Transport Corporation of America, Inc. Exhibit 10.16




	



TRANSPORT CORPORATION
OF AMERICA, INC. 
1715 Yankee Doodle Road
Eagan, MN 55121 



October 17, 2002 



     Mr. Jeffrey P. Vandercook
3668 Ashbury Road 
Eagan, MN 55122 




Dear Jeff: 



        This
letter describes the agreement by and among you and Transport America regarding (a) your
termination as Vice President of Operations at Transport Corporation of America, Inc., and
(b) your release of any claims you may have against Transport America. You have also
agreed to certain confidentiality restrictions that are reflected in this letter as well.
The term “Transport America” as used in this Agreement means Transport
Corporation of America, Inc., its subsidiaries and respective officers and directors. 




        If,
after reading this letter, you feel there is any discrepancy between our conversations and
the content of this letter, please contact Karen Vesovich, Director of Human Resources. 



         1.       
          Departure from Employment. The parties agree that your employment
          relationship with Transport America shall end effective October 17, 2002 (the
          “departure date”), and that, except for payment by Transport
          America to you of compensation in the aggregate sum of $16,983.03 (less
          applicable withholding) for 328.60 hours of earned and unused vacation time and
          personal leave, Transport America will stop all salary and other compensation
          payments to you as of the departure date subject only to the provisions of this
          Agreement. 



         2.       
          Severance Benefits. Although neither Transport America nor you are
          obligated to each other beyond your termination and departure on the departure
          date, you have agreed to comply with certain restrictions and Transport America
          has offered to provide you with the following benefits: 










          		    A.       
               Severance Payments. In consideration for the promises made in this
               Agreement, and subject to any rescission of this Agreement as provided later in
               this Agreement, Transport America will pay you each week, for a period of
               twenty-six (26) weeks, an amount equal to your weekly salary that was in effect
               as of your departure date, ($2067.30) less applicable taxes and withholding and
               less up to thirty-five dollars ($35) per week to be withheld as payment for your
               portion of the premium costs of elected benefits under Section 2B of this
               Agreement. If you execute this Agreement and do not rescind it within the
               rescission periods provided for later in this Agreement, then the weekly
               severance payments will accrue as of the departure date and will be paid to you
               upon the receipt by 



               















          		
Transport America of the Exhibit to this Agreement, signed
               and dated by you. Subsequent weekly severance payments will be paid thereafter,
               when due. You expressly acknowledge that these are payments to which you are not
               otherwise entitled except as a term of this Agreement. 



               



          		    B.       
               Continuation Of Benefits. As further consideration for the promises in
               this Agreement, and subject to any rescission of this Agreement as provided
               later in this Agreement, should you elect to continue to participate in those
               medical, dental and/or life insurance benefits you were participating in as of
               your departure date as provided for by COBRA, Transport America, will continue
               to pay the same portion of your premium cost of participating in the elected
               benefits for a period of twenty-six (26) weeks, or until the date on
               which you become covered under another plan, whichever occurs first, as such
               portion was paid by Transport America during the period of your employment. You
               acknowledge that these payments by Transport America are not payments to which
               you are otherwise entitled except upon execution of this Agreement. For this
               period, you will be responsible for the portion of the premium payments not paid
               for by Transport America.
For any periods of time that you may elect to
               continue coverage after the period referred to above, you will be responsible
               for the entire premium cost of the continuing coverage subject only to your
               rights under COBRA. You will retain at all times the right to elect not to
               continue your participation in the group health insurance benefits and the right
               to discontinue your participation as provided for under COBRA by providing
               appropriate notice to Transport America. Except as expressly provided for in
               this paragraph, all benefits will be discontinued immediately upon the departure
               date. All contributions to your 401(k) Retirement Plan will cease, but this in
               no way affects your rights under the Plan. 



               



          		    C.       
               Outplacement Support Services. Transport America will provide you with
               Outplacement Support Services through Employers Association, Inc., located at
               9805 45th Avenue North, Plymouth, Minnesota 55442, for a period of thirty (30)
               days totaling $975. 



               


	


         3.       
          Severance Consideration. In consideration for the payments and
          benefits set forth above, you agree as follows: 









          		    A.       
               Confidentiality of this Agreement. You agree that the terms of this
               Agreement are, and shall remain, confidential and that you will not, either
               directly or indirectly, disclose either the terms or the fact of this Agreement
               to any person other than your attorney, your accountant, tax advisor, or spouse,
               or as may be required by either judicial or administrative order. You expressly
               agree not to disclose the terms of this Agreement to any employees or former
               employees of Transport America. 



               



          		    B.       
               Confidential Information. You agree at all times to use all reasonable
means to keep Confidential Information secret and confidential. You shall not at
any time use, disclose, duplicate, record, or in any other manner reproduce in
whole or in part any Confidential Information, except as necessary to determine
compliance with your obligations under this Agreement so long as such disclosure
is not to a competitor of Transport America.




               



















	  	
You shall not at any time render
services to any person or entity if providing such services would require or
likely result in using or disclosing Confidential Information. You acknowledge
that use or disclosure of any of Transport America’s confidential or
proprietary information in violation of this Agreement would have a materially
detrimental effect upon Transport America, the monetary loss from which would be
difficult, if not impossible, to measure. You agree that should you breach the
confidentiality restrictions of this Agreement, Transport America will be
entitled to seek injunctive relief and specific enforcement of this Agreement.



               



	  	        For
purposes of this Agreement, “Confidential Information” shall mean any
information that is not generally known by Transport America’s competitors or the
general public. Subject to the foregoing, Confidential Information includes, but is not
limited to, data of any type that was created by you in the course of your employment by
Transport America; data or conclusions or opinions formed by you in the course of
employment; manuals; trade secrets; methods, procedures, or techniques pertaining to the
core business of Transport America; specifications; systems; price lists; marketing plans;
sales or service analyses; financial information; customer names or customer specific
information; supplier names; employee names and personnel information; research and
development data; diagrams; drawings; videotapes, audiotapes, or computerized media used
as training regimens; and notes, memoranda, notebooks, and records or documents that were
created or used by you in the course of employment with Transport America. Confidential
Information does not include information that you can demonstrate by reliable,
corroborated documentary evidence (1) is generally available to the public, (2) became
generally available to the public through no act or failure to act by you, or (3) relates
to a business or service not provided by Transport America on or before October 17, 2002. 







               	C. 	       

                     Return of Property. You will return any Transport America
                    property in your possession and all copies thereof, including but not limited to
                    all office equipment, keys, documents, hardware and software and specifically
                    including any Confidential Information. 


                    



               	D. 	       

                     Release Of Claims. In consideration of the terms and conditions set
                    forth in this Agreement, you, your heirs, legal representatives, successors and
                    assigns hereby forever release and discharge Transport America, and its
                    officers, directors, agents and employees, as well as the successors and assigns
                    of each from any and all manner of actions, causes of actions, individual or
                    class action claims or demands of every kind whatsoever, whether known,
                    suspected or unknown in law or in equity, and however originating or existing to
                    the date hereof including, but not limited to, all claims or potential claims
                    arising out of state or federal law specifically including, but not limited to,
                    any claims under the Age Discrimination in Employment Act, 29 U.S.C. § 621,
                    et seq., Title VII of the Civil Rights Act of 1964, as amended,
                    the Americans with Disabilities Act, the Minnesota Human Rights Act, or any
                    other applicable laws including, but not limited to, any claims arising out of
                    the acts or statements of any of Transport America’s officers,
                    directors, agents or employees or the terms and conditions of your employment by
                    Transport America or the ending of that employment relationship. 


                    
















	  	        You
expressly understand and agree that, by signing this Agreement, you give up all claims of
every kind, whether you know about them now or not, that you may have against Transport
America as of the date of this Agreement. 







	



         4.       
          Consideration Period. You understand and acknowledge that you have
          an opportunity to consult with an attorney of your choosing prior to executing
          this Agreement. You acknowledge that you are entitled to take up to 21 days to
          consider the terms of this Agreement, and to discuss them with your attorney,
          before signing it although you are free to sign the Agreement at any time during
          the 21 day consideration period if you wish to do so. 



         5.       
          Rescission Period. You understand and acknowledge that to the
          extent this Agreement acts to release any and all claims you may have under the
          Age Discrimination in Employment Act you have the right to rescind this
          Agreement within seven (7) calendar days of signing it. You further understand
          that to the extent this Agreement acts to release any and all claims you may
          have under the Minnesota Human Rights Act you have the right to rescind this
          Agreement within fifteen (15) calendar days of signing it. To be effective, any
          rescission by you must be in writing and delivered to Transport America, in the
          care of the Director of Human Resources, Karen Vesovich, either by hand or by
          mail within the appropriate period. If sent by mail, the rescission must be: 







	  	  	a. 	  	Postmarked
within the applicable 7 or 15 day period;  







	  	  	b.  	  	Properly
addressed to Transport Corporation of America, Inc., attention: Karen
                    Vesovich, Director of Human Resources, 1715 Yankee Doodle Road,
Eagan, MN 55121;                     and  






	  	  	c.  	  	Sent by certified mail, return receipt requested.







	


        If
you rescind this Agreement, all of Transport America’s obligations to you under
this Agreement will immediately cease, Transport America will owe you no amounts or
benefits hereunder. If you rescind this Agreement, you further agree to reimburse us for
any payments heretofore made to you pursuant to Section 2 of this Agreement. 



         6.       
          General Terms. This Agreement may be executed in counterparts,
          each of which when executed and delivered, shall constitute one and the same
          instrument. This Agreement shall not in any way be construed as an admission of
          liability by Transport America or as an admission that we have acted wrongfully
          with respect to you. We specifically deny and disclaim any such liability or
          wrongful acts. In the event that any provision of this Agreement is found to be
          illegal or unenforceable, such provision will be severed or modified to the
          extent necessary to make it enforceable, and as so severed or modified, the
          remainder of this Agreement shall remain in full force and effect. No change or
          modification of this Agreement shall be valid unless in writing and signed by
          you and Transport America. 





















	



        This
Agreement sets forth the entire agreement between you and Transport America and fully
supersedes any prior agreements, contracts or understandings between you and Transport
America. You may not assign any of your rights or delegate any of your duties or
obligations under this Agreement. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Minnesota, without reference to its conflict of
law provisions. 



        If
this letter accurately reflects our understanding and agreement, please sign the original,
copy the document, and return the original to me. The copy is for your file. 



        We
sincerely appreciate your services to Transport America and its affiliates and wish you
well in new endeavors. 



Very truly yours, 



TRANSPORT CORPORATION OF
AMERICA, INC. 



By:       /s/ Michael
J. Paxton                
      Michael J. Paxton, Chairman, President and CEO 



Read and agreed to, with
declarations confirmed,
this _____ day of ____________, 2002 



      /s/ Jeffrey P.
Vandercook                
Jeffrey P. Vandercook