August 1, 2006***Via E-Mail***To: Alan G. ShulerRe: Separation Agreement and ReleaseDear Alan:As you know, your employment with MakeMusic, Inc. (“MakeMusic”) ended effective at the close ofbusiness on July 31, 2006. On July 31, 2006, MakeMusic gave you a Separation Agreement and Releaseletter for your review and execution. On July 31, 2006, you requested that certain changes be madeto the Agreement and MakeMusic agreed to make certain changes. This Separation Agreement andRelease letter dated August 1, 2006 is the revised Agreement which includes the agreed uponchanges. You acknowledge and agree that MakeMusic need not restart the 21-day consideration periodnoted below on account of the changes reflected herein.Although not required to do so, MakeMusic would like to offer you separation pay and benefits toease your transition to new employment. The purpose of this Separation Agreement and Releaseletter (“Agreement”) is to set forth the specific separation pay and benefits that MakeMusic willprovide you in exchange for your agreement to the terms and conditions of this Agreement.By your signature below, you agree to the following terms and conditions:     1. End of Employment. Your employment with MakeMusic ended effective at the close ofbusiness on July 31, 2006. Upon your receipt of your final paycheck which includes payment forservices through July 31, 2006, you will have received all wages owed to you by virtue of youremployment with MakeMusic or termination thereof. Upon your receipt of payment from MakeMusic inthe amount of $7,896.00, less applicable deductions and withholding, which represents payment foryour prorated calendar year 2006 bonus, you will have received all compensation owed to you byvirtue of your employment with MakeMusic or termination thereof. Upon your receipt of payment fromMakeMusic in the amount of $6,890.96, less applicable deductions and withholding, which representspayment for 102.38 hours of accrued and unused Paid Time Off (PTO) at your regular rate, you willhave received all benefits owed to you by virtue of your employment with MakeMusic or terminationthereof. The COBRA period for continuation of your insurance coverage under MakeMusic’s group planswill begin on August 1, 2006. Information regarding your right to elect COBRA coverage will besent to you via separate letter.     You are not eligible for any other payments or benefits by virtue of your employment withMakeMusic or termination thereof except for those expressly described in this Agreement. You willnot receive the payments described in Section 2 and subsequent sections of this Agreement if you(i) do not sign this Agreement, (ii) rescind this Agreement after signing it, or (iii) violate anyof the terms and conditions set forth in this Agreement.
 

 
Page 2     2. Separation Pay and Benefits. Specifically in consideration of your signing thisAgreement and subject to the limitations, obligations, and other provisions contained in thisAgreement, MakeMusic agrees as follows:          a. To pay you five months of separation pay for the period from August 1, 2006 throughDecember 31, 2006 in the gross amount of Fifty Eight Thousand Three Hundred Thirty Three and 33/100Dollars ($58,333.33), less applicable deductions and withholding. Such separation pay will be paidto you in installments on MakeMusic’s normal payroll schedule beginning with the first pay dayfollowing the expiration of the rescission periods described in Section 5 below, with the firstsuch payment to include any retroactive payments to August 1, 2006.          b. Provided you timely elect COBRA, to pay $816.74 of your COBRA premiums for health insurancefor the months of August, September, October, November and December 2006. Beginning August 1,2006, you will be responsible for paying $140 of your COBRA premiums for health insurance for themonths of August, September, October, November and December 2006. Beginning January 1, 2007, youwill be responsible for paying your entire COBRA premiums for health insurance. Beginning August1, 2006, you will be responsible for paying your entire COBRA premiums for dental and lifeinsurance.     3. Release of Claims. Specifically in consideration of the separation pay andbenefits described in Section 2, and to which you would not otherwise be entitled, by signing thisAgreement you, for yourself and anyone who has or obtains legal rights or claims through you, agreeto the following:          a. You hereby do release, agree not to sue, and forever discharge MakeMusic (as defined below)of and from any and all manner of claims, demands, actions, causes of action, administrativeclaims, liability, damages, claims for punitive or liquidated damages, claims for attorney’s fees,costs and disbursements, individual or class action claims, or demands of any kind whatsoever, youhave or might have against them or any of them, whether known or unknown, in law or equity,contract or tort, arising out of or in connection with your employment with MakeMusic, or thetermination of that employment, or otherwise, and however originating or existing, from thebeginning of time through the date of your signing this Agreement.          b. This release includes, without limiting the generality of the foregoing, any claims you mayhave for wages, bonuses, commissions, penalties, deferred compensation, vacation pay, separationbenefits, defamation, invasion of privacy, negligence, emotional distress, breach of contract,estoppel, improper discharge (based on contract, common law, or statute, including any federal,state or local statute or ordinance prohibiting discrimination or retaliation in employment),violation of the United States Constitution, the Minnesota Constitution, the Age Discrimination inEmployment Act, 29 U.S.C. § 621 etseq., the Minnesota Human Rights Act, Minn.Stat. § 363A.01
 

 
Page 3etseq., Title VII of the Civil Rights Act, 42 U.S.C. § 2000eetseq., the Americans with DisabilitiesAct, 42 U.S.C. § 12101 etseq., the Employee Retirement Income Security Act of1974, 29 U.S.C. § 1001 etseq., the Family and Medical Leave Act, 29 U.S.C. § 2601etseq., the National Labor Relations Act, 29 U.S.C. § 151 etseq.,the Worker Adjustment and Retraining Notification Act, 29 U.S.C. § 2101 et seq., the Sarbanes-OxleyAct, 15 U.S.C. § 7201 etseq., the Fair Labor Standards Act, any claim arisingunder Minn. Stat. Chapters 177 and 181, Minn. Stat. § 176.82, and any claim for retaliation,harassment or discrimination based on sex, race, color, creed, religion, age, national origin,marital status, sexual orientation, disability, status with regard to public assistance or anyother protected class, or sexual or other harassment. You hereby waive any and all relief notprovided for in this Agreement. You understand and agree that, by signing this Agreement, youwaive and release any past, present, or future claim to employment with MakeMusic.          c. You affirm that you have not caused or permitted, and to the full extent permitted by lawwill not cause or permit to be filed, any charge, complaint, or action of any nature or typeagainst MakeMusic, including but not limited to any action or proceeding raising claims arising intort or contract, or any claims arising under federal, state, or local laws, includingdiscrimination laws. If you file, or have filed on your behalf, a charge, complaint, or action,you agree that the payments and benefits described above in Section 2 are in complete satisfactionof any and all claims in connection with such charge, complaint, or action and you waive, and agreenot to take, any award of money or other damages from such charge, complaint, or action.          d. You are not, by signing this Agreement, releasing or waiving (1) any vested interest youmay have in any 401(k) or profit sharing plan by virtue of your employment with MakeMusic, (2) anyrights or claims that may arise after the Agreement is signed, (3) the post-employment payments andbenefits specifically promised to you under this Agreement, (4) the right to institute legal actionfor the purpose of enforcing the provisions of this Agreement, or (5) the right to apply for stateunemployment compensation benefits.          e. MakeMusic, as used in this Section 3, shall mean MakeMusic, Inc. and its parent,subsidiaries, divisions, affiliated entities, insurers, if any, and its and their present andformer officers, directors, shareholders, trustees, employees, agents, attorneys, representativesand consultants, and the successors and assigns of each, whether in their individual or officialcapacities, and the current and former trustees or administrators of any pension or other benefitplan applicable to the employees or former employees of MakeMusic, in their official and individualcapacities.     4. Notice of Right to Consult Attorney and Twenty-One (21) Calendar Day ConsiderationPeriod. By signing this Agreement, you acknowledge and agree that MakeMusic has informed youby this Agreement that (1) you have the right to consult with an attorney of your choice prior tosigning this Agreement, and (2) you are entitled to twenty-one (21) calendar days from the receiptof this Agreement (July 31, 2006) to consider whether the terms are acceptable to you. MakeMusicencourages you to use the full 21-day period to consider this Agreement but you have the right, ifyou choose, to sign this Agreement prior to the expiration of the twenty-one (21) day period.
 

 
Page 4     5. Notification of Rights under the Minnesota Human Rights Act (Minn. Stat. Chapter 363A)and the Federal Age Discrimination in Employment Act (29 U.S.C. § 621 et seq.). You are herebynotified of your right to rescind the release of claims contained in Section 3 with regard toclaims arising under the Minnesota Human Rights Act, Minnesota Statutes Chapter 363A, withinfifteen (15) calendar days of your signing this Agreement, and with regard to your rights arisingunder the federal Age Discrimination in Employment Act, 29 U.S.C. § 621 etseq.,within seven (7) calendar days of your signing this Agreement. The two rescission periods shallrun concurrently. In order to be effective, the rescission must (a) be in writing; (b)delivered to Deb Peterson, MakeMusic, Inc., 7615 Golden Triangle Drive, Suite M, Eden Prairie, MN55344-3848 by hand or mail within the required period; and (c) if delivered by mail, the rescissionmust be postmarked within the required period, properly addressed to Deb Peterson, as set forthabove, and sent by certified mail, return receipt requested. This Agreement will be effective uponthe expiration of the 15-day period without rescission. You understand that if you rescind anypart of this Agreement in accordance with this Section 5, you will not receive the separation payand benefits described in Section 2 and you will be obligated to return any such payments andbenefits if already received.     6. Return of Property. By signing this Agreement, you acknowledge and agree that alldocuments and materials relating to the business of, or the services provided by, MakeMusic are thesole property of MakeMusic. By signing this Agreement you further agree and represent that youhave returned to MakeMusic all of its property, including but not limited to, all customer recordsand other documents and materials, whether on computer disc, hard drive or other form, and allcopies thereof, within your possession or control, which in any manner relate to the business of,or the duties and services you performed on behalf of MakeMusic.     7. Confidential and Proprietary Information. By signing this Agreement, youacknowledge and agree that you have had access in your employment with MakeMusic to confidentialand proprietary information of MakeMusic and further acknowledge and agree that the release ordisclosure of any confidential or proprietary information of MakeMusic will cause MakeMusicirreparable injury. By signing this Agreement, you acknowledge that you have not used ordisclosed, and agree that you will not at any time use or disclose, to any other entity or person,directly or indirectly, any confidential or proprietary information of MakeMusic. For purposes ofthis Agreement, the term “confidential or proprietary information” shall include, but not belimited to, customer lists and information pertaining to customer lists; contact lists; andinformation about the personal or business affairs of MakeMusic’s customers, vendors, or employees.     8. Confidentiality. You promise and agree not to disparage MakeMusic, its owners,employees, products or services, or disclose or discuss, directly or indirectly, in any mannerwhatsoever, any information regarding either (1) the contents and terms of this Agreement, or (2)
 

 
Page 5the substance and/or nature of any dispute between MakeMusic and any employee or former employee,including yourself. You agree that the only people with whom you may discuss this confidentialinformation are your legal and financial advisors and your spouse, if applicable, provided theyagree to keep the information confidential, or as otherwise required by law.     9. Remedies. If you breach any term of this Agreement, MakeMusic shall be entitled toits available legal and equitable remedies, including but not limited to suspending and recoveringany and all payments and benefits made or to be made under this Agreement. If MakeMusic seeksand/or obtains relief from an alleged breach of this Agreement, all of the provisions of thisAgreement shall remain in full force and effect.     10. Non-Admission. It is expressly understood that this Agreement does notconstitute, nor shall it be construed as, an admission by MakeMusic or you of any liability orunlawful conduct whatsoever. MakeMusic and you specifically deny any liability or unlawfulconduct.     11. Successors and Assigns. This Agreement is personal to you and may not be assignedby you without the written agreement of MakeMusic. The rights and obligations of this Agreementshall inure to the successors and assigns of MakeMusic.     12. Enforceability. If a court finds any term of this Agreement to be invalid,unenforceable, or void, the parties agree that the court shall modify such term to make itenforceable to the maximum extent possible. If the term cannot be modified, the parties agree thatthe term shall be severed and all other terms of this Agreement shall remain in effect.     13. Law Governing. This Agreement shall be governed and construed in accordance withthe laws of the State of Minnesota.     14. Full Agreement. This Agreement contains the full agreement between you andMakeMusic and may not be modified, altered, or changed in any way except by written agreementsigned by both parties. The parties agree that this Agreement supersedes and terminates any andall other written and oral agreements and understandings between the parties except for anyconfidentiality agreements to which you are subject in connection with your employment withMakeMusic.     15. Acknowledgment of Reading and Understanding. By signing this Agreement, youacknowledge that you have read this Agreement, including the release of claims contained in Section3, and understand that the release of claims is a **full and final release of all claims** youmay have against MakeMusic and the other entities and individuals covered by the release. Bysigning, you also acknowledge and agree that you have entered into this Agreement knowingly andvoluntarily.
 

 
Page 6     The offer contained in this Agreement will expire at 5:00 p.m. on August 22, 2006. After youhave reviewed this Agreement and obtained whatever advice and counsel you consider appropriateregarding it, please evidence your agreement to the provisions set forth in this Agreement bydating and signing the Agreement. Please then return an original signed Agreement to Deb Petersonno later than 5:00 p.m. on August 22, 2006.Sincerely,/s/ William R. WolffWilliam R. Wolff