Knowles Corp 8-K

What Happened

• Knowles Corporation (KN) filed an 8-K (Item 5.02) on Feb 20, 2026 disclosing that on Feb 17, 2026 its Compensation Committee granted a special equity award of performance share units (PSUs) to COO Daniel J. Giesecke.
• The award target is 18,423 PSUs (grant-date fair value $500,000) with a two-year performance period from Jan 1, 2026 through Dec 31, 2027. PSUs vest based on revenue and adjusted EBIT targets for the company’s Cornell Dubilier (CD) business unit.

Key Details

• Target PSUs: 18,423; grant-date fair value: $500,000.
• Performance period: Jan 1, 2026 – Dec 31, 2027 (2 years); performance measured annually.
• Metric allocation: Year 1 revenue 25%, Year 1 adjusted EBIT 25%, Year 2 revenue 25%, Year 2 adjusted EBIT 25%.
• Payout range: 0%–140% of target per metric (threshold 60% at 90% of target; target 100% at 100%; max 140% at 110%); maximum possible ≈ 25,792 shares (140% of target).
• Vesting/forfeiture: No PSU vests until final certification after the Performance Period and Mr. Giesecke must remain employed through the period. Special Change of Control and termination timing provisions apply as described in the award agreement (Exhibit 10.1).

Why It Matters

• This award links executive pay to specific revenue and adjusted-EBIT performance for the Cornell Dubilier unit, showing management incentives tied to unit-level results.
• The grant represents a potential equity dilution only if performance targets are met and PSUs convert to shares; accounting grant value is $500K but actual share issuance depends on performance (0%–140%).
• Investors should note ongoing compensation decisions because they affect incentive alignment, potential future share count, and reported compensation expense; the full terms are in the attached PSU agreement (Exhibit 10.1).