þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 62-1721435 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
942 South Shady Grove Road | ||
Memphis, Tennessee | 38120 | |
(Address of principal executive offices) | (ZIP Code) |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
Common Stock | Outstanding Shares at December 15, 2010 | |
Common Stock, par value $0.10 per share | 315,020,546 |
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
November 30,
2010
May 31,
(Unaudited)
2010
$
1,877
$
1,952
4,279
4,163
400
389
540
529
302
251
7,398
7,284
32,720
31,302
17,454
16,917
15,266
14,385
2,224
2,200
1,205
1,033
3,429
3,233
$
26,093
$
24,902
Table of Contents
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT SHARE DATA)
Table of Contents
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended
Six Months Ended
November 30,
November 30,
2010
2009
2010
2009
$
9,632
$
8,596
$
19,089
$
16,605
3,779
3,424
7,582
6,801
1,390
1,155
2,717
2,209
628
593
1,229
1,171
502
487
981
982
938
744
1,825
1,410
473
410
990
811
67
67
1,386
1,212
2,601
2,335
9,163
8,025
17,992
15,719
469
571
1,097
886
(23
)
(15
)
(41
)
(33
)
(9
)
(9
)
(16
)
(12
)
(32
)
(24
)
(57
)
(45
)
437
547
1,040
841
154
202
377
315
$
283
$
345
$
663
$
526
$
0.90
$
1.10
$
2.11
$
1.68
$
0.89
$
1.10
$
2.09
$
1.68
$
0.12
$
0.11
$
0.36
$
0.33
Table of Contents
Six Months Ended
November 30,
2010
2009
$
663
$
526
981
982
66
68
56
58
140
50
(79
)
(408
)
(53
)
240
253
304
(16
)
(463
)
2,011
1,357
(2,059
)
(1,549
)
7
33
(2,052
)
(1,516
)
(12
)
(625
)
25
24
4
5
(76
)
(69
)
(16
)
(59
)
(681
)
25
13
(75
)
(827
)
1,952
2,292
$
1,877
$
1,465
Table of Contents
(UNAUDITED)
Table of Contents
Three Months Ended
2010
2009
$
283
$
345
44
28
26
1
$
353
$
374
Six Months Ended
2010
2009
$
663
$
526
72
37
52
2
$
787
$
565
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
282
$
345
$
661
$
525
314
312
314
312
$
0.90
$
1.10
$
2.11
$
1.68
$
282
$
345
$
661
$
525
314
312
314
312
2
2
2
1
316
314
316
313
$
0.89
$
1.10
$
2.09
$
1.68
11.2
9.5
11.3
13.5
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
134
$
76
$
275
$
151
51
23
105
45
15
10
30
21
$
200
$
109
$
410
$
217
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
130
$
104
$
260
$
208
225
205
449
411
(265
)
(238
)
(530
)
(477
)
44
5
96
9
$
134
$
76
$
275
$
151
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
7
$
6
$
15
$
12
9
7
17
15
(1
)
(3
)
(2
)
(6
)
$
15
$
10
$
30
$
21
2010
2009
$
158
$
118
495
$
158
$
613
Table of Contents
FedEx Express Segment
FedEx Ground Segment
FedEx Freight Segment
FedEx Services Segment
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
5,992
$
5,314
$
11,904
$
10,238
2,077
1,837
4,038
3,567
1,221
1,068
2,479
2,050
434
465
849
916
(92
)
(88
)
(181
)
(166
)
$
9,632
$
8,596
$
19,089
$
16,605
$
264
$
345
$
621
$
449
296
238
583
447
(91
)
(12
)
(107
)
(10
)
$
469
$
571
$
1,097
$
886
Aircraft-
Aircraft
(1)
Related
(2)
Other
(3)
Total
$
186
$
156
$
459
$
801
986
4
183
1,173
724
83
807
480
20
500
493
12
505
1,431
143
1,574
(1)
Our obligation to purchase 15 of these aircraft (Boeing 777
Freighters, or B777Fs) is conditioned upon there being no event
that causes FedEx Express or its employees to no longer be
covered by the Railway Labor Act of 1926, as amended.
(2)
Primarily aircraft modifications.
(3)
Primarily vehicles, facilities, advertising and promotions
contracts, and for the remainder of 2011, a total of $322 million
of quarterly contributions to our U.S. Retirement Plans.
Table of Contents
B777F
(1)
B757
Total
1
9
10
6
9
15
6
6
3
3
3
3
10
10
29
18
47
(1)
Our obligation to purchase 15 of these B777F
aircraft is conditioned upon there being no
event that causes FedEx Express or its
employees to no longer be covered by the
Railway Labor Act of 1926, as amended.
Operating Leases
Aircraft
Total
Capital
and Related
Facilities
Operating
Leases
Equipment
and Other
Leases
$
4
$
393
$
659
$
1,052
8
504
1,199
1,703
119
499
1,042
1,541
2
473
887
1,360
2
455
807
1,262
14
2,003
5,292
7,295
149
$
4,327
$
9,886
$
14,213
20
$
129
Table of Contents
Table of Contents
Table of Contents
2010
2009
$
45
$
46
$
340
$
113
(11
)
(275
)
$
329
$
(162
)
Table of Contents
(UNAUDITED)
November 30, 2010
Table of Contents
May 31, 2010
Table of Contents
(UNAUDITED)
Three Months Ended November 30, 2010
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
8,002
$
1,718
$
(88
)
$
9,632
26
3,216
537
3,779
970
447
(27
)
1,390
1
564
64
(1
)
628
443
59
502
891
47
938
440
33
473
17
50
67
(58
)
(80
)
138
31
1,137
278
(60
)
1,386
7,598
1,653
(88
)
9,163
404
65
469
283
23
(306
)
(23
)
1
(1
)
(23
)
28
(34
)
6
(5
)
(3
)
(1
)
(9
)
283
391
69
(306
)
437
138
16
154
$
283
$
253
$
53
$
(306
)
$
283
Table of Contents
(UNAUDITED)
Three Months Ended November 30, 2009
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
7,240
$
1,442
$
(86
)
$
8,596
26
2,935
463
3,424
837
341
(23
)
1,155
1
534
58
593
1
436
50
487
707
37
744
379
31
410
(53
)
(56
)
109
25
995
255
(63
)
1,212
6,767
1,344
(86
)
8,025
473
98
571
345
42
(387
)
(23
)
12
(4
)
(15
)
28
(36
)
8
(5
)
(4
)
(9
)
345
487
102
(387
)
547
167
35
202
$
345
$
320
$
67
$
(387
)
$
345
Table of Contents
(UNAUDITED)
Six Months Ended November 30, 2010
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
15,895
$
3,364
$
(170
)
$
19,089
64
6,465
1,053
7,582
1,890
879
(52
)
2,717
2
1,101
128
(2
)
1,229
875
106
981
1,732
93
1,825
923
67
990
17
50
67
(129
)
(172
)
301
63
2,123
531
(116
)
2,601
14,954
3,208
(170
)
17,992
941
156
1,097
663
49
(712
)
(47
)
9
(3
)
(41
)
55
(69
)
14
(8
)
(7
)
(1
)
(16
)
663
923
166
(712
)
1,040
334
43
377
$
663
$
589
$
123
$
(712
)
$
663
Table of Contents
(UNAUDITED)
Six Months Ended November 30, 2009
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
14,091
$
2,670
$
(156
)
$
16,605
49
5,828
924
6,801
1,633
612
(36
)
2,209
2
1,054
116
(1
)
1,171
1
874
107
982
1,338
72
1,410
751
60
811
(100
)
(29
)
129
48
1,925
481
(119
)
2,335
13,374
2,501
(156
)
15,719
717
169
886
526
76
(602
)
(52
)
26
(7
)
(33
)
59
(75
)
16
(7
)
(4
)
(1
)
(12
)
526
740
177
(602
)
841
255
60
315
$
526
$
485
$
117
$
(602
)
$
526
Table of Contents
(UNAUDITED)
Six Months Ended November 30, 2010
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
(6
)
$
1,755
$
259
$
3
$
2,011
(1
)
(1,968
)
(90
)
(2,059
)
6
1
7
(1
)
(1,962
)
(89
)
(2,052
)
(94
)
100
(6
)
113
(113
)
5
(5
)
(12
)
(12
)
25
25
4
4
(76
)
(76
)
(141
)
206
(124
)
(59
)
11
14
25
(148
)
10
60
3
(75
)
1,310
258
443
(59
)
1,952
$
1,162
$
268
$
503
$
(56
)
$
1,877
(UNAUDITED)
Six Months Ended November 30, 2009
Guarantor
Non-guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
(333
)
$
1,373
$
353
$
(36
)
$
1,357
(1,446
)
(103
)
(1,549
)
32
1
33
(1,414
)
(102
)
(1,516
)
54
55
(109
)
35
(35
)
70
(70
)
(500
)
(125
)
(625
)
24
24
5
5
(69
)
(69
)
(16
)
(16
)
(502
)
35
(214
)
(681
)
6
7
13
(835
)
44
(36
)
(827
)
1,768
272
304
(52
)
2,292
$
933
$
272
$
348
$
(88
)
$
1,465
Table of Contents
PUBLIC ACCOUNTING FIRM
FedEx Corporation
December 17, 2010
Table of Contents
the overall customer demand for our various services;
the volumes of transportation services provided through our networks, primarily measured by
our average daily volume and shipment weight;
the mix of services purchased by our customers;
the prices we obtain for our services, primarily measured by yield (revenue per package or
pound or revenue per hundredweight for LTL freight shipments);
our ability to manage our cost structure (capital expenditures and operating expenses) to
match shifting volume levels; and
the timing and amount of fluctuations in fuel prices and our ability to recover incremental
fuel costs through our fuel surcharges.
Table of Contents
Three Months Ended
Percent
Six Months Ended
Percent
2010
2009
Change
2010
2009
Change
$
9,632
$
8,596
12
$
19,089
$
16,605
15
469
571
(18
)
1,097
886
24
4.9
%
6.6
%
(170
)bp
5.7
%
5.3
%
40
bp
$
283
$
345
(18
)
$
663
$
526
26
$
0.89
$
1.10
(19
)
$
2.09
$
1.68
24
Change in
Percent change in
Change in
Percent change in
Operating Income
Operating Income
Revenues
Revenue
(Loss)
(Loss)
Three
Six
Three
Six
Three
Six
Three
Six
Months
Months
Months
Months
Months
Months
Months
Months
Ended
Ended
Ended
Ended
Ended
Ended
Ended
Ended
$
678
$
1,666
13
16
$
(81
)
$
172
(23
)
38
240
471
13
13
58
136
24
30
153
429
14
21
(79
)
(97
)
(658
)
(970
)
(31
)
(67
)
(7
)
(7
)
(4
)
(15
)
NM
NM
$
1,036
$
2,484
12
15
$
(102
)
$
211
(18
)
24
Table of Contents
Table of Contents
(1)
Package statistics do not include the operations of FedEx SmartPost.
Table of Contents
(1)
Package statistics do not include the operations of FedEx SmartPost.
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
$
3,779
$
3,424
$
7,582
$
6,801
1,390
1,155
2,717
2,209
628
593
1,229
1,171
502
487
981
982
938
744
1,825
1,410
473
410
990
811
67
67
1,386
1,212
2,601
2,335
$
9,163
$
8,025
$
17,992
$
15,719
(1)
Represents charges associated with the combination of FedEx Freight and FedEx National LTL operations, which will be
effective January 30, 2011.
Percent of Revenue
Percent of Revenue
Three
Months
Ended
2010
Three
Months
Ended
2009
Six
Months
Ended
2010
Six
Months
Ended
2009
39.2
%
39.8
%
39.7
%
41.0
%
14.4
13.4
14.2
13.3
6.5
6.9
6.4
7.0
5.2
5.7
5.2
5.9
9.8
8.7
9.6
8.5
4.9
4.8
5.2
4.9
0.7
0.4
14.4
14.1
13.6
14.1
95.1
93.4
94.3
94.7
4.9
%
6.6
%
5.7
%
5.3
%
Table of Contents
Table of Contents
Table of Contents
FedEx Express (express transportation)
FedEx Trade Networks (global trade services)
FedEx SupplyChain Systems (logistics services)
FedEx Ground (small-package ground delivery)
FedEx SmartPost (small-parcel consolidator)
FedEx Freight LTL Group:
FedEx Freight (fast-transit LTL freight transportation)
FedEx National LTL (economical LTL freight transportation)
FedEx Custom Critical (time-critical transportation)
FedEx Services (sales, marketing and information technology functions)
FedEx Office (document and business services and package
acceptance)
Table of Contents
Table of Contents
Three Months Ended
Percent
Six Months Ended
Percent
2010
2009
Change
2010
2009
Change
$
1,489
$
1,372
9
$
2,980
$
2,703
10
416
395
5
848
803
6
666
626
6
1,327
1,227
8
2,571
2,393
7
5,155
4,733
9
2,009
1,763
14
3,983
3,357
19
165
151
9
313
285
10
4,745
4,307
10
9,451
8,375
13
530
490
8
1,053
939
12
435
321
36
841
581
45
69
63
10
139
124
12
1,034
874
18
2,033
1,644
24
213
133
60
420
219
92
5,992
5,314
13
11,904
10,238
16
2,253
2,036
11
4,511
4,079
11
388
283
37
757
538
41
427
396
8
830
781
6
265
251
6
520
503
3
802
638
26
1,556
1,209
29
320
267
20
672
528
27
512
470
9
1,025
939
9
761
628
21
1,412
1,212
17
5,728
4,969
15
11,283
9,789
15
$
264
$
345
(23
)
$
621
$
449
38
4.4
%
6.5
%
(210
)bp
5.2
%
4.4
%
80
bp
(1)
International domestic revenues include our international intra-country domestic express operations.
(2)
Other revenues include FedEx Trade Networks and, beginning in the second quarter of 2010, FedEx SupplyChain Systems.
Percent of Revenue
Percent of Revenue
Three
Three
Six
Six
Months
Months
Months
Months
Ended
Ended
Ended
Ended
2010
2009
2010
2009
37.6
%
38.3
%
37.9
%
39.8
%
6.5
5.3
6.3
5.3
7.1
7.5
7.0
7.6
4.4
4.7
4.4
4.9
13.4
12.0
13.1
11.8
5.3
5.0
5.6
5.2
8.6
8.9
8.6
9.2
12.7
11.8
11.9
11.8
95.6
93.5
94.8
95.6
4.4
%
6.5
%
5.2
%
4.4
%
Table of Contents
Three Months Ended
Percent
Six Months Ended
Percent
2010
2009
Change
2010
2009
Change
1,196
1,154
4
1,182
1,141
4
626
606
3
625
611
2
865
858
1
855
840
2
2,687
2,618
3
2,662
2,592
3
585
529
11
575
502
15
354
338
5
339
315
8
3,626
3,485
4
3,576
3,409
5
$
19.75
$
18.87
5
$
19.70
$
18.51
6
10.54
10.36
2
10.59
10.27
3
12.24
11.58
6
12.12
11.40
6
15.19
14.51
5
15.13
14.26
6
54.54
52.88
3
54.12
52.27
4
7.39
7.09
4
7.22
7.07
2
20.77
19.62
6
20.65
19.19
8
7,459
7,193
4
7,179
6,883
4
3,320
2,571
29
3,171
2,353
35
1,243
1,207
3
1,242
1,253
(1
)
12,022
10,971
10
11,592
10,489
11
$
1.13
$
1.08
5
$
1.15
$
1.07
7
2.08
1.98
5
2.07
1.93
7
0.88
0.83
6
0.87
0.77
13
1.36
1.26
8
1.37
1.22
12
(1)
Package and freight statistics include only the operations of FedEx Express.
(2)
International domestic statistics include our international intra-country domestic express operations.
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
7.00
%
5.50
%
7.00
%
1.00
%
8.50
7.50
10.00
7.50
7.82
6.35
8.17
4.81
7.00
5.50
7.00
1.00
13.50
12.50
14.00
12.50
10.59
9.57
10.83
8.50
Table of Contents
Three Months Ended
Percent
Six Months Ended
Percent
2010
2009
Change
2010
2009
Change
$
1,916
$
1,712
12
$
3,755
$
3,349
12
161
125
29
283
218
30
2,077
1,837
13
4,038
3,567
13
318
288
10
625
570
10
845
733
15
1,627
1,426
14
67
63
6
129
121
7
83
83
165
168
(2
)
3
2
NM
4
3
NM
42
40
5
86
78
10
227
196
16
448
380
18
196
194
1
371
374
(1
)
1,781
1,599
11
3,455
3,120
11
$
296
$
238
24
$
583
$
447
30
14.3
%
13.0
%
130
bp
14.4
%
12.5
%
190
bp
3,843
3,602
7
3,686
3,454
7
1,484
1,265
17
1,287
1,135
13
$
7.89
$
7.54
5
$
7.94
$
7.56
5
$
1.72
$
1.57
10
$
1.70
$
1.50
13
Percent of Revenue
Percent of Revenue
Three
Three
Six
Six
Months
Months
Months
Months
Ended
Ended
Ended
Ended
2010
2009
2010
2009
15.3
%
15.7
%
15.5
%
16.0
%
40.7
39.9
40.3
40.0
3.2
3.4
3.2
3.4
4.0
4.5
4.1
4.7
0.1
0.1
0.1
0.1
2.0
2.2
2.1
2.2
10.9
10.7
11.1
10.6
9.5
10.5
9.2
10.5
85.7
87.0
85.6
87.5
14.3
%
13.0
%
14.4
%
12.5
%
Table of Contents
Three Months Ended
Six Months Ended
2010
2009
2010
2009
5.50
%
3.75
%
5.50
%
2.75
%
6.00
4.00
6.00
4.00
5.66
3.92
5.74
3.47
Table of Contents
Three Months Ended
Percent
Six Months Ended
Percent
2010
2009
Change
2010
2009
Change
$
1,221
$
1,068
14
$
2,479
$
2,050
21
584
513
14
1,184
1,020
16
185
168
10
389
286
36
31
27
15
65
56
16
62
46
35
110
101
9
133
104
28
264
198
33
45
35
29
91
69
32
67
NM
67
NM
108
98
10
217
150
45
97
89
9
199
180
11
1,312
1,080
21
2,586
2,060
26
$
(91
)
$
(12
)
(658
)
$
(107
)
$
(10
)
(970
)
(7.5
%)
(1.1
%)
(640
)bp
(4.3
%)
(0.5
%)
(380
)bp
89.4
82.9
8
90.6
77.0
18
1,115
1,128
(1
)
1,125
1,119
1
$
18.27
$
17.09
7
$
17.77
$
17.45
2
(1)
Includes severance, impairment and other charges associated with the combination of FedEx Freight and FedEx National LTL operations, which will be effective January 30, 2011.
(2)
Certain functions were transferred from the FedEx Freight segment to FedEx Services and FedEx TechConnect effective August 1, 2009. For 2010, the costs associated with these functions, previously a
direct charge, were allocated to the FedEx Freight segment through intercompany allocations.
Table of Contents
Percent of Revenue
Percent of Revenue
Three
Three
Six
Six
Months
Months
Months
Months
Ended
Ended
Ended
Ended
2010
2009
2010
2009
47.8
%
48.0
%
47.8
%
49.8
%
15.2
15.7
15.7
13.9
2.5
2.5
2.6
2.7
5.1
4.3
4.4
4.9
10.9
9.8
10.6
9.7
3.7
3.3
3.7
3.4
5.5
2.7
8.9
9.2
8.8
7.3
7.9
8.3
8.0
8.8
107.5
101.1
104.3
100.5
(7.5)
%
(1.1)
%
(4.3)
%
(0.5)
%
(1)
Includes charges associated with the combination of FedEx Freight and FedEx National LTL operations, which will be effective January 30, 2011.
(2)
Certain functions were transferred from the FedEx Freight segment to FedEx Services and FedEx TechConnect effective August 1, 2009. For 2010, the costs associated with these functions, previously a direct
charge, were allocated to the FedEx Freight segment through intercompany allocations.
Three Months Ended
Six Months Ended
2010
2009
2010
2009
15.30
%
12.50
%
15.10
%
10.80
%
16.40
14.20
16.40
14.20
15.80
13.40
15.60
12.90
Table of Contents
2010
2009
$
663
$
526
1,243
1,158
105
(327
)
2,011
1,357
(2,059
)
(1,549
)
7
33
(2,052
)
(1,516
)
(12
)
(625
)
25
24
(76
)
(69
)
4
(11
)
(59
)
(681
)
25
13
$
(75
)
$
(827
)
Table of Contents
Percent Change
2010/2009
Three Months Ended
Six Months Ended
Three Months
Six Months
2010
2009
2010
2009
Ended
Ended
$
660
$
303
$
1,407
$
859
118
64
133
167
203
353
(20
)
(42
)
124
59
196
115
110
70
92
106
195
162
(13
)
20
38
33
58
60
15
(3
)
$
1,047
$
668
$
2,059
$
1,549
57
33
760
377
1,604
1,019
102
57
119
105
191
216
13
(12
)
59
106
91
172
(44
)
(47
)
108
80
172
142
35
21
1
1
$
1,047
$
668
$
2,059
$
1,549
57
33
Table of Contents
Table of Contents
Payments Due by Fiscal Year (Undiscounted)
(in millions)
2011
(1)
2012
2013
2014
2015
Thereafter
Total
$
1,052
$
1,703
$
1,541
$
1,360
$
1,262
$
7,295
$
14,213
101
183
83
20
12
143
542
72
126
98
97
78
1,737
2,208
322
322
342
990
724
480
493
1,431
4,460
37
37
250
300
250
989
1,789
4
8
119
2
2
14
149
$
2,180
$
3,010
$
2,865
$
2,209
$
1,847
$
11,609
$
23,720
(1)
Cash obligations for the remainder of 2011.
Table of Contents
economic conditions in the global markets in which we operate;
the impact of any international conflicts or terrorist activities on the U.S. and global
economies in general, the transportation industry or us in particular, and what effects these
events will have on our costs or the demand for our services;
Table of Contents
damage to our reputation or loss of brand equity;
disruptions to the Internet or our technology infrastructure, including those impacting our
computer systems and web site, which can adversely affect shipment levels;
the price and availability of jet and vehicle fuel;
the impact of intense competition on our ability to maintain or increase our prices
(including our fuel surcharges in response to rising fuel costs) or to maintain or grow our
market share;
our ability to manage our cost structure for capital expenditures and operating expenses,
and match it to shifting and future customer volume levels;
our ability to effectively operate, integrate, leverage and grow acquired businesses, and
to continue to support the value we allocate to these acquired businesses, including their
goodwill;
any impacts on our businesses resulting from new domestic or international government laws
and regulation, including regulatory actions affecting global aviation rights, increased air
cargo and other security or safety requirements, and tax, accounting, trade (such as
protectionist measures enacted in response to weak economic conditions), labor (such as
card-check legislation or changes to the Railway Labor Act affecting FedEx Express employees),
environmental (such as climate change legislation) or postal rules;
changes in foreign currency exchange rates, especially in the euro, Chinese yuan, Canadian
dollar, British pound and Japanese yen, which can affect our sales levels and foreign currency
sales prices;
the impact of costs related to (i) challenges to the status of FedEx Grounds
owner-operators as independent contractors, rather than employees, and (ii) any related
changes to our relationship with these owner-operators;
any liability resulting from and the costs of defending against class-action litigation,
such as wage-and-hour and discrimination and retaliation claims, and any other legal
proceedings;
our ability to maintain good relationships with our employees and prevent attempts by labor
organizations to organize groups of our employees, which could significantly increase our
operating costs and reduce our operational flexibility;
increasing costs, the volatility of costs and funding requirements and other legal mandates
for employee benefits, especially pension and healthcare benefits;
significant changes in the volumes of shipments transported through our networks, customer
demand for our various services or the prices we obtain for our services;
market acceptance of our new service and growth initiatives;
the impact of technology developments on our operations and on demand for our services, and
our ability to continue to identify and eliminate unnecessary information technology
redundancy and complexity throughout the organization;
adverse weather conditions or natural disasters, such as earthquakes, volcanoes, and
hurricanes, which can disrupt our electrical service, damage our property, disrupt our
operations, increase our fuel costs and adversely affect our shipment levels;
Table of Contents
widespread outbreak of an illness or any other communicable disease, or any other public
health crisis;
availability of financing on terms acceptable to us and our ability to maintain our current
credit ratings, especially given the capital intensity of our operations;
the outcome of negotiations to reach a new collective bargaining agreement with the union
that represents the pilots of FedEx Express; and
other risks and uncertainties you can find in our press
releases and SEC filings, including the risk factors identified under the heading Risk
Factors in Managements Discussion and Analysis of Results of Operations and Financial
Condition in our Annual Report, as updated by our quarterly reports on Form 10-Q.
Table of Contents
Table of Contents
50
51
Table of Contents
Exhibit
Number
Description of Exhibit
Compensation Arrangements with Outside Directors.
Supplemental Agreement No. 12 (and related side letter) dated as of September 3, 2010,
Supplemental Agreement No. 14 (and related side letter) dated as of October 25, 2010, and
Supplemental Agreement No. 15 (and related side letter) dated as of October 29, 2010, each
amending the Boeing 777 Freighter Purchase Agreement dated as of November 7, 2006 between The
Boeing Company and Federal Express Corporation. Confidential treatment has been requested for
confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
Amendment dated November 22, 2010 to the Transportation Agreement dated July 31, 2006 between
the United States Postal Service and Federal Express Corporation. Confidential treatment has
been requested for confidential commercial and financial information, pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.
Computation of Ratio of Earnings to Fixed Charges.
Letter re: Unaudited Interim Financial Statements.
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under
the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under
the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Interactive Data Files.
Table of Contents
52
FEDEX CORPORATION
Date: December 17, 2010
/s/ JOHN L. MERINO
JOHN L. MERINO
CORPORATE VICE PRESIDENT AND
PRINCIPAL ACCOUNTING OFFICER
Table of Contents
E-1
Exhibit
Number
Description of Exhibit
Compensation Arrangements with Outside Directors.
Supplemental Agreement No. 12 (and related side letter) dated as of September 3, 2010,
Supplemental Agreement No. 14 (and related side letter) dated as of October 25, 2010, and
Supplemental Agreement No. 15 (and related side letter) dated as of October 29, 2010, each
amending the Boeing 777 Freighter Purchase Agreement dated as of November 7, 2006 between The
Boeing Company and Federal Express Corporation. Confidential treatment has been requested for
confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
Amendment dated November 22, 2010 to the Transportation Agreement dated July 31, 2006 between
the United States Postal Service and Federal Express Corporation. Confidential treatment has
been requested for confidential commercial and financial information, pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.
Computation of Ratio of Earnings to Fixed Charges.
Letter re: Unaudited Interim Financial Statements.
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under
the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under
the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Interactive Data Files.
| a quarterly retainer of $20,000; |
| $2,000 for each in-person Board meeting attended; and |
| $2,000 for each in-person committee meeting attended. |
Delivery Month for | ||
new Aircraft | ||
[ * ] | ||
[ * ] |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
S12 - 1
1. | Remove and replace, in its entirety, the Table of Contents with the revised Table of Contents attached hereto to reflect the changes made by this Supplemental Agreement No. 12. | |
2. | Customer and Boeing hereby acknowledge and confirm that two (2) new Aircraft with delivery months of [ * ] and [ * ] are hereby added to the Purchase Agreement and will be collectively called Block D Aircraft (Block D). | |
3. | [ * ] | |
4. | Table 1-D attached hereto is hereby added to the Purchase Agreement to incorporate the delivery dates and pricing of the Block D Aircraft. | |
5. | Exhibit A4 is hereby added to the Purchase Agreement to incorporate an updated Detail Specification and to reflect the Optional Features [ * ] for all Block D Aircraft. | |
6. | Customer and Boeing agree that the Block D Aircraft will be subject to and benefit from the same terms and conditions as the Aircraft except as set forth herein and in writing signed by the authorized representatives of the parties. | |
7. | Customer and Boeing agree that the Block D Aircraft will be treated exactly as Block B Aircraft except: |
7.1 | Delivery dates and pricing of Block D Aircraft will be determined by Table 1-D. | ||
7.2 | Letter Agreement FED-PALA-1001683 titled Special Matters for Block D Aircraft attached hereto is hereby added to the Purchase Agreement to reflect certain agreements between Customer and Boeing with respect to Block D Aircraft. | ||
[ * ] |
9. | As a result of adding the Block D Aircraft to the Purchase Agreement, [ * ]. |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
S12 - 2
11. | Boeings offer to add the Block D Aircraft to the Purchase Agreement will expire on September 3, 2010, if not accepted by written notice by such date. |
12. | This Supplemental Agreement shall not be effective unless and until, and the matters expressed herein are expressly conditioned upon, Customer receiving approval from the board of directors of Customers parent company, FedEx Corporation. Should such approval not be granted and confirmed in writing by Customer to Boeing by September 28, 2010, this Supplemental Agreement shall automatically terminate and be null and void in all respects, and neither party shall owe any obligation to the other party with respect to the matters expressed herein; provided, however, no such termination shall otherwise impact the parties rights and obligations existing under the Purchase Agreement prior to this Supplemental Agreement. For the sake of clarity, neither party shall be deemed to be in default hereunder for failing to have performed any obligation created under this Supplement Agreement, including without limitation any payment obligation, prior to the receipt by Boeing of the aforementioned written confirmation. |
THE BOEING COMPANY
|
FEDERAL EXPRESS CORPORATION | |||
|
||||
By: /s/ RICHARD R. OCHS
|
By: /s/ PHILLIP C. BLUM | |||
|
|
|||
Its: Attorney-In-Fact
|
Its: VP, Aircraft Acquisitions & SAO
|
S12 - 3
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
P.A. No. 3157 | SA 12 |
1
SA | ||||||
LETTER AGREEMENT | NUMBER | |||||
|
||||||
3157-01
|
777 Spare Parts Initial Provisioning | |||||
|
||||||
3157-02
|
Demonstration Flight Waiver | |||||
|
||||||
6-1162-RCN-1785
|
[ * ] | |||||
|
||||||
6-1162-RCN-1789
|
Option Aircraft Attachment to Letter 6-1162-RCN-1789 |
Exercised in
SA # 4 |
||||
|
||||||
6-1162-RCN-1790
|
Special Matters | |||||
|
||||||
6-1162-RCN-1791
|
Performance Guarantees | 4 | ||||
|
||||||
6-1162-RCN-1792
|
Liquidated Damages Non-Excusable Delay | |||||
|
||||||
6-1162-RCN-1793
|
Open Configuration Matters | |||||
|
||||||
6-1162-RCN-1795
|
AGTA Amended Articles | |||||
|
||||||
6-1162-RCN-1796
|
777 First-Look Inspection Program | |||||
|
||||||
6-1162-RCN-1797
|
Licensing and Customer Supplemental Type Certificates | |||||
|
||||||
6-1162-RCN-1798
|
777 Boeing Converted Freighter |
Deleted in
SA # 4 |
||||
|
||||||
6-1162-RCN-1798 R1
|
777 Boeing Converted Freighter | 4 | ||||
|
||||||
6-1162-RCN-1799
|
[ * ] | |||||
|
||||||
6-1162-RRO-1062
|
Option Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1065
|
Performance Guarantees for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1066R1
|
Special Matters for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1067
|
Special Matters for Option Aircraft detailed in Letter Agreement 6-1162-RRO-1062 | 4 | ||||
|
||||||
6-1162-RRO-1068
|
Special Provision Block B Aircraft | 4 | ||||
|
||||||
FED-PALA-1000790R1
|
Special Matters for Block C Aircraft | 11 | ||||
|
||||||
FED-PALA-1001683
|
Special Matters for Block D Aircraft | 12 |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
P.A. No. 3157 | SA 12 |
2
SUPPLEMENTAL AGREEMENTS | DATED AS OF: | |
|
||
Supplemental Agreement No. 1
|
May 12, 2008 | |
|
||
Supplemental Agreement No. 2
|
July 14, 2008 | |
|
||
Supplemental Agreement No. 3
|
December 15, 2008 | |
|
||
Supplemental Agreement No. 4
|
January 9, 2009 | |
|
||
Supplemental Agreement No. 5
|
January 11, 2010 | |
|
||
Supplemental Agreement No. 6
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 7
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 8
|
April 30, 2010 | |
|
||
Supplemental Agreement No. 9
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 10
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 11
|
August 19, 2010 | |
|
||
Supplemental Agreement No. 12
|
September 3, 2010 |
P.A. No. 3157 | SA 12 |
3
Airframe Model/MTOW: | 777-Freighter | 766000 pounds | Detail Specification: |
D019W007FED7F-1 Rev B
dated July 16, 2010 |
||||||
Engine Model/Thrust:
|
GE90-110B1L | 110100 pounds | Airframe Price Base Year/Escalation Formula: | Jul-10 | ECI-MFG/CPI | |||||
Airframe Price:
|
[ * ] | Engine Price Base Year/Escalation Formula: | N/A | N/A | ||||||
Optional Features:
|
[ * ] | |||||||||
|
||||||||||
Sub-Total of Airframe and Features:
|
[ * ] | Airframe Escalation Data: | ||||||||
Engine Price (Per Aircraft): | [ * ] | Base Year Index (ECI): | 106.8 | |||||||
Aircraft Basic Price (Excluding BFE/SPE): | [ * ] | Base Year Index (CPI): | 215.6 | |||||||
|
||||||||||
Buyer Furnished Equipment (BFE) Estimate:
|
[ * ] | |||||||||
Seller Purchased Equipment (SPE) Estimate:
|
[ * ] | |||||||||
Deposit per Aircraft:
|
[ * ] |
Escalation | Escalation Estimate | Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery): | ||||||||||||
Delivery | Number of | Factor | Adv Payment Base | At Signing | 24 Mos. | 21/18/15/12/9/6 Mos. | Total | |||||||
Date | Aircraft | (Airframe) | Price Per A/P | 1% | 4% | 5% | 35% | |||||||
Block D Aircraft | ||||||||||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
FED | Supplemental Agreement No. 12 |
Page 1
Exhibit A4 to
Purchase Agreement No. 3157 |
BOEING PROPRIETARY |
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
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[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] |
Supplemental Agreement No. 12 | BOEING PROPRIETARY |
Page 1
Exhibit A4 to
Purchase Agreement No. 3157 |
BOEING PROPRIETARY |
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
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[ * ] | [ * ] | [ * ] |
Supplemental Agreement No. 12 | BOEING PROPRIETARY |
Page 2
Exhibit A4 to
Purchase Agreement No. 3157 |
BOEING PROPRIETARY |
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] | ||
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* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
Supplemental Agreement No. 12 | BOEING PROPRIETARY |
Page 3
Subject: | Special Matters for Block D Aircraft | |
Reference: | Purchase Agreement No. 3157 (the Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 777-FREIGHTER aircraft (the Aircraft) |
7. | ADVANCE PAYMENT SETOFF RIGHTS |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
9. | PUBLIC ANNOUNCEMENT |
Very truly yours, | ||||
|
||||
THE BOEING COMPANY | ||||
|
||||
By:
|
/s/ RICHARD R. OCHS | |||
|
Its: Attorney-In-Fact | |||
|
||||
ACCEPTED AND AGREED TO this | ||||
|
||||
Date: September 3, 2010 | ||||
|
||||
FEDERAL EXPRESS CORPORATION | ||||
|
||||
By:
|
/s/ PHILLIP C. BLUM | |||
|
Its: VP, Aircraft Acquisitions & SAO |
Serial | Current Delivery | Revised Delivery | ||
Number | Month per SA # 8 | Month | ||
[ * ] | [ * ] | [ * ] |
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
S14 - 1
1. |
Remove and replace, in its entirety, the Table of Contents with the revised Table of
Contents attached hereto to reflect the changes made by this Supplemental Agreement No. 14.
|
2. |
Remove and replace, in its entirety, Table 1 to the Purchase Agreement with the revised Table
1 attached hereto to reflect changes relating to the Rescheduled Aircraft.
|
3. |
Customer hereby acknowledges and confirms that [ * ].
|
4. |
Customer and Boeing hereby acknowledge and confirm that Letter Agreement 6-1162-RRO-1144R1 is
hereby cancelled and replaced in its entirety with Letter Agreement 6-1162-RRO-1144R2.
|
5. |
Boeings offer to re-schedule the Rescheduled Aircraft (MSN [ * ]) will expire on November 1,
2010.
|
THE BOEING COMPANY | FEDERAL EXPRESS CORPORATION | |||||||
|
||||||||
By:
|
/s/ STUART C. ROSS | By: | /s/ PHILLIP C. BLUM | |||||
|
||||||||
|
Its: Attorney-In-Fact | Its: VP, Aircraft Acquisitions & SAO |
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
S14 - 2
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
P.A. No. 3157 | SA 14 | |||
BOEING PROPRIETARY |
1
SA | ||||||
LETTER AGREEMENT | NUMBER | |||||
|
||||||
3157-01
|
777 Spare Parts Initial Provisioning | |||||
|
||||||
3157-02
|
Demonstration Flight Waiver | |||||
|
||||||
6-1162-RCN-1785
|
[ * ] | |||||
|
||||||
6-1162-RCN-1789
|
Option Aircraft Attachment to Letter 6-1162-RCN-1789 |
Exercised in
SA # 4 |
||||
|
||||||
6-1162-RCN-1790
|
Special Matters | |||||
|
||||||
6-1162-RCN-1791
|
Performance Guarantees | 4 | ||||
|
||||||
6-1162-RCN-1792
|
Liquidated Damages Non-Excusable Delay | |||||
|
||||||
6-1162-RCN-1793
|
Open Configuration Matters | |||||
|
||||||
6-1162-RCN-1795
|
AGTA Amended Articles | |||||
|
||||||
6-1162-RCN-1796
|
777 First-Look Inspection Program | |||||
|
||||||
6-1162-RCN-1797
|
Licensing and Customer Supplemental Type Certificates | |||||
|
||||||
6-1162-RCN-1798
|
777 Boeing Converted Freighter |
Deleted in
SA #4 |
||||
|
||||||
6-1162-RCN-1798 R1
|
777 Boeing Converted Freighter | 4 | ||||
|
||||||
6-1162-RCN-1799
|
[ * ] | |||||
|
||||||
6-1162-RRO-1062
|
Option Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1065
|
Performance Guarantees for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1066R1
|
Special Matters for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1067
|
Special Matters for Option Aircraft detailed in
Letter Agreement 6-1162-RRO-1062 |
4 | ||||
|
||||||
6-1162-RRO-1068
|
Special Provision Block B Aircraft | 4 | ||||
|
||||||
FED-PALA-1000790R1
|
Special Matters for Block C Aircraft | 11 | ||||
|
||||||
FED-PALA-1001683
|
Special Matters for Block D Aircraft | 12 |
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
P.A. No. 3157 | SA 14 | |||
BOEING PROPRIETARY |
2
SUPPLEMENTAL AGREEMENTS | DATED AS OF: | |
|
||
Supplemental Agreement No. 1
|
May 12, 2008 | |
|
||
Supplemental Agreement No. 2
|
July 14, 2008 | |
|
||
Supplemental Agreement No. 3
|
December 15, 2008 | |
|
||
Supplemental Agreement No. 4
|
January 9, 2009 | |
|
||
Supplemental Agreement No. 5
|
January 11, 2010 | |
|
||
Supplemental Agreement No. 6
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 7
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 8
|
April 30, 2010 | |
|
||
Supplemental Agreement No. 9
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 10
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 11
|
August 19, 2010 | |
|
||
Supplemental Agreement No. 12
|
September 3, 2010 | |
|
||
Supplemental Agreement No. 13
|
August 27, 2010 | |
|
||
Supplemental Agreement No. 14
|
October 25, 2010 |
P.A. No. 3157 | SA 14 | |||
BOEING PROPRIETARY |
3
Airframe Model/MTOW:
|
777-Freighter | 766000 pounds | Detail Specification: |
D019W007FED7F-1, Rev
B dated July 16, 2010 |
||||||||
Engine Model/Thrust:
|
GE90-110B1L | 110100 pounds | Airframe Price Base Year/Escalation Formula: | Jul-06 | ECI-MFG/CPI | |||||||
Airframe Price:
|
[ * ] | Engine Price Base Year/Escalation Formula: | N/A | N/A | ||||||||
Optional Features:
|
[ * ] | |||||||||||
|
||||||||||||
Sub-Total of Airframe
and Features:
|
[ * ] | Airframe Escalation Data: | ||||||||||
Engine Price (Per
Aircraft):
|
[ * ] | Base Year Index (ECI): | 180.3 | |||||||||
Aircraft Basic Price
(Excluding BFE/SPE):
|
[ * ] | Base Year Index (CPI): | 195.4 | |||||||||
|
||||||||||||
Buyer Furnished Equipment
(BFE) Estimate:
|
[ * ] | |||||||||||
Seller Purchased Equipment
(SPE) Estimate:
|
[ * ] | |||||||||||
Refundable Deposit/Aircraft
at Proposal Accept:
|
[ * ] |
Note: |
Boeing and Customer acknowledge that letter 6-1162-RRO-1069 Delivery Notice and Excusable Delay for Aircraft
with Delivery Dates of [ * ] has been sent to Customer. [ * ]
|
|
* |
Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
|
FED | Supplemental Agreement No. 14 |
Page 1
Attention:
|
Mr. Kevin Burkhart
Managing Director Aircraft Acquisitions & Sales |
|
|
||
Subject:
|
[ * ] | |
|
||
Reference:
|
Supplemental Agreement No. 8, No. 13 and No. 14 to Purchase Agreement 3157, dated November 7, 2006, between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 777-FREIGHTER Aircraft (the Aircraft) |
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
By:
|
/s/ STUART C. ROSS | |||
|
|
By:
|
/s/ PHILLIP C. BLUM
|
Attachment A to 6-1162-RRO-1144R2
October 19, 2010 |
Page 1 of 1 |
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
Serial | Current Delivery | Revised Delivery | ||
Number | Month per SA # 14 | Month | ||
[ * ] | [ * ] | [ * ] | ||
[ * ] | [ * ] | [ * ] |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
S15 - 1
1. | Remove and replace, in its entirety, the Table of Contents with the revised Table of Contents attached hereto to reflect the changes made by this Supplemental Agreement No. 15. |
2. | Remove and replace, in its entirety, Table 1 to the Purchase Agreement with the revised Table 1 attached hereto to reflect changes relating to the Rescheduled Aircraft. |
3. | Customer and Boeing hereby acknowledge and confirm that Letter Agreement 6-1162-RRO-1144R2 is hereby cancelled and replaced in its entirety with Letter Agreement 6-1162-RRO-1144R3. |
4. | Boeings offer to re-schedule the Rescheduled Aircraft will expire on November 1, 2010. |
THE BOEING COMPANY | FEDERAL EXPRESS CORPORATION | |||||||||||||
|
||||||||||||||
By: | /s/ STUART C. ROSS | By: | /s/ PHILLIP C. BLUM | |||||||||||
|
Its: | Attorney-In-Fact | Its: | VP, Aircraft Acquisitions & SAO |
S15 - 2
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
P.A. No. 3157 | SA 15 |
1
SA | ||||||
LETTER AGREEMENT | NUMBER | |||||
|
||||||
3157-01
|
777 Spare Parts Initial Provisioning | |||||
|
||||||
3157-02
|
Demonstration Flight Waiver | |||||
|
||||||
6-1162-RCN-1785
|
[ * ] | |||||
|
||||||
6-1162-RCN-1789
|
Option Aircraft Attachment to Letter 6-1162-RCN-1789 |
Exercised
in SA # 4 |
||||
|
||||||
6-1162-RCN-1790
|
Special Matters | |||||
|
||||||
6-1162-RCN-1791
|
Performance Guarantees | 4 | ||||
|
||||||
6-1162-RCN-1792
|
Liquidated Damages Non-Excusable Delay | |||||
|
||||||
6-1162-RCN-1793
|
Open Configuration Matters | |||||
|
||||||
6-1162-RCN-1795
|
AGTA Amended Articles | |||||
|
||||||
6-1162-RCN-1796
|
777 First-Look Inspection Program | |||||
|
||||||
6-1162-RCN-1797
|
Licensing and Customer Supplemental Type Certificates | |||||
|
||||||
6-1162-RCN-1798
|
777 Boeing Converted Freighter |
Deleted in
SA # 4 |
||||
|
||||||
6-1162-RCN-1798 R1
|
777 Boeing Converted Freighter | 4 | ||||
|
||||||
6-1162-RCN-1799
|
[ * ] | |||||
|
||||||
6-1162-RRO-1062
|
Option Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1065
|
Performance Guarantees for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1066R1
|
Special Matters for Block B Aircraft | 4 | ||||
|
||||||
6-1162-RRO-1067
|
Special Matters for Option Aircraft detailed in
Letter Agreement 6-1162-RRO-1062 |
4 | ||||
|
||||||
6-1162-RRO-1068
|
Special Provision Block B Aircraft | 4 | ||||
|
||||||
FED-PALA-1000790R1
|
Special Matters for Block C Aircraft | 11 | ||||
|
||||||
FED-PALA-1001683
|
Special Matters for Block D Aircraft | 12 | ||||
|
||||||
6-1162-RRO-1144R3
|
[ * ] | 15 |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
P.A. No. 3157 | SA 15 |
2
SUPPLEMENTAL AGREEMENTS | DATED AS OF: | |
|
||
Supplemental Agreement No. 1
|
May 12, 2008 | |
|
||
Supplemental Agreement No. 2
|
July 14, 2008 | |
|
||
Supplemental Agreement No. 3
|
December 15, 2008 | |
|
||
Supplemental Agreement No. 4
|
January 9, 2009 | |
|
||
Supplemental Agreement No. 5
|
January 11, 2010 | |
|
||
Supplemental Agreement No. 6
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 7
|
March 17, 2010 | |
|
||
Supplemental Agreement No. 8
|
April 30, 2010 | |
|
||
Supplemental Agreement No. 9
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 10
|
June 18, 2010 | |
|
||
Supplemental Agreement No. 11
|
August 19, 2010 | |
|
||
Supplemental Agreement No. 12
|
September 3, 2010 | |
|
||
Supplemental Agreement No. 13
|
August 27, 2010 | |
|
||
Supplemental Agreement No. 14
|
October 25, 2010 | |
|
||
Supplemental Agreement No. 15
|
October 29, 2010 |
P.A. No. 3157 | SA 15 |
3
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery): | ||||||||||||||
Escalation | Escalation Estimate | Balance At | ||||||||||||
Delivery | Number of | Factor | Adv Payment Base | Signing | 24 Mos. | 21/18/15/12/9/6 Mos. | Total | |||||||
Date | Aircraft | (Airframe) | Price Per A/P | 1% | 4% | 5% | 35% | |||||||
Aircraft | ||||||||||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 2 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 2 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | |||||||
[ * ] | 1 | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] | [ * ] |
Note: | Boeing and Customer acknowledge that letter 6-1162-RRO-1069 Delivery Notice and Excusable Delay for Aircraft with Delivery Dates of [ * ] has been sent to Customer. | |
[ * ] | ||
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
FED | Supplemental Agreement No. 15 |
Page 1
|
The Boeing Company
P.O. Box 3707 Seattle, WA 98124-2207 |
Attention:
|
Mr. Kevin Burkhart
Managing Director Aircraft Acquisitions & Sales |
|
|
||
Subject:
|
[ * ] | |
|
||
Reference:
|
Supplemental Agreement No. 8, No. 13, No. 14 and No. 15 to Purchase Agreement 3157, dated November 7, 2006, between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 777-FREIGHTER Aircraft (the Aircraft) |
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
PA 3157 | 6-1162-RRO-1144R3 | |
[*] as related to SA # 8, SA # 13, SA # 14 and SA#15 |
Page 1
Very truly yours, | ||||||
|
||||||
THE BOEING COMPANY | ||||||
|
||||||
By: | /s/ STUART C. ROSS | |||||
|
Its: | Attorney-In-Fact | ||||
|
||||||
ACCEPTED AND AGREED TO this | ||||||
|
||||||
Date: October 29, 2010 | ||||||
|
||||||
FEDERAL EXPRESS CORPORATION | ||||||
|
||||||
By: | /s/ PHILLIP C. BLUM | |||||
|
Its: | VP, Aircraft Acquisitions & SAO |
PA 3157 | 6-1162-RRO-1144R3 | |
[*] as related to SA # 8, SA # 13, SA # 14 and SA#15 |
Page 2
* | Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
THE UNITED STATES POSTAL SERVICE
|
||||||
By: | /s/ GREGORY BAYNE | |||||
Title: | Purchasing & Supply Chain Specialist, | |||||
Contracting Officer | ||||||
FEDERAL EXPRESS CORPORATION
|
||||||
By: | /s/ PAUL J. HERRON | |||||
Title: | VP, Postal Transportation Management |
Total AMJs for the Period
|
[ * ] | |||
Total LD3s for the Period
|
[ * ] | |||
Optional Days AMJ
|
[ * ] | |||
Optional Days LD3s
|
[ * ] |
ULD Type | AMJ | LD3 | ||||
Amount of containers
|
[ * ] | [ * ] | ||||
Charge per ULD
|
[ * ] | [ * ] | ||||
Total Charges Per ULD type
|
[ * ] | [ * ] | ||||
Optional Day
|
[ * ] | [ * ] | ||||
Total Charges (w/o Optional Day)
|
[ * ] | |||||
Total Charges (w/ Optional Day)
|
[ * ] |
1. |
747 Aircraft are used for the charter operations. Each aircraft carries [ * ] and [ * ]
|
|
2. |
Each location requires 2 sets of ULDs, one set for the ULDs in transit and another set at the origin to build the next dispatch.
|
|
3. |
Two sets of ULDs per aircraft, [ * ] and [ * ], are the amount of containers charged per day.
|
|
4. |
[ * ] from [ * ]. [ * ] from [ * ]. [ * ] from [ * ].
|
|
5. |
The amount of ULDs charged is based on [ * ], [ * ], and [ * ] as outlined above
|
|
6. |
The rate per ULD type is: AMJ [ * ] and LD3s [ * ].
|
|
7. |
If optional day is exercised, the same rates will apply.
|
|
8. |
Charges for the optional day are based on [ * ]. If [ * ], additional rates will apply. The rates are set out in 6. above.
|
|
* |
Blank spaces contained confidential information which has been filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of
1934, as amended.
|
Six Months Ended | ||||||||||||||||||||||||||||
November 30, | Year Ended May 31, | |||||||||||||||||||||||||||
2010 | 2009 | 2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||||||||
Earnings:
|
||||||||||||||||||||||||||||
Income before income taxes
|
$ | 1,040 | $ | 841 | $ | 1,894 | $ | 677 | $ | 2,016 | $ | 3,215 | $ | 2,899 | ||||||||||||||
Add back:
|
||||||||||||||||||||||||||||
Interest expense, net of capitalized
interest
|
45 | 38 | 79 | 85 | 98 | 136 | 142 | |||||||||||||||||||||
Amortization of debt issuance costs
|
8 | 6 | 14 | 5 | 5 | 6 | 5 | |||||||||||||||||||||
Portion of rent expense representative
of interest factor
|
417 | 385 | 806 | 795 | 784 | 766 | 842 | |||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Earnings as adjusted
|
$ | 1,510 | $ | 1,270 | $ | 2,793 | $ | 1,562 | $ | 2,903 | $ | 4,123 | $ | 3,888 | ||||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Fixed Charges:
|
||||||||||||||||||||||||||||
Interest expense, net of capitalized
interest
|
$ | 45 | $ | 38 | $ | 79 | $ | 85 | $ | 98 | $ | 136 | $ | 142 | ||||||||||||||
Capitalized interest
|
38 | 44 | 80 | 71 | 50 | 34 | 33 | |||||||||||||||||||||
Amortization of debt issuance costs
|
8 | 6 | 14 | 5 | 5 | 6 | 5 | |||||||||||||||||||||
Portion of rent expense representative
of interest factor
|
417 | 385 | 806 | 795 | 784 | 766 | 842 | |||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
$ | 508 | $ | 473 | $ | 979 | $ | 956 | $ | 937 | $ | 942 | $ | 1,022 | ||||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Ratio of Earnings to Fixed Charges
|
3.0 | 2.7 | 2.9 | 1.6 | 3.1 | 4.4 | 3.8 | |||||||||||||||||||||
|
1. | I have reviewed this quarterly report on Form 10-Q of FedEx Corporation (the registrant); | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
1. | I have reviewed this quarterly report on Form 10-Q of FedEx Corporation (the registrant); | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | ||
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of FedEx. |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | ||
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of FedEx. |