Exhibit 10.b


    CTS
      Corporation

    Form
      10-Q

    Second
      Quarter 2006

    
      

      

    

    EXHIBIT
      (10)(b)


    
       

      DIRECTOR
        AND NAMED EXECUTIVE OFFICER COMPENSATION 

       

      Director
        Compensation 

      


      Employee
        directors receive no additional compensation for serving on the Board of
        Directors or Board Committees. The non-employee director fees established
        by the
        Board on June 7, 2006 are as follows: annual board retainer — $30,000; annual
        retainer for each Audit Committee member — $5,000; annual retainer for each
        Compensation Committee member — $5,000: annual retainer for each Finance and
        Nominating and Governance Committee member — $3,000; annual retainer for each
        Leadership Continuity Committee member — $4,000; additional annual retainer for
        Audit Committee Chairman — $5,000; additional annual retainer for Compensation
        Committee Chairman — $5,000; additional annual retainer for Finance and
        Nominating and Governance Chairman — $3,000; additional annual retainer for
        Leadership Continuity Committee Chairman — $4,000; meeting fee for each Board or
        Committee Meeting — $1,500. All committee meetings, including special meetings
        called by the committee chairman, are compensated at the regular meeting
        fee
        rate. Special activity by the committee chairman, as well as any special
        activity by another committee member that is requested or approved by the
        committee chairman, is also compensated at the regular meeting fee rate.
        Non-employee directors are reimbursed by the corporation for reasonable travel
        expenses related to their performance of services and for director education
        programs. 

      


      In
        1990,
        CTS adopted the Stock Retirement Plan for Non-Employee Directors. Under that
        plan, a deferred stock unit account was established for each non-employee
        director. Through January 2004, 800 common stock units and additional units
        representing dividends on CTS common stock paid were credited annually to
        each
        non-employee director’s account. When a non-employee director retires from the
        Board, he or she receives one share of CTS common stock for each deferred
        stock
        unit credited to his or her account. On December 1, 2004, the Board of Directors
        amended the plan to preclude crediting any additional units to the deferred
        stock unit accounts. On December 1, 2004, each non-employee director received
        a
        grant of restricted stock units under the CTS Corporation 2004 Omnibus Long-term
        Incentive Plan equivalent to the number of deferred stock units which would
        have
        been credited to the director for 2004 service under the Stock Retirement
        Plan
        for Non-Employee Directors. Under the terms of this award, each non-employee
        director will receive one share of CTS common stock for each restricted stock
        unit upon retirement from the Board. 

      


      In
        2002,
        the Board established a $30,000 annual stock-based compensation target for
        each
        non-employee director. For 2006, the stock-based compensation target was
        achieved by awarding each non-employee director 2,500 restricted stock units
        under the CTS Corporation 2004 Omnibus Long-term Incentive Plan. The awards
        were
        granted on December 7, 2005 and became distributable on January 10, 2006
        absent
        a deferral election by the non-employee director. Upon distribution, one
        share
        of CTS common stock for each restricted stock unit is transferred to the
        non-employee director. A prototype non-employee director restricted stock
        unit
        agreement has been previously filed with the Commission as an exhibit to
        CTS’
Annual Report on Form 10-K. 

      


      Named
        Executive Officer Compensation

      


      CTS
        has
        employment agreements with Donald K. Schwanz and Vinod M. Khilnani which
        have
        been previously filed with the Commission as exhibits to the corporation’s
        Annual Report on Form 10-K. CTS does not have written employment agreements
        with
        the other named executive officers. Annual Salary for the Chief Executive
        Officer is determined by the full Board of Directors based on the recommendation
        of the Compensation Committee. The annual salary for Donald K. Schwanz set
        on
        June 7, 2006 is $779,300. Annual salary for each other named executive officer
        is determined by the Compensation Committee. The annual salaries for each
        other
        named executive officers set June 7, 2006 were as follows: Vinod M. Khilnani
—
$364,000; Donald R. Schroeder — $322,200; H. Tyler Buchanan — $256,400; James L.
        Cummins — $247,900. 

      


      Each
        named executive officer participates in the CTS Corporation Management Incentive
        Plan which has been previously filed with the Commission as an exhibit to
        CTS’
Annual Report on Form 10-K. The plan provides cash bonuses determined by
        the
        Compensation Committee, based on achievement of annual performance goals
        established by the Committee. 

      


      The
        Compensation Committee has historically awarded stock-based compensation
        to
        named executive officers on an annual basis. On June 7, 2006, the Compensation
        Committee awarded each of the named executive officers incentive stock options
        under the CTS Corporation 2004 Omnibus Long-term Incentive Plan. Prototype
        incentive stock option agreements have been previously filed with the Commission
        as an exhibit to the corporation’s Annual Report on Form 10-K. In addition, each
        of the executive officers, other than Mr. Schwanz, was awarded Restricted
        Stock
        Units under the CTS Corporation 2004 Omnibus Long-Term Incentive Plan. A
        prototype Restricted Stock Unit Agreement is filed herewith.

      


      Mr.
        Schwanz receives a quarterly perquisite allowance of $4,300. Each other named
        executive officer receives a quarterly perquisite allowance of $4,000. Mr.
        Schroeder receives an additional $6,700 per month cost-of-living allowance
        related to his relocation to Southern California as a result of his appointment
        as President of CTS Electronics Manufacturing Solutions, a strategic business
        unit of the corporation, during his first thirty-six months in this position.
        

      


      Each
        named executive officer has executed a change-in-control severance agreement
        which provides severance benefits only upon a change-in-control of CTS.
        Prototype change-in-control severance agreements have been previously filed
        with
        the Commission as an exhibit to the corporation’s Annual Report on Form 10-K. On
        September 30, 2005, CTS issued a notice of non-renewal of these agreements.
        As a
        result, these agreements will expire on December 31, 2007.