Exhibit 10.bb


    CTS
      Corporation

    Form
      10-K 2005

    
      

      

    

    EXHIBIT
      (10)(bb)

     

     

    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 for 2005 are as follows: annual board retainer — $25,000; annual retainer
      for each Audit Committee member — $5,000; annual retainer for each Compensation
      Committee member — $4,000: 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 — $4,000; 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 is filed herewith. 

    


    Named
      Executive Officer Compensation

    


    CTS
      has
      an employment agreement with Donald K. Schwanz which has been previously filed
      with the Commission as an exhibit to the corporation’s Annual Report on Form
      10-K and an employment agreement with Vinod M. Khilnani which has been
      previously filed as an exhibit to the corporation’s Quarterly Report on Form
      10-Q for the quarter ended October 2, 2005. CTS does not have written employment
      agreements with the other named executive officers. Annual salary for each
      named
      executive officer is determined by the Compensation Committee of the Board
      of
      Directors. The annual salaries for named executive officers set in 2005 were
      as
      follows: Donald K. Schwanz — $749,280; Vinod M. Khilnani — $350,000; Donald R.
      Schroeder — $309,800; James L. Cummins — $238,300; Richard G. Cutter — $233,700.


    


    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. In 2005, the Compensation Committee
      awarded the named executive officers restricted stock units and incentive stock
      options under the CTS Corporation 2005 Omnibus Long-term Incentive Plan.
      Restricted stock unit agreements are filed herewith. 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.

    


    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.