all Claims:

          o    relating to your employment by and resignation from employment
               with Berkshire;

          o    arising from or out of the June 27, 2000 employment agreement
               between you and the Holding Company and/or the June 27, 2000
               employment agreement between you and Berkshire Bank;

          o    of wrongful discharge;

          o    of breach of contract;

          o    of retaliation or discrimination under federal, state or local
               law (including, without limitation, Claims of age discrimination
               or retaliation under the Age Discrimination in Employment Act,
               Claims of disability discrimination or retaliation under the
               Americans with Disabilities Act, and Claims of discrimination or
               retaliation under Title VII of the Civil Rights Act of 1964);

          o    under any other federal or state statute (including, without
               limitation, Claims under the Family Medical Leave Act and Claims
               under the Worker Adjustment and Retraining Notification Act);

          o    of defamation or other torts;

          o    of violation of public policy;

          o    for wages, bonuses, incentive compensation, vacation pay or any
               other compensation or benefits; and



<PAGE>


          o    for damages or other remedies of any sort, including, without
               limitation, compensatory damages, punitive damages, injunctive
               relief and attorney's fees;

provided, however, that this release shall not affect your rights under this
Agreement or your rights to receive a distribution of your vested account
balances under the 401(k) Plan and ESOP.

You agree that you shall not seek or accept damages of any nature, other
equitable or legal remedies for your own benefit, attorney's fees, or costs from
any of the Releasees with respect to any Claim. As a material inducement to
Berkshire to enter into this Agreement, you represent that you have not assigned
to any third party and you have not filed with any agency or court any Claim
released by this Agreement.

     (b) By Berkshire. Berkshire, on behalf of itself and its predecessors,
successors, assign, directors (but only in their capacities as directors of
Berkshire) and officers (but only in their capacities as officers of Berkshire)
voluntarily and irrevocably release and discharge you and your successors,
assigns, heirs, and survivors from any and all charges, complaints, claims,
promises, agreements, causes of action, damages and debts (including attorney's
fees and costs actually incurred) which any of them have, claim to have, ever
had or ever claimed to have had against you through the date hereof, known or
unknown, which relate to good faith acts or omissions by you during the course
of your employment with Berkshire undertaken or not undertaken in the reasonable
belief that such acts or omissions were in the best interest of Berkshire.

     9.   Nondisparagement

     You agree not to make any disparaging statements concerning Berkshire or
any of its affiliates or current or former officers, directors, shareholders,
employees or agents. You further agree not to take any actions or conduct
yourself in any way that would reasonably be expected to affect adversely the
reputation or goodwill of Berkshire or any of its affiliates or any of its
current or former officers, directors, shareholders, employees or agents.
Berkshire will instruct the members of its Board of Directors and its executive
management not to take any action or make any statement, written or oral, which
disparages or criticizes you or your management and business practices. The
provisions of this Section 9 shall not apply to any truthful statement required
to be made by you or Berkshire, as the case may be, in any legal proceeding or
governmental or regulatory investigation or any truthful statements made by
Berkshire in connection with the public disclosure of your resignation from
Berkshire.

     10.  Future Cooperation

     You agree to cooperate reasonably with Berkshire and all of its affiliates
(including its outside counsel) in connection with the contemplation,
prosecution and defense of all phases of existing, past and future litigation,
regulatory or administrative actions about which


<PAGE>


Berkshire believes you may have knowledge or information. You further agree to
make yourself available at mutually convenient times during and outside of
regular business hours as reasonably deemed necessary by Berkshire's counsel.
Berkshire shall not utilize this Section 10 to require you to make yourself
available to an extent that would unreasonably interfere with full-time
employment responsibilities that you may have. You agree to appear without the
necessity of a subpoena to testify truthfully in any legal proceedings in which
Berkshire calls you as a witness. Berkshire shall also reimburse you for any
pre-approved reasonable business travel expenses that you incur on Berkshire's
behalf as a result of your litigation cooperation services, after receipt of
appropriate documentation consistent with Berkshire's business expense
reimbursement policy. You further agree that you shall not voluntarily provide
information to or otherwise cooperate with any individual or entity that is
contemplating or pursuing litigation against any of the Releasees or that is
undertaking any investigation or review of any of the Releasees' activities or
practices; provided, however, that you may participate in or otherwise assist in
any investigation or inquiry conducted by the EEOC or the Massachusetts
Commission Against Discrimination.

     11.  Suspension or Termination of Payments

     In the event that you fail to comply with any of your obligations under
this Agreement, in addition to any other legal or equitable remedies it may have
for such breach Berkshire shall have the right to terminate or suspend its
payments to you under this Agreement. The termination or suspension of such
payments in the event of such breach by you will not affect your continuing
obligations under this Agreement. Notwithstanding the foregoing, this provision
shall not apply to the extent that your breach of this Agreement consists of
initiating a legal action in which you contend that the release set forth in
Section 8(a) is invalid, in whole or in part, due to the provisions of 29 U.S.C.
ss. 626(f).

     12.  Legal Representation

     This Agreement is a legally binding document and your signature will commit
you to its terms. You acknowledge that you have been advised to discuss all
aspects of this Agreement with your attorney, that you have in fact retained a
personal attorney who has reviewed this Agreement and represented you concerning
it, that you have carefully read and fully understand all of the provisions of
this Agreement and that you are voluntarily entering into this Agreement.
Berkshire represents and warrants to you that all requisite company authority,
and all other consents necessary for the execution of this Agreement, have been
duly adopted and obtained, and Berkshire has the full right, power and authority
to execute, deliver, and carry out the terms and conditions of this Agreement
and all other documents to be executed pursuant to, or in connection with, this
Agreement.


<PAGE>


13.        Enforcement

     (a) Jurisdiction. You and Berkshire hereby agree that the Superior Court of
the Commonwealth of Massachusetts and the United States District Court for the
District of Massachusetts shall have the exclusive jurisdiction to consider any
matters related to this Agreement, including without limitation any claim for
violation of this Agreement. With respect to any such court action, you (i)
submit to the jurisdiction of such courts, (ii) consent to service of process,
and (iii) waive any other requirement (whether imposed by statute, rule of court
or otherwise) with respect to personal jurisdiction or venue.

     (b) Relief. You agree that it would be difficult to measure any harm caused
to Berkshire that might result from any breach by you of your promises set forth
in Sections 5, 6, 7 and 9 and that in any event money damages would be an
inadequate remedy for any such breach. Accordingly, you agree that if you
breach, or propose to breach, any portion of your obligations under Sections 5,
6, 7 and 9, Berkshire shall be entitled, in addition to all other remedies it
may have, to an injunction or other appropriate equitable relief to restrain any
such breach, without showing or proving any actual damage to Berkshire and
without the necessity of posting a bond. In the event that Berkshire prevails in
any action to enforce Section 5, 6, 7 and 9, then you also shall be liable to
Berkshire for attorney's fees and costs incurred by Berkshire in enforcing such
provision(s). In addition, in the event that you breach any portion of Section
7, you agree that the restrictions of Section 7 shall remain in effect for the
period of such breach notwithstanding the period of one (1) year set forth above
and you further agree that the same restrictions shall apply for a period of one
(1) year commencing effective upon the cessation of any such breach.

     14.  Indemnification

     Berkshire shall indemnify you (and your heirs, executors and
administrators) to the fullest extent permitted under Delaware law against all
expenses and liabilities reasonably incurred by you in connection with or
arising out of any action, suit, or proceeding in which you may be involved by
reason of your having been a director or officer of Berkshire (whether or not
incurred before or after the Resignation Date). Such expenses and liabilities
will include, but will not be limited to, judgments, court costs and attorneys'
fees and the cost of reasonable settlements. Any payments made to you pursuant
to this Section 14 are subject to and conditioned on compliance with 12 U.S.C.
ss. 1828(k) and 12 C.F.R. Part 359 and any rules or regulations promulgated
thereunder.

     15.  Notices, Acknowledgments and Other Terms

          (a) You are advised to consult with an attorney before signing this
     Agreement.



<PAGE>


     (b) You acknowledge and agree that Berkshire's promises in this Agreement
constitute consideration in addition to anything of value to which you are
otherwise entitled by reason of your resignation from employment.

     (c) You acknowledge that you have been given the opportunity, if you so
desired, to consider this Agreement for twenty-one (21) days before executing
it. If not signed by you and returned to Gerald A. Denmark so that it is
received by close of business on the twenty-second (22nd) day after your receipt
of the Agreement, this Agreement will not be valid. In addition, if you breach
any of the conditions of the Agreement within the twenty-one (21) day period,
the offer of this Agreement will be withdrawn and your execution of the
Agreement will not be valid. In the event that you execute and return this
Agreement within twenty-one (21) days or less of the date of its delivery to
you, you acknowledge that such decision was entirely voluntary and that you had
the opportunity to consider this letter agreement for the entire twenty-one (21)
day period. Berkshire acknowledges that for a period of seven (7) days from the
date of the execution of this Agreement, you shall retain the right to revoke
this Agreement by written notice delivered to Gerald A. Denmark before the end
of such period. This Agreement shall become effective upon the expiration of
such revocation period (the "Effective Date"). You acknowledge that the Bank may
elect to accept your resignation and announce it publicly at any time after you
tender a signed copy of this Agreement.

     (d) By signing this Agreement, you acknowledge that you are doing so
voluntarily and knowingly, fully intending to be bound by this Agreement. You
also acknowledge that you are not relying on any representations by us or any
other representative of Berkshire concerning the meaning of any aspect of this
Agreement. You understand that this Agreement shall not in any way be construed
as an admission by Berkshire of any liability or any act of wrongdoing
whatsoever by Berkshire against you and that Berkshire specifically disclaims
any liability or wrongdoing whatsoever against you on the part of itself and its
respective officers, directors, shareholders, employees and agents. You
understand that if you do not enter into this Agreement and bring any claims
against Berkshire, Berkshire will dispute the merits of those claims and contend
that it acted lawfully and for good business reasons with respect to you.

     (e) In the event of any dispute, this Agreement will be construed as a
whole, will be interpreted in accordance with its fair meaning, and will not be
construed strictly for or against either you or Berkshire.

     (f) Except to the extent that the law of Delaware will establish the scope
of Berkshire's obligations to indemnify you pursuant to Section 14 of this
Agreement, the law of the Commonwealth of Massachusetts will govern any dispute
about this Agreement, including any interpretation or enforcement of this
Agreement.

     (g) In the event that any provision or portion of a provision of this
Agreement shall be determined to be illegal, invalid or unenforceable, the
remainder of this Agreement shall


<PAGE>

be enforced to the fullest extent possible and the illegal, invalid or
unenforceable provision or portion of a provision will be amended by a court of
competent jurisdiction to reflect the parties' intent if possible. If such
amendment is not possible, the illegal, invalid or unenforceable provision or
portion of a provision will be severed from the remainder of this Agreement and
the remainder of this Agreement shall be enforced to the fullest extent possible
as if such illegal, invalid or unenforceable provision or portion of a provision
was not included.

     (h) This Agreement may be modified only by a written agreement signed by
you and authorized representatives of Berkshire.

     (i) This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior agreements
between the parties with respect to any related subject matter.

     (j) This Agreement shall be binding upon each of the parties and upon their
respective heirs, administrators, representatives, executors, successors and
assigns, and shall inure to the benefit of each party and to their heirs,
administrators, representatives, executors, successors, and assigns.

Please indicate your agreement to the terms of this Agreement by signing and
returning to me the original of this letter within the time period set forth
above.

Very truly yours,

BERKSHIRE BANK



By:        /s/ Michael P. Daly                           November 13, 2002
           -------------------------------          ----------------------------
           Michael P. Daly                                    Date
           President and CEO


BERKSHIRE HILLS BANCORP, INC.

By:        /s/ Michael P. Daly                           November 13, 2002
           -------------------------------          ----------------------------

           Michael P. Daly                                    Date
           President

You are advised to consult with an attorney before signing this Agreement. The
foregoing is agreed to and accepted by:

/s/ Susan Santora                                        November 13, 2002
------------------------------------------          ----------------------------
     Susan Santora                                            Date



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>6
<FILENAME>exhibit99-1.txt
<TEXT>
                                                                    Exhibit 99.1

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002




         In connection with the Quarterly Report of Berkshire Hills Bancorp,
Inc. (the "Company") on Form 10-Q for the period ending September 30, 2002 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Michael P. Daly, Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C.ss. 1350, as adopted pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002, that:





1.   The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information  contained in the Report fairly  presents,  in all material
     respects,  the financial condition and results of operations of the Company
     as of and for the period covered by the Report.





                                                     /s/ Michael P. Daly
                                                     -----------------------
                                                     Michael P. Daly
                                                     Chief Executive Officer
                                                     November 13, 2002


<PAGE>




                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         In connection with the Quarterly Report of Berkshire Hills Bancorp,
Inc. (the "Company") on Form 10-Q for the period ending September 30, 2002 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Charles F. Plungis, Jr., Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C.ss. 1350, as adopted pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002, that:





1.   The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information  contained in the Report fairly  presents,  in all material
     respects,  the financial condition and results of operations of the Company
     as of and for the period covered by the Report.





                                                     /s/ Charles F. Plungis, Jr.
                                                     ---------------------------
                                                     Charles F. Plungis, Jr.
                                                     Chief Financial Officer
                                                     November 13, 2002



</TEXT>
</DOCUMENT>
</SUBMISSION>
