Mr. Ronald B. Raup 10627 Sherman Drive Eden Prairie, MN 55347 Re: Separation Agreement and Release Dear Ron:
Exhibit 10.18
November 9, 2010
(revised per ▇▇▇ ▇▇▇▇’▇ request and sent to him via email on November 11, 2010)
(revised per ▇▇▇ ▇▇▇▇’▇ request and sent to him via email on November 11, 2010)
Personally Delivered Via Hand
Personal and Confidential
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇▇:
As you know, your employment with MakeMusic, Inc. (“MakeMusic”) will end effective at the close of
business on December 10, 2010, as the result of your resignation. The purpose of this Separation
Agreement and Release letter (“Agreement”) is to set forth the specific separation pay that
MakeMusic has agreed to provide to you, provided you agree to the terms and conditions of this
Agreement.
You are being provided this Agreement now for your review and initial agreement. We ask that you
indicate your agreement to this Agreement as soon as possible by signing, dating and returning the
first signature block at the end of this Agreement. To finalize this Agreement, sometime between
December 10, 2010 and December 31, 2010, you must sign, date and return the second signature block
at the end of this Agreement.
By your signature below, you agree to the following terms and conditions:
1. End of Employment.
a. Your employment with MakeMusic will end effective at the close of business on December 10,
2010. You will remain on MakeMusic’s payroll and covered by MakeMusic’s benefits through December
10, 2010. You are to perform no work on behalf of MakeMusic between today and December 10, 2010,
unless expressly asked to do so by ▇▇▇▇ ▇▇▇▇, Chair of the Board of Directors.
b. Upon your receipt of your final paycheck which includes payment for services through
December 10, 2010, you will have received all wages owed to you by virtue of your employment with
MakeMusic or separation thereof.
c. Upon your receipt of payment from MakeMusic in the amount of $27,567.20, less applicable
deductions and withholding, which represents payment for 257.73 hours of accrued (accrued through
December 10, 2010) and unused Paid Time Off (PTO) at your regular rate, you will have received all
PTO benefits owed to you by virtue of your employment with MakeMusic or separation thereof.
e. The COBRA period for continuation of your insurance coverage under MakeMusic’s group plans
will begin on January 1, 2011. Information regarding your right to elect COBRA coverage will be
sent to you via separate letter.
f. Except as set forth below in Section 2.c., your rights with regard to your stock options
with MakeMusic are governed by your separate stock option agreements with MakeMusic.
g. Effective November 10, 2010, you resigned from your positions as an officer of MakeMusic
and as a member of MakeMusic’s Board of Directors.
You are not eligible for any other payments or benefits by virtue of your employment with MakeMusic
or separation thereof except for those expressly described in this Agreement or otherwise provided
by the terms of any benefit plan. You will not receive the payments described in Section 2 if you
(i) do not sign and return this Agreement by the due date indicated, (ii) rescind this Agreement
after signing it, or (iii) violate any of the terms and conditions set forth in this Agreement.
2. Separation Pay. Specifically in consideration of your signing this Agreement and
subject to the limitations, obligations, and other provisions contained in this Agreement,
MakeMusic agrees as follows:
a. To pay you separation pay in the gross amount of Two Hundred Twenty-Two Thousand Four
Hundred Eighty and 00/100 Dollars ($222,480) (representing 12 months of your ending base salary),
less applicable deductions and withholding. Such separation pay will be paid to you in
substantially equal installments on MakeMusic’s normal payroll schedule beginning on the first
regularly scheduled payday following expiration of the rescission periods noted below;
b. To pay you the pro-rated value of any incentive compensation earned by you in calendar year
2010. MakeMusic will calculate such calendar year 2010 bonus in accordance with the terms of the
applicable Executive Compensation Plan as if you had remained actively employed by MakeMusic
through December 10, 2010. Your 2010 bonus, if earned, will be paid to you on or before March 15,
2011;
c. To allow the cashless exercise of your vested stock options;
d. To transfer ownership of the following MakeMusic property to you: a computer, computer
monitor, related computer accessories, and cell phone. If there is any remaining current value to
such items, MakeMusic will loan these items to you until such time as there is no remaining taxable
value on these items, at which time MakeMusic will give the items to you. MakeMusic requires that
you remove all of MakeMusic’s confidential and trade secret information from the computer and cell
phone that will be transferred to you, and that you not use, disclose or keep any copies of such
information; and
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e. To continue to pay your current monthly AT&T fees for your cell phone through February 28,
2011.
3. Your Release of Claims. Specifically in consideration of the separation pay
described in Section 2, by signing this Agreement you, for yourself and anyone who has or obtains
legal rights or claims through you, agree to the following:
a. You hereby do release, agree not to ▇▇▇, and forever discharge MakeMusic (as defined below)
of and from any and all manner of claims, demands, actions, causes of action, administrative
claims, 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, you
have 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 the
termination of that employment, or otherwise, and however originating or existing, from the
beginning of time through the date of your signing this Agreement.
b. This release includes, without limiting the generality of the foregoing, any claims you may
have for wages, bonuses, commissions, penalties, deferred compensation, vacation pay, separation
benefits, defamation, invasion of privacy, negligence, emotional distress, breach of contract
(including, without limitation, any claim for breach of your Employment Agreement dated October 19,
2000, as amended (herein after “Employment Agreement”)), 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 in Employment Act, 29 U.S.C. § 621
et seq., the Minnesota Human Rights Act, Minn. Stat. § 363A.01 et
seq., Title VII of the Civil Rights Act, 42 U.S.C. § 2000e et seq., the
Americans with ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. § ▇▇▇▇▇ et seq., the Employee Retirement
Income Security Act of 1974, 29 U.S.C. § 1001 et seq., the Family and Medical Leave
Act, 29 U.S.C. § 2601 et seq., the National Labor Relations Act, 29 U.S.C. § 151
et seq., the Worker Adjustment and Retraining Notification Act, 29 U.S.C. § 2101 et
seq., the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. § ▇▇▇▇ et seq., the Fair Labor Standards
Act, any claim arising under 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, veteran or military status, genetic information, or any other protected class under
federal, state or local law. You hereby waive any and all relief not provided for in this
Agreement. You understand and agree that, by signing this Agreement, you waive and release any
past, present, or future claim to employment with MakeMusic.
c. 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 is in complete satisfaction of any and all
claims in connection with such charge, complaint, or action and you waive, and agree not to take,
any award of money or other damages from such charge, complaint, or action.
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d. You are not, by signing this Agreement, releasing or waiving (1) any vested interest you
may have in any 401(k) or profit sharing plan by virtue of your employment with MakeMusic, (2) any
rights or claims that may arise after the Agreement is signed, (3) the post-employment payments
specifically promised to you under Section 2 of this Agreement, (4) the right to institute legal
action for the purpose of enforcing the provisions of this Agreement, (5) any rights you have under
workers compensation laws, (6) any rights you have under state unemployment compensation benefits
laws, (7) the right to file a charge of discrimination with a governmental agency such as the Equal
Employment Opportunity Commission, although, as noted above, you agree that you will not be able to
recover any award of money or damages if you file such a charge or have a charge filed on your
behalf, (8) the right to testify, assist, or participate in an investigation, hearing, or
proceeding conducted by the EEOC, (9) any rights you have under the Consolidated Omnibus Budget
Reconciliation Act (“COBRA”), or (10) the right to coverage and indemnification under MakeMusic’s
directors’ and officers’ insurance coverage as set forth in MakeMusic’s D&O insurance policy.
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 and
former officers, directors, shareholders, trustees, employees, agents, attorneys, representatives
and consultants, and the successors and assigns of each, whether in their individual or official
capacities, and the current and former trustees or administrators of any pension or other benefit
plan applicable to the employees or former employees of MakeMusic, in their official and individual
capacities.
4. Notice of Right to Consult Attorney and Twenty-One (21) Calendar Day Consideration
Period. By signing this Agreement, you acknowledge and agree that MakeMusic has informed you
by this Agreement that (1) you have the right to consult with an attorney of your choice prior to
signing this Agreement, and (2) you are entitled to twenty-one (21) calendar days from December 10,
2010 to consider whether the terms are acceptable to you. You have the right, if you choose, to
sign this Agreement prior to the expiration of the twenty-one (21) day period. You may not,
however, execute the second signature block of this Agreement until sometime between December 10,
2010 and December 31, 2010.
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 hereby
notified of your right to rescind the release of claims contained in Section 3 with regard to
claims arising under the Minnesota Human Rights Act, Minnesota Statutes Chapter 363A, within
fifteen (15) calendar days of your signing the second signature block of this Agreement, and with
regard to your rights arising under the federal Age Discrimination in Employment Act, 29 U.S.C. §
621 et seq., within seven (7) calendar days of your signing the second signature
block of this Agreement. The two rescission periods shall run concurrently. In order to be
effective, the rescission must (a) be in writing; (b) delivered to ▇▇▇ ▇▇▇▇▇▇▇▇, MakeMusic,
Inc., ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ by hand or mail within the
required period; and (c) if delivered by mail, the rescission must be postmarked within the
required period, properly
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addressed to ▇▇▇ ▇▇▇▇▇▇▇▇, as set forth above, and sent by certified
mail, return receipt requested. You understand that if you rescind any part of this Agreement in
accordance with this Section 5, you will not receive the separation pay described in Section 2 and you will be obligated to return
any such payments if already received.
6. Return of Property. By signing this Agreement, you acknowledge and agree that all
documents and materials relating to the business of, or the services provided by, MakeMusic are the
sole property of MakeMusic. Except as set forth in Section 2.d. above, by signing this Agreement
you further agree and represent that you have returned to MakeMusic all of its property, including
but not limited to, all keys, access cards, credit cards, customer records and other documents and
materials, whether on computer disc, hard drive or other form, and all copies 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. On-Going Obligations. You are hereby reminded of your on-going obligations to
MakeMusic under Articles IV, V and VI of your Employment Agreement. You acknowledge and agree that
if you violate Article IV, V and/or VI of your Employment Agreement, MakeMusic shall be entitled to
all available legal and equitable remedies, including but not limited to suspending and recovering
any and all payments made or to be made under Section 2 of this Agreement.
8. Non-Disparagement and Confidentiality. You promise and agree not to disparage
MakeMusic, its shareholders, officers, directors, employees, customers, products or services. You
also promise and agree not to disclose or discuss, directly or indirectly, in any manner
whatsoever, any information regarding the 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 confidential information are your legal advisors or as otherwise required by
law.
9. Remedies. If you breach any term of this Agreement, MakeMusic shall be entitled to
its available legal and equitable remedies, including but not limited to suspending and recovering
any and all payments and benefits made or to be made under this Agreement and payment by you of its
attorneys’ fees and costs. If MakeMusic seeks and/or obtains relief from an alleged breach of this
Agreement, all of the provisions of this Agreement shall remain in full force and effect.
10. Non-Admission. It is expressly understood that this Agreement does not
constitute, nor shall it be construed as, an admission by MakeMusic or you of any liability or
unlawful conduct whatsoever. MakeMusic and you specifically deny any liability or unlawful
conduct.
11. Successors and Assigns. This Agreement is personal to you and may not be assigned
by you without the written agreement of MakeMusic. The rights and obligations of this Agreement
shall 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 it
enforceable
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to the maximum extent possible. If the term cannot be modified, the parties agree that
the 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 with
the laws of the State of Minnesota.
14. Full Agreement. This Agreement contains the full agreement between you and
MakeMusic and may not be modified, altered, or changed in any way except by written agreement
signed by both parties. The parties agree that this Agreement supersedes and terminates any and
all other written and oral agreements and understandings between the parties except for the
following agreements which shall remain in full force and effect: your separate stock option
agreements with MakeMusic and Articles I and IV — X of your Employment Agreement.
15. Acknowledgment of Reading and Understanding. By signing this Agreement, you
acknowledge that you have read this Agreement, including the release of claims contained in Section
3, and understand that the release of claims is a full and final release of all claims you may have
against MakeMusic and the other entities and individuals covered by the release. By signing, you
also acknowledge and agree that you have entered into this Agreement knowingly and voluntarily.
The offer contained in this Agreement will expire at 5:00 p.m. on December 31, 2010. After
you have reviewed this Agreement and obtained whatever advice and counsel you consider appropriate
regarding it, please evidence your agreement to the provisions set forth in this Agreement, by
signing, dating and returning the first signature block at the end of this Agreement to ▇▇▇
▇▇▇▇▇▇▇▇. To finalize this Agreement, sometime between December 10, 2010 and December 31, 2010,
you must sign, date and return the second signature block at the end of this Agreement to ▇▇▇
▇▇▇▇▇▇▇▇.
▇▇▇, we thank you for your many contributions to MakeMusic and wish you all the best both
personally and professionally.
Sincerely,
/s/ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇
Chairman of the Board of Directors
Chairman of the Board of Directors
FIRST ACKNOWLEDGMENT AND SIGNATURE
By signing below, I, ▇▇▇▇▇▇ ▇. ▇▇▇▇, acknowledge and agree to the following:
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| • | I have read this Separation Agreement and Release carefully. |
| • | I agree that this Separation Agreement and Release accurately reflects the agreement between me and MakeMusic with regard to the separation of my employment. |
| • | I will execute and return to MakeMusic the “Second Acknowledgment and Signature” sometime between December 10, 2010 and December 31, 2010. |
Accepted this 15th day of November, 2010.
| /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ | ||||
| ▇▇▇▇▇▇ ▇. ▇▇▇▇ | ||||
SECOND ACKNOWLEDGMENT AND SIGNATURE
By signing below, I, ▇▇▇▇▇▇ ▇. ▇▇▇▇, acknowledge and agree to the following:
| • | I have had adequate time to consider whether to sign this Separation Agreement and Release. |
| • | I have read this Separation Agreement and Release carefully. |
| • | I understand and agree to all of the terms of the Separation Agreement and Release. |
| • | I am knowingly and voluntarily releasing my claims against MakeMusic. |
| • | I have not, in signing this Agreement, relied upon any statements or explanations made by MakeMusic except as for those specifically set forth in this Separation Agreement and Release. |
| • | I intend this Separation Agreement and Release to be legally binding. |
| • | I am signing this Separation Agreement and Release on or after my last day of employment with MakeMusic. |
Accepted
this 13th day of December, 2010.
| /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ | ||||
| ▇▇▇▇▇▇ ▇. ▇▇▇▇ | ||||
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