CTS CORP, DEF 14A filed on 3/29/2024
Proxy Statement (definitive)
v3.24.1
Cover
 12 Months Ended
Dec. 31, 2023
Document Information [Line Items]  
Document Type DEF 14A
Amendment Flag false
Entity Information [Line Items]  
Entity Registrant Name CTS CORPORATION
Entity Central Index Key 0000026058
v3.24.1
Pay vs Performance Disclosure - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Pay vs Performance Disclosure        
Pay vs Performance Disclosure, Table
Pay Versus Performance Disclosure
Pay Versus Performance
In accordance with SEC rules, we provide the following disclosure regarding executive compensation for our principal executive officer (“PEO”) and
Non-PEO
named executive officers (the “Other NEOs”) and certain Company performance for each of the fiscal years listed below. The Compensation and Talent Committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown.
 
Year
  
Summary
Compensation
Table Total for
PEO
1

($)
    
Compensation
Actually Paid
to PEO
1,2,3

($)
    
Average
Summary
Compensation
Table Total for
Non-PEO

NEOs
1

($)
    
Average
Compensation
Actually Paid
to
Non-PEO

NEOs
1,2,3

($)
    
Value of Initial Fixed
$100 Investment
based on:
4
    
Net
Income
($ Millions)
  
Adjusted Diluted
EPS
5

($)
 
Total
Shareholder
Return
(“TSR”)
($)
  
Peer
Group
TSR
($)
  
(a)
  
 
(b)
 
  
 
(c)
 
  
 
(d)
 
  
 
(e)
 
  
(f)
  
 
(g)
 
  
(h)
  
(i)
2023
  
 
3,199,406
 
  
 
3,252,016
 
  
 
780,611
 
  
 
545,509
 
  
148.63
  
 
151.67
 
  
60.5
  
2.22
2022
  
 
4,176,016
 
  
 
6,735,773
 
  
 
1,027,985
 
  
 
1,482,635
 
  
133.47
  
 
122.19
 
  
59.6
  
2.46
2021
  
 
3,944,440
 
  
 
5,734,073
 
  
 
1,108,408
 
  
 
1,440,330
 
  
123.80
  
 
148.92
 
  
(41.9)
  
1.93
2020
  
 
2,500,797
 
  
 
2,383,328
 
  
 
800,401
 
  
 
140,234
 
  
115.20
  
 
123.08
 
  
34.7
  
1.12
 
1.
Kieran O’Sullivan was our PEO for each year presented. The individuals comprising the Other NEOs for each year presented are listed below.
 
2020
   
2021
   
2022
   
2023
Ashish Agrawal
   
Ashish Agrawal
   
Ashish Agrawal
   
Ashish Agrawal
Luis Machado
   
Scott D’Angelo
   
Scott D’Angelo
   
Scott D’Angelo
 
   
 
   
Martin Baumeister
   
Martin Baumeister
 
   
 
   
Michael Murray
   
Michael Murray
 
2.
The amounts shown for “Compensation Actually Paid” have been calculated in accordance with Item 402(v) of Regulation
S-K
and may not necessarily reflect compensation actually earned, realized, or received by the Company’s PEO and the Other NEOs. These amounts instead reflect the Summary Compensation Table Total with certain adjustments as described in footnote 3 below.
 
3.
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Other NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the amounts from the Stock Awards column set forth in the Summary Compensation Table. Please note that, while similar adjustment information was provided in the Company’s 2023 proxy statement for 2020, 2021 and 2022, under applicable SEC guidance, repeating such adjustment information is not required in this Proxy Statement because it is not material to our stockholders’ understanding of the information reported in the Pay Versus Performance table above for 2023 or the relationship disclosures provided below.
 
Year
   
Summary Compensation
Table Total for Kieran
O’Sullivan
($)
   
Exclusion of Stock Awards
for Kieran O’Sullivan
($)
  
Inclusion of Equity Values
for Kieran O’Sullivan
($)
   
Compensation Actually
Paid to Kieran O’Sullivan 
($)
2023
   
3,199,406
   
(2,400,021)
  
2,452,631
   
3,252,016
 
 
 
Year
   
Average Summary
Compensation Table Total
for Other NEOs
($)
   
Average Exclusion of
Stock Awards
for Other NEOs
($)
  
Average Inclusion of Equity
Values for Other NEOs
($)
   
Average Compensation 
Actually Paid to 
Other NEOs 
($)
2023
   
780,611
   
(392,032)
  
156,930 
   
545,509
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables:
 
Year
  
Year-End
Fair
Value of Equity
Awards Granted
During Year That
Remained
Unvested as of
Last Day of Year
for Kieran O’Sullivan
($)
  
Change in Fair
Value from Last
Day of Prior Year to
Last Day of Year of
Unvested Equity
Awards Granted
Prior to Year for
Kieran O’Sullivan
($)
  
Change in Fair
Value from Last
Day of Prior Year to
Vesting Date of
Unvested Equity
Awards that Vested
During Year for
Kieran O’Sullivan
($)
  
Fair Value at Last
Day of Prior Year of
Equity Awards
Forfeited During
Year for Kieran
O’Sullivan
($)
  
Total - Inclusion of 

Equity Values for 
Kieran O’Sullivan 
($) 
2023
  
1,982,169
  
47,497
  
422,965
  
 — 
  
2,452,631
 
Year
   
Average
Year-End Fair

Value of
Equity
Awards
Granted
During Year
That
Remained
Unvested as
of Last Day
of Year for
Other
NEOs
($)
   
Average
Change in Fair
Value from
Last Day of
Prior Year to
Last Day of
Year of
Unvested
Equity Awards
Granted Prior
to Year for
Other NEOs
($)
   
Average
Change in
Fair Value
from Last Day
of Prior Year
to Vesting
Date of
Unvested
Equity
Awards that
Vested
During Year
for Other
NEOs
($)
   
Average Fair
Value at Last
Day of Prior
Year of Equity
Awards
Forfeited
During Year
for Other
NEOs
($)
  
Total - Average Inclusion of

 Equity Values for Other NEOs 
($)
2023
   
272,145
   
(2,572)
   
62,313
   
(174,956)
  
   156,930 
 
4.
The Peer Group TSR set forth in this table utilizes the Dow Jones Electrical Components & Equipment Industry Group (“DJUSEC”), which we also utilize in the stock performance graph required by Item 201(e) of Regulation
S-K
included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the DJUSEC, respectively. Historical stock performance is not necessarily indicative of future stock performance.
 
5.
We determined adjusted fully diluted net earnings per share (“Adjusted Diluted EPS”) to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO and Other NEOs in 2023. More information on Adjusted Diluted EPS can be found at page 29 of the Compensation Discussion and Analysis section and in the Appendix to this Proxy Statement. This performance measure may not have been the most important financial performance measure for prior years, and we may determine a different financial performance measure to be the most important financial performance measure in future years.
     
Company Selected Measure Name Adjusted Diluted EPS      
Named Executive Officers, Footnote
1.
Kieran O’Sullivan was our PEO for each year presented. The individuals comprising the Other NEOs for each year presented are listed below.
 
2020
   
2021
   
2022
   
2023
Ashish Agrawal
   
Ashish Agrawal
   
Ashish Agrawal
   
Ashish Agrawal
Luis Machado
   
Scott D’Angelo
   
Scott D’Angelo
   
Scott D’Angelo
 
   
 
   
Martin Baumeister
   
Martin Baumeister
 
   
 
   
Michael Murray
   
Michael Murray
      
Peer Group Issuers, Footnote The Peer Group TSR set forth in this table utilizes the Dow Jones Electrical Components & Equipment Industry Group (“DJUSEC”), which we also utilize in the stock performance graph required by Item 201(e) of Regulation
S-K
included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the DJUSEC, respectively. Historical stock performance is not necessarily indicative of future stock performance. 		     
PEO Total Compensation Amount $ 3,199,406 $ 4,176,016 $ 3,944,440 $ 2,500,797
PEO Actually Paid Compensation Amount $ 3,252,016 6,735,773 5,734,073 2,383,328
Adjustment To PEO Compensation, Footnote Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Other NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the amounts from the Stock Awards column set forth in the Summary Compensation Table. Please note that, while similar adjustment information was provided in the Company’s 2023 proxy statement for 2020, 2021 and 2022, under applicable SEC guidance, repeating such adjustment information is not required in this Proxy Statement because it is not material to our stockholders’ understanding of the information reported in the Pay Versus Performance table above for 2023 or the relationship disclosures provided below.
Year
   
Summary Compensation
Table Total for Kieran
O’Sullivan
($)
   
Exclusion of Stock Awards
for Kieran O’Sullivan
($)
  
Inclusion of Equity Values
for Kieran O’Sullivan
($)
   
Compensation Actually
Paid to Kieran O’Sullivan 
($)
2023
   
3,199,406
   
(2,400,021)
  
2,452,631
   
3,252,016
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables:
Year
  
Year-End
Fair
Value of Equity
Awards Granted
During Year That
Remained
Unvested as of
Last Day of Year
for Kieran O’Sullivan
($)
  
Change in Fair
Value from Last
Day of Prior Year to
Last Day of Year of
Unvested Equity
Awards Granted
Prior to Year for
Kieran O’Sullivan
($)
  
Change in Fair
Value from Last
Day of Prior Year to
Vesting Date of
Unvested Equity
Awards that Vested
During Year for
Kieran O’Sullivan
($)
  
Fair Value at Last
Day of Prior Year of
Equity Awards
Forfeited During
Year for Kieran
O’Sullivan
($)
  
Total - Inclusion of 

Equity Values for 
Kieran O’Sullivan 
($) 
2023
  
1,982,169
  
47,497
  
422,965
  
 — 
  
2,452,631
      
Non-PEO NEO Average Total Compensation Amount $ 780,611 1,027,985 1,108,408 800,401
Non-PEO NEO Average Compensation Actually Paid Amount $ 545,509 1,482,635 1,440,330 140,234
Adjustment to Non-PEO NEO Compensation Footnote Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Other NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the amounts from the Stock Awards column set forth in the Summary Compensation Table. Please note that, while similar adjustment information was provided in the Company’s 2023 proxy statement for 2020, 2021 and 2022, under applicable SEC guidance, repeating such adjustment information is not required in this Proxy Statement because it is not material to our stockholders’ understanding of the information reported in the Pay Versus Performance table above for 2023 or the relationship disclosures provided below.
Year
   
Average Summary
Compensation Table Total
for Other NEOs
($)
   
Average Exclusion of
Stock Awards
for Other NEOs
($)
  
Average Inclusion of Equity
Values for Other NEOs
($)
   
Average Compensation 
Actually Paid to 
Other NEOs 
($)
2023
   
780,611
   
(392,032)
  
156,930 
   
545,509
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables:
Year
   
Average
Year-End Fair

Value of
Equity
Awards
Granted
During Year
That
Remained
Unvested as
of Last Day
of Year for
Other
NEOs
($)
   
Average
Change in Fair
Value from
Last Day of
Prior Year to
Last Day of
Year of
Unvested
Equity Awards
Granted Prior
to Year for
Other NEOs
($)
   
Average
Change in
Fair Value
from Last Day
of Prior Year
to Vesting
Date of
Unvested
Equity
Awards that
Vested
During Year
for Other
NEOs
($)
   
Average Fair
Value at Last
Day of Prior
Year of Equity
Awards
Forfeited
During Year
for Other
NEOs
($)
  
Total - Average Inclusion of

 Equity Values for Other NEOs 
($)
2023
   
272,145
   
(2,572)
   
62,313
   
(174,956)
  
   156,930 
      
Compensation Actually Paid vs. Total Shareholder Return
Description of Relationship Between PEO and Average Other NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”), and Between Company TSR and Peer Group TSR
The following chart sets forth the relationship between (1) each of Compensation Actually Paid to our PEO and the average of Compensation Actually Paid to our Other NEOs for 2023, and (2) the Company’s cumulative TSR over the four most recently completed fiscal years, and also compares our cumulative TSR over the four most recently completed fiscal years to that of the Dow Jones Electrical Components & Equipment Industry Group over the same period.
 
 
LOGO
     
Compensation Actually Paid vs. Net Income
Description of Relationship Between PEO and Other NEO Compensation Actually Paid and Net Income
1
The following chart sets forth the relationship between (1) each of Compensation Actually Paid to our PEO and the average of Compensation Actually Paid to our Other NEOs, and (2) our GAAP Net Income during the four most recently completed fiscal years.
 
 
LOGO
     
Compensation Actually Paid vs. Company Selected Measure
Description of Relationship Between PEO and Other NEO Compensation Actually Paid and Adjusted Diluted EPS
The following chart sets forth the relationship between (1) each of Compensation Actually Paid to our PEO and the average of Compensation Actually Paid to our Other NEOs, and (2) our Adjusted Diluted EPS during the four most recently completed fiscal years.
 
 
LOGO
     
Total Shareholder Return Vs Peer Group
Description of Relationship Between PEO and Average Other NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”), and Between Company TSR and Peer Group TSR
The following chart sets forth the relationship between (1) each of Compensation Actually Paid to our PEO and the average of Compensation Actually Paid to our Other NEOs for 2023, and (2) the Company’s cumulative TSR over the four most recently completed fiscal years, and also compares our cumulative TSR over the four most recently completed fiscal years to that of the Dow Jones Electrical Components & Equipment Industry Group over the same period.
 
 
LOGO
     
Tabular List, Table
Tabular List of Most Important Financial Performance Measures
The following table presents the financial performance measures that the Company considers to have been the most important in linking Compensation Actually Paid to our PEO and Other NEOs for 2023 to Company performance. The measures in this table are not ranked.
 
 
Adjusted Diluted EPS
CTS Annual Sales
CTS Sales Growth
Operating Cash Flow
Adjusted Operating Earnings
Relative Total Shareholder Return
Controllable Working Capital as a Percentage of Annual Sales
      
Total Shareholder Return Amount $ 148.63 133.47 123.8 115.2
Peer Group Total Shareholder Return Amount 151.67 122.19 148.92 123.08
Net Income (Loss) $ 60,500,000 $ 59,600,000 $ (41,900,000) $ 34,700,000
Company Selected Measure Amount 2.22 2.46 1.93 1.12
PEO Name Kieran O’Sullivan      
Measure:: 1        
Pay vs Performance Disclosure        
Name Adjusted Diluted EPS      
Measure:: 2        
Pay vs Performance Disclosure        
Name CTS Annual Sales      
Measure:: 3        
Pay vs Performance Disclosure        
Name CTS Sales Growth      
Measure:: 4        
Pay vs Performance Disclosure        
Name Operating Cash Flow      
Measure:: 5        
Pay vs Performance Disclosure        
Name Adjusted Operating Earnings      
Measure:: 6        
Pay vs Performance Disclosure        
Name Relative Total Shareholder Return      
Measure:: 7        
Pay vs Performance Disclosure        
Name Controllable Working Capital as a Percentage of Annual Sales      
PEO | Exclusion Of Stock Awards [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount $ (2,400,021)      
PEO | Inclusion Of Equity Values [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 2,452,631      
PEO | YearEnd Fairvalue Of Equity Awards Granted During Year That Remained Unvested As Of Last Day Of Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 1,982,169      
PEO | Change In Fair Value From Last Day Of Prior Year To Last Day Of Year Of Unvested Equity Awards Granted Prior To Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 47,497      
PEO | Change In Fair Value From Last Day Of Prior Year To Vesting Date Of Unvested Equity Awards That Vested During Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 422,965      
PEO | Total Inclusion of Equity Values [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 2,452,631      
Non-PEO NEO | Exclusion Of Stock Awards [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount (392,032)      
Non-PEO NEO | Inclusion Of Equity Values [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 156,930      
Non-PEO NEO | YearEnd Fairvalue Of Equity Awards Granted During Year That Remained Unvested As Of Last Day Of Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 272,145      
Non-PEO NEO | Change In Fair Value From Last Day Of Prior Year To Last Day Of Year Of Unvested Equity Awards Granted Prior To Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount (2,572)      
Non-PEO NEO | Change In Fair Value From Last Day Of Prior Year To Vesting Date Of Unvested Equity Awards That Vested During Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount 62,313      
Non-PEO NEO | Fair Value At Last Day Of Prior Year Of Equity Awards Forfeited During Year [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount (174,956)      
Non-PEO NEO | Total Inclusion of Equity Values [Member]        
Pay vs Performance Disclosure        
Adjustment to Compensation, Amount $ 156,930