CTS CORPORATION 2001 STOCK OPTION PLAN: EMPLOYEE STOCK OPTION AGREEMENT, AS AMENDED

THIS EMPLOYEE STOCK OPTION AGREEMENT (hereafter, “Agreement”) made this 1st day of October, 2001, (herein-after, "Option Date") by and between CTS Corporation, an Indiana corporation (hereinafter, "CTS"), and Donald K. Schwanz, an employee of CTS or a subsidiary or division of CTS (hereinafter, "Employee").

WHEREAS, CTS desires to create an additional incentive for the Employee to continue his or her services with CTS and to stimulate his or her interest in the growth and profitability of CTS, and

WHEREAS, CTS desires to increase the Employee's personal participation in the success of CTS through the acquisition of an equity interest in CTS;

Section 1: Option Grant

CTS hereby grants to the Employee the right and option to purchase all or any part of an aggregate of 100,000 shares of CTS Common Stock, without par value, on the terms and conditions set forth below (hereinafter the ྿Option࿀).

Section 2: Purchase Price

The purchase price per share for CTS Common Stock subject to this Option shall be $14.02, the reported closing price per share on the New York Stock Exchange on the date this Option is granted.

Section 3: Option Exercise Period

Except as provided in Section 6, this Option is not exercisable until one year after the Option Date. This Option is exercisable in installments as follows; on October 1, 2005, 33,333 shares (“Installment 1”); on December 31, 2005, 33,333 shares (“Installment 2”), on December 31, 2005, 33,334 shares (“Installment 3”). In the event that Employee exercises Installment 2 prior to October 1, 2006 or Installment 3 prior to October 1, 2007, unless an installment would have otherwise become exercisable pursuant to the occurrence of an event described in Section 6, Employee agrees that he shall not sell, contract to sell, grant any option to purchase, transfer the economic risk of ownership in, make any short sale of, pledge or otherwise transfer or dispose of any shares obtained upon exercise, until the shares have been released from the foregoing Resale Restrictions (hereinafter referred to as the “Resale Restrictions”). Shares obtained upon the exercise of Installment 2 shall be released from the Resale Restrictions on October 1, 2006 and shares obtained upon the exercise of Installment 3 shall be released on October 1, 2007. The Employee understands and agrees that CTS may cause the legend set forth below or a legend substantially equivalent thereto, to be placed upon any certificate(s) evidencing ownership of shares that are subject to Resale Restrictions:

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET FORTH IN THE OPTION AGREEMENT BETWEEN THE ISSUER AND THE HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.

Section 4: Payment

Payment for this Option must be made at the time of exercise and may be made in cash or in previously acquired CTS Common Stock, which has been held for at least six months, or a combination thereof. If payment is made in whole or part by previously acquired CTS Common Stock, then the value per share of such stock is the reported closing price per share of CTS Common Stock on the New York Stock Exchange on the date the Option is exercised or, if not reported on such date, the next preceding date for which such a closing price is reported. Payment may be made by surrender of shares or by attestation by submission of the prescribed Attestation Form. Subsequent to the use of previously owned shares of CTS Common Stock as consideration for the exercise of all or a part of this Option, the shares so utilized may not be used again in payment for the exercise of this Option or any other option for CTS stock for a period of one year.

Section 5: Nontransferability of Option

This Option may not be assigned or transferred by the Employee other than by will or by the laws of descent and distribu-tion, and is exercisable, during the Employee's lifetime, only by him or her. Any attempt by the Employee to assign or transfer this Option will be null, void and without effect.

Section 6: Separation from Employment or Change of Control

In the event of the termination of employment of the Employee with CTS due to Employee’s qualified retirement (as used herein, a qualified retirement means that Employee’s date of termination occurs after completing at least five years of service and attaining age 62), he may exercise the Option only to the extent permitted by the Option terms on the date of retirement, any time before the Option expires. All shares subject to this Option which are not exercisable as of the Employee’s date of termination will be canceled.

In the event of the termination of employment of the Employee with CTS for any reason other than qualified retirement, he may exercise the Option only to the extent permitted by the Option terms on the date of termination, and only within the three month period immediately following Employee’s date of termination. All shares subject to this Opti