Document:

Exhibit

SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
SECOND AMENDMENT dated as of November 19, 2015 (this “Amendment”), to CREDIT AGREEMENT among KNOWLES CORPORATION (the “Company”), the Lenders party hereto and JPMORGAN CHASE BANK, N.A., as the Administrative Agent.
WITNESSETH:
WHEREAS, the Company, the Luxembourg Borrower, the Lenders and the Administrative Agent previously entered into that certain Credit Agreement dated as of January 27, 2014, as amended and restated as of December 31, 2014 (as amended by the First Amendment, dated as of April 17, 2015, the “Credit Agreement”; capitalized terms used and not otherwise defined herein have the same meanings as set forth in the Credit Agreement);
WHEREAS, the Company has requested that the Lenders agree to amend the definition of “Change in Control” in the Credit Agreement; and
WHEREAS, the Company, the Administrative Agent and the Lenders party hereto, constituting the Required Lenders, have so agreed on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.Amendment to Definition of “Change in Control”.  The definition of “Change in Control,” as set forth in Section 1.01, is hereby amended and restated in its entirety to read as follows:
“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Exchange Act and the rules of the SEC thereunder), excluding any employee benefit plan of the Company or its Subsidiaries, and any person acting as a trustee, agent or other fiduciary or administrator of any such plan, of Equity Interests in the Company representing more than 35% of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in the Company; or (b) persons who were (i) directors of the Company on the Effective Date, (ii) nominated, appointed or approved for consideration for election by the board of directors of the Company or (iii) appointed or elected by directors who were directors of the Company on the Effective Date or were nominated, appointed or approved as provided in clause (ii) above, ceasing to occupy a majority of the seats (excluding vacant seats) on the board of directors of the Company.”
2.Effectiveness.  This Amendment shall become effective upon satisfaction of the following conditions precedent:
(a)The representations and warranties of each Loan Party set forth in the Loan Documents shall be true and correct in all material respects, in each case on and as of the date hereof as if made on and as of such date, except in the case of any such representation and warranty that expressly relates to a prior date, in which case such representation and warranty shall be true and correct in all material respects as of the prior date;

(b)As of the date hereof and immediately after giving effect to this Amendment no Default shall have occurred and be continuing; and
(c)The Administrative Agent shall have received either (i) counterparts of this Amendment that, when taken together, bear the signatures of (A) the Company, (B) the Required Lenders, and (C) the Administrative Agent or (ii) written evidence satisfactory to the Administrative Agent (which may include facsimile or other electronic transmission of a signed counterpart of this Amendment) that each such party has signed a counterpart of this Amendment.
3.Counterparts; Effectiveness; Entirety.
(a)    This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  The delivery of an executed counterpart of a signature page of this Amendment by facsimile or other electronic imaging shall be effective as delivery of a manually executed counterpart of this Amendment.
(b)    Except as expressly set forth herein, all of the terms and provisions of the Credit Agreement are and shall remain in full force and effect.  The amendments contained herein shall not constitute a waiver, amendment or modification of any other provision of the Credit Agreement or for any other purpose except as expressly set forth herein.
(c)    This Amendment, the Credit Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.
4.Severability.  Any provision of this Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality or enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
5.Governing Law; Miscellaneous.
(a)    THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
(b)    This Amendment shall be deemed to be a Loan Document.
(c)    The captions and headings of this Amendment are for convenience of reference only and shall not affect the interpretation of this Amendment.

[Signature Pages Follow]

IN WITNESS WHEREOF, the parties hereto have caused this amendment to be duly executed by their respective authorized officers as of the day and year first above written.
KNOWLES CORPORATION
    by
_________________________
Name: John Anderson  
Title: Senior Vice President and 
Chief Financial Officer

JPMORGAN CHASE BANK N.A.,  
individually and as Administrative Agent
    by
_________________________    
Name:    
Title:

SIGNATURE PAGE TO SECOND AMENDMENT 
TO KNOWLES CORPORATION CREDIT AGREEMENT 

Name of Lender:____________________________________
	
		
	by

	 
	 

	 
	Name:

	 
	Title:

For any Lender requiring a second signature line:
	
		
	by

	 
	 

	 
	Name:

	 
	Title:Exhibit

FIRST AMENDMENT TO THE
KNOWLES CORPORATION
SENIOR EXECUTIVE CHANGE-IN-CONTROL SEVERANCE PLAN

WHEREAS, Knowles Corporation (the “Company”) maintains the Knowles Corporation Senior Executive Change-in-Control Severance Plan (the “Plan”); and
WHEREAS, the Company wishes to amend the Plan’s eligibility provisions so that those executives who report directly to the Company’s Chief Executive Officer are eligible to participate in the Plan.
NOW, THEREFORE, by virtue and in exercise of the amending authority reserved to the Compensation Committee of the Board of Directors of the Company under Article 11 of the Plan, the Plan is hereby amended, effective as of May 5, 2015, as follows:
		
	1.
	Article 1.a. of the Plan is hereby amended in its entirety to read as follows:

		
	a.
	Eligible Executives.  Those executives who are eligible to participate in the Plan and to receive Severance Payments thereunder are (i) the Chief Executive Officer and the Chief Financial Officer of Knowles, Business Unit Presidents, those executives who report directly to the Chief Executive Officer of Knowles, and those Vice Presidents of Knowles who are designated as eligible by the Chief Executive Officer of Knowles from time to time; provided, however, that such executives (A) are employed in the United States or are a U.S.-based employee temporarily assigned to the non-U.S. payroll of a Subsidiary on an expatriate assignment, and (B) remain in such a position on the date of a “Change of Control” (as defined in Article 14) (such executives who meet the above eligibility requirements, the “Eligible Executives”).Exhibit

FIRST AMENDMENT TO THE
KNOWLES CORPORATION
2014 EQUITY AND CASH INCENTIVE PLAN

WHEREAS, Knowles Corporation (the “Company”) maintains the Knowles Corporation 2014 Equity and Cash Incentive Plan (the “Plan”); and
WHEREAS, the Company wishes to amend the Plan to (i) clarify that non-employee directors of the Company are eligible for accelerated vesting of equity awards upon a qualifying cessation of service following a change of control; and (ii) establish a twelve (12) month exercise period for stock options and stock appreciation rights upon a participant’s qualifying termination of employment or service following a change of control.
NOW, THEREFORE, the Compensation Committee hereby recommends to the Board of Directors of the Company the Plan be amended, effective of as May 5, 2015, as follows:
		
	1.
	Paragraph 11 of the Plan is hereby amended in its entirety to read as follows:

“11.  Voluntary or Involuntary Termination. Except as otherwise provided in Paragraph 37, if a Participant’s employment with the Corporation is voluntarily or involuntarily terminated for any reason, other than for reasons or in circumstances specified in Paragraph 10 above or for Cause, the Participant shall have the right at any time on or before the earlier of the expiration date of the Option or SSAR or three (3) months following the effective date of such termination of employment, to exercise, and acquire shares under, any Options or SSARs which at such termination are exercisable.”
		
	2.
	Paragraph 37(a) of the Plan is hereby amended in its entirety to read as follows:

“(a) In the event a Change of Control occurs and, within eighteen (18) months following the date of the Change of Control, (i) a Participant experiences an involuntary termination of employment (other than for Cause, death or Disability) such that he or she is no longer in the employ of the Corporation or an Affiliate, (ii) an event or condition that constitutes “Good Reason” occurs and the Participant subsequently resigns for Good Reason within the time limits set forth in Paragraph 37(h)(iv) below pursuant to a resignation that meets the requirements set forth in Paragraph 37(h)(iv) below, or (iii) a Participant who is a Non-Employee Director ceases to serve on the Board or the board of directors of any successor corporation (each of the events described in (i), (ii) and (iii), a “Termination of Service”):        
(i) all Options and SSARs to purchase or acquire shares of Common Stock of the Corporation shall immediately vest and become exercisable on the date of such Termination of Service and shall remain exercisable in accordance with the terms of the appropriate Option or SSAR Award Agreement until the earlier of (A) twelve (12) months after such Termination of Service or (B) the expiration of the term of such Option or SSAR;
(ii) all outstanding Restrictions, including any Performance Targets, with respect to any Restricted Stock or Restricted Stock Unit Award or any other Award shall immediately vest or expire on the date of such Termination of Service and be deemed to have been satisfied or earned “at target” as if the Performance Targets (if any) have been achieved, and such Award shall become immediately due and payable on the date of such Termination of Service; and

(iii) all Cash Performance Awards and Performance Share Awards outstanding shall be deemed to have been earned at “target” as if the Performance Targets have been achieved, and such Awards shall immediately vest and become immediately due and payable on the date of such Termination of Service.”
		
	3.
	All references to “Change in Control” throughout the Plan are hereby amended to read “Change of Control”.

WHEREAS, Knowles Corporation (the “Company”) maintains the Knowles Corporation 2014 Equity and Cash Incentive Plan (the “Plan”); and
WHEREAS, the Company wishes to amend the Plan to allow for non-employee directors of the Company to receive annual equity-based compensation awards in a form other than fully vested shares of common stock of the Company and to provide for such awards to be granted at the time of the Company’s annual meeting, rather than on November 15th of each year. 
NOW, THEREFORE, the Compensation Committee hereby recommends to the Board of Directors of the Company the Plan be amended, effective of as May 5, 2015, as follows:
		
	4.
	The Plan is hereby amended by deleting the definition of “Directors’ Shares” in Section 2 of the Plan and inserting the following definition in its place, and further by deleting each reference in the Plan to “Directors’ Shares” and inserting a reference to “Directors’ Awards” in its place:

“’Directors’ Awards’” shall mean the annual Awards granted to eligible Non-Employee Directors as provided in Paragraph 34.”
		
	5.
	Paragraph 5(a) of the Plan is hereby amended by deleting the reference to “Directors’ Shares” in the first sentence thereof.

		
	6.
	Paragraph 14 of the Plan is hereby amended by deleting the first sentence thereof, and by inserting the following sentence in its place:

“At the time of each grant, the Committee may adopt such time based vesting schedules and other forfeiture conditions and Restrictions as it may deem appropriate with respect to Awards of Restricted Stock and Restricted Stock Units, to apply during a Restricted Period as may be specified by the Committee; provided that with respect to Awards other than Directors’ Awards such Restricted Period shall be not less than one (1) year nor more than five (5) years from the date of the Award.”
		
	7.
	Paragraph 34 of the Plan is hereby amended to read as follows:

“34.  Directors’ Awards.  As of or as soon as administratively practicable following the date of each annual meeting of the Company’s stockholders, each Director who is a Non-Employee Director immediately following the date of such annual meeting shall be granted an Award in the form of shares of Common Stock, Options, SSARs, Restricted Stock, Restricted Stock Units and/or Deferred Stock Units, in such amount and subject to such terms and conditions as shall be determined by the Board for such year.”

		
	8.
	Paragraph 35 of the Plan is hereby amended by deleting the first sentence thereof, and inserting the following sentence in its place:

“A Non-Employee Director may elect to defer receipt of his or her Directors’ Awards, other than Options and SSARs, in accordance with such procedures as may from time to time be prescribed by the Committee.”
		
	9.
	Paragraph 36 of the Plan is hereby amended by deleting the last three sentences thereof.

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