Document:

srdx-ex1018_389.htm

Exhibit 10.18

Board Compensation Policy

Surmodics, Inc.

(Approved: April 26, 2016)

Directors of Surmodics, Inc. (the “Company”) that are not employed by the Company (“non-employee directors”) are entitled to the compensation set forth below for their service as a member of the Board of Directors (the “Board”) of the Company.  The Board reserves the right to amend this policy from time to time.

A.Cash Compensation.  Beginning in fiscal 2016, each non-employee director of the Company will be entitled to receive annual cash retainers as follows:

The cash retainers set forth above will become payable quarterly in arrears on the first trading day of each calendar quarter.  The annual cash retainer shall be reduced by 25% if a non-employee director does not attend at least 75% of the total meetings of the Board and Board committees on which such director served during the applicable fiscal year.  If, for any reason, a director does not serve an entire calendar quarter, the cash retainers will be pro-rated based on such director’s length of service during such calendar quarter.

B.Equity Compensation.  In addition to the cash compensation described above, each non-employee director will also receive the following equity grants:

1.Initial Grant:  Upon his or her initial election or appointment to the Board, each non-employee director will be awarded an equity grant having a value of $60,000, one-half of such award shall be in the form of a nonqualified stock option to purchase shares of the Company’s common stock (“Stock Options”) and the other half shall be in the form of restricted stock units (“RSUs”).

2.Annual Grant:  On the date of the Company’s annual meeting of shareholders during each fiscal year, each non-employee director will be awarded an equity grant having a value of $60,000, one-half of such award shall be in the form of Stock Options and the other half shall be in the form of RSUs.  The value of the first annual equity grant following a director’s initial election or appointment to the Board will be pro-rated based on such director’s length of service on the Board during the preceding 12-month period.

C.Stock in Lieu of Cash.  A non-employee director may elect, in a form and in a manner prescribed by the Company, to receive all or a portion of their cash retainers (“Deferred Retainers”) in the form of RSUs.  Such RSU award will be granted on the last trading day of the calendar quarter for which the applicable Deferred Retainers would have otherwise been paid, and the number of RSUs covered by such award will be determined using the fair market value of the Company’s common stock (i.e., the closing price) on such date.  Such RSUs will be fully vested as of the date of grant and will be paid in shares of the Company’s common stock on a one-for-one basis upon the termination of the director’s service on the Board (or, if earlier 

 

Surmodics, Inc.

Board Compensation Policy (continued)

Page 2 of 2

 

 

and as permitted under applicable tax law, upon the occurrence of a change in control event).  Any such election to receive an equity award in lieu of cash retainers must be made prior to the December 31 that precedes the calendar year during which the Deferred Retainers are earned by the non-employee director (or such earlier date as may be prescribed by the Company).  A newly appointed or elected non-employee director may make such an election to receive an equity award in lieu of cash retainers at any time within 30 days after the director’s initial election or appointment to the Board, and such election will be effective for the first quarter following the quarter in which the election is received by the Company.

D.Expense Reimbursement.  All non-employee directors will be entitled to reimbursement from the Company for their reasonable travel and other expenses incurred in connection with attending Board or committee meetings.

E.General Provisions.  All equity awards provided pursuant to this policy shall be granted under the Company’s 2009 Equity Incentive Plan or any successor plan designated by the Board (the “Plan”).  The terms below shall apply to all equity awards granted on or after February 17, 2014, and all such awards shall be evidenced by, and subject to the terms and conditions set forth in, a written agreement in substantially the form approved by the Board.

1.Stock Options.  The number of Stock Options granted will be determined using the Company’s Black-Scholes valuation methodology as of the date of grant.  Each Stock Option grant will (a) have a seven-year term, (b) vest ratably on a monthly basis and will become fully vested upon the earlier of (i) the 12-month anniversary of the grant date, or (ii) the date of the next year’s annual meeting, and (c) have an exercise price equal to the fair market value of the Company’s common stock on the date of grant.

2.Restricted Stock Units.  The number of RSUs granted will be determined using the fair market value of the Company’s common stock (i.e., the closing price) on the date of grant.  Each RSU grant will vest ratably on a monthly basis and will become fully vested on the first anniversary of the date of grant (except for RSUs granted in lieu of cash compensation which shall be fully vested as of the date of grant).

3.Dividend Equivalents.  To the extent the Company pays a dividend, each non-employee director shall have the right to receive dividend equivalents for each RSU held by such director on the record date for the payment of such dividend.  The dividend equivalents shall be treated as reinvested in an additional number of RSUs which will be determined by dividing (a) the cash amount of any such dividend that would have been paid if the RSUs held by the director were outstanding shares of Company stock by (b) the fair market value of the Company’s common stock (i.e., the closing price) on the applicable dividend payment date.

4.Stock Ownership Guidelines.  RSUs shall be considered owned, but only the extent vested, for purposes of the Company’s stock ownership guidelines applicable to non-employee directors.

5.Effect of Termination of Service.  In the event the director’s service on the Board terminates for any reason, (a) all outstanding and unvested Stock Options or RSUs shall expire and be canceled, (b) except as set forth below, all vested Stock Options shall remain exercisable for up to three months after the date of such termination of service, but not later than the date the option expires, and (c) all vested RSUs shall be settled in shares of the Company’s common stock on a one-for-one basis.  Notwithstanding the foregoing, in the event that the director’s service on the Board terminates as a result of a disability or death, the director’s guardian or legal representative may exercise the options not later than the earlier of the date the options expire or six months after the date that the director’s service ceases by reason of such disability or death.Exhibit 10.1

 

 

EXPATRIATE LOCALIZATION TO THE U.S.

MEMORANDUM

 

		TO:	Stephen Bird

		FROM:	Juan Manuel Cerda / Heather Cummo

		DATE:	December 2nd, 2016

		RE:	TRANSITION FROM EXPATRIATE STAFF TO LOCAL STAFF IN
THE U.S.

 

 

 

This memorandum describes the changes in
your employment status that will occur upon your localization under the general terms of the Citi Expatriate Program. Effective
January 1, 2017, your expatriate assignment under the Citi Expatriate Program will end and you will become a local employee in
the U.S., your current assignment country.

 

The changes that will be effective upon
your localization are as follows:

 

		·	You
will formally resign from Citibank, N.A. Hong Kong branch and your employment agreement dated January 1, 2009 will terminate,
effective December 31, 2016. Your Assignment Letter under Citi’s Expatriate Program will also terminate effective December
31, 2016. Your last day of employment as a Hong Kong employee is December 31, 2016 and your first day as a U.S. local employee
is January 1, 2017.

 

		·	You
will cease participation in all Hong Kong benefits (including the Hong Kong retirement plan) effective December 31, 2016. Upon
becoming a U.S. employee, you will become eligible for local U.S. benefits, including the U.S. Retirement Savings Plan.

 

		·	Your
service with Citi in prior locations, including but not limited to Hong Kong, will be recognized for certain U.S. benefit plan
purposes, including but not limited to retirement plan vesting and vacation eligibility.  However service recognition will
be based on the applicable plan rules, policies and practices in effect in the U.S. as they may be amended from time to time.

 

		·	Responsibility
for payment of your base salary and discretionary incentive compensation award will be transferred to the U.S. payroll effective
January 1, 2017.

 

RELOCATION

 

In accordance with the generally applicable
terms of the Citi Expatriate Program, you will receive relocation benefits upon localization and must be utilized before June 30th,
2017. Please refer to the “Conclusion of Expatriate Assignment” section of the Expatriate Handbook.

 

U.S. EMPLOYMENT AND BENEFITS

 

Effective January 1, 2017, you will become
an employee of Citibank, N.A. Your office will be located at 388 Greenwich Street, New York, New York.

 

Your Annual Base Salary Effective
January 1, 2017 shall be U.S. $500,000 payable in accordance with Citi’s U.S. regular payroll practices (currently
bi-weekly). You will continue to be eligible for a discretionary incentive compensation and retention award generally made on
an annual basis based upon a variety of factors, including your performance, the performance of the Global Consumer Banking
Business and the performance of Citi, pursuant to the applicable plans and 

 

    

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practices. In order to receive the award you will need to be actively employed at
the time of the receipt of the award or the award notification, as the case may be, which is generally in the year after the year
services are performed, but not later than March 15 of the following year.

 

Effective with your January 1, 2017 localization
to the U.S., you will be automatically enrolled in the Aetna Choice Plan 500 medical plan and the MetLife dental plan.  You
will have an option to elect coverage under one of the other generally available options under the U.S. medical plans within
31 days after your transfer onto the U.S. domestic payroll.  You will be eligible for other broad-based U.S. employee
benefits in accordance with the terms of the benefit plans.

 

DEFERRED COMPENSATION

 

Please note that you will be
subject to actual taxes (i.e., U.S. Federal, New York State, New York City, U.S. FICA and/or Hong Kong tax, if applicable) on your
deferred compensation. Taxation is based on the tax rules and your tax residency status in the year of vesting for equity awards;
the year of exercise for stock options; and the year of payment for performance share unit and deferred cash awards.

 

TAX EQUALIZATION BALANCES/TAX RETURN
FILINGS

 

Upon originally accepting your
expatriate assignment, you agreed in writing to meet your tax obligations. Under the generally applicable tax equalization
provisions of Citi’s Expatriate Program, (a) the portion of any award granted under the Discretionary Incentive and
Retention Award Plan for performance in 2016 that is delivered in cash in February 2017 will be subject to such generally
applicable tax equalization provisions, and (b) you may have a trailing tax obligation several months or even years after the
tax year or tax event in question. You will be responsible for working with Citi to resolve any outstanding tax-related
liabilities under our tax equalization policies as they arise.

 

ACKNOWLEDGEMENT AND AGREEMENT

 

I hereby resign from, and terminate my employment contract dated
January 1, 2009 with, Citibank N.A., Hong Kong branch effective December 31, 2016. I furthermore acknowledge that my assignment
under the Citi Expatriate Program described in my Assignment Letter dated June 17, 2015 will terminate effective December 31, 2016
and I will become a local employee in the U.S. on January 1, 2017. I understand the policy and benefit changes resulting from the
termination of my Assignment Letter and my localization and I am in agreement with these changes.

 

The terms and conditions of U.S. employment are further set
out in the U.S. Citi Employee Handbook.

 

Please review, execute and return a copy of this memorandum
to my attention.

 

 

	/s/ Stephen Bird	 	12/2/2016
	(Signature)	Stephen Bird	Date

 

		cc:	Terry Endsor - APAC SHRO/Hong Kong CHRO

Martin
Leese - Hong Kong Business HR

Juan
Manuel Cerda - US SHRO for Global Consumer Bank

Connie
Yeung - Hong Kong Mobility Coordinator

Heather
Cummo - US Mobility Coordinator

 

    
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