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                                                                   EXHIBIT 10.14


                            KNOWLES ELECTRONICS, INC.
                            MANAGEMENT INCENTIVE PLAN
                                FOR CALENDAR 1999

      This document describes the Management Incentive Plan (the "Plan")
designed for key management positions in all business units of Knowles
Electronics, Inc. (the "Company") as it applies for the period from January 1,
1999 through December 31, 1999 ("the Plan Year").

Plan Description

      Corporate and Strategic Business Unit ("SBU") goals have been established
for the Plan Year. Threshold, target and maximum performance levels have also
been determined for Corporate and the Strategic Business Units. Corporate and
SBU performance measures have been weighted to reflect the degree of control by
the participant and the amount of emphasis that the Company places on the two
performance areas for the participant.

      At the end of the Plan Year, actual results will be determined and
incentive awards distributed based upon Corporate and SBU results, compared to
the predetermined goals.

Administration

      Administrative issues having material impact on the Company's operations
or its personnel policies are to be referred to the Compensation Committee of
the Board of Directors for determination. The Board of Directors continues to
have final authority for the Plan's provisions.
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Eligibility

      The Plan includes key executives and managers whose positions have a
direct impact on overall operating results. In order to be eligible,
participants must be in positions that are exempt from overtime and have
significant supervisory (managerial) responsibility. In addition, these
positions must create strategic value for the Company.

      Participation for the Plan Year is determined on the basis of documented
participant performance as determined by the Company's Performance Appraisal
System. Current participants are eligible to participate for the Plan Year if
their performance appraisal rating for the twelve-month period ending December
31, 1998 is at or above the "Meets Expectations" level. However, a participant
who fails to achieve a performance appraisal rating of "Exceeds Expectations" or
above for the Plan Year will not be eligible to receive a payout for the Plan
Year.

      An employee who is promoted, assigned, or transferred prior to the
mid-year date of the Plan Year (June 30, 1999) into a position that is eligible
to participate in the Plan will participate in the Plan upon approval by the CEO
and subject to the provisions hereof. Employees holding new positions
established during the course of the Plan Year may become Plan participants in
the same manner. If the initial participation date is on or before June 30,
1999, the incentive award will be prorated based upon the number of full months
the employee is a participant during the Plan Year. If the initial participation
date is after June 30, 1999, the employee will not be eligible to participate.


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      New employees joining the Company during the Plan Year will be considered
for participation by the CEO. Upon the approval by the CEO, the employee will
enter the Plan as of the date determined by the CEO.

Target Incentive Award

      The Plan provides incentive awards that are meaningful and consistent with
competitive award levels and the participant's responsibility level with the
Company. The participants are assigned to responsibility tiers. A targeted
incentive, expressed as a percentage of base salary, is established for each
tier, as shown below.

<TABLE>
<CAPTION>
              Responsibility                  Targeted Incentive As a
                  Tier                        Percent of Base Salary
              --------------                  -----------------------
                  <S>                                  <C>
                  I                                    40%
                  II                                   30%
                  IIA/IIB                              25%
                  III                                  20%
                  IV                                   15%
                  V                                    10%
</TABLE>

      A targeted incentive award is determined by multiplying participant's base
salary by her/his respective targeted incentive percentage. The resulting
targeted incentive award represents the amount that will be generated if the
Company and SBU meet their performance goals.


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Performance Criteria

      Targeted goals have been established for two areas of performance:

                              Corporate Performance

                       Strategic Business Unit Performance

      These two areas of performance will be weighted to reflect degree of
control over and desired emphasis on the performance criteria.

      The Corporate and SBU performance goals are based on Operating Income in
terms of dollars and as a percentage of Sales. The actual incentive award level
is related to actual financial performance results as shown in Exhibit A.

      Each participant's performance is assessed and incentive awards are
distributed consistent with evaluated performance results documented in the
participant's Performance Appraisal. Notwithstanding any other provision hereof,
any participant who fails to achieve the minimum performance appraisal rating as
specified under "Eligibility" above will not be entitled to any incentive award
for the Plan Year. If a participant's performance as of June 30, 1999 is
considered to be sufficiently below expected performance standards as to
indicate serious doubt whether she/he will be entitled to any incentive award
for the Plan Year, such participant will be so advised by written notice prior
to July 31. Upon receipt of such written notice, the participant shall be
entitled, if she/he so requests in writing, to a meeting with the CEO and, at
the participant's option, the Vice President of Human Resources and/or the
participant's supervisor.

      The determination that a participant's performance fails to meet the
performance standards as determined by the Performance Appraisal System shall be
made on or about the end of the Plan


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Year by the CEO, after consultation with, and with the recommendation of, the
participant's supervisor and when requested by the CEO, the cognizant Vice
President. The determination of the CEO shall be final, subject only to the
participant's right upon prompt written notice to the CEO, to have an adverse
determination reconsidered and then confirmed or reversed by the CEO, and in
that connection to have a meeting with the CEO and, at the participant's option,
the Vice President of Human Resources and/or the participant's supervisor.

Form and Timing of Payment

      All earned incentive awards (if any) will be paid out in cash as soon as
practical after the Company's results for the Plan Year have been certified by
the Company's independent public accounting firm.

Participation and Termination

      Participation in the Plan does not give an individual the right to
continued employment with the Company, and participation is limited to those
employees who are employed by the company on December 31, 1999, except as
provided below. In the case of separation, other than as a result of retirement,
death, permanent disability or involuntary termination due to work force
reduction, before the end of the Plan Year, an employee has no right to any
incentive award opportunity for the Plan Year.

      In the case of separation as the result of retirement, death, permanent
disability or involuntary termination due to work force reduction, an amount
equal to the prorata share of the incentive award, if any, which would otherwise
have been paid to the employee if the employee had been employed by the company
at year end, based on the number of full months of actual


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employment during the Plan Year, will be paid to the former employee at the same
time in the following year when payments are made to continuing employees.

Accounting Treatment

      The cost of the Plan is charged to Plan Year earnings and the liability is
accrued monthly and adjusted at year-end based on the actual earned incentive
awards.

Tax Treatment

      The incentive awards are taxed as personal service income to the
participants in the year received. The Company is entitled to a deduction for
the awards as compensation expense.

Other Incentive Arrangements

      During the course of the Plan Year, participation in the Plan by certain
participants may be supplemented, modified or superseded by special incentive
arrangements that are deemed to be more appropriate than the Plan.

Effective Date: January 1, 1999


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