Exhibit
10.18


EMPLOYMENT
AGREEMENT


WITH BRIAN D.
LANGSTRAAT


September 10, 2003


 


The parties to
this Employment Agreement (this "Agreement") are Parametric Portfolio
Associates LLC, a Delaware limited liability company (the "Company"),
and Brian D. Langstraat (the "Employee"). The Company desires to ensure
itself of the services of the Employee and the Employee desires to accept such
employment on the terms and conditions set forth in this Agreement.


 


Accordingly, the parties, intending to be
legally bound, agree as follows:


 


1.         Employment and Term. The Company offers to employ the
Employee as Chief Executive Officer of the Company, and the Employee accepts
that employment with the Company, for the Term set forth below. The term of the
Employee's employment under this Agreement (the "Term") shall
commence as of the date of this Agreement and end on the fifth anniversary of
that date, subject to extension of the Term as set forth in the immediately
following sentence or earlier expiration of the Term as provided in Section 7.
Unless either the Company or the Employee provides notice to the other of
non-renewal not later than 30 days prior to the scheduled expiration of the
Term as then in effect, the Term shall be extended for an additional period of
one year, and the preceding clause of this sentence shall again apply with
respect to each subsequent extension of the Term. Employee may, at the
Company's request but without increase in the duties provided for below or in
consideration, enter into concurrent employment with a designated subsidiary of
Eaton Vance Corp.


 


2.         Duties.  The Employee shall perform such duties
consistent with the Employee's position as may be reasonably assigned from time
to time by the Company. The Employee shall perform his or her duties at the
Company's offices in Seattle, Washington, reasonable periods of travel for
business purposes excepted. The Employee shall devote his or her best efforts
to promote the Company's interests, and he or she shall perform his or her
duties and responsibilities faithfully, diligently and to the best of his or
her ability, consistent with sound business practices. The Employee shall
devote his or her full working time to the business and affairs of the Company.
Nothing in this Agreement shall preclude the Employee from devoting reasonable
periods required for engaging in charitable and community activities and
managing his or her personal investments; provided, that such activities do
not, in the good faith determination of the Company, interfere in any material
respect with the regular performance of his or her duties and responsibilities
under this Agreement.


 


3.         Base Salary. During the Term, the Company shall pay
the Employee a base salary (the "Base Salary") at an annual rate not
less than $357,434.38. The Employee shall not be entitled to any additional
salary or compensation in the event the Employee is assigned any additional
titles, offices, duties or responsibilities with the Company or any affiliate
of the Company. The Base Salary shall be payable in accordance with the
Company's regular payroll practices (but no less frequently than monthly).


 


4.         Incentive
Compensation. During the Term, the Employee shall be entitled to receive
incentive compensation (a "Bonus") in such amounts and times as the
Company may 



determine in its discretion to award to the
Employee under any incentive compensation or other bonus plan or plans for
employees of the Company as may be established by the Company, or by EVA or any
affiliate of EVA, from time to time.


 


5.         Employee Benefits and Expense Reimbursement. During
the Term, the Employee shall be entitled to participate in and receive benefits
as a senior executive under and subject to the terms and conditions of all of
the employee benefit plans, programs and arrangements of the Company, as they
may be duly amended, approved or adopted by the Company from time to time,
including any retirement plan, profit sharing plan, savings plan, life
insurance plan, health insurance plan, accident or disability insurance plan
and any vacation policy. During the Term, the Employee shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred by the
Employee in performing services under this Agreement, provided that such
expenses are properly accounted for and are in accordance with the policies and
practices for employees in effect from time to time as established by the
Company.


 


6.         Applicability of Restrictive Covenants to Employment.
As of the date of this Agreement, the Company and the Employee have entered
into that certain Restrictive Covenant Agreement (the "Restrictive
Covenant Agreement"), pursuant to which the Employee has made certain
representations and covenants protecting the Company's interests in its
inventions, confidential information, goodwill and other business assets. The
Employee acknowledges and understands that part of the consideration for the
Company entering into and becoming bound by this Employment Agreement are the
Employee's covenants set forth in the Restrictive Covenant Agreement, which are
incorporated herein by reference.


 


7.         Termination of Employment. 


 


(a)        Death or Disability. The employment of the Employee
under this Agreement shall terminate upon the death or disability of the
Employee. The Employee shall be deemed to be disabled if the Employee is, by
reason of a physical, mental or emotional disease, impairment or condition,
continuously absent from work for a period of six (6) consecutive months;
provided, however, that the Employee shall not be deemed disabled if, within
thirty (30) days after the Company gives notice to the Employee that it intends
to replace the Employee due to disability, the Employee shall have returned to
the performance of the Employee's duties on essentially a full-time basis. Any
determination as to whether the Employee is disabled shall be made by the
Company in good faith; provided, however, that if the Employee disputes the
disability determination, the dispute shall be resolved by a licensed physician
selected by the Company and approved by the Employee, or, if the Company and
the Employee do not agree on a licensed physician, then the dispute shall be
resolved by a panel of three licensed physicians, one chosen by the Company,
one chosen by the Employee and one chosen by the other two licensed physicians.
At any time and from time to time, upon reasonable request therefor by the
Company, the Employee shall submit to reasonable medical examination for the
purpose of determining the existence, nature and extent of any such disability.


 


(b)        Termination by the Company. The Company may terminate
the Employee's employment under this Agreement with or without Cause (as
defined below) at any time during the Term by giving written notice to the
Employee of such termination. Upon any 



termination of
the Employee's employment under this Section 7(b), the Company's sole
compensation obligation, if any, shall be as provided under Section 8(a) (if
the termination is with Cause) or Section 8(b) (if the termination is without
Cause). For purposes of this Agreement, the Company shall have
"Cause" to terminate the Employee's employment under this Agreement
if (i) the Employee fails substantially to perform and to discharge his or her
duties and responsibilities for any reason other than the Employee's
disability, unless, within thirty (30) days after the Employee receives a
written notice from the Company describing the failure, the Employee cures or
commences a good faith effort to cure the failure (as determined in good faith
by the Company), (ii) the Employee engages in an action or course of conduct
that (A) relates to the Company or its subsidiaries and constitutes fraud,
embezzlement or theft or (B) constitutes a felony and, in the reasonable
determination of the Company, is injurious to the Company or (C) is grossly
negligent, (iii) any sanction, suspension or censure of the Employee by any
federal, state or local governmental, regulatory or administrative body having
jurisdiction over the Company or its business, unless in the sole judgment of
the Company such sanction, suspension or censure does not materially adversely
affect the Employee's performance of his duties nor the business or reputation
of the Company or any of its Affiliates and the Employee cures or takes prompt
action to cure the failure (as determined in good faith by the Company) (iv)
the failure of the Employee to maintain any licenses or registrations required
for Employee to perform the functions of Employee's position, unless in the
sole judgment of the Company such failure does not materially adversely affect
the Employee's performance of his duties nor the business or reputation of the
Company or any of its Affiliates and the Employee cures or takes prompt action
to cure the failure (as determined in good faith by the Company) or (v) the
Employee deliberately and intentionally violates any terms of the covenants
described in Section 6.


 


(C)       Termination by the Employee. The Employee may
terminate his or her employment under this Agreement with or without "Good
Reason" (as defined below) at any time during the Term by giving at least
thirty (30) days prior written notice to the Company. Upon any termination of
the Employee's employment under this Section 7(c), the Company's sole
compensation obligation, if any, shall be as provided under Section 8(a) (if
the termination is without Good Reason) or Section 8(b) (if the termination is
with Good Reason). For purposes of this Agreement, the Employee shall have
"Good Reason" to terminate the Employee's employment under this
Agreement if, without the Employee's written consent, (i) the Employee's Base
Salary is reduced, (ii) the Employee's primary place of employment is relocated
outside of the greater Seattle, Washington metropolitan area, or (iii) a
material reduction in the Employee's responsibilities or status, other than an
act that is remedied by the Company promptly after receipt of notice given by
the Employee.


 


8.         Compensation Upon Termination.


 


(a)        By the Company for Cause or by the Employee without Good
Reason.  If the Employee's employment under this Agreement is terminated prior
to the scheduled  expiration of the Term by the Company for Cause or by the
Employee without Good Reason, then the Employee shall be entitled to receive
the following benefits ( collectively, the "Pre­Termination Benefits"):
(i) the amount of his or her Accrued Obligations (as defined below), 


 


 





such amount to be paid in a single lump sum cash payment within 30 days
of the date of termination, and (ii) any payments which the Employee, his or
her spouse, beneficiaries or estate may be entitled to receive pursuant to any
employee benefits plan or program of the Company. As used in this Agreement,
"Accrued Obligations" means, as of the date of termination, (A) any
accrued but unpaid Base Salary and Bonus, and (B) any accrued and unpaid
expense reimbursements; provided, however, that any accrued Bonus shall be
forfeited in the event of a termination for Cause.


 


(b)        By the Company
other than for Cause or by the Employee for Good Reason.


(i)         Payments.  If, prior to scheduled expiration of the
Term, the Company terminates the Employee's employment without Cause or if the
Employee terminates his employment with Good Reason, the Employee shall be
entitled to receive the Pre-­        Termination Benefits and, subject to
Section 8(b )(ii), the following amounts each month, commencing with the first
month following the date of termination, for a total number of months equal to
the lesser of (A) eighteen months and (B) the number of full months remaining
in the Term as of the date of termination but in no case less than six (6)
months, a cash amount equal to one-twelfth (1/12) of the sum of (a) the
Employee's Base Salary at the highest rate in effect at    any time during the
twelve (12)-month period prior to the date of termination and (b) an amount
equal to one-half of the aggregate Bonus paid to the Employee during the eight
(8) calendar quarters completed prior to the date of termination (such cash
amount, the "Post-Termination Benefits").


(ii)        Conditions to Receipt of Post-Termination Benefits under
Section    8(b). As a condition to receiving any Post-Termination Benefits
(but not Pre-Termination Benefits) to which the Employee would otherwise be
entitled under Section 8(b), the Employee shall execute a release (the "Release"), in a form and
substance reasonably satisfactory to the Company, of any claims, whether
arising under Federal, state or local statute, common law or otherwise, against
the Company and its direct or indirect subsidiaries, and their respective
officers, directors and stockholders which arise or may have arisen on or
before the date of the Release, other than any claims under this Agreement or
any rights to indemnification from the Company and its direct or indirect subsidiaries
pursuant to any provisions of the Company's (or any of its subsidiaries')
certificate of incorporation or by-laws or any directors and officers liability
insurance policies maintained by the Company. If the Employee fails or
otherwise refuses to execute a Release within a reasonable time after the
Company's request to do so, the Employee will not be entitled to any
Post-Termination Benefits. In addition, if, following a termination of
employment that gives the Employee a right to the payment of Post-Termination
Benefits, the Employee violates any terms of the covenants described in Section
6, the Employee shall have no further right or claim to any
Post-Termination Benefits and shall promptly repay any Post-Termination
Benefits previously received (such repayment to be in addition to any other
rights or remedies available to the Company in respect of such violation).


 


(iii)       Exclusive Benefits. The Post-Termination Benefits
payable under this Section 8(b) shall be in lieu of any other severance or similar
benefits that would otherwise be payable under any other agreement, plan,
program or policy of the Company. In addition, the 





Company and the Employee agree that, in the event of a termination of
the Employee's employment under any provision of Section 7, the Employee shall
be entitled solely to the payments and other benefits provided under the
applicable provisions of this Section 8 with respect to such termination, and
the Company, upon satisfaction of such payments and other benefits, thereafter
shall have no further obligation to the Employee under this Agreement or with
respect to the Employee's employment with the Company, other than for payment
of any amounts accrued and vested under any employee benefit plans or programs
of the Company.


 


(c)        As a Result of Death or Disability. If the Employee's
employment under this Agreement is terminated prior to the scheduled expiration
of the Term by reason of his or her death or disability, then the Employee (or
in the case of his or her death, his or her personal representative) shall be
entitled to receive the Pre-Termination Benefits. In the event that the
Employee is terminated due to disability, the Company shall continue paying the
Employee's Base Salary (as in effect on the date of termination) until the
Employee becomes eligible to receive disability income or other payments under
any applicable disability insurance policy (whether such policy is sponsored,
maintained or otherwise paid for, in whole or in part, by the Company, the
Employee or any other party); provided, however, this provision is intended solely  to provide the Employee with a short-term stream of income for any
waiting period under an applicable policy (including any short-term disability
insurance policy) and, to the extent any such payment by the Company would
operate to prevent the Employee from becoming eligible to receive any payments
under such policy, this provision shall be void and of no further effect. In
the event of such termination by Disability, the Company will determine in its
discretion the appropriate amount of Bonus, if any, to be paid, based upon a
consideration of such facts and circumstances as it shall deem appropriate.


 


9.         Miscellaneous. 


 


(a)        Assignment; Binding Effect. This Agreement may not be
assigned by either party, whether by operation of law or otherwise, without the
prior written consent of the other party, except that any right, title or
interest of the Company arising out of this Agreement may be assigned to any
corporation or entity controlling, controlled by, or under common control with
the Company, or succeeding to the business and substantially all of the assets
of the Company or any affiliates for which the Employee performs substantial
services; provided, however, that no such assignment shall relieve the Company
of its obligations hereunder without the express written consent of the
Employee. This Agreement shall be binding upon and inure to the benefit of the
heirs and representatives of the Employee and the successors and assigns of the
Company.


 


(b)        Notices.  Any notice or other communication under this
Agreement shall be in writing and shall be considered given when mailed by
registered, return receipt requested mail, to the parties at the following
addresses (or at such other address as a party may specify by notice to the
others):


 


(i)         to the Company, to: 


             


 


 


 





Parametric Portfolio Associates LLC 


1151 Fairview Avenue
N 


Seattle, WA 98109 


Attention: Chief Legal Officer


 


(ii)        to the Employee, to:


 


Brian D. Langstraat 


115 Maiden Lane East 


Seattle, WA 98112


 


Addresses may be
changed by written notice sent to the other party at the last recorded address
of that party. 


 


(c)        Execution
in Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which
together shall constitute but a single instrument.


 


(d)        Governing
Law, etc.


 


(i)         This
Agreement shall be governed in all respects, including as to validity,
interpretation and effect, by the internal laws of the State of New York,
without giving effect to the conflict of laws rules thereof ( other than
Section 5-1401 and 5-1402 of the General Obligations Law of the State of New
York).


 


(ii)        The parties hereby agree that, in the event of any dispute
(other than a dispute in respect of which provisions for resolution are
otherwise set forth in this Agreement), they will meet and attempt to resolve
such dispute within 10 days after a party gives a notice of dispute to one
other party or parties. If for any reason they do not agree on a resolution,
then each party will consider whether alternative dispute resolution
(including, without limitation, arbitration) would be appropriate for the
resolution of such dispute. Alternative dispute resolution shall be adopted
only if all parties agree in writing, such decision  to be made by each party
in its sole discretion. This Section 9(d)(ii) shall not affect or be 


deemed to require
any delay in the ability of any party to seek injunctive relief in respect of
any dispute arising under this Agreement.


 


(iii)       The parties hereby irrevocably submit to the jurisdiction
of the courts of the State of Washington and the Federal courts of the United
States of America located in the City of Seattle, State of Washington, solely
in respect of the interpretation and enforcement of the provisions of this
Agreement and of the documents referred to in this Agreement, and in respect of
the transactions contemplated hereby and thereby. Each of the parties
irrevocably agrees that all claims in respect of the interpretation and
enforcement of the provisions of this Agreement and of the documents referred
to in this Agreement, and in respect of the transactions contemplated hereby
and thereby, or with respect to any such action or proceeding, shall be heard
and determined in such a Washington or Federal court, and that such
jurisdiction of such courts with respect thereto shall be exclusive, except
solely to the extent that 





all such courts lawfully decline to exercise such jurisdiction. Each of
the parties hereby waive, and agree not to assert, as a defense in any action,
suit or proceeding for the interpretation or enforcement hereof or of any such
document or in respect of any such transaction, that it is not subject to such
jurisdiction. Each of the parties hereby waive, and agree not to assert, to the
maximum extent permitted by law, as a defense in any action, suit or proceeding
for the interpretation or enforcement hereof or of any such document or in
respect of any such transaction, that such action, suit or proceeding may not
be brought or is not maintainable in such courts or that the venue thereof may
not be appropriate or that this Agreement or any such document may not be
enforced in or by such courts. The parties hereby consent to and grant any such
court jurisdiction over the person of such parties and over the subject matter
of any such dispute and agree that mailing of process or other papers in
connection with any such action or proceeding in the manner provided in Section
9(b) or in such other manner as may be permitted by law, shall be valid and
sufficient service thereof.


 


(e)        Severability.  If any provision, including any phrase,
sentence, clause, section or subsection, of this Agreement, or the application
of any provision to any person or circumstance, is invalid, inoperative or
unenforceable for any reason, such circumstances shall not have the effect of rendering
such provision in question invalid, inoperative or unenforceable in any other
case or circumstance, or of rendering any other provision herein contained
invalid, inoperative or unenforceable to any extent whatsoever.


 


(f)        Complete Agreement; Modification and Termination.
This Agreement embodies the entire understanding of the parties hereof, and
supersedes all other oral or written agreements or understandings between them
regarding the subject matter hereof. No change, alteration or modification hereof
may be made except in a writing signed by each of the parties hereto.


 


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IN WITNESS WHEREOF,
the parties hereto have executed and delivered this Agreement as of the day and
year first above written.


 


 


 


	
   

  	
  PARAMETRIC
  PORTFOLIO ASSOCIATES LLC

  
	
  By:

  	
  /s/ David M.
  Stein

  
	
   

  	
  (Signature)

  
	
  Name:

  	
  David M. Stein

  
	
  Title:

  	
  Manager Director

  
	
   

  	
   

  
	
   

  	
  BRIAN D.
  LANGSTRAAT

  
	
   

  	
  /s/ Brain D.
  Langstraat