Exhibit 10.1 Severance Agreement


    
      EXHIBIT 10.1

        


        


        


        


        November
          29, 2005

        


        


        Via
          Hand Delivery

        


        F.
          Dixon
          McElwee, Jr.

        7354
          Lane
          Park Drive

        Dallas,
          Texas 75225

        


        Dear
          Dixon:

         

        On
          behalf
          of Frozen Food Express Industries, Inc., FFE Transportation Services, Inc.
          and
          their affiliated companies (collectively referred to as the “Company”), I am
          providing you with this letter describing severance benefits providing
          for an
          amicable transition on terms and conditions acceptable to both you and
          the
          Company. The following sets forth the terms and conditions of our agreement
          (the
“Agreement”).

         

        
          	1.  	
                  Termination
                    of Employment.
                    You and the Company agree that your employment with the Company
                    will be
                    terminated effective November 29, 2005 (the “Termination Date”). We agree
                    that your termination will be characterized as a voluntary resignation
                    from the Company. In order to receive any benefits under this
                    Agreement,
                    in addition to complying with all of its terms, you must fully
                    cooperate
                    with the Company in the transition of your responsibilities and
                    preparation of necessary documents prior to the Termination Date.
                    Commencing on the Termination Date, you will have no power or
                    authority to
                    incur any debt, liability, or obligation on behalf of the Company
                    or any
                    of its parent and holding companies, subsidiaries, affiliates,
                    divisions,
                    successors, and assigns.

                


        

         

        
          	2.  	
                  Severance
                    Payment.
                    Subject to the provisions of Section 10 below and contingent
                    upon your
                    timely execution and return of this Agreement, you will receive
                    nine (9)
                    months’ salary based upon your ending annual salary of $192,389.60. This
                    equates to $144,292.19, which will be subject to statutory deductions,
                    including withholding. This will be paid in a lump sum in the
                    next normal
                    pay cycle at least eight (8) days after your execution and return
                    of this
                    Agreement.

                


        

         

        
          	3.  	
                  Consulting
                    Term and Compensation.
                    You agree to serve as a Company consultant for a term of three
                    (3) years,
                    beginning on December 1, 2005 and continuing through November
                    30, 2008
                    pursuant to the terms and conditions of the Consulting Agreement
                    attached
                    hereto as Exhibit A. The purpose of the Consulting Agreement
                    is to ensure
                    your cooperation in the transition of your responsibilities after
                    the
                    Termination Date and cooperation with the Company in pending
                    business
                    matters. Upon your execution of the Consulting Agreement, you
                    will receive
                    a payment in the amount of $75,000.00 or the prorata share of
                    the bonus
                    payment under the 2005 Executive Bonus And Restricted Stock Plan,
                    whichever is greater. The payment of such compensation, however,
                    is
                    contingent upon your execution of the attached Consulting
                    Agreement.

                


        

         

        
          	4.  	
                  Vacation.
                    You will not continue to accrue vacation time after the Termination
                    Date.
                    You have been paid for unused accrued vacation days as of the
                    Termination
                    Date. You agree and authorize the Company to deduct from your
                    salary
                    continuation payments any vacation time taken but not yet accrued
                    by you
                    as of the Termination Date.

                


        

         

        
          	5.  	
                  Expense
                    Reimbursements.
                    The Company will reimburse you for pre-approved reasonable and
                    necessary
                    business expenses prior to November 29, 2005 upon presentation
                    of an
                    appropriate itemization of expenses incurred. Any such reimbursement(s)
                    should be submitted to the Company no later than November 29,
                    2005,
                    otherwise the Company shall have no further obligation to pay
                    you for such
                    reimbursement(s).

                


        

         

        
          	6.  	
                  Confidentiality.
                    By accepting the benefits, payments, and other items described
                    above, you
                    agree that:

                


        

         

        
          	a.  	
                  All
                    documents (including this Agreement), records, techniques, business
                    secrets and other information which have come into your possession
                    from
                    time to time during your employment with the Company (“Confidential
                    Information and Business Secrets”) are and shall remain confidential and
                    proprietary to the Company and/or its affiliates, and you will
                    keep
                    confidential and not divulge to any other party any of the Company’s
                    and/or its affiliates’ Confidential Information and Business Secrets,
                    including, but not limited to, Confidential Information and Business
                    Secrets relating to such matters as the Company’s finances (including
                    financial results, budgets, forecast, and long-range plans),
                    operations,
                    materials, processes, plans, designs, models, new products, apparatus,
                    equipment, or formulas used in the Company’s operations, and the names of
                    the Company’s customers and
                    suppliers;

                


        

         

        
          	b.  	
                  All
                    of the Company’s and/or its affiliates’ and related companies’
                    Confidential Information and Business Secrets are and shall remain
                    the
                    sole and exclusive property of the Company and/or its affiliates
                    and
                    related companies;

                


        

         

        
          	c.  	
                  You
                    will return to the Company all Company property and the property
                    of any of
                    its affiliates, including all documents and records which came
                    into your
                    possession during your employment with the
                    Company;

                


        

         

        
          	d.  	
                  You
                    will not disparage the Company or any of the Releasees (as that
                    term is
                    defined in Section 7 below);

                


        

         

        
          	e.  	
                  At
                    any time prior to November 30, 2008, if you desire to participate
                    in any
                    business as an officer, director or member of executive management
                    that
                    offers or sells any refrigerated trucking services which competes,
                    directly or indirectly, with the Company, you will promptly advise
                    the
                    Company of your desire to undertake such employment, the name
                    of the new
                    employer, your proposed position, and the nature of your job
                    requirements
                    with such new employer, and you agree that you will take no such
                    position
                    that will require the use or disclosure of the Company’s trade
                    secrets;

                


        

         

        
          	f.  	
                  At
                    any time prior to November 30, 2008, you will not, whether for
                    your own
                    account or for the account of any other individual, partnership,
                    firm,
                    corporation, or business organization, either directly or indirectly
                    solicit or endeavor to entice away from the Company any person
                    who is
                    employed by or otherwise engaged to perform services for the
                    Company or
                    any of the Releasees, or to interfere with the business relationship
                    of
                    the Company with any person who is then a customer of the Company;
                    and

                


        

         

        
          	g.  	
                  If
                    you fail to comply with any of the provisions of this Section
                    6, the
                    Company will be entitled to a pro rata rebate of the severance
                    paid to
                    you. As a general example only, if a breach should occur during
                    the
                    eighteenth (18th) month of the three (3) year term, the Company
                    would then
                    be entitled to fifty percent (50%) rebate of the severance payment.
                    In
                    addition, the Company shall be entitled, upon application to
                    any court of
                    competent jurisdiction, to specific performance or injunction
                    or other
                    relief in order to enforce or prevent violation of such provision
                    or
                    provisions through November 30, 2008. Nothing herein contained
                    shall be
                    construed as prohibiting the Company from pursuing any other
                    remedies
                    available to it for such breach or threatened breach including
                    the
                    recovery of damages from you.

                


        

         

        
          	7.  	
                  Release
                    of Claims.
                    In exchange for the consideration set forth in Section 2, you
                    hereby, on
                    behalf of yourself, your descendants, ancestors, dependents,
                    heirs,
                    representatives, executors, administrators, successors, and
                    assigns:

                


        

         

        
          	a.  	
                  Fully
                    and forever release and discharge the Company and each of its
                    parent and
                    holding companies, subsidiaries, affiliates, divisions, successors,
                    and
                    assigns, including but not limited to FFE Transportation Services,
                    Inc.
                    and Frozen Food Express Services, Inc., together with all of
                    their past
                    and present trustees, directors, officers, agents, attorneys,
                    insurers,
                    employees, stockholders, and representatives (collectively the
                    “Releasees”), from any and all claims, wages, demands, rights, liens,
                    agreements, contracts, covenants, actions, suits, causes of action,
                    obligations, debts, costs, expenses, attorneys’ fees, damages, judgments,
                    orders, or liabilities of whatsoever kind or nature in law, equity,
                    or
                    otherwise, whether now known or unknown, suspected or unsuspected,
                    which
                    you now own or hold or have or may have at any time heretofore
                    or
                    hereafter owned or held as against the Company and/or any of
                    the
                    Releasees, arising out of or in any way connected
                    with:

                


        

         

        
          	(1)  	
                  your
                    employment relationship with the Company and/or any of its past
                    or present
                    subsidiaries or parent or affiliated companies or entities (except
                    any
                    claims for pension or retirement
                    benefits);

                


        

         

        
          	(2)  	
                  your
                    termination from the Company and/or any of its past or present
                    subsidiaries or parent or affiliated companies or entities;
                    and

                


        

         

        
          	(3)  	
                  any
                    and all other transactions, occurrences, acts or omissions, and
                    any loss,
                    damage, or injury whatsoever, known or unknown, suspected or
                    unsuspected,
                    resulting from any act or omission by or on the part of the Company
                    and/or
                    any of the Releasees arising, committed, or omitted prior to
                    the effective
                    date of this Agreement or at any time during your employment
                    with the
                    Company or with any of the Releasees, including, but not limited
                    to claims
                    under Title VII of the Civil Rights Act of 1964, the Texas Commission
                    on
                    Human Rights Act, the Worker Adjustment and Retraining Notification
                    Act,
                    the Equal Pay Act of 1963, the Age Discrimination in Employment
                    Act of
                    1967, the Employee Retirement Income Security Act, the Civil
                    Rights Act of
                    1866, the Older Workers’ Benefit Protection Act, the Americans with
                    Disabilities Act, the Family and Medical Leave Act, any and all
                    claims for
                    breach of contract (except for the obligations created herein),
                    tort, and
                    personal injury of any kind, including but not limited to any
                    claims for
                    severance pay, bonus, salary, sick leave, holiday pay, vacation
                    pay, life
                    insurance, health or medical insurance, or any other fringe benefit,
                    worker’s compensation or disability, and/or any claims under any other
                    federal, state, local, or other governmental statute, regulation,
                    and/or
                    common law.

                


        

         

        
          	b.  	
                  Covenant
                    not to sue the Company or any of the Releasees for any reason
                    in any suit
                    or proceeding, including, but not limited to, any suit, grievance
                    or
                    proceeding under Title VII of the Civil Rights Act of 1964, the
                    Texas
                    Commission on Human Rights Act, the Worker Adjustment and Retraining
                    Notification Act, the Equal Pay Act of 1963, the Age Discrimination
                    in
                    Employment Act of 1967, the Employee Retirement Income Security
                    Act, the
                    Civil Rights Act of 1866, the Older Workers’ Benefit Protection Act, the
                    Americans with Disabilities Act, the Family and Medical Leave
                    Act, and/or
                    any and all other executive orders, federal or state laws, precedents,
                    statutes or regulations, or bring any charge or complaint with
                    the Texas
                    Commission on Human Rights, the Texas Workforce Commission, the
                    U.S.
                    Department of Labor, or any other administrative, governmental,
                    regulatory, legislative, or judicial
                    body.

                


        

         

        In
          the
          event that you breach this Agreement by bringing any judicial, quasi-judicial,
          or administrative action against the Company and/or any of the Releasees,
          then
          it is agreed that the Company’s obligation to provide you with the consideration
          described in Section 2 will immediately cease, and that you will be liable
          for
          all direct, indirect, and consequential damages that the Company and/or
          any of
          the Releasees may suffer as a result of such breach, including but not
          limited
          to any costs and attorney’s fees incurred. It is understood that your
          obligations under this Agreement would, nevertheless, remain binding and
          in full
          force and effect.

         

        In
          the
          event that any charge, complaint, grievance, arbitration, action, or other
          proceeding was or is filed by you or by any person or entity on your behalf
          (other than to receive the consideration described in Section 2 of this
          Agreement), you
          agree
          not to cooperate beyond the minimum level that is legally required, and
          that in
          no event will you accept or share in any recovery or relief obtained as
          a result
          of any such action or proceeding.

         

        
          	8.  	
                  Stock
                    Option Plans.
                    The general release, contained in Section 7 above, shall not
                    limit or
                    otherwise affect your rights or obligations under any stock option
                    plan
                    with the Company or any of the Releasees. Any such option(s)
                    shall be
                    governed in accordance with the relevant plan covering such
                    option(s).

                


        

         

        
          	9.  	
                  Non-Liability.
                    You agree that neither this Agreement nor the furnishing of the
                    consideration for this Agreement shall be deemed or construed
                    at any time,
                    for any purpose, an admission by the Company or by any of the
                    Releasees of
                    any liability or wrongful or unlawful conduct of any kind
                    whatsoever.

                


        

         

        
          	10.  	
                  Withholdings.
                    All payments or benefits to you under this Agreement or otherwise
                    are
                    subject to withholding by the Company from such payments or benefits
                    in
                    accordance with applicable laws and regulations then in effect,
                    including
                    but not limited to any federal, state, regional, and local
                    taxes.

                


        

         

        
          	11.  	
                  Company
                    Property.
                    You agree to return to the Company, on or before the close of
                    business on
                    the Termination Date, any and all Company property (including,
                    but not
                    limited to, sales materials, documents or other company records,
                    parking
                    cards, pass cards, access cards, keys, calling cards, mobile
                    phones,
                    beepers, pagers, credit cards, computers, fax machines, copy
                    machines,
                    Palm Pilots or personal digital assistants, or any other equipment)
                    that
                    you have or may have in your possession or control. If you do
                    not return
                    any items of Company property in your possession or control by
                    said date,
                    then the Company may, in addition to any rights and remedies
                    it may have
                    under this Agreement or otherwise, withhold any and all payments
                    to be
                    made to you hereunder.

                


        

         

        
          	12.  	
                  Neutral
                    Reference Policy.
                    Pursuant to Company policy, the Human Resources Department will
                    confirm to
                    prospective employers your position held, dates of employment,
                    and social
                    security number. The Company will not provide any other information
                    about
                    your employment, including a letter of
                    reference.

                


        

         

        
          	13.  	
                  Notices.
                    All notices, requests, demands, and other communications hereunder
                    must be
                    in writing and shall be deemed to have been given if delivered
                    by hand or
                    mailed within the continental United States by first class, registered,
                    or
                    certified mail, return receipt requested, postage and registry
                    fees
                    prepaid and addressed as follows:

                


        

         

        
          	a.  	
                  If
                    to the Company:

                


        

        Charles
          G. Robertson

        Executive
          Vice President and Chief Operating Officer

        Frozen
          Food Express Industries, Inc.

        1145
          Empire Central Place

        Dallas,
          Texas 75247-4309

         

        
          	b.  	
                  If
                    to you:

                


        

        F.
          Dixon
          McElwee, Jr. 

        7354
          Lane
          Park Drive

        Dallas,
          Texas 75225

        


        Either
          party by notice in writing to the other may change the address to which
          notices,
          requests, demands, or other communications to it shall be mailed.

         

        
          	14.  	
                  Offer.
                    This offer shall remain only in effect through the close of business
                    on
                    December 21, 2005, after
                    which it shall be deemed to have been automatically withdrawn.

                


        

         

        
          	15.  	
                  Employee
                    Acknowledgments and Representations.
                    You hereby acknowledge and represent
                    that:

                


        

         

        
          	a.  	
                  You
                    have been advised in writing to seek the advice of an attorney
                    of your
                    choice prior to signing this Agreement, and have had an adequate
                    opportunity to seek legal counsel of your own choosing. The Company
                    and
                    you agree that the parties have relied upon the advice of their
                    respective
                    attorneys, who are attorneys of their own choice, or they have
                    knowingly
                    and willingly not sought the advice of such attorneys. You hereby
                    understand and acknowledge the significance and consequence of
                    this
                    Agreement and represent that the terms of this Agreement are
                    fully
                    understood and voluntarily accepted by
                    you.

                


        

         

        
          	b.  	
                  You
                    have read this Agreement and understand all of the terms of this
                    Agreement, and you enter into this Agreement freely and
                    voluntarily.

                


        

         

        
          	c.  	
                  This
                    Agreement is intended to include in its effect and does include,
                    without
                    limitation, all claims which you do not know or suspect to exist
                    in your
                    favor at the time of execution of this release, and that the
                    terms agreed
                    upon contemplate and extinguish any and all such
                    claims.

                


        

         

        
          	d.  	
                  You
                    acknowledge that you received this Agreement on or before
                    November 29, 2005, and that you are being provided at least
                    twenty-one (21) days after you received this Agreement to decide
                    whether
                    to sign this Agreement and to be bound by its terms, and that
                    you
                    considered the terms of this Agreement for at least twenty-one
                    (21) days
                    or knowingly and voluntarily waived your right to do
                    so.

                


        

         

        
          	e.  	
                  You
                    acknowledge and understand that you have the right to revoke
                    this
                    Agreement for a period of seven (7) days after you have signed
                    it. This
                    Agreement shall not become effective, and no money shall be paid
                    by the
                    Company, until the seven-day period has expired. The effective
                    date of
                    this Agreement shall be the eighth day following the date on
                    which you
                    sign this Agreement. You further acknowledge and understand that
                    revocation must be accomplished by delivery of a written notification
                    to
                    Charles G. Robertson of the Company at the address indicated
                    above. In the
                    event that this Agreement is canceled or revoked, the Company
                    shall have
                    no obligation to furnish the payments and benefits described
                    herein.

                


        

         

        
          	f.  	
                  This
                    Agreement will become null and void and of no further force or
                    effect if
                    the Company does not receive a fully executed copy from you after
                    the
                    Termination Date but ON
                    OR BEFORE the
                    close of business on December 21, 2005, which is at least twenty-one
                    (21)
                    days after you received a copy of this
                    Agreement.

                


        

         

        
          	16.  	
                  Termination
                    of Company Associations.
                    You agree that, as of the Termination Date, you will resign or
                    shall be
                    considered to have resigned from any position held with the Company
                    as
                    well as its parent, subsidiary, and affiliated companies and
                    divisions,
                    including but not limited to Frozen Food Express Industries,
                    Inc., FFE
                    Transportation Services, Inc., Lisa Motor Lines, Inc., American
                    Eagle
                    Lines, AirPro Holdings, Inc., and W&B Refrigeration Service Company.
                    You therefore acknowledge that, following the Termination Date,
                    you shall
                    hold no further positions with the Company and/or its parent,
                    subsidiary,
                    and affiliated companies and
                    divisions.

                


        

         

        
          	17.  	
                  Miscellaneous.

                


        

         

        
          	a.  	
                  Assignment.
                    This Agreement shall not be assigned, pledged, or transferred
                    in any way
                    by you without the Company’s prior written
                    consent.

                


        

         

        
          	b.  	
                  Modification.
                    No change, alteration, or modification of this Agreement may
                    be made
                    except in writing signed by both parties
                    thereto.

                


        

         

        
          	c.  	
                  Entire
                    Agreement:
                    The matters set forth in this Agreement, along with the Consultant
                    Agreement between the parties, dated November 29, 2005, constitute
                    the
                    entire agreement between Consultant
                    and the Company and supersede all prior agreements, negotiations,
                    and
                    discussions between the parties hereto and/or their respective
                    counsel
                    with respect to the subject matter hereof. No other representations,
                    covenants, undertakings, or other prior or contemporaneous agreements,
                    oral or written, regarding the matters set forth in this Agreement
                    shall
                    be deemed to exist or bind any of the parties hereto. Each party
                    understands and agrees that it has not relied on any statement
                    or
                    representation by the other party or any of its representatives
                    in
                    entering into this Agreement.

                


        

         

        
          	d.  	
                  Headings.
                    The headings in this Agreement are for convenience of reference
                    only and
                    shall not be considered as part of this Agreement nor limit or
                    otherwise
                    affect the meaning hereof.

                


        

         

        
          	e.  	
                  Severability.
                    Should any provision of this Agreement be declared illegal or
                    unenforceable by any court of competent jurisdiction,
                    a
                    provision that most closely resembles the parties’ intent, but which is
                    legally enforceable, shall be deemed to have been automatically
                    substituted in the place and stead of such illegal or unenforceable
                    provision. If a legal provision which would carry out the parties’ intent
                    cannot, as a practical matter, be substituted in the place of
                    such
                    unenforceable provision (other than the general release language),
                    then
                    such provision shall immediately become null and void, but leaving
                    the
                    remainder of this Agreement in full force and effect. If, however,
                    any
                    portion of the general release language were ruled or deemed
                    to be
                    unenforceable for any reason, then you agree to promptly return
                    to the
                    Company all of the consideration that has been paid to you under
                    this
                    Agreement.

                


        

         

        
          	f.  	
                  Rights
                    and Remedies Cumulative.
                    No failure or delay on the part of any party hereto in exercising
                    any
                    right hereunder shall operate as a waiver thereof; nor shall
                    any single or
                    partial exercise of or the exercise of any other right hereunder
                    preclude
                    any other or further exercise thereof or the exercise of any
                    other right.
                    No right or remedy provided for herein is intended to be exclusive
                    of any
                    other right or remedy, and every right and remedy shall, to the
                    extent
                    permitted by law, be cumulative and in addition to every other
                    right or
                    remedy given hereunder or now or hereafter existing at law or
                    in equity or
                    otherwise. The assertion or employment of any right or remedy
                    hereunder,
                    or otherwise, shall not prevent the concurrent assertion or employment
                    of
                    any other appropriate right or
                    remedy.

                


        

         

        
          	g.  	
                  All
                    Commitments.
                    The amounts and benefits payable to you under this Agreement
                    constitute
                    all payments or benefits which the Company shall be obligated
                    to provide
                    for you, and you agree that, except as provided herein, neither
                    you nor
                    your estate will have any rights under any bonus plan, incentive
                    compensation plan, health plan, or any other benefit or compensation
                    plan
                    whatsoever. Any rights under any savings or pension plan, if
                    applicable,
                    are subject to the terms and conditions of such
                    plans.

                


        

         

        
          	18.  	
                  Governing
                    Law and Venue.
                    The terms and provisions of this letter agreement and release
                    shall be
                    governed by and construed in accordance with the laws of the
STATE
                    OF TEXAS,
                    exclusive of any conflict of law provisions, and venue for all
                    purposes of
                    this letter agreement and release shall be in a court of competent
                    jurisdiction sitting in DALLAS
                    COUNTY, TEXAS
                    or
                    the applicable federal district or appellate court having jurisdiction
                    over actions filed in such county and
                    state.

                


        

         

        
          	19.  	
                  BY
                    SIGNING BELOW, YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT,
                    HAVE HAD
                    THE OPPORTUNITY TO CONSULT WITH AN ATTORNEY OF YOUR CHOICE, UNDERSTAND
                    IT,
                    AND ARE VOLUNTARILY ENTERING INTO IT. READ THIS AGREEMENT CAREFULLY.
                    IT
                    CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN
                    CLAIMS.

                


        

         

        If
          the
          foregoing is acceptable to you, please acknowledge your agreement by signing
          three copies of this letter and returning two of them to me after the
          Termination Date but ON
          OR BEFORE
          December
          21, 2005. The remaining copy is for your files.

         

        
          
            	 Sincerely,
	 
	 
	 
	 /s/ Stoney
                    M. Stubbs, Jr.
	 Stoney M. Stubbs, Jr.
	 Chairman, President, and Chief Executive
                    Officer
	 Frozen
                    Food Express Industries, Inc.


          

        

         

         

        ACCEPTED
          AND AGREED:

        


        
          
            	 /s/ F.
                    Dixon McElwee, Jr.
	 F.
                    Dixon McElwee, Jr.