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Exhibit 10.1                 
 
CTS Corporation                                            905 West Boulevard
North                                                                P:
574.523.3800
Corporate Offices                                           Elkhart, Indiana
46514-1899                                                              F:
574.293.6146
                     www.ctscorp.com
 
 
 
December 16, 2013

 
 
Mr. Thomas Kroll
59196 Clover Road
Mishawaka, IL  46544

Re:  Separation Agreement

Dear Tom:

This Separation Agreement summarizes the arrangements that have been discussed
with you concerning your separation of employment from CTS Corporation
(hereinafter, “CTS”).
 
 
1.
Termination of Employment

 
Your last day of employment with CTS will be March 31, 2014 (hereinafter, your
“Date of Separation from Service”).

2.             Payments and Benefits

A.           You shall receive the following payments and benefits, in
accordance with the CTS Corporation Executive Severance Policy:
 
(i)
You will receive severance pay equivalent to fifteen (15) months of your base
salary in effect immediately prior to termination. Such payment will be paid in
a single lump sum cash payment on September 30, 2014, subject to applicable
withholding and receipt by CTS of a duly signed copy of this Agreement and the
expiration of the Rescission Period described in Section 4 below.

 
(ii)
CTS will pay for outplacement assistance with an outplacement provider to be
selected by CTS, in an amount not to exceed a total cost of $30,000.00.  In no
event shall expenses incurred after December 31 of the second year following the
year in which your Date of Separation from Service occurs be eligible for
reimbursement hereunder, and all reimbursements hereunder shall be paid no later
than December 31 of the third year following the year in which your Date of
Separation from Service occurs.

 
 
(iii)
You will be eligible for COBRA continuation of your medical and dental insurance
coverage.  You will receive information for continuing such insurance coverage
from Chard/Snyder, Inc., the COBRA service provider for CTS, following your Date
of Separation from Service.  You will be eligible to continue the medical and
dental insurance benefits that you had elected and were eligible to receive as
of your Date of Separation from Service for a period of 15 months from your Date
of Separation from Service.  This will be a COBRA continuation of medical and
dental insurance coverage, but the costs of such coverage will be shared by CTS
and you on the same basis as in effect prior to your Date of Separation from
Service for the 15-month period.  You will be required to make monthly premium
payments.  The portion of your insurance premium that is paid by CTS is
considered taxable income and will be reported on your form W-2.  At the end of
the 15-month period, you will be eligible under COBRA continuation for an
additional 3 months of medical and dental insurance coverage, at customary COBRA
rates.  All payments of benefits under the CTS’ medical and dental insurance
programs shall be made no later than December 31 of the year following the year
in which you incur the related expenses.  In no event will the benefits and
reimbursements provided by CTS in one taxable year affect the amount of expenses
or reimbursements that CTS is obligated to pay, or in-kind benefits to be
provided, in any other taxable year.

B.            In addition to the above payments and benefits that you will
receive pursuant to the CTS Corporation Executive Severance Policy, you will be
eligible to receive a pro-rated incentive award under the CTS Management
Incentive Plan (“MIP”) equal to three (3) months of the 2014 MIP plan year award
if, in accordance with the terms of the MIP, you are otherwise entitled to
receive an award.  The award, if any, will be paid at the same time and in the
same manner that awards for the 2014 MIP plan year are paid to MIP participants
who remain actively employed by CTS, in accordance with the terms of the MIP.

C.           You will also be eligible for a pro-rated award under the 2013-2015
CTS Long Term Incentive Plan (“LTIP”), subject to your achievement of the
transition period goals established by the President and Chief Executive
Officer.  Such award, if any, will be paid in 2016 at the same time and in the
same manner that awards for the 2013-2015 LTIP are paid to LTIP participants who
remain actively employed by CTS, in accordance with the terms of the LTIP.

D.           From and after your Date of Separation from Service, the   you will
not participate or be eligible to participate in any employee benefit plans,
programs, policies, or arrangements that cover eligible employees of CTS, other
than as set forth above.  With respect to your participation in any pension,
savings, health and welfare or other employee benefit plans, the terms of such
plans shall govern any right or entitlement you and/or any of your beneficiaries
have or may have hereunder to the extent required by law.  If you have any
unused, earned vacation, it will be paid to you.

3.             Release

In exchange for the compensation described in this Separation Agreement and
other good and valuable consideration, receipt of which is hereby acknowledged,
you hereby agree that you, your representatives, agents, estate, dependents,
beneficiaries and assigns release and forever discharge CTS and its affiliated
corporations, subsidiary corporations, successors, assigns, directors, members,
officers, employees and agents, both individually and in their official
capacities with CTS (hereinafter, the “Releasees”), from any and all actions or
causes of action, suits, claims, complaints, contracts, liabilities, agreements,
promises, debts or damages, whether existing or contingent, known or unknown,
which arise out of your employment or the termination of your employment with
CTS except for claims which relate to your enforcement of CTS' payments and
other obligations under this Separation Agreement.  THIS RELEASE IS INTENDED BY
YOU TO BE ALL ENCOMPASSING AND TO ACT AS A FULL AND TOTAL RELEASE OF ANY CLAIMS
THAT YOU MAY HAVE OR HAVE HAD AGAINST THE RELEASEES. Without limiting the
generality of the foregoing, this release includes any claim of discrimination
on the basis of race, sex, marital status, sexual preference, national origin,
handicap or disability, age, veteran status, special disabled handicap status or
any other basis prohibited by law; any claim arising from any express or implied
employment contract or covenant of good faith and fair dealing; any claim
arising under the Family and Medical Leave Act of 1993; any tort claims, any
personal gain with respect to any claim arising under the qui tam provisions of
the False Claims Act, 31 USC 3730.

You agree and acknowledge that the payments and benefits set forth in this
Separation Agreement, together with payments and benefits previously provided to
you by CTS, are the only payments and benefits you will receive in connection
with your employment or its termination.  Without limitation of the foregoing,
you expressly agree and acknowledge that you will not receive any type of bonus,
including but not limited to a retention bonus or payment, in connection with
your employment or its termination.

You represent that you understand the foregoing release, that you understand
that rights and claims under the Age Discrimination in Employment Act of 1967,
as amended; Title VII of the Civil Rights Act of 1964, as amended, the Americans
with Disabilities Act, and similar state and local anti-discrimination laws are
among the rights and claims against the Releasees that you are releasing hereby.

You further acknowledge and agree that you have been encouraged to seek the
advice of an attorney of your choice in regard to this Separation Agreement and
the Release contained herein.  You represent that you have relied upon the
advice of your attorney in entering into this Separation Agreement and,
specifically, in agreeing to the Release contained herein, or that you have
voluntarily waived the right to seek an attorney’s advice. You hereby understand
and acknowledge the significance and consequences of the Release contained
herein.  You represent that you fully understand the terms of the Release
contained herein and voluntarily accept the terms of the Release contained
herein.  You further acknowledge that you have had a sufficient amount of time
to consider the terms of this Separation Agreement and of the Release contained
herein and to seek independent advice regarding the effect of this Separation
Agreement prior to its execution.

4.              Right to Consider/Rescind

In accordance with the provisions of the Older Workers Benefit Protection Act
related to claims brought under the Age Discrimination in Employment Act, you
understand that you shall have the right to consider whether to accept this
Agreement for a period of twenty-one (21) days from your Date of Separation from
Service.  You are also advised to consult with your attorney before signing this
Agreement.  You further understand that you shall have the right to rescind
(that is, cancel) this Agreement within seven (7) days of signing it to
reinstate claims under the Age Discrimination in Employment Act (hereinafter,
the “Rescission Period"). To begin receiving

benefits pursuant to this Agreement, you must deliver a fully executed copy of
the Agreement to Mary DeVous, Executive Director, Human Resources, CTS
Corporation, 905 West Boulevard N., Elkhart, IN  46514, upon expiration of the
above referenced twenty-one (21) day period.  Notwithstanding anything contained
herein to the contrary, the payments and benefits set forth in Section 2 above
will not commence until the Rescission Period has expired.

5.
Proprietary Information

You agree not to use, publish, or otherwise disclose, either directly or
indirectly, to any person or corporation any trade secret, confidential, or
proprietary information, data, documents or records, including but not limited
to site customer lists and product costing and pricing information, of CTS or
any such information of others which CTS is obligated to maintain in
confidence.  You further agree to abide by any and all proprietary agreements
signed by you during your employment with CTS and acknowledge that such
agreements remain in full force and effect according to their terms.  In the
event of a breach or threatened breach of this Section 5 of the Agreement or of
any proprietary information agreement signed by you during your employment with
CTS, CTS shall be entitled to injunctions, both preliminary and permanent,
enjoining such breach or threatened breach as well as costs in obtaining such
relief including attorney’s fees.

6.
Amicable Relationship

Each party to this Separation Agreement wishes to maintain an amicable
relationship with the other and agrees not to act inconsistently with the
interests of the other party.  Without limitation of the foregoing, you
specifically agree that you will not disparage or defame CTS, its directors,
shareholders, officers, managers and employees or voluntarily cooperate in any
activity or proceeding that is adverse to CTS.  CTS agrees that its official
corporate response to any inquiries from prospective employers that may be
directed to CTS will be limited to the dates of your employment with CTS and
your last position held.

7.             Competitive Activity and Non-solicitation

In accordance with the CTS Corporation Executive Severance Policy, during a
period ending one year following your Date of Separation from Service, you agree
that you will not, without the prior written consent of

CTS, which consent will not be unreasonably withheld, engage in the management
of any business enterprise if such enterprise engages in substantial and direct
competition with CTS.  In addition, for such one year period, you agree that you
will not, either alone or in association with others (i) solicit, or facilitate
any organization with which you are associated in soliciting, any CTS employee
or any of its subsidiaries to leave the employ of CTS or any of its
subsidiaries; (ii) solicit for employment, hire or engage as an independent
contractor, or facilitate any organization with which you are associated in
soliciting for employment, hire or engagement as an independent contractor, any
person who was employed by CTS or any of its subsidiaries at any time during the
term of your employment with CTS or any of its subsidiaries; provided, however
that this clause shall not apply to any individual whose employment with CTS or
any of its subsidiaries has been terminated for a minimum of one year preceding
any such solicitation.

8.
Miscellaneous

 
A.
This Separation Agreement represents a complete understanding between the
parties, supersedes any and all other agreements and understandings, whether
oral or written, and may not be modified, altered or changed except upon written
consent of the parties.

 
B.
This Separation Agreement shall be governed by, construed and enforced in
accordance with the laws of the State of Indiana without regard to principles of
conflicts of law.   The State and Federal Courts of Indiana shall have exclusive
jurisdiction over any disputes or controversies that may arise out of or in
relation to this Agreement. The parties hereby waive any other venue to which
either party might be entitled by virtue of residence, domicile or otherwise.

 
C.
The benefits afforded you under this Separation Agreement are in lieu of any
other compensation, benefit, bonus pay, retention bonus, separation pay,
severance pay, or notice pay to which you might otherwise have been entitled.

 
D.
The waiver by either party of a breach of any provision of this Separation
Agreement shall not operate or be construed to be a waiver of any subsequent
breach thereof.

 
E.
It is agreed and understood that neither the offer nor any negotiations or
proceedings connected herewith nor the execution of this Separation Agreement
nor the payment of money shall constitute or be construed as an admission of any
liability to, or the validity of, any claims whatsoever.

 
F.
By executing this Agreement you acknowledge, understand and agree that CTS is
not obligated under this or any other agreement or applicable law to offer you
employment or accept services for the performance of work from you, directly or
indirectly, as an employee, contractor, or supplier, now or in the future and
you hereby agree not to re-apply for employment with CTS in the future.

 
G.
CTS regards the terms of this Separation Agreement as confidential and therefore
the terms shall not be disclosed by you or your legal counsel to any third party
outside your immediate family, without the prior authorization of CTS.

 
H.
The parties intend this Separation Agreement to serve as a final expression of
this contract and as a complete and exclusive statement of the terms
hereof.  This Separation Agreement supersedes any prior written or verbal
contracts, agreements, or letters of intent or understanding between you and CTS
executed prior to the execution date hereof to the extent any such agreement is
inconsistent with the terms hereof.

      I.  
The parties agree that in the event a court of competent jurisdiction determines
that the character, duration or scope of any provision of this Separation
Agreement is unreasonable or unenforceable in any respect, then such provision
shall be deemed limited to the extent the court deems reasonable or enforceable
and the provision shall remain in effect as limited by the court.  In the event
that such a court determines that any provision is wholly unenforceable, the
provision shall be deemed severed from this Separation Agreement and the other
provisions shall remain in full force and effect.

9.
Representations and Warranties

In consideration of CTS' willingness to enter into this Separation Agreement,
you hereby make the following representations and warranties to CTS:

 
A.  
You have been provided a reasonable time of at least twenty-one (21) days to
consider whether or not to sign this Separation Agreement.

B.  
You are aware, by signing this Separation Agreement, which includes a general
release, you are giving up rights to initiate a lawsuit or other legal
proceeding.

C.  
You understand and agree that by signing this Separation Agreement, you are
specifically waiving your rights to make any claims, or initiate any
proceedings, against the Releasees under Title VII of the Civil Rights Act of
1964 as amended, the Age Discrimination in Employment Act, as amended, the
Americans with Disabilities Act and similar state and local anti-discrimination
laws.

D.  
There are no promises or representations except those contained in this
Separation Agreement which have been made to you in connection with this
subject.

E.  
You have read and understand each and every provision of this Agreement.

F.  
You acknowledge and agree that the release contained herein is an essential and
material term of this Separation Agreement.

Please review this Separation Agreement carefully.  If you are in agreement with
its provisions, please signify your acceptance by signing and dating both copies
of this letter in the space provided below and return one copy to Mary DeVous,
in accordance with Section 4 of this Agreement.

Very truly yours,

CTS Corporation

/s/ Kieran O’Sullivan                                              
Kieran O’Sullivan
President & Chief Executive Officer

 
 

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EMPLOYEE ACKNOWLEDGMENT AND ACCEPTANCE
OF SEPARATION AGREEMENT

I have carefully read and reviewed the foregoing Separation Agreement,
acknowledge its contents, and agree to be bound by its terms, including the
release of claims set forth in the Agreement.  I fully understand that this
Agreement generally releases all of my claims, both known and unknown, arising
prior to the execution hereof, against each and all of the Releasees.

I have been given sufficient time of at least twenty-one (21) days to decide
whether to sign this Separation Agreement and, in the event that I have executed
this Agreement sooner, I have done so voluntarily.  I have consulted with my
private attorney concerning the terms and effect of the Agreement and concerning
my rights or have waived my right to do so.
 

I understand that I have seven (7) days from the date of my signature below to
revoke my acceptance of this Separation Agreement, thereby canceling it.  If I
do not revoke my acceptance, this Separation Agreement will become effective and
enforceable on the date that is seven (7) days from the date of my signature, as
indicated below.
 
 
/s/ Thomas Kroll              
Thomas Kroll
 
 
 
January  7, 2014           
Date of Execution of Agreement