exv10w13






Exhibit 10.13




EMPLOYMENT SEPARATION AGREEMENT, WAIVER AND RELEASE




     THIS EMPLOYMENT SEPARATION AGREEMENT, WAIVER AND RELEASE (hereinafter “Agreement”) is made and
entered into by and between LANDSTAR SYSTEM, INC. (hereinafter referred to as “Company”) which term
shall include its subsidiaries and affiliates, and their directors, officers, attorneys,
representatives, employees, agents, successors and assigns, and JAMES M. HANDOUSH, and his heirs,
assigns, executors and administrators (collectively referred to as “Employee”).



     WHEREAS, Company and Employee desire to amicably end their employment relationship and to
fully and finally settle all existing or potential claims, whether known or unknown, that Employee
has, had or may have had against Company at any time on or prior to the effective date of this
Agreement;



     NOW, THEREFORE, the parties hereby agree as follows:



     1. Obligations of Company. In consideration of Employee’s agreement to the terms
herein, Company shall provide to Employee the following, which Company is not otherwise legally
obligated to provide:




	 	(a)	 	Company will pay Employee one (1) year’s pay as wages in lieu of
notice in the gross amount of TWO HUNDRED AND TWENTY THOUSAND and 00/100 dollars
($220,000.00), less standard payroll deductions. This sum shall be payable for
the time period of February 1, 2011-January 31, 2012 by payroll checks made
payable to Employee in four (4) equal quarterly installments of FIFTY-FIVE
THOUSAND and 00/100 dollars ($55,000.00), with the first quarterly installment
to be mailed to Employee within ten (10) business days of the expiration of the
revocation period specified in paragraph 9 of this Agreement; and the remaining
quarterly installments to be mailed to Employee on or before the following
dates: July 31, 2011, October 31, 2011, and January 31, 2012. Provided,
however, that it is agreed that if Employee requests and is granted written
approval as provided in paragraph 3. below to become involved with a competing
business and Employee’s services commence with such business on or before
January 31, 2012, the payments under this paragraph 1.(a) will be proportionally
reduced so that no payment will be made for the time period of involvement with
such competing business prior to January 31, 2012.
	 
	 	(b)	 	On February 1, 2011, Company will deliver a check to Employee in
the gross amount of $224,259 less standard payroll deductions. Such amount
represents Employee’s 2010 4th quarter and year end discretionary
bonus payment (calculated based upon a total bonus amount of $270,249 less
$45,990 already paid to Employee). On




 









 






	 	 	 	February 1, 2011, Company will also deliver to Employee a check representing
Employee’s final paycheck for work performed through January 31, 2011.
	 
	 	(c)	 	Company will pay Employee the gross sum of SEVENTEEN THOUSAND
SEVEN HUNDRED AND SIXTY NINE and 15/100 dollars ($17,769.15), less standard
payroll deductions, in lieu of 20 days of accrued and unused vacation and one
floating holiday. This sum shall be payable by payroll check made payable to
Employee and mailed to Employee within ten (10) business days of the expiration
of the revocation period specified in paragraph 9 of this Agreement.
	 
	 	(d)	 	Company agrees not to contest any claim by Employee for
unemployment compensation benefits.
	 
	 	(e)	 	Should Employee timely elect to continue group health insurance
coverage pursuant to his rights under COBRA, Company will pay Employee’s premium
for this COBRA continuation coverage for a period of 12 months following
Employee’s termination or until Employee becomes covered under another group
health insurance plan offered by a subsequent employer, whichever occurs first.
	 
	 	(f)	 	Money held under the Landstar System, Inc. 401(k) Savings Plan
will be administered in accordance with the terms of that Plan.
	 
	 	(g)	 	Money held under the Landstar System, Inc. Supplemental Executive
Retirement Plan will be administered in accordance with the terms of that Plan.
	 
	 	(h)	 	Stock options and restricted stock, in each case as vested as of
February 1, 2011, will be administered under the terms of the Amended and
Restated Landstar System, Inc. 2002 Employee Stock Option and Stock Incentive
Plan.





     2. Obligations of Employee. In consideration of the foregoing special separation
arrangements provided by Company, Employee agrees as follows:




	 	(a)	 	Employee acknowledges he has been separated from his employment
with Company effective February 1, 2011.
	 
	 	(b)	 	Employee waives, and releases Company from, any claims,
demands, damages, lawsuits, obligations, promises, administrative actions,
charges, and causes of action, both known and unknown, in law or in equity, of
any kind whatsoever, including, but not limited to, all matters relating to or
arising out of Employee’s employment with
Company, compensation by Company, or separation from employment by




 









 






	 	 	 	Company.
This Waiver and Release covers any causes of action or claims under Title
VII of the Civil Rights Act of 1964, as amended; the Employee Retirement
Income Security Act of 1974 (“ERISA”), as amended; the Age Discrimination in
Employment Act of 1967 (“ADEA”), as amended; the Civil Rights Act of 1866,
as amended; the Americans with Disabilities Act of 1990; the Family and
Medical Leave Act of 1993; Executive Orders 11246 and 11478; the National
Labor Relations Act, as amended; the Fair Labor Standards Act of 1938, as
amended; the Equal Pay Act of 1963, as amended; the Consolidated Omnibus
Budget Reconciliation Act of 1984 (“COBRA”), as amended; the Sarbanes-Oxley
Act of 2002; the Florida Civil Rights Act of 1992, as amended; Fla. Stat. §§
448.101-448.104; Fla. Stat. § 440.205; and any other state, federal or local
law, ordinance or constitutional provision, and any claims or causes of
action founded in tort (including negligence or intentional torts), contract
(oral, written, or implied), or any other common law or equitable basis of
action.
	 
	 	(c)	 	Employee shall not disclose, either directly or indirectly, any
information whatsoever regarding any of the terms or the existence of this
Agreement or of any other claim Employee has, had, or may have had against
Company, to any person or organization, including, but not limited to, members
of the press and media, present and former employees of Company, past, current
or prospective clients, customers or agents of Company, companies which do
business with Company, or other members of the public. The only exceptions to
Employee’s promise of confidentiality herein is that Employee may reveal such
terms of this Agreement as are necessary to comply with a request made by the
Internal Revenue Service, as otherwise compelled by a court or agency of
competent jurisdiction, or as necessary to comply with requests from Employee’s
accountants or attorneys for legitimate business purposes. Each breach by
Employee of this promise of confidentiality shall be a material breach of this
Agreement, for which the parties agree that Company would suffer irreparable
damage to its reputation.
	 
	 	(d)	 	Employee agrees to refrain from expressing (or causing others
to express) to any third party, any derogatory or negative opinions, comments,
or statements concerning Company, including to friends, employees, clients,
customers, agents, contractor, suppliers, vendors or members of the press or
media.
	 
	 	(e)	 	Nothing in this Agreement shall preclude Employee from filing a
charge or complaint of discrimination or retaliation with Equal Employment
Opportunity Commission (“EEOC”) or any other federal,
state or local governmental agency or department, nor shall anything in this
Agreement be construed to preclude or impose any condition




 









 






	 	 	 	precedent, any
penalty or any other limitation adversely affecting Employee’s right to
challenge the validity of his waiver of claims under the Age Discrimination
in Employment Act. Employee, however, represents that, while he is not
legally barred from doing so, he has not filed and does not intend to file
any complaints or charges of discrimination or retaliation with EEOC or any
federal, state or local agency and he understands that the Company has
relied on his representation in this paragraph in agreeing to perform the
payment obligations in paragraph 1 of this Agreement. Employee further
agrees that, with respect to the claims he is waiving in this Agreement,
Employee is waiving his right to recover monetary damages, reinstatement or
any other damages or relief based on any complaint or charge of
discrimination or retaliation filed by Employee or by any person or entity
on his behalf, including, but not limited to, EEOC or any other federal,
state or local governmental agency or department. Employee further
acknowledges that he is not aware of any factual or legal basis to support
any such claims.
	 
	 	(f)	 	Employee agrees, for a two year period following his
termination of Employment with Company, to cooperate with the Company and its
attorneys, including, but not limited to, making himself available at
reasonable times to meet with the Company and/or its attorneys, for the purpose
of assisting the Company and/or its attorneys in conducting Company’s business
and in addressing matters, including, but not limited to matters in litigation
and matters that may become the subject of litigation, that arose during
Employee’s employment with Company or in any way concern Employee’s performance
of duties on behalf of Company during Employee’s employment with Company.
	 
	 	(g)	 	Employee agrees to comply with the Restrictive Covenants set
forth in paragraphs 3 of this Agreement.





     3. Restrictive Covenants.




	 	(a)	 	Employee acknowledges that, in his position as Vice President
and Co-Chief Operating Officer of Company and in earlier positions Employee
held with Company, Employee had access to and knowledge of detailed
confidential and proprietary information of and concerning Company, including,
but not limited to, Company’s business and its strategic plans, knowledge of
customers, customer lists, customer needs, agents, agent needs, agent lists,
computer programs, pricing, organization, rail and vendor contracts, business
processes, business methods, business transactions and
negotiations, other business operations, actual or potential claims by or
against Company, and actual, anticipated or threatened litigation concerning
Company (“collectively referred to as “Confidential




 









 






	 	 	 	Business Information”).
Employee agrees that Employee’s unauthorized use or disclosure of the
Company’s Confidential Business Information would cause irreparable harm to
the Company.
	 
	 	(b)	 	Employee recognizes that all of the documents and other
tangible items which contain any of Company’s Confidential Information are
Company’s property exclusively, including any items which Employee may have
developed or contributed to developing while working for Company.
	 
	 	(c)	 	Employee recognizes that all files, records, computer programs,
memoranda, materials, information, manuals, keys, credit cards, passwords,
technical notes and equipment Company has provided to Employee are also the
property of Company exclusively. All items described in this and the preceding
paragraphs are hereafter collectively referred to as “Company’s Property.”
	 
	 	(d)	 	Employee shall immediately:






	 	(i)	 	Refrain from taking any of Company’s Property
or allowing any of Company’s Property to be taken from Company’s
premises;
	 
	 	(ii)	 	Refrain from reproducing in any manner or
allowing to be reproduced any of Company’s Property or any information
contained therein;
	 
	 	(iii)	 	Refrain from removing any such reproduction
from Company’s premises; and
	 
	 	(iv)	 	Return to Company any original or reproduction
of Company’s Property in his possession.






	 	(e)	 	Unless Employee receives Company’s advance written consent as
described in paragraph 3(k) of this Agreement, for the remainder of Employee’s
employment with Company and for a period of one (1) year following Employee’s
February 1, 2011 termination from employment with Company, Employee shall not,
anywhere within the United States of America or Canada, either directly or
indirectly, either on his own behalf or on behalf of another individual or
business, engage in the following activities, or assist others in such
activities:






	 	(i)	 	Hiring, recruiting, or attempting to recruit,
for any business which competes with Company, or otherwise becoming
associated in such a business with, any person working for or employed
by Company or working for or employed by 




 









 






	 	 	 	Company at any time during the
twelve (12) months before Employee’s termination of his employment with
Company;
	 
	 	(ii)	 	Hiring, contracting with, recruiting, or
attempting to recruit, for any business which competes with Company, or
otherwise becoming associated in such a business with, any agent or
other independent contractor performing services for Company at any
time during the twelve (12) months before Employee’s termination of his
employment with Company;
	 
	 	(iii)	 	Soliciting any business from any of Company’s
current or prospective customers or agents. For purposes of this
Agreement, a prospective customer or agent is defined as any individual
or entity Company has actively solicited, planned to solicit, or
provided services to, during the twelve (12) months before Employee’s
termination of his employment with Company; and
	 
	 	(iv)	 	Entering into, engaging in, being employed by,
being connected to, consulting for, or possessing or acquiring any
direct or indirect ownership interest in any business which competes
with any business conducted by Company or any business planned to be
conducted by Company at the time of Employee’s termination from
Company.






	 	(f)	 	At no time during the remainder of Employee’s employment with
Company or at any time following the termination of Employee’s employment with
Company shall Employee disclose to any third party any of Company’s
Confidential Information without Company’s express written authorization as
provided in paragraph 3(k) of this Agreement, or unless compelled to do so by a
court or agency of competent jurisdiction provided, upon being served with any
order or subpoena compelling such disclosure, Employee shall promptly notify
Company’s President to allow Company to determine whether to seek an order
quashing or vacating any such order or subpoena.
	 
	 	(g)	 	The parties to this Agreement recognize that irreparable harm
would result from any breach by Employee of the covenants of this Agreement and
that monetary damages alone would not provide adequate relief for any such
breach. Accordingly, in addition to any other remedy which may be available to
Company, if Employee
breaches a restrictive covenant in this Agreement, the parties acknowledge
that injunctive relief in favor of Company is proper.




 









 






	 	(h)	 	If Employee breaches a covenant containing a specified term,
the term shall be extended by the period of time between Employee’s termination
of his relationship with Company and the date a court of competent jurisdiction
enters an injunction restraining further breach of the covenant.
	 
	 	(i)	 	If Company determines that Employee has breached any
Restrictive Covenant in this Agreement, Employee shall make himself available
for service of process within the State of Florida.
	 
	 	(j)	 	If a court of competent jurisdiction determines that any of the
restrictions in this Agreement are overbroad, Employee shall agree to
modification of the affected restriction(s) to permit enforcement to the
maximum extent allowed by law.
	 
	 	(k)	 	A consent which purports to waive or modify any of Employee’s
obligations under this Agreement or any other modification of this Agreement
shall be ineffective unless it is set forth in writing and signed by Company’s
Chief Executive Officer. With respect to the restrictions contained in
subparagraph 3.(e) above, it is agreed that Employee may request permission to
work with, or directly or indirectly assist, a business that provides services
in the transportation, logistics and/or supply chain sector(s). Company, in
turn, agrees to reasonably consider any such request by Employee for a written
consent and agrees not to impose any unreasonable conditions upon any such
consent. However, it is specifically recognized and agreed that it will not be
unreasonable for Company to withhold consent with respect to any such request
that would enable Employee to work with or directly or indirectly assist a
business that utilizes, or is considering utilizing, a network of sales agents
that competes with or is in any way similar in structure to the network of
sales agents under contract to Company.
	 
	 	(l)	 	The parties acknowledge that the restrictive covenants in this
paragraph are essential independent elements of this Agreement and that, but
for Employee agreeing to comply with them, Company would not have entered into
this Agreement with Employee. Accordingly, the Restrictive Covenants set forth
in this Agreement shall be construed as agreements independent of any other
provision in any other agreement by, between, among, or affecting Company and
Employee, and the existence of any claim or cause of action of Employee against
Company, whether predicated on this Agreement or otherwise, shall not
constitute or operate as a defense to
Company’s enforcement of any of the Restrictive Covenants contained in this
Agreement.




 









 






	 	(m)	 	It is expressly agreed that the Restrictive Covenants in this
paragraph shall survive the February 1, 2011 termination of Employee’s
employment with Company.
	 
	 	(n)	 	If any provision of this Agreement is declared invalid or
unenforceable by a court of competent jurisdiction, the remaining provisions
shall remain in full force and effect and shall be construed to effectuate the
purpose and intent of this Agreement.





     4. Non-Admission. Neither this Agreement, nor anything contained herein, is to be
construed as an admission by Company or Employee of any liability, wrongdoing, or unlawful conduct
whatsoever and the parties hereto specifically deny same.



     5. Entire Agreement. This Agreement contains the entire understanding and agreement
between the parties and shall not be modified or superseded except upon express written consent of
the parties to this Agreement. Employee represents and acknowledges that, in executing this
Agreement, he does not rely and has not relied upon any representation or statement made by Company
or its agents, representatives, or attorneys which is not set forth in this Agreement. Except for
the Indemnification Agreement, dated August 2, 2005, by and between the Company and the Employee,
this Agreement supersedes and renders null and void any prior agreements, written or oral, express
or implied between Company and Employee, including, without limitation, the Arbitration Agreement,
dated February 27, 2007, by and between the Company and Employee.



     6. Agreement Not to be Used as Evidence. This Agreement shall not be admissible as
evidence in any proceeding, except in any action in which a party to this Agreement seeks to
enforce this Agreement or alleges this Agreement has been breached.



     7. Attorneys’ Fees. Employee or Company shall be entitled to an award of costs and
attorneys’ fees, including any costs and attorneys’ fees on appeal, as prevailing party in any
action to enforce the terms of this Agreement (including seeking injunctive relief or rescission),
or to defend a claim, lawsuit or other type of action which has been waived herein.



     8. Opportunity to Consider and Confer. Company has advised Employee of Employee’s
right to consult with an attorney prior to executing this Agreement, and Employee acknowledges that
he has been given a period of 21 days within which to consider this Agreement. Employee and
Company acknowledge that each has had the opportunity to read, study, consider, and deliberate upon
this Agreement, have been given the opportunity to consult with an attorney or an otherwise
competent representative, and both parties fully understand and are in complete agreement with all
of the terms of this
Agreement. Accordingly, this Agreement having been mutually negotiated by the parties, no
term of this Agreement shall be construed against either party.



 









 





     9. Revocation Period/Effective Date. After signing this Agreement, Employee has a
period of seven (7) calendar days after the date of signing the Agreement during which he may
revoke this Agreement. Provided Employee does not exercise this revocation option within this
seven (7) day revocation period, this Agreement shall become effective upon the expiration of the
seven (7) day revocation period.



     10. Arbitration. Any dispute between the parties, except an action for injunctive or
other equitable relief (including, without limitation, any action arising under paragraph 3 of this
Agreement), which cannot be resolved by agreement of the parties, shall be fully and finally
resolved by binding arbitration before a single arbitrator appointed by, and proceeding under, the
rules of the American Arbitration Association. The parties agree that no class or consolidated
arbitration will be allowed under this Agreement. In the event any class action arbitration is
deemed to be arbitrable under this Agreement, then, in that event, the parties agree that this
arbitration clause shall be disregarded in its entirety and the parties shall litigate their
disputes subject to the jurisdiction and venue provisions set forth in paragraph 11 of this
Agreement. A demand for arbitration shall be filed with the American Arbitration Association and
served upon the other party no later than one (1) year after the dispute arises or the claim
accrues, whichever is sooner. The failure to file said demand within the one (1) year period shall
be deemed a full waiver and release of the claim. Any arbitration proceeding shall be kept
confidential by Employee and Company, and the parties agree that information regarding any
arbitration proceeding shall not be disclosed to third parties without the prior written consent of
the other party. Employee and Company agree to be fully and finally bound by the arbitration
award, and that judgment may be entered on the award in any court having jurisdiction thereof.



     11. Applicable Law, Jurisdiction And Venue. The laws of the State of Florida shall
govern the construction of this Agreement and performance of Company and Employee under this
Agreement without regard to the conflict of laws or choice of law rules of such state. Any
arbitration demanded by either party concerning this Agreement shall be conducted in the City of
Jacksonville, Duval County, Florida. Company and Employee hereby expressly consent to the
exclusive jurisdiction and venue of the state and federal courts situated in the county of Duval,
City of Jacksonville, State of Florida, for any injunctive relief hereunder and for any litigation
arising under this Agreement that is not subject to arbitration pursuant to the provisions of
paragraph 10 of this Agreement.



 









 





     IN WITNESS WHEREOF, and intending to be legally bound, LANDSTAR SYSTEM, INC., by its
authorized representative, and JAMES M. HANDOUSH, execute this Employment Separation Agreement,
Waiver and Release, consisting of ten (10) pages (including this signature page) and including
eleven (11) enumerated paragraphs, by signing below voluntarily and with full knowledge of the
significance of all of its provisions.



PLEASE READ CAREFULLY. THIS EMPLOYMENT SEPARATION AGREEMENT, WAIVER AND RELEASE INCLUDES A RELEASE
OF ALL KNOWN AND UNKNOWN CLAIMS.




     Executed at Jacksonville, Duval County, Florida, this 25th  day of January, 2011.




	 	 	 	 	 	 	 
	/s/ [illegible]	 	 	/s/ James M. Handoush
	Witness as to James M. Handoush	 	 	JAMES M. HANDOUSH






     Executed at Jacksonville, Duval County, Florida, this 26th day of January,
2011.





	 	 	 	 	 	 	 

	 	 	 	 	 	LANDSTAR SYSTEM, INC.
	 
	/s/ Joan Norve	 	By: 	 /s/ Michael K. Kneller
	Witness as to Landstar System, Inc.	 	 	Michael K. Kneller
	 
	 	 	 	 	Its: 	Vice President, General Counsel
	 	 	 	 	 	and Secretary