þ | ANNUAL 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 | (I.R.S. Employer | |
Incorporation or Organization) | Identification No.) | |
942 South Shady Grove Road, Memphis, Tennessee | 38120 | |
(Address of Principal Executive Offices) | (ZIP Code) |
Title of each class | Name of each exchange on which registered | |
Common Stock, par value $0.10 per share | New York Stock Exchange |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
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EXHIBITS
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Exhibit 32.2 |
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FedEx Express
: Federal Express Corporation (FedEx Express) is the worlds largest
express transportation company, offering time-certain delivery within one to three business
days and serving markets that comprise more than 90% of the worlds gross domestic product.
The FedEx Express segment also includes FedEx Trade Networks, Inc., which provides
international trade services, specializing in customs brokerage and global cargo distribution.
FedEx Ground
: FedEx Ground Package System, Inc. (FedEx Ground) is a leading provider of
small-package ground delivery service. FedEx Ground provides low-cost, day-certain service to
every business address in the United States, Canada and Puerto Rico, as well as residential
delivery to nearly 100% of U.S. residences through FedEx Home Delivery. The FedEx Ground
segment also includes FedEx SmartPost, Inc., which specializes in the consolidation and
delivery of high volumes of low-weight, less time-sensitive business-to-consumer packages
using the U.S. Postal Service for final delivery to residences.
FedEx Freight:
FedEx Freight Corporation is a leading U.S. provider of less-than-truckload
(LTL) freight services through its FedEx Freight business (regional LTL freight services)
and its FedEx National LTL business (long-haul LTL freight services). The FedEx Freight
segment also includes FedEx Custom Critical, Inc., North Americas largest time-specific,
critical shipment carrier, and Caribbean Transportation Services, Inc., a leading provider of
airfreight forwarding services between the United States and Puerto Rico.
FedEx Services:
FedEx Corporate Services, Inc. (FedEx Services) provides sales,
marketing and information technology support, as well as customer service support through
FedEx Customer Information Services, Inc., primarily for the benefit of FedEx Express and
FedEx Ground. The FedEx Services segment also includes FedEx Office and Print Services, Inc.
(FedEx Office), formerly known as FedEx Kinkos, a leading provider of document solutions
and business services, and FedEx Global Supply Chain Services, Inc., which offers a range of
supply chain solutions.
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To accommodate anticipated international growth at FedEx Express, we are purchasing
aircraft and improving services to and from Europe and Asia based on the long-term growth
prospects of these regions.
We are expanding network capacity at our fast growing FedEx Ground company. For instance,
we expect to increase FedEx Grounds daily package pick-up capacity to approximately five
million packages by 2012.
We are slowing the expansion of FedEx Offices retail network as a result of, among other
things, reduced customer demand for the companys copy and print services.
Increase in High-Tech and High-Value-Added Businesses:
High-tech and high-value-added
goods continue to increase as a percentage of total economic output. Our various operating
companies offer a unique menu of services to fit virtually all shipping needs of high-tech and
high-value-added industries.
Globalization:
As the worlds economy becomes more fully integrated, and as barriers to
trade continue to decrease, companies are sourcing and selling globally. With customers in
more than 220 countries and territories, we facilitate this supply chain through our global
reach, delivery services and information capabilities.
Supply Chain Acceleration:
As the economy has become increasingly global, it has also
become more fast-paced, and companies of all sizes now depend on the delivery of just-in-time
inventory to help them compete. We have taken advantage of the move toward faster, more
efficient supply chains by helping customers obtain near real-time information to manage
inventory in motion, thereby reducing overhead and obsolescence and speeding time-to-market.
Growth of E-Commerce:
E-commerce acts as a catalyst for the other three trends and is a
vital growth engine for businesses today. Through our global transportation and technology
networks, we contribute to and benefit from the growth of e-commerce.
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Optimizing and expanding our worldwide FedEx Express network, particularly in key markets
such as China, India and Europe.
Increasing the capacity, speed and reliability of our FedEx Ground and FedEx Freight
networks.
Emphasizing the compete collectively part of our core strategy through service
improvements and focusing on delivering the best customer experience in the industry,
resulting in better alignment across all FedEx networks.
deliver superior financial returns for our stockholders;
expand our portfolio of services to meet our customers needs; and
execute our compete collectively, operate independently, manage collaboratively strategy
with both discipline and imagination.
FedEx ranked seventh in
FORTUNE
magazines Americas Most Admired Companies list and
sixth in its Worlds Most Admired Companies list the seventh consecutive year we have been
ranked in the top ten on both lists.
FedEx ranked in the top 15 in corporate reputation and first in the category of customer
service in the Harris Interactive Reputation Quotient (RQ) Survey.
FedEx continued to rank highest in customer satisfaction in the University of Michigan
Business School National Quality Research Centers
American Customer Satisfaction Index
in the
express delivery category.
According to a poll conducted by
Institutional Investor
magazine, FedEx was rated as the
most shareholder-friendly company and Frederick W. Smith was named the top CEO in our
industry. Mr. Smith was also named among the top 30 chief executives in the world by
Barrons
magazine.
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United Way of America:
We believe the United Way is one of the most effective and
efficient ways of meeting community needs. FedEx supports a yearly fundraising campaign
company-wide, and during our annual FedEx Cares Week, FedEx employee volunteers donate
thousands of hours to support United Way community efforts.
American Red Cross:
FedEx works with the Red Cross to provide a quick response to
disasters around the world. FedEx uses its logistics and transportation expertise to provide
complimentary shipping of emergency supplies and assists with financial support.
Safe Kids Worldwide:
Reflecting the fact that safety is one of our top priorities, FedEx
is the sole corporate sponsor of Safe Kids Walk This Way, a global program that advocates
child pedestrian safety and teaches children, parents and communities how to prevent
pedestrian accidents.
ORBIS International:
FedEx helps ORBIS International provide eye care and treatment to
people in developing countries. FedEx provides free aircraft maintenance and our pilots
volunteer their time for ORBISs Flying Eye Hospital a converted DC-10 aircraft equipped
with surgical and training facilities.
Salvation Army:
FedEx supports the Salvation Armys training of emergency response
personnel worldwide through an initiative called Prepare to Respond to Emergencies Planning
and Readiness
Education (PREPARE). To date, FedEx has provided funding for eleven Emergency Services Response
Units, which are deployed during emergencies and disasters.
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Heart to Heart International:
FedEx helps Heart to Heart International deliver food,
medicine and emergency supplies to areas in need throughout the world.
National Civil Rights Museum:
FedEx serves as a major corporate sponsor of the National
Civil Rights Museum, which educates the public on the lessons of the civil rights movement in
the United States and its impact and influence on the human rights movement worldwide.
Teach for America:
FedEx supports Teach for America in its efforts to provide students of
diverse backgrounds with a high-quality education. In 2008, FedEx announced a $1 million
donation to Teach for America to further the organizations goal of increasing the diversity
of its teachers.
Junior Achievement:
Through support of Junior Achievement, FedEx helps to ensure that our
future leaders have access to educational opportunities. Through a recent $1 million pledge,
FedEx launched a global competition that will enable teams of students from around the world
to compete for the FedEx Global Impact Award.
March of Dimes:
FedEx is a national sponsor of March of Dimes March for Babies, and
thousands of FedEx employees participate in it and other events that raise funds to help
improve the health of babies by preventing birth defects and infant mortality.
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We acquired ANC Holdings Ltd. (now rebranded as FedEx UK), a United Kingdom domestic
express transportation company. The acquisition of FedEx UK has allowed us to establish a
domestic service in the United Kingdom and better serve the U.K. international market, which
we previously served primarily through independent agents.
We acquired Prakash Air Freight Pvt. Ltd. (PAFEX), our primary service provider in India.
The acquisition of PAFEX extends our operations in the global express industry with a wholly
owned company in one of the worlds fastest growing markets.
We acquired Tianjin Datian W. Group Co., Ltd.s (DTW Group) fifty percent share of the
FedEx-DTW International Priority joint venture and assets relating to DTW Groups domestic
network in China. The acquisition converted our joint venture with DTW Group, formed in 1999,
into a wholly owned subsidiary. The acquisition increases our presence in China in the
international market and establishes our presence in the domestic market.
In 2006, we broke ground on a new Asia-Pacific hub at the Guangzhou Baiyun International
Airport in Southern China. The new Asia-Pacific hub is expected to assume and expand the
current activities of our existing hub in Subic Bay, Philippines, in 2009. We believe the new
hub will better serve our global customers doing business in and with the fast-growing China
and Asia-Pacific markets.
In 2007, we initiated next-morning domestic delivery service in China, which is available
in more than 40 cities and counties throughout the country. The new China domestic service is
supported by a money-back guarantee and real-time package status tracking. Our China domestic
network relies on a hub-and-spoke system centered at the Hangzhou Xiaoshan International
Airport, located in East Chinas Zhejiang Province.
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Total Cost
Percentage of Total
Fiscal Year
(in millions)
Revenues
$
3,396
8.9
%
2,639
7.5
2,497
7.7
1,780
6.1
1,160
4.7
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The National Football League (NFL), as its Official Delivery Service Sponsor
FedExField, home of the NFLs Washington Redskins
FedEx Orange Bowl, host of one of college footballs Bowl Championship Series games
The #11 Joe Gibbs Racing Toyota Camry driven by Denny Hamlin in the NASCAR Sprint Cup
Series
PGA TOUR and the Champions Tour golf organizations, as the Official Shipping Company
FedExCup, a season-long points competition for PGA TOUR players
Pebble Beach Golf Resorts, as the official shipping company
National Basketball Association (NBA), as its official delivery service sponsor
FedExForum, home of the NBAs Memphis Grizzlies
Vodafone McLaren Mercedes Formula One team
French Open tennis tournament
The China National Badminton Team
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Maximum Operational
Revenue Payload
Description
Owned
Leased
Total
(Pounds per Aircraft)
(1)
32
26
58
164,200
6
2
8
114,200
5
7
12
(3)
114,200
58
58
113,100
5
5
(4)
113,100
32
36
68
(5)
85,600
50
16
66
61,900
12
12
(6)
45,800
81
9
90
38,200
29
29
14,660
13
13
10,880
1
1
10,100
4
4
9,850
243
243
2,500
10
10
1,900
581
96
677
(1)
Maximum operational revenue payload is the lesser of the net volume-limited payload and the
net maximum structural payload.
(2)
The MD10-30s and MD10-10s are DC10-30s and DC10-10s, respectively, that have been converted
to an MD10 configuration.
(3)
Includes two aircraft not currently in operation and awaiting conversion to MD10
configuration.
(4)
Includes three aircraft not currently in operation and awaiting conversion to MD10
configuration.
(5)
Includes four aircraft not currently in operation three awaiting completion of
passenger-to-freighter modification and one in storage.
(6)
Includes 12 aircraft not currently in operation six awaiting completion of
passenger-to-freighter modification and six in storage.
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The MD11s are three-engine, wide-bodied aircraft that have a longer range and larger capacity
than DC10s.
The DC10s are three-engine, wide-bodied aircraft that have been specially modified to meet
FedEx Expresss cargo requirements. We operate two models, the DC10-10 and the DC10-30. The
DC10-30 has a longer range and higher weight capacity than the DC10-10.
The MD10s are three-engine, wide-bodied DC10 aircraft that have received an Advanced Common
Flightdeck (ACF) modification, which includes a conversion to a two-pilot cockpit, as well as
upgrades of electrical and other systems.
The A300s and A310s are two-engine, wide-bodied aircraft that have a longer range and more
capacity than B757s and B727s.
The B757s are two-engine aircraft configured for cargo service.
The B727s are three-engine aircraft configured for cargo service.
The ATR, Fokker F27 and Cessna 208 turbo-prop aircraft are leased to independent operators
to support FedEx Express operations in areas where demand does not justify use of a larger
aircraft.
A300
B757
B777F
MD11
Total
4
16
2
22
6
6
12
5
9
14
2
2
4
29
15
2
50
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Sorting
Lease
Square
Capacity
Expiration
Location
Acres
Feet
(per hour)
(1)
Lessor
Year
518
3,450,000
465,000
Memphis-Shelby County Airport Authority
2036
262
1,895,000
192,000
Indianapolis Airport Authority
2028
168
948,000
76,000
Fort Worth Alliance Airport Authority
2021
70
595,000
154,000
Port Authority of New York and New Jersey
2010
74
320,000
65,000
City of Oakland
2011
51
419,000
52,000
City of Chicago
2018
34
305,000
57,000
City of Los Angeles
2009/2025
(5)
64
332,000
24,000
Alaska Department of Transportation and Public Facilities
2023
87
861,000
54,000
Aeroports de Paris
2029
18
316,000
22,000
Subic Bay Metropolitan Authority
2010
(1)
Documents and packages.
(2)
Handles international express package and freight shipments to and from Asia, Europe and
North America.
(3)
Handles intra-Europe express package and freight shipments, as well as international express
package and freight shipments to and from Europe.
(4)
Handles intra-Asia express package and freight shipments, as well as international express
package and freight shipments to and from Asia.
(5)
Property is held under two separate leases lease for sorting and handling facility (23
acres) expires in 2009, and lease for ramp expansion (11 acres) expires in 2025.
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Name and Office
Age
Positions and Offices Held and Business Experience
Chairman, President and
Chief Executive Officer
63
Chairman, President and Chief Executive Officer
of FedEx since January 1998; Chairman of FedEx
Express since 1975; Chairman, President and Chief
Executive Officer of FedEx Express from April
1983 to January 1998; Chief Executive Officer of
FedEx Express from 1977 to January 1998; and
President of FedEx Express from June 1971 to
February 1975.
President and Chief
Executive Officer,
FedEx Express
54
President and Chief Executive Officer of FedEx
Express since January 2000; Executive Vice
President and Chief Operating Officer of FedEx
Express from January 1998 to January 2000; Senior
Vice President Europe, Middle East and Africa
of FedEx Express
from June 1995
to January 1998;
Senior Vice President Europe, Africa and
Mediterranean of FedEx Express from June 1993 to
June 1995; Vice President Canadian Operations
of FedEx Express from February 1987 to March
1993; and several sales and operations managerial
positions at FedEx Express from 1976 to 1987.
Mr. Bronczek serves as a director of
International Paper Company, an uncoated paper
and packaging company.
Executive Vice President
FedEx Information
Services
and Chief
Information
Officer
49
Executive Vice President FedEx Information
Services and Chief Information Officer of FedEx
since January 2007; Executive Vice President and
Chief Information Officer of FedEx from June 2000
to January 2007; Corporate Vice President and
Chief Technology Officer of FedEx from February
1998 to June 2000; Vice President Corporate
Systems Development of FedEx Express from
September 1993 to February 1998; Managing
Director Systems Development of FedEx Express
from April 1993
to September
1993. Mr. Carter
serves as a director of Saks Incorporated, a
retailer operating luxury, specialty and
traditional department stores, and as a director
of First Horizon National Corporation, a
financial services holding company.
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Name and Office
Age
Positions and Offices Held and Business Experience
President and Chief
Executive Officer,
FedEx Freight Corporation
57
President and Chief Executive Officer of FedEx
Freight Corporation since February 2001;
President and Chief Executive Officer of Viking
Freight, Inc. (Viking Freight) from November
1998 to February 2001; Senior Vice President
Sales and Marketing of Viking Freight from 1996
to November 1998; Vice President Sales and
Marketing of Caliber System, Inc. (Caliber)
from 1995 to 1996; various positions with Roadway
Express, Inc., including Vice President Sales,
from 1976 to 1995. Mr. Duncan serves as a
director of Benchmark Electronics, Inc., an
electronics manufacturer.
Executive Vice President
Market Development and
Corporate Communications
52
Executive Vice President Market Development and
Corporate Communications of FedEx since January
1998; Senior Vice President Marketing, Customer
Service and Corporate Communications of FedEx
Express from June 1994 to January 1998; Senior
Vice President Marketing and Corporate
Communications of FedEx Express from December
1993 to June 1994; Senior Vice President
Worldwide Marketing Catalog Services and
Corporate Communications of FedEx Express from
June 1993 to December 1993; Senior Vice President
Catalog and Remail Services of FedEx Express
from September 1992 to June 1993; Vice President
Marketing of FedEx Express from August 1985 to
September 1992; and various management positions
in sales and marketing and senior sales
specialist of FedEx Express from 1981 to 1985.
Mr. Glenn serves as a director of Pentair, Inc.,
a diversified industrial manufacturing company
operating in water and technical products
business segments, and as a director of Renasant
Corporation, a financial services holding
company.
Executive Vice President
and Chief Financial
Officer
54
Executive Vice President and Chief Financial
Officer of FedEx since January 1998; Executive
Vice President and Chief Financial Officer of
FedEx Express from February 1996 to January 1998;
Senior Vice President and Chief Financial Officer
of FedEx Express from December 1991 to February
1996; Vice President and Treasurer of FedEx
Express from August 1987 to December 1991; and
various management positions in finance and a
senior financial analyst of FedEx Express from
1980 to 1987. Mr. Graf serves as a director of
Mid-America Apartment Communities Inc., a real
estate investment trust that focuses on
acquiring, constructing, developing, owning and
operating apartment communities, and as a
director of NIKE, Inc., a designer and marketer
of athletic footwear, apparel, equipment and
accessories for sports and fitness activities.
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Name and Office
Age
Positions and Offices Held and Business Experience
President and Chief
Executive Officer,
FedEx Ground
55
President and Chief Executive Officer of FedEx
Ground since January 2007; President of FedEx
Ground from September 2006 to January 2007;
Executive Vice President Operations & Systems
Support of FedEx Express from December 1999 to
September 2006; Senior Vice President U.S. of
FedEx Express from January 1997 to November 1999;
Senior Vice President Sales & Customer Service
of FedEx Express from June 1993 to December 1996;
Vice President Regional Operations of FedEx
Express from October 1991 to June 1993; Vice
President Customer Services of FedEx Express
from December 1988 to October 1991; and various
other positions with FedEx Express from 1976 to
1988.
Executive Vice
President,
General
Counsel and Secretary
53
Executive Vice President, General Counsel and
Secretary of FedEx since June 2005; Corporate
Vice President Customer and Business
Transactions of FedEx from March 2001 to June
2005; Senior Vice President and General Counsel
of FedEx Services from March 2000 to June 2005;
Staff Vice President Customer and Business
Transactions of FedEx from November 1999 to March
2001; Vice President Customer and Business
Transactions of FedEx Express from 1998 to
November 1999; and various legal positions with
FedEx Express from 1984 to 1998.
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30
31
ITEM 5.
MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
Sale Prices
High
Low
Dividend
$
118.74
$
97.79
$
0.09
119.21
99.34
0.09
121.42
106.63
0.09
116.76
104.01
0.09
$
119.10
$
99.30
$
0.10
111.29
91.10
0.10
101.53
80.00
0.10
99.46
82.50
0.10
ITEM 7.
MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
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ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Board must obtain stockholder approval prior to adopting a poison pill unless the
Board determines, in the exercise of its fiduciary duties, that it would be in the best
interests of FedEx and its stockholders to adopt a poison pill without prior stockholder
approval; and
If a poison pill is adopted by the Board without prior stockholder approval, the poison
pill shall expire within one year of adoption unless ratified by stockholders.
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32
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
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33
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34
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39
FEDEX CORPORATION
Dated: July 16, 2008
By:
/s/ FREDERICK W. SMITH
Frederick W. Smith
Chairman, President and
Chief Executive Officer
Signature
Capacity
Date
/s/ FREDERICK W. SMITH
Chairman, President and
Chief Executive Officer
and Director
(Principal Executive Officer)
July 16, 2008
/s/ ALAN B. GRAF, JR.
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
July 16, 2008
/s/ JOHN L. MERINO
Corporate Vice President and
Principal Accounting Officer
(Principal Accounting Officer)
July 16, 2008
/s/ JAMES L. BARKSDALE *
Director
July 16, 2008
/s/ AUGUST A. BUSCH IV *
Director
July 16, 2008
/s/ JOHN A. EDWARDSON *
Director
July 16, 2008
/s/ JUDITH L. ESTRIN *
Director
July 16, 2008
/s/ PHILIP GREER *
Director
July 16, 2008
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Signature
Capacity
Date
/s/ J. R. HYDE, III *
Director
July 16, 2008
/s/ SHIRLEY ANN JACKSON *
Director
July 16, 2008
/s/ STEVEN R. LORANGER *
Director
July 16, 2008
/s/ GARY W. LOVEMAN *
Director
July 16, 2008
/s/ CHARLES T. MANATT *
Director
July 16, 2008
/s/ JOSHUA I. SMITH *
Director
July 16, 2008
/s/ PAUL S. WALSH *
Director
July 16, 2008
/s/ PETER S. WILLMOTT *
Director
July 16, 2008
/s/ JOHN L. MERINO
July 16, 2008
John L. Merino
Attorney-in-Fact
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Results of Operations includes an overview of our consolidated 2008 results compared to
2007, and 2007 results compared to 2006. This section also includes a discussion of key
actions and events that impacted our results, as well as a discussion of our outlook for 2009.
The overview is followed by a financial summary and analysis (including a discussion of
both historical operating results and our outlook for 2009) for each of our reportable
transportation segments.
Our financial condition is reviewed through an analysis of key elements of our liquidity,
capital resources and contractual cash obligations, including a discussion of our cash flow
statements and our financial commitments.
We conclude with a discussion of the critical accounting estimates that we believe are
important to understanding certain of the material judgments and assumptions incorporated in
our reported financial results.
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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 (average price per
shipment or pound or average price per hundredweight for FedEx Freight LTL Group 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.
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134
135
E-1
E-2
E-3
E-4
E-5
Percent Change
2008
(1)
2007
(2)
2006
(3)
2008/2007
2007/2006
$
37,953
$
35,214
$
32,294
8
9
2,075
3,276
3,014
(37
)
9
5.5
%
9.3
%
9.3
%
(380
) bp
bp
$
1,125
$
2,016
$
1,806
(44
)
12
$
3.60
$
6.48
$
5.83
(44
)
11
(1)
Operating expenses include a charge of approximately $891 million ($696 million,
net of tax, or $2.23 per diluted share), predominantly related to noncash impairment charges
associated with the decision to minimize the use of the Kinkos trade name and goodwill resulting
from the Kinkos acquisition (described below).
(2)
Operating expenses include a $143 million charge at FedEx Express associated with
upfront compensation and benefits under the new labor contract with our pilots, which was ratified
in October 2006. The impact of this new contract on second quarter net income was approximately
$78 million net of tax, or $0.25 per diluted share.
(3)
Operating expenses include a $79 million ($49 million, net of tax, or $0.16 per
diluted share) charge to adjust the accounting for certain facility leases, predominantly at FedEx
Express.
Revenues
Operating Income
Dollar
Percent
Dollar
Percent
Change
Change
Change
Change
2008/
2007/
2008/
2007/
2008/
2007/
2008/
2007/
2007
2006
2007
2006
2007
2006
2007
2006
$
1,740
$
1,235
8
6
$
(90
)
$
178
(5
)
10
708
737
12
14
(86
)
106
(10
)
15
348
941
8
26
(134
)
(22
)
(29
)
(5
)
2
48
2
(891
)
NM
(59
)
(41
)
NM
NM
$
2,739
$
2,920
8
9
$
(1,201
)
$
262
(37
)
9
(1)
FedEx Express 2007 operating expenses include a $143 million charge associated with upfront compensation
and benefits under the new pilot labor contract and 2006 operating expenses include a $75 million charge to adjust the accounting for certain facility leases.
(2)
FedEx Freight segment results include the results of FedEx National LTL from the date of its acquisition on September 3, 2006.
(3)
FedEx Services segment operating expenses include a charge of approximately $891 million, predominantly
related to noncash impairment charges associated with the decision to minimize the use of the Kinkos trade name and goodwill resulting from the Kinkos acquisition (described below).
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(1)
Package statistics do not include the operations of FedEx SmartPost.
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Percent of Revenue
2008
2007
2006
37.4
%
39.0
%
38.9
%
11.7
11.0
10.1
6.4
6.7
7.4
5.1
5.0
4.8
12.1
10.0
10.1
5.5
5.5
5.5
2.3
14.0
13.5
13.9
94.5
90.7
90.7
5.5
%
9.3
%
9.3
%
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$
515
367
9
$
891
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Purchase Price
Segment
Business Acquired
Rebranded
Date Acquired
(in millions)
Watkins Motor Lines
FedEx National LTL
September 3, 2006
$
787
ANC Holdings Ltd.
FedEx U.K.
December 16, 2006
241
Tianjin Datian W. Group Co., Ltd. (DTW Group)
N/A
March 1, 2007
427
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FedEx Express (express transportation)
FedEx Trade Networks (global trade services)
FedEx Ground (small-package ground delivery)
FedEx SmartPost (small-parcel consolidator)
FedEx Freight LTL Group:
FedEx Freight (regional LTL freight transportation)
FedEx National LTL (long-haul LTL freight transportation)
FedEx Custom Critical (time-critical transportation)
Caribbean Transportation Services (airfreight forwarding)
FedEx Services (sales, marketing and information technology functions)
FedEx Office (document and business services and package acceptance)
FedEx Customer Information Services (FCIS) (customer service, billing and collections)
FedEx Global Supply Chain Services (logistics services)
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Percent Change
2008
2007
2006
2008/2007
2007/2006
$
6,578
$
6,485
$
6,422
1
1
2,012
1,990
1,974
1
1
2,995
2,883
2,853
4
1
11,585
11,358
11,249
2
1
7,666
6,722
6,139
14
9
663
370
199
79
86
19,914
18,450
17,587
8
5
2,398
2,412
2,218
(1
)
9
1,243
1,045
840
19
24
406
394
434
3
(9
)
4,047
3,851
3,492
5
10
460
380
367
21
4
24,421
22,681
21,446
8
6
8,451
8,234
(3)
8,033
3
3
1,208
1,098
971
10
13
1,673
1,610
1,696
(4)
4
(5
)
944
856
805
10
6
3,785
2,946
2,786
28
6
1,512
1,444
1,344
5
7
2,134
2,046
1,496
4
37
2,813
2,456
2,502
15
(2
)
22,520
20,690
19,633
9
5
$
1,901
$
1,991
$
1,813
(5
)
10
7.8
%
8.8
%
8.5
%
(100
) bp
30
bp
(1)
International domestic revenues include our international domestic express
operations, primarily in the United Kingdom, Canada, India and China. We reclassified the prior
period international domestic revenues previously included within other revenues to conform to the
current period presentation.
(2)
Other revenues includes FedEx Trade Networks.
(3)
Includes a $143 million charge for signing bonuses and other upfront
compensation associated with the new four-year labor contract with our pilots.
(4)
Includes a $75 million one-time, noncash charge to adjust the accounting
for certain facility leases.
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Percent Change
2008
2007
2006
2008/2007
2007/2006
1,151
1,174
1,203
(2
)
(2
)
677
706
713
(4
)
(1
)
895
898
901
2,723
2,778
2,817
(2
)
(1
)
517
487
466
6
5
296
134
46
121
191
3,536
3,399
3,329
4
2
$
22.40
$
21.66
$
20.94
3
3
11.66
11.06
10.86
5
2
13.12
12.59
12.42
4
1
16.68
16.04
15.66
4
2
58.11
54.13
51.64
7
5
8.80
10.77
16.69
(18
)
(35
)
22.08
21.28
20.72
4
3
8,648
9,569
9,374
(10
)
2
2,220
1,878
1,634
18
15
1,817
1,831
2,126
(1
)
(14
)
12,685
13,278
13,134
(4
)
1
$
1.09
$
0.99
$
0.93
10
6
2.20
2.18
2.02
1
8
0.88
0.84
0.80
5
5
1.25
1.14
1.04
10
10
(1)
Package and freight statistics include only the operations of FedEx Express.
(2)
International domestic revenues include our international domestic express
operations, primarily in the United Kingdom, Canada, India and China.
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2008
2007
2006
13.50
%
8.50
%
10.50
%
25.00
17.00
20.00
17.06
12.91
13.69
12.00
8.50
10.00
25.00
17.00
20.00
16.11
12.98
12.73
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Percent of Revenue
2008
2007
2006
34.6
%
36.3
%
(1)
37.4
%
4.9
4.8
4.5
6.9
7.1
7.9
(2)
3.9
3.8
3.7
15.5
13.0
13.0
6.2
6.4
6.3
8.7
9.0
7.0
11.5
10.8
11.7
92.2
91.2
91.5
7.8
%
8.8
%
8.5
%
(1)
Includes a $143 million charge for signing bonuses and other upfront
compensation associated with the new four-year labor contract with our pilots (0.6% of revenue).
(2)
Includes a $75 million one-time, noncash charge to adjust the accounting
for certain facility leases (0.4% of revenue).
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fuel-efficient aircraft. Our aircraft-related capital outlays include the more
fuel-efficient Boeing 757s, the first of which enter revenue service in 2009, and the new Boeing
777s, the first of which enter revenue service in 2010. These aircraft capital expenditures are
necessary to achieve significant long-term operating savings and to support projected long-term
international volume growth. However, we may temporarily ground certain aircraft due to excess
capacity in the current economic environment. The new Asia-Pacific hub in Guangzhou, China is
planned to be operational in 2009.
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Percent Change
2008
2007
2006
2008/2007
2007/2006
$
6,751
$
6,043
$
5,306
12
14
1,073
1,006
929
7
8
2,691
2,326
2,019
16
15
189
166
133
14
25
305
268
224
14
20
201
117
93
72
26
145
134
118
8
14
658
569
515
16
10
753
635
559
19
14
6,015
5,221
4,590
15
14
$
736
$
822
$
716
(10
)
15
10.9
%
13.6
%
13.5
%
(270
) bp
10
bp
3,365
3,126
2,815
8
11
618
599
377
3
59
$
7.48
$
7.21
$
7.02
4
3
$
2.09
$
1.88
$
1.55
11
21
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2008
2007
2006
4.50
%
3.50
%
2.50
%
7.75
5.25
5.25
5.47
4.18
3.54
Percent of Revenue
2008
2007
2006
15.9
%
16.7
%
17.5
%
39.9
38.5
38.1
2.8
2.8
2.5
4.5
4.4
4.2
3.0
1.9
1.8
2.1
2.2
2.2
9.7
9.4
9.7
11.2
10.5
10.5
89.1
86.4
86.5
10.9
%
13.6
%
13.5
%
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Table of Contents
Percent Change
2008
2007
(1)
2006
2008/2007
2007/2006
$
4,934
$
4,586
$
3,645
8
26
2,381
2,250
1,801
6
25
582
465
298
25
56
119
112
94
6
19
227
195
120
16
63
608
468
377
30
24
175
165
120
6
38
81
61
37
33
65
432
407
313
6
30
4,605
4,123
3,160
12
30
$
329
$
463
$
485
(29
)
(5
)
6.7
%
10.1
%
13.3
%
(340
) bp
(320
) bp
79.7
78.2
66.7
2
17
1,136
1,130
1,143
1
(1
)
$
19.65
$
18.65
$
16.84
5
11
(1)
Includes the results of FedEx National LTL from the date of its acquisition on September 3, 2006.
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2008
2007
2006
14.5
%
14.0
%
12.5
%
23.7
21.2
20.1
17.7
17.8
16.3
Percent of Revenue
2008
2007
2006
48.3
%
49.1
%
49.4
%
11.8
10.1
8.2
2.4
2.4
2.6
4.6
4.3
3.3
12.3
10.2
10.3
3.5
3.6
3.3
1.6
1.3
1.0
8.8
8.9
8.6
93.3
89.9
86.7
6.7
%
10.1
%
13.3
%
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2008
2007
2006
$
1,125
$
2,016
$
1,806
3,187
1,988
2,006
(828
)
(441
)
(136
)
3,484
3,563
3,676
(4
)
(1,310
)
(2,893
)
(2,814
)
(2,454
)
(2,897
)
(4,124
)
(2,454
)
1,054
(639
)
(906
)
(369
)
(124
)
(110
)
(97
)
146
155
142
(617
)
193
(324
)
$
(30
)
$
(368
)
$
898
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Percent Change
2008
2007
2006
2008/2007
2007/2006
$
998
$
1,107
$
1,033
(10
)
7
900
674
507
34
33
404
445
413
(9
)
8
366
431
394
(15
)
9
279
225
171
24
32
$
2,947
$
2,882
$
2,518
2
14
$
1,716
$
1,672
$
1,408
3
19
509
489
487
4
266
287
274
(7
)
5
455
432
345
5
25
1
2
4
NM
NM
$
2,947
$
2,882
$
2,518
2
14
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Payments Due by Fiscal Year
(in millions)
2009
2010
2011
2012
2013
Thereafter
Total
$
1,803
$
1,647
$
1,482
$
1,332
$
1,208
$
8,338
$
15,810
342
127
61
56
33
134
753
110
79
65
47
20
1,534
1,855
1,143
1,051
674
31
2,899
219
219
500
499
250
300
239
1,788
13
97
8
8
119
18
263
$
4,130
$
3,500
$
2,540
$
1,474
$
1,680
$
10,263
$
23,587
(1)
See Note 16 to the accompanying consolidated financial statements.
(2)
Capital lease obligations represent principal and interest payments.
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2008
2007
2006
$
323
$
467
$
425
216
176
167
77
55
73
$
616
$
698
$
665
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2008
2007
2006
$
518
$
540
$
473
720
707
642
(985
)
(930
)
(811
)
70
150
121
$
323
$
467
$
425
Discount
Sensitivity (in millions)
(2)
Rate
(1)
Expense
PBO
7.15
%
$
1.7
n/a
6.96
%
2.1
$
16
6.01
%
2.5
19
5.91
%
2.1
21
(1)
The discount rate in effect at the end of a given fiscal year
affects the current years PBO and the succeeding years
pension expense, except for 2009 which was affected by our
measurement date transition. The 2009 expense sensitivity is driven
by the 7.15% discount rate determined at the June 1, 2008
measurement date.
(2)
Sensitivities show the impact on expense and the PBO of a
one-basis-point change in the discount rate.
Table of Contents
the duration of our pension plan liabilities, which drives the investment strategy we can
employ with our pension plan assets;
the types of investment classes in which we invest our pension plan assets and the expected
compound geometric return we can reasonably expect those investment classes to earn over the
next 10- to 15-year time period (or such other time period that may be appropriate); and
the investment returns we can reasonably expect our active investment management program to
achieve in excess of the returns we could expect if investments were made strictly in indexed
funds.
Table of Contents
Plan Assets at Measurement Date
2008
2007
Asset Class
Actual
Actual
Target
Actual
Actual
Target
$
5,694
49
%
53
%
$
5,897
52
%
53
%
2,481
21
17
2,413
21
17
406
4
5
314
3
5
8,581
74
75
8,624
76
75
1,778
15
15
1,627
15
15
1,302
11
10
1,049
9
10
$
11,661
100
%
100
%
$
11,300
100
%
100
%
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2008
2007
$
11,617
$
12,209
11,879
11,506
262
(703
)
15
22
$
277
$
(681
)
$
827
$
1
(32
)
(24
)
(518
)
(658
)
$
277
$
(681
)
$
548
$
524
$
318
$
261
Table of Contents
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reorganizing senior management at FedEx Office with several positions terminated and
numerous reporting realignments, including naming a new president and CEO;
determining that we would minimize the use of the Kinkos trade name over the next
several years;
implementing revenue growth and cost management plans to improve financial performance;
and
pursuing a more disciplined approach to the long-term expansion of the retail network,
reducing the overall level of expansion.
benchmark capital structures for guideline companies with characteristics similar to the
FedEx Office reporting unit;
current market conditions for the risk free interest rate;
the size and industry of the FedEx Office reporting unit; and
risks related to the forecast of future revenues and profitability of the FedEx Office
reporting unit.
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the impact of any international conflicts or terrorist activities on the United States 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;
any impacts on our businesses resulting from new domestic or international government laws
and regulation, including tax, accounting, trade, labor, environmental or postal rules;
our ability to manage our cost structure for capital expenditures and operating expenses,
and match it to shifting and future customer volume levels;
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;
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;
a shortage of qualified labor and our ability to mitigate this shortage through recruiting
and retention efforts and productivity gains;
increasing costs, the volatility of costs and 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;
any liability resulting from and the costs of defending against class-action litigation,
such as wage-and-hour and discrimination and retaliation claims, patent litigation, and any
other legal proceedings;
the impact of technology developments on our operations and on demand for our services;
adverse weather conditions or natural disasters, such as earthquakes and hurricanes, which
can damage our property, disrupt our operations, increase fuel costs and adversely affect
shipment levels;
widespread outbreak of an illness or any other communicable disease, or any other public
health crisis; and
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, and the current
volatility of credit markets.
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FedEx Corporation
July 10, 2008
Table of Contents
PUBLIC ACCOUNTING FIRM
FedEx Corporation
July 10, 2008
Table of Contents
May 31,
2008
2007
$
1,539
$
1,569
4,359
3,942
435
338
544
536
367
244
7,244
6,629
10,165
9,593
4,817
3,889
5,040
4,685
2,754
2,561
6,529
6,362
29,305
27,090
15,827
14,454
13,478
12,636
3,165
3,497
827
919
1,238
4,911
4,735
$
25,633
$
24,000
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CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT SHARE DATA)
May 31,
2008
2007
$
502
$
639
1,118
1,354
2,195
2,016
1,553
1,419
5,368
5,428
1,506
2,007
1,264
897
989
1,164
804
759
671
655
315
343
190
91
4,233
3,909
31
31
1,922
1,689
13,002
11,970
(425
)
(1,030
)
(4
)
(4
)
14,526
12,656
$
25,633
$
24,000
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Years ended May 31,
2008
2007
2006
$
37,953
$
35,214
$
32,294
14,202
13,740
12,571
4,447
3,873
3,251
2,441
2,343
2,390
1,946
1,742
1,550
4,596
3,533
3,256
2,068
1,952
1,777
882
5,296
4,755
4,485
35,878
31,938
29,280
2,075
3,276
3,014
(98
)
(136
)
(142
)
44
83
38
(5
)
(8
)
(11
)
(59
)
(61
)
(115
)
2,016
3,215
2,899
891
1,199
1,093
$
1,125
$
2,016
$
1,806
$
3.64
$
6.57
$
5.94
$
3.60
$
6.48
$
5.83
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(IN MILLIONS)
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Accumulated
Additional
Other
Common
Paid-in
Retained
Comprehensive
Treasury
Stock
Capital
Earnings
Income (Loss)
Stock
Total
30
1,213
8,363
(17
)
(1
)
9,588
1,806
1,806
29
29
(36
)
(36
)
1,799
(101
)
(101
)
1
225
(1
)
225
31
1,438
10,068
(24
)
(2
)
11,511
2,016
2,016
26
26
(50
)
(50
)
1,992
(982
)
(982
)
(114
)
(114
)
251
(2
)
249
31
1,689
11,970
(1,030
)
(4
)
12,656
1,125
1,125
99
99
506
506
1,730
(93
)
(93
)
233
233
$
31
$
1,922
$
13,002
$
(425
)
$
(4
)
$
14,526
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Table of Contents
Net Book Value at May 31,
Range
2008
2007
15 to 25 years
$
5,550
$
5,391
5 to 15 years
452
352
2 to 30 years
1,897
1,420
2 to 10 years
943
1,021
3 to 15 years
1,007
957
2 to 40 years
3,629
3,495
Table of Contents
Table of Contents
Table of Contents
Table of Contents
2006
$
1,806
5
method for all awards, net of tax benefit
46
$
1,765
$
5.94
$
5.81
$
5.83
$
5.70
Table of Contents
Total purchase
Segment
Business acquired
Rebranded
Date acquired
price (in millions)
Watkins Motor Lines
FedEx National LTL
September 3, 2006
$
787
ANC Holdings Ltd.
FedEx U.K.
December 16, 2006
241
Tianjin Datian W. Group Co., Ltd.
(DTW Group)
N/A
March 1, 2007
427
Table of Contents
FedEx
National LTL
FedEx U.K.
DTW Group
$
121
$
68
$
54
525
20
16
77
49
17
121
168
348
3
2
10
(60
)
(56
)
(18
)
(10
)
$
787
$
241
$
427
Purchase
Purchase
Goodwill
Adjustments
Impairment
Adjustments
May 31, 2006
Acquired
and Other
May 31, 2007
Charge
and Other
(3)
May 31, 2008
$
530
$
549
(1)
$
9
$
1,088
$
$
35
$
1,123
90
90
90
656
121
(2)
777
777
1,549
(7
)
1,542
(367
)
1,175
$
2,825
$
670
$
2
$
3,497
$
(367
)
$
35
$
3,165
(1)
Primarily FedEx U.K. and DTW Group acquisitions.
(2)
FedEx National LTL acquisition.
(3)
Primarily currency translation adjustments.
Table of Contents
reorganizing senior management at FedEx Office with several positions terminated and
numerous reporting realignments, including naming a new president and CEO;
determining that we would minimize the use of the Kinkos trade name over the next
several years;
implementing revenue growth and cost management plans to improve financial performance;
and
pursuing a more disciplined approach to the long-term expansion of the retail network,
reducing the overall level of expansion.
benchmark capital structures for guideline companies with characteristics similar to the
FedEx Office reporting unit;
current market conditions for the risk free interest rate;
the size and industry of the FedEx Office reporting unit; and
risks related to the forecast of future revenues and profitability of the FedEx Office
reporting unit.
Table of Contents
May 31, 2008
May 31, 2007
Gross Carrying
Accumulated
Net Book
Gross Carrying
Accumulated
Net Book
Amount
Amortization
Value
Amount
Amortization
Value
$
205
$
(95
)
$
110
$
206
$
(58
)
$
148
79
(67
)
12
79
(62
)
17
74
(51
)
23
74
(39
)
35
52
(8
)
44
567
567
$
410
$
(221
)
$
189
$
926
$
(159
)
$
767
$
73
50
26
11
9
Table of Contents
May 31,
2008
2007
$
193
$
283
404
599
521
472
$
1,118
$
1,354
$
577
$
548
339
310
637
561
$
1,553
$
1,419
May 31,
2008
2007
$
$
500
500
500
499
499
250
249
300
300
239
239
1,788
2,287
220
308
51
2,008
2,646
502
639
$
1,506
$
2,007
Table of Contents
$
500
499
250
300
Table of Contents
May 31,
2008
2007
$
$
115
165
165
20
20
150
151
335
451
290
306
$
45
$
145
For years ended May 31,
2008
2007
2006
$
1,990
$
1,916
$
1,919
228
241
245
$
2,218
$
2,157
$
2,164
(1)
Contingent rentals are based on equipment usage.
Operating Leases
Capital
Aircraft and Related
Facilities and
Total Operating
Leases
Equipment
Other
Leases
$
13
$
555
$
1,248
$
1,803
97
544
1,103
1,647
8
526
956
1,482
8
504
828
1,332
119
499
709
1,208
18
2,931
5,407
8,338
263
$
5,559
$
10,251
$
15,810
43
$
220
Table of Contents
2008
2007
2006
$
101
$
103
$
37
Table of Contents
2008
2007
2006
$
29.88
$
31.60
$
25.78
$
126
$
145
$
191
5 years
5 years
5 years
19
%
22
%
25
%
4.763
%
4.879
%
3.794
%
0.337
%
0.302
%
0.323
%
Stock Options
Weighted-
Average
Weighted-
Remaining
Aggregate
Average
Contractual
Intrinsic Value
Shares
Exercise Price
Term
(in millions)
16,590,401
$
68.22
2,821,758
111.51
(2,381,900
)
45.50
(352,453
)
102.30
16,677,806
$
78.09
5.9 years
$
326
10,666,189
$
64.05
4.7 years
$
312
5,530,688
$
102.99
9.2 years
$
13
3,684,999
Table of Contents
Restricted Stock
Weighted-
Average Grant
Shares
Date Fair Value
481,347
$
92.37
174,418
114.40
(212,113
)
86.16
(18,667
)
104.60
424,985
$
103.97
Stock Options
Vested during
Fair value
the year
(in millions)
3,366,273
$
59
3,147,642
65
2,694,602
64
Table of Contents
2008
2007
2006
$
1,125
$
2,016
$
1,806
309
307
304
14
18
19
(11
)
(14
)
(13
)
312
311
310
$
3.64
$
6.57
$
5.94
$
3.60
$
6.48
$
5.83
4.8
0.4
2008
2007
2006
$
514
$
829
$
719
74
72
79
242
174
132
830
1,075
930
31
62
129
(2
)
27
13
32
35
21
61
124
163
$
891
$
1,199
$
1,093
Table of Contents
2008
2007
2006
35.0
%
35.0
%
35.0
%
6.8
2.1
2.0
2.1
0.3
0.3
0.6
44.2
%
37.3
%
37.7
%
2008
2007
Deferred
Deferred
Deferred
Deferred
Tax Assets
Tax Liabilities
Tax Assets
Tax Liabilities
$
321
$
1,650
$
328
$
1,655
401
398
406
53
359
350
426
190
346
139
135
172
(124
)
(116
)
$
1,518
$
2,238
$
1,486
$
1,847
2008
2007
$
544
$
536
(1,264
)
(897
)
$
(720
)
$
(361
)
Table of Contents
$
72
16
9
(9
)
$
88
Table of Contents
2008
2007
2006
$
323
$
467
$
425
216
176
167
77
55
73
$
616
$
698
$
665
Table of Contents
Table of Contents
Plan Assets at Measurement Date
2008
2007
Asset Class
Actual
Actual
Target
Actual
Actual
Target
$
5,694
49
%
53
%
$
5,897
52
%
53
%
2,481
21
17
2,413
21
17
406
4
5
314
3
5
8,581
74
75
8,624
76
75
1,778
15
15
1,627
15
15
1,302
11
10
1,049
9
10
$
11,661
100
%
100
%
$
11,300
100
%
100
%
the duration of our pension plan liabilities, which drives the investment strategy we can
employ with our pension plan assets;
the types of investment classes in which we invest our pension plan assets and the expected
compound geometric return we can reasonably expect those investment classes to earn over the
next 10- to 15-year time period (or such other time period that may be appropriate); and
the investment returns we can reasonably expect our active investment management program to
achieve in excess of the returns we could expect if investments were made strictly in indexed
funds.
Table of Contents
Pension Plans
Postretirement Healthcare Plans
2008
2007
2008
2007
$
11,212
$
11,559
$
12,209
$
12,153
$
525
$
475
518
540
35
31
720
707
31
28
(1,531
)
590
(56
)
9
(318
)
(261
)
(40
)
(40
)
1
(1,551
)
5
18
31
(3
)
17
$
11,617
$
12,209
$
492
$
525
$
11,506
$
10,130
$
$
141
1,086
548
524
64
23
(318
)
(261
)
(40
)
(40
)
2
27
(24
)
17
$
11,879
$
11,506
$
$
$
262
$
(703
)
$
(492
)
$
(525
)
15
22
5
4
$
277
$
(681
)
$
(487
)
$
(521
)
$
827
$
1
$
$
(32
)
(24
)
(30
)
(30
)
(518
)
(658
)
(457
)
(491
)
$
277
$
(681
)
$
(487
)
$
(521
)
$
2,455
$
3,324
$
(144
)
$
(97
)
(1,362
)
(1,477
)
2
2
$
1,093
$
1,847
$
(142
)
$
(95
)
$
51
$
(7
)
(114
)
$
(63
)
$
(7
)
Table of Contents
Fair Value of
Funded
Net Amount
ABO
PBO
Plan Assets
Status
Other
(1)
Recognized
$
10,530
$
10,834
$
11,661
$
827
$
$
827
333
338
(338
)
7
(331
)
349
445
218
(227
)
8
(219
)
$
11,212
$
11,617
$
11,879
$
262
$
15
$
277
$
10,926
$
11,487
$
11,300
$
(187
)
$
$
(187
)
314
326
(326
)
16
(310
)
319
396
206
(190
)
6
(184
)
$
11,559
$
12,209
$
11,506
$
(703
)
$
22
$
(681
)
(1)
Amounts in Other represent employer contributions after measurement date.
PBO Exceeds the Fair Value
of Plan Assets
2008
2007
$
783
$
12,085
218
11,381
ABO Exceeds the Fair Value
of Plan Assets
2008
2007
$
782
$
727
682
637
217
206
Table of Contents
Pension Plans
Postretirement Healthcare Plans
2008
2007
2006
2008
2007
2006
$
518
$
540
$
473
$
35
$
31
$
42
720
707
642
31
28
32
(985
)
(930
)
(811
)
70
150
121
11
(4
)
(1
)
$
323
$
467
$
425
$
77
$
55
$
73
Postretirement
Pension Plans
Healthcare Plans
Gross
Net of tax
Gross
Net of tax
amount
amount
amount
amount
$
(685
)
$
(430
)
$
(56
)
$
(38
)
(17
)
(10
)
6
4
113
70
(166
)
(104
)
3
2
$
(755
)
$
(474
)
$
(47
)
$
(32
)
Table of Contents
Pension Plans
Postretirement Healthcare Plans
2008
2007
2006
2008
2007
2006
6.96
%
6.01
%
5.91
%
6.81
%
6.08
%
6.08
%
6.01
5.91
6.29
6.08
6.08
6.16
4.51
4.47
3.46
4.47
3.46
3.15
8.50
9.10
9.10
(1)
The assumed interest rate used to discount the estimated future benefit payments that have been accrued to date (the PBO) to their net present value.
(2)
Average future salary increases based on age and years of service.
Postretirement
Pension Plans
Healthcare Plans
$
362
$
30
442
31
463
33
537
35
609
36
4,633
222
Table of Contents
FedEx Express (express transportation)
FedEx Trade Networks (global trade services)
FedEx Ground (small-package ground delivery)
FedEx SmartPost (small-parcel consolidator)
FedEx Freight LTL Group:
FedEx Freight (regional LTL freight transportation)
FedEx National LTL (long-haul LTL freight transportation)
FedEx Custom Critical (time-critical transportation)
Caribbean Transportation Services (airfreight forwarding)
FedEx Services (sales, marketing and information technology functions)
FedEx Office (document and business services and package
acceptance)
FedEx Customer Information Services (FCIS) (customer service,
billing and collections)
FedEx Global Supply Chain Services (logistics services)
Table of Contents
Table of Contents
FedEx
FedEx
FedEx
FedEx
Express
Ground
Freight
Services
Other and
Consolidated
Segment
Segment
Segment
(1)
Segment
Eliminations
Total
$
24,421
$
6,751
$
4,934
$
2,138
$
(291
)
$
37,953
22,681
6,043
4,586
2,136
(232
)
35,214
21,446
5,306
3,645
2,088
(191
)
32,294
$
944
$
305
$
227
$
469
$
1
$
1,946
856
268
195
420
3
1,742
805
224
120
400
1
1,550
$
1,901
$
736
$
329
$
(891
)
$
$
2,075
1,991
822
463
3,276
1,813
716
485
3,014
$
13,416
$
2,770
$
3,276
$
4,651
$
1,520
$
25,633
15,650
3,937
3,150
5,384
(4,121
)
24,000
14,673
3,378
2,245
3,807
(1,413
)
22,690
(1)
Includes the operations of FedEx National LTL from the date of acquisition,
September 3, 2006.
(2)
The net operating costs of the FedEx Services segment, including FedEx Office, are
allocated back to the transportation segments it supports. Prior year amounts have been revised to
conform to the current year presentation.
(3)
FedEx Services segment operating expenses include a charge of approximately $891
million, predominantly related to noncash impairment charges associated with the decision to
minimize the use of the Kinkos trade name and goodwill
resulting from the Kinkos acquisition. These charges were not
allocated to our transportation segments, as the charges were
unrelated to the core performance of these businesses.
(4)
FedEx Express operating expenses include a $143 million charge associated with
upfront compensation and benefits under the new pilot labor contract.
(5)
Includes a $79 million one-time, noncash charge to adjust the accounting for
certain facility leases ($75 million at FedEx Express).
(6)
Segment assets include intercompany receivables.
FedEx
FedEx
FedEx
FedEx
Express
Ground
Freight
Services
Consolidated
Segment
Segment
Segment
Segment
Other
Total
$
1,716
$
509
$
266
$
455
$
1
$
2,947
1,672
489
287
432
2
2,882
1,408
487
274
345
4
2,518
Table of Contents
2008
2007
2006
$
6,578
$
6,485
$
6,422
2,012
1,990
1,974
2,995
2,883
2,853
11,585
11,358
11,249
7,666
6,722
6,139
663
370
199
19,914
18,450
17,587
2,398
2,412
2,218
1,243
1,045
840
406
394
434
4,047
3,851
3,492
460
380
367
24,421
22,681
21,446
6,751
6,043
5,306
4,934
4,586
3,645
2,138
2,136
2,088
(291
)
(232
)
(191
)
$
37,953
$
35,214
$
32,294
$
27,306
$
26,132
$
24,172
10,647
9,082
8,122
$
37,953
$
35,214
$
32,294
$
14,920
$
14,191
$
13,804
3,469
3,180
2,422
$
18,389
$
17,371
$
16,226
(1)
International domestic revenues include our international domestic express operations, primarily in the United
Kingdom, Canada, India and China. We reclassified the prior period international domestic revenues previously
included within other revenues to conform to the current period presentation.
(2)
Other revenues includes FedEx Trade Networks.
(3)
Includes the operations of FedEx National LTL from the date of acquisition, September 3, 2006.
(4)
International revenue includes shipments that either originate in or are destined to locations outside the United
States. Noncurrent assets include property and equipment, goodwill and other long-term assets. Flight
equipment is allocated between geographic areas based on usage.
Table of Contents
2008
2007
2006
$
100
$
136
$
145
816
1,064
880
Aircraft-
Aircraft
Related
(1)
Other
(2)
Total
$
965
$
178
$
561
$
1,704
919
132
127
1,178
665
9
61
735
31
56
87
33
33
134
134
(1)
Primarily aircraft modifications.
(2)
Primarily vehicles, facilities, computers and advertising and promotions contracts.
Table of Contents
A300
B757
B777F
MD11
Total
4
16
2
22
6
6
12
5
9
14
2
2
4
29
15
2
50
Table of Contents
Table of Contents
Table of Contents
First
Second
Third
Fourth
(in millions, except per share amounts)
Quarter
Quarter
(1)
Quarter
Quarter
(2)
$
9,199
$
9,451
$
9,437
$
9,866
814
783
641
(163
)
494
479
393
(241
)
1.60
1.55
1.27
(0.78
)
1.58
1.54
1.26
(0.78
)
$
8,545
$
8,926
$
8,592
$
9,151
784
839
641
1,012
475
511
420
610
1.55
1.67
1.37
1.98
1.53
1.64
1.35
1.96
(1)
Results for the second quarter of 2007 include a $143 million charge at FedEx Express associated with upfront compensation
and benefits under the new pilot labor contract. The impact of this new contract on second quarter net income was approximately
$78 million net of tax, or $0.25 per diluted share. Additionally, FedEx National LTLs financial results have been included from
September 3, 2006 (the date of acquisition).
(2)
Results for the fourth quarter of 2008 include a charge of approximately $891 million ($696 million, net of tax, or $2.22 per
diluted share), predominantly related to noncash impairment charges associated with the decision to minimize the use of the
Kinkos trade name and goodwill resulting from the Kinkos acquisition. The earnings per share impact of the impairment charge
differs for the fourth quarter and full year due to differences in the weighted-average number of shares outstanding.
Table of Contents
May 31, 2008
Table of Contents
May 31, 2007
Table of Contents
Year Ended May 31, 2008
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
31,464
$
6,860
$
(371
)
$
37,953
98
11,660
2,444
14,202
3,216
1,322
(91
)
4,447
4
2,127
313
(3
)
2,441
2
1,651
293
1,946
4,272
324
4,596
1
1,907
160
2,068
882
882
(204
)
(94
)
298
99
4,400
1,074
(277
)
5,296
30,021
6,228
(371
)
35,878
1,443
632
2,075
1,125
310
(1,435
)
(44
)
4
(14
)
(54
)
51
(66
)
15
(7
)
3
(1
)
(5
)
1,125
1,694
632
(1,435
)
2,016
687
204
891
$
1,125
$
1,007
$
428
$
(1,435
)
$
1,125
Table of Contents
Year Ended May 31, 2007
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
29,894
$
5,671
$
(351
)
$
35,214
103
11,632
2,005
13,740
2,964
944
(35
)
3,873
3
2,082
261
(3
)
2,343
2
1,513
227
1,742
3,317
216
3,533
1
1,830
121
1,952
(193
)
(170
)
363
84
4,133
851
(313
)
4,755
27,301
4,988
(351
)
31,938
2,593
683
3,276
2,016
390
(2,406
)
(22
)
(29
)
(2
)
(53
)
29
(34
)
5
(7
)
(1
)
(8
)
2,016
2,920
685
(2,406
)
3,215
971
228
1,199
$
2,016
$
1,949
$
457
$
(2,406
)
$
2,016
Year Ended May 31, 2006
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
$
28,310
$
4,325
$
(341
)
$
32,294
81
11,046
1,444
12,571
2,642
627
(18
)
3,251
4
2,163
226
(3
)
2,390
2
1,401
147
1,550
3,128
128
3,256
1
1,709
67
1,777
(164
)
(229
)
393
76
4,008
721
(320
)
4,485
25,868
3,753
(341
)
29,280
2,442
572
3,014
1,806
327
(2,133
)
(47
)
(57
)
(104
)
55
(78
)
23
(8
)
(4
)
1
(11
)
1,806
2,630
596
(2,133
)
2,899
876
217
1,093
$
1,806
$
1,754
$
379
$
(2,133
)
$
1,806
Table of Contents
Year Ended May 31, 2008
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
(44
)
$
3,072
$
456
$
$
3,484
(1
)
(2,683
)
(263
)
(2,947
)
(4
)
(4
)
(5,971
)
5,971
34
20
54
(5,972
)
3,322
(247
)
(2,897
)
463
(296
)
(167
)
5,971
(5,971
)
(551
)
(85
)
(3
)
(639
)
108
108
38
38
(124
)
(124
)
5,905
(6,352
)
(170
)
(617
)
(111
)
42
39
(30
)
1,212
124
233
1,569
$
1,101
$
166
$
272
$
$
1,539
Year Ended May 31, 2007
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
(57
)
$
2,741
$
879
$
$
3,563
(1
)
(2,631
)
(250
)
(2,882
)
(175
)
(36
)
(1,099
)
(1,310
)
47
21
68
(176
)
(2,620
)
(1,328
)
(4,124
)
(578
)
40
538
(700
)
(206
)
(906
)
999
55
1,054
115
115
45
45
(110
)
(110
)
(5
)
(5
)
(234
)
(111
)
538
193
(467
)
10
89
(368
)
1,679
114
144
1,937
$
1,212
$
124
$
233
$
$
1,569
Table of Contents
Year Ended May 31, 2006
Guarantor
Non-Guarantor
Parent
Subsidiaries
Subsidiaries
Eliminations
Consolidated
$
(69
)
$
3,418
$
327
$
$
3,676
(4
)
(2,321
)
(193
)
(2,518
)
58
6
64
(4
)
(2,263
)
(187
)
(2,454
)
1,215
(1,073
)
(142
)
(250
)
(119
)
(369
)
144
144
(97
)
(97
)
(2
)
(2
)
1,010
(1,192
)
(142
)
(324
)
937
(37
)
(2
)
898
742
151
146
1,039
$
1,679
$
114
$
144
$
$
1,937
Table of Contents
Table of Contents
2008
(1)
2007
(2)
2006
(3)
2005
(4)
2004
(5)
$
37,953
$
35,214
$
32,294
$
29,363
$
24,710
2,075
3,276
3,014
2,471
1,440
2,016
3,215
2,899
2,313
1,319
1,125
2,016
1,806
1,449
838
$
3.64
$
6.57
$
5.94
$
4.81
$
2.80
$
3.60
$
6.48
$
5.83
$
4.72
$
2.76
309
307
304
301
299
312
311
310
307
304
$
0.30
$
0.37
$
0.33
$
0.29
$
0.29
$
13,478
$
12,636
$
10,770
$
9,643
$
9,037
25,633
24,000
22,690
20,404
19,134
1,506
2,007
1,592
2,427
2,837
14,526
12,656
11,511
9,588
8,036
677
669
671
670
645
254,142
241,903
221,677
215,838
195,838
(1)
Results for 2008 include a charge of approximately $891 million ($696 million, net of tax, or
$2.23 per diluted share) recorded during the fourth quarter, predominantly related to noncash
impairment charges associated with the decision to minimize the use of the Kinkos trade name and
goodwill resulting from the Kinkos acquisition. See Note 4 to the accompanying consolidated
financial statements. Additionally, results for 2008 and 2007 include several 2007 acquisitions as
described in Note 3 to the accompanying financial statements.
(2)
Results for 2007 include a $143 million charge at FedEx Express associated with upfront
compensation and benefits under the new labor contract with our pilots. See Note 1 to the
accompanying consolidated financial statements.
(3)
Results for 2006 include a $79 million ($49 million, net of tax, or $0.16 per diluted share)
charge to adjust the accounting for certain facility leases, predominantly at FedEx Express. See
Note 7 to the accompanying consolidated financial statements.
(4)
Results for 2005 include a $48 million ($31 million, net of tax, or $0.10 per diluted share)
Airline Stabilization Act charge at FedEx Express and a $12 million or $0.04 per diluted share
benefit from an income tax adjustment.
(5)
Results for 2004 include $435 million ($270 million, net of tax, or $0.89 per diluted share) of
business realignment costs and a $37 million, or $0.12 per diluted share, benefit related to a
favorable ruling on an aircraft engine maintenance tax case and the reduction of our effective tax
rate. Additionally, FedEx Office financial results have been included from February 12, 2004 (the
date of acquisition).
Table of Contents
PUBLIC ACCOUNTING FIRM
FedEx Corporation
/s/ Ernst & Young LLP
July 10, 2008
Table of Contents
(IN MILLIONS)
ADDITIONS
BALANCE
CHARGED
BALANCE
AT
CHARGED
TO
AT
BEGINNING
TO COSTS
OTHER
END OF
DESCRIPTION
OF YEAR
EXPENSES
ACCOUNTS
DEDUCTIONS
YEAR
$
79
$
134
$
$
125
(a)
$
88
80
106
107
(a)
79
73
121
114
(a)
80
$
57
$
$
486
(b)
$
473
(c)
$
70
64
478
(b)
485
(c)
57
52
489
(b)
477
(c)
64
$
156
$
10
$
$
3
$
163
150
9
3
156
142
10
2
150
(a)
Uncollectible accounts written off, net of recoveries.
(b)
Principally charged against revenue.
(c)
Service failures, rebills and other.
Table of Contents
(IN MILLIONS, EXCEPT RATIOS)
Years Ended May 31,
2008
2007
2006
2005
2004
$
2,016
$
3,215
$
2,899
$
2,313
$
1,319
98
136
142
160
136
5
6
5
6
7
784
766
842
800
712
$
2,903
$
4,123
$
3,888
$
3,279
$
2,174
$
98
$
136
$
142
$
160
$
136
50
34
33
22
11
5
6
5
6
7
784
766
842
800
712
$
937
$
942
$
1,022
$
988
$
866
3.1
4.4
3.8
3.3
2.5
Table of Contents
Exhibit
Number
Description of Exhibit
Certificate of Incorporation and Bylaws
Second Amended and Restated Certificate of Incorporation of FedEx.
(Filed as Exhibit 3.1 to FedExs FY07 First Quarter Report on
Form 10-Q, and incorporated herein by reference.)
Amended and Restated Bylaws of FedEx.
Facility Lease Agreements
Composite Lease Agreement dated May 21, 2007 (but effective as of
January 1, 2007) between the Memphis-Shelby County Airport
Authority (the Authority) and FedEx Express. (Filed as Exhibit
10.1 to FedExs FY07 Annual Report on Form 10-K, and incorporated
herein by reference).
Special Facility Lease Agreement dated as of August 1, 1979
between the Authority and FedEx Express. (Filed as Exhibit 10.15
to FedEx Expresss FY90 Annual Report on Form 10-K, and
incorporated herein by reference.)
First Special Facility Supplemental Lease Agreement dated as of
May 1, 1982 between the Authority and FedEx Express. (Filed as
Exhibit 10.25 to FedEx Expresss FY93 Annual Report on Form 10-K,
and incorporated herein by reference.)
Second Special Facility Supplemental Lease Agreement dated as of
November 1, 1982 between the Authority and FedEx Express. (Filed
as Exhibit 10.26 to FedEx Expresss FY93 Annual Report on Form
10-K, and incorporated herein by reference.)
Third Special Facility Supplemental Lease Agreement dated as of
December 1, 1984 between the Authority and FedEx Express. (Filed
as Exhibit 10.25 to FedEx Expresss FY95 Annual Report on Form
10-K, and incorporated herein by reference.)
Fourth Special Facility Supplemental Lease Agreement dated as of
July 1, 1992 between the Authority and FedEx Express. (Filed as
Exhibit 10.20 to FedEx Expresss FY92 Annual Report on Form 10-K,
and incorporated herein by reference.)
Fifth Special Facility Supplemental Lease Agreement dated as of
July 1, 1997 between the Authority and FedEx Express. (Filed as
Exhibit 10.35 to FedEx Expresss FY97 Annual Report on Form 10-K,
and incorporated herein by reference.)
Sixth Special Facility Supplemental Lease Agreement dated as of
December 1, 2001 between the Authority and FedEx Express. (Filed
as Exhibit 10.28 to FedExs FY02 Annual Report on Form 10-K, and
incorporated herein by reference.)
Seventh Special Facility Supplemental Lease Agreement dated as of
June 1, 2002 between the Authority and FedEx Express. (Filed as
Exhibit 10.3 to FedExs FY03 First Quarter Report on Form 10-Q,
and incorporated herein by reference.)
Special Facility Lease Agreement dated as of July 1, 1993 between
the Authority and FedEx Express. (Filed as Exhibit 10.29 to FedEx
Expresss FY93 Annual Report on Form 10-K, and incorporated herein
by reference.)
Table of Contents
Exhibit
Number
Description of Exhibit
Special Facility Ground Lease Agreement dated as of July 1, 1993
between the Authority and FedEx Express. (Filed as Exhibit 10.30
to FedEx Expresss FY93 Annual Report on Form 10-K, and
incorporated herein by reference.)
Aircraft-Related Agreement
Boeing 777 Freighter Purchase Agreement dated as of November 7,
2006 between The Boeing Company and FedEx Express. Confidential
treatment has been granted for confidential commercial and
financial information, pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. (Filed as Exhibit 10.1 to
FedExs FY07 Second Quarter Report on Form 10-Q, and incorporated
herein by reference.)
Supplemental Agreement No. 1 dated as of June 16, 2008 to the
Boeing 777 Freighter Purchase Agreement dated as of November 7,
2006 between The Boeing Company and FedEx Express.
U.S. Postal Service Agreement
Transportation Agreement dated July 31, 2006 between the United
States Postal Service and FedEx Express. Confidential treatment
has been granted for confidential commercial and financial
information, pursuant to
Rule 24b-2
under the Securities Exchange
Act of 1934, as amended. (Filed as Exhibit 10.2 to FedExs FY07
First Quarter Report on Form 10-Q, and incorporated herein by
reference.)
Amendment dated November 30, 2006 to the Transportation Agreement
dated July 31, 2006 between the United States Postal Service and
FedEx Express. Confidential treatment has been granted for
confidential commercial and financial information, pursuant to
Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
(Filed as Exhibit 10.2 to FedExs FY07 Second Quarter Report on
Form 10-Q, and incorporated herein by reference.)
Letter Agreement dated March 8, 2007 and Letter Agreement dated
May 14, 2007, each amending the Transportation Agreement dated
July 31, 2006, as amended, between the United States Postal
Service and FedEx Express. Confidential treatment has been
granted for confidential commercial and financial information,
pursuant to
Rule 24b-2
under the Securities Exchange Act of 1934,
as amended. (Filed as Exhibit 10.15 to FedExs FY07 Annual Report
on Form 10-K, and incorporated herein by reference.)
Amendment dated June 20, 2007 and Amendment dated July 31, 2007,
each amending the Transportation Agreement dated July 31, 2006, as
amended, between the United States Postal Service and FedEx
Express. Confidential treatment has been granted for confidential
commercial and financial information, pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934, as amended. (Filed as
Exhibit 10.1 to FedExs FY08 First Quarter Report on Form 10-Q,
and incorporated herein by reference.)
Amendment dated December 4, 2007 to the Transportation Agreement
dated July 31, 2006, as amended, between the United States Postal
Service and FedEx Express. Confidential treatment has been
granted for confidential commercial and financial information,
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934,
as amended. (Filed as Exhibit 10.1 to FedExs FY08 Third Quarter
Report on Form 10-Q, and incorporated herein by reference.)
Table of Contents
Exhibit
Number
Description of Exhibit
Financing Agreement
Five-Year Credit Agreement dated as of July 20, 2005 among FedEx,
JPMorgan Chase Bank, N.A., individually and as administrative agent,
and certain lenders. (Filed as Exhibit 99.1 to FedExs Current
Report on Form 8-K dated July 20, 2005, and incorporated herein by
reference.)
FedEx is not filing any other instruments evidencing any indebtedness
because the total amount of securities authorized under any single
such instrument does not exceed 10% of the total assets of FedEx and
its subsidiaries on a consolidated basis. Copies of such instruments
will be furnished to the Securities and Exchange Commission upon
request.
Management Contracts/Compensatory Plans or Arrangements
1993 Stock Incentive Plan and Form of Stock Option Agreement pursuant
to 1993 Stock Incentive Plan, as amended. (The 1993 Stock Incentive
Plan was filed as Exhibit A to FedEx Expresss FY93 Definitive Proxy
Statement, Commission File No. 1-7806, and is incorporated herein by
reference, and the form of stock option agreement was filed as
Exhibit 10.61 to FedEx Expresss FY94 Annual Report on Form 10-K, and
is incorporated herein by reference.)
Amendment to 1993 Stock Incentive Plan. (Filed as Exhibit 10.63 to
FedEx Expresss FY94 Annual Report on Form 10-K, and incorporated
herein by reference.)
1995 Stock Incentive Plan and Form of Stock Option Agreement pursuant
to 1995 Stock Incentive Plan. (The 1995 Stock Incentive Plan was
filed as Exhibit A to FedEx Expresss FY95 Definitive Proxy
Statement, and is incorporated herein by reference, and the form of
stock option agreement was filed as Exhibit 99.2 to FedEx Expresss
Registration Statement No. 333-03443 on Form S-8, and is incorporated
herein by reference.)
Amendment to 1993 and 1995 Stock Incentive Plans. (Filed as Exhibit
10.79 to FedEx Expresss FY97 Annual Report on Form 10-K, and
incorporated herein by reference.)
1997 Stock Incentive Plan, as amended, and Form of Stock Option
Agreement pursuant to 1997 Stock Incentive Plan. (The 1997 Stock
Incentive Plan was filed as Exhibit 4.3 to FedExs Registration
Statement on Form S-8, Registration No. 333-71065, and is
incorporated herein by reference, and the form of stock option
agreement was filed as Exhibit 4.4 to FedExs Registration Statement
No. 333-71065 on Form S-8, and is incorporated herein by reference.)
Amendment to 1997 Stock Incentive Plan. (Filed as Exhibit A to
FedExs FY98 Definitive Proxy Statement, and incorporated herein by
reference.)
1999 Stock Incentive Plan and Form of Stock Option Agreement pursuant
to 1999 Stock Incentive Plan. (The 1999 Stock Incentive Plan was
filed as Exhibit 4.3 to FedExs Registration Statement No. 333-34934
on Form S-8, and is incorporated herein by reference, and the form of
stock option agreement was filed as Exhibit 4.4 to FedExs
Registration Statement No. 333-34934 on Form S-8, and is incorporated
herein by reference.)
2002 Stock Incentive Plan and Form of Stock Option Agreement pursuant
to 2002 Stock Incentive Plan. (The 2002 Stock Incentive Plan was
filed as Exhibit 4.3 to FedExs Registration Statement No. 333-100572
on Form S-8, and is incorporated herein by reference, and the form of
stock option agreement was filed as Exhibit 4.4 to FedExs
Registration Statement No. 333-100572 on Form S-8, and is
incorporated herein by reference.)
Table of Contents
Exhibit
Number
Description of Exhibit
1997 Restricted Stock Plan and Form of Restricted Stock Agreement
pursuant to 1997 Restricted Stock Plan. (Filed as Exhibit 10.82 to
FedEx Expresss FY97 Annual Report on Form 10-K, and incorporated
herein by reference.)
Amendment to 1997 Restricted Stock Plan. (Filed as Exhibit 10.65 to
FedExs FY02 Annual Report on Form 10-K, and incorporated herein by
reference.)
2001 Restricted Stock Plan and Form of Restricted Stock Agreement
pursuant to 2001 Restricted Stock Plan. (Filed as Exhibit 10.60 to
FedExs FY01 Annual Report on Form 10-K, and incorporated herein by
reference.)
Amendment to 2001 Restricted Stock Plan. (Filed as Exhibit 10.67 to
FedExs FY02 Annual Report on Form 10-K, and incorporated herein by
reference.)
Amendment to 1995, 1997, 1999 and 2002 Stock Incentive Plans and 1997
and 2001 Restricted Stock Plans. (Filed as Exhibit 10.3 to FedExs
FY04 Second Quarter Report on Form 10-Q, and incorporated herein by
reference.)
FedEx Corporation Incentive Stock Plan, as amended; Amendment to
FedEx Corporation Incentive Stock Plan, as amended, and 1997, 1999
and 2002 Stock Incentive Plans; Forms of Stock Option and Restricted
Stock Agreements pursuant to FedEx Corporation Incentive Stock Plan;
and Terms and Conditions of Stock Option Grants for U.S. and Non-U.S.
Employees.
FedEx Corporation Incentive Stock Plan 2005 Inland Revenue Approved
Sub-Plan for the United Kingdom and Form of Share Option Agreement
pursuant to the FedEx Corporation Incentive Stock Plan 2005 Inland
Revenue Approved Sub-Plan for the United Kingdom. (The United
Kingdom Sub-Plan was filed as Exhibit 4.2 to FedEx Corporations
Registration Statement No. 333-130619 on Form S-8, and is
incorporated herein by reference, and the form of share option
agreement pursuant to the UK Sub-Plan was filed as Exhibit 4.3 to
FedEx Corporations Registration Statement No. 333-130619 on Form
S-8, and is incorporated herein by reference.)
Amended and Restated FedEx Corporation Retirement Parity Pension Plan.
Compensation Arrangements with Named Executive Officers.
Compensation Arrangements with Outside Directors.
FedExs Amended and Restated
Retirement Plan for Outside Directors. (Filed as Exhibit 10.87 to
FedEx Expresss FY97 Annual Report on Form 10-K, and
incorporated herein by reference.)
Form of Management Retention Agreement entered into between FedEx
Corporation and each of Frederick W. Smith, David J. Bronczek, Robert
B. Carter, Douglas G. Duncan, T. Michael Glenn, Alan B. Graf, Jr.,
David F. Rebholz and Christine P. Richards. (Filed as Exhibit 10.2
to FedExs FY05 Second Quarter Report on Form 10-Q, and incorporated
herein by reference.)
Table of Contents
Exhibit
Number
Description of Exhibit
Other Exhibits
Statement re Computation of Ratio of Earnings to Fixed Charges (presented
on page 135 of this Annual Report on Form 10-K).
Subsidiaries of Registrant.
Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
Powers of Attorney.
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.
*
Filed herewith.
ARTICLE I. OFFICES
|
1 | |||
1 Registered Office and Agent
|
1 | |||
2 Other Offices
|
1 | |||
|
||||
ARTICLE II. MEETINGS OF STOCKHOLDERS
|
1 | |||
1 Place of Meetings
|
1 | |||
2 Annual Meeting
|
1 | |||
3 Notice of Annual Meeting
|
1 | |||
4 List of Stockholders Entitled to Vote
|
1 | |||
5 Special Meetings
|
2 | |||
6 Notice of Special Meeting
|
2 | |||
7 Quorum; Adjournment of Meetings
|
2 | |||
8 Required Vote
|
2 | |||
9 Voting; Proxies
|
3 | |||
10 Conduct of Meeting
|
3 | |||
11 Action Without a Meeting
|
3 | |||
12 Nomination of Directors and Stockholder Business at Annual Meeting
|
3 | |||
|
||||
ARTICLE III. DIRECTORS
|
5 | |||
1 Number, Election and Term of Directors
|
5 | |||
2 Newly Created Directorships and Vacancies
|
5 | |||
3 Powers
|
6 | |||
4 Place of Meetings; Minutes
|
6 | |||
5 Regular Meetings
|
6 | |||
6 Special Meetings
|
6 | |||
7 Quorum; Required Vote; Adjournment
|
6 | |||
8 Action Without a Meeting
|
6 | |||
9 Board Committees
|
6 | |||
10 Committee Authority
|
7 | |||
11 Committee Procedure and Meetings
|
7 | |||
12 Compensation
|
7 | |||
13 Stockholder Rights Plans
|
7 | |||
|
||||
ARTICLE IV. NOTICES
|
7 | |||
1 Method
|
7 | |||
2 Waiver
|
7 | |||
|
||||
ARTICLE V. OFFICERS
|
8 | |||
1 Titles; Election; Term of Office
|
8 | |||
2 Removal
|
8 | |||
3 Vacancies
|
8 | |||
4 Powers and Duties
|
8 | |||
5 Compensation
|
8 |
-i-
ARTICLE VI. INDEMNIFICATION
|
9 | |||
1 Rights to Indemnification and Advancement of Expenses
|
9 | |||
2 Non-Exclusivity of Rights
|
9 | |||
3 Nature of Rights
|
9 | |||
|
||||
ARTICLE VII. MISCELLANEOUS PROVISIONS
|
10 | |||
1 Shares of Stock
|
10 | |||
2 Stock Certificates
|
10 | |||
3 Lost, Stolen or Destroyed Certificates
|
10 | |||
4 Record Date
|
10 | |||
5 Registered Stockholders
|
10 | |||
6 Dividends
|
10 | |||
7 Fiscal Year
|
11 | |||
8 Seal
|
11 | |||
9 Resignations
|
11 | |||
10 Invalid Provisions
|
11 | |||
11 Headings
|
11 | |||
|
||||
ARTICLE VIII. AMENDMENTS
|
11 |
-ii-
1
2
3
(a) | the name and address of the stockholder who intends to make a nomination or bring up any other matter; |
(b) | a representation that the stockholder is a holder of the corporations voting stock (indicating the class and number of shares owned) and intends to appear in person or by proxy at the meeting to make the nomination or bring up the matter specified in the notice; |
(c) | with respect to notice of an intent to make a nomination, a description of all agreements, arrangements or understandings (whether written or oral) among the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder; |
(d) | with respect to notice of an intent to make a nomination, the name and address of each nominee and such other information regarding each nominee proposed by such stockholder as would have been required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had each nominee been nominated by the board of directors of the corporation; and |
(e) | with respect to notice of an intent to bring up any other matter, a description of the matter, including the complete text of any resolutions intended to be presented at the meeting, the reasons for bringing up such matter at the meeting and any personal or other material interest of the stockholder in the matter. |
4
5
6
7
8
9
10
11
1. | In order to reschedule the three Aircraft scheduled for delivery in February, May, 2010 and March 2011 to June 2010(two Aircraft) and June 2011, Table 1 to the Purchase Agreement is hereby deleted and replaced with a new Table 1 which is attached hereto. Boeing hereby agrees that such Aircraft slides are at no charge to Customer. |
S1-1
Supplemental Agreement 1 to
Purchase Agreement No. 3157 |
page 2 |
2. | In order to reschedule one option aircraft scheduled for delivery in May 2011 to February 2014, the attachment to Letter 6-1162-RCN-1789, is hereby deleted and replaced with a new attachment to Letter 6-1162-RCN-1789 which is attached hereto. | |
3. | Customer agrees that Boeing will retain the excess advance payments that result from the rescheduling in paragraph 1 and will apply them to the first advance payment(s) due by Customer subsequent to the date of this Supplemental Agreement. |
THE BOEING COMPANY | FEDERAL EXPRESS CORPORATION | |||||||
|
||||||||
By:
|
/s/ R.C. Nelson
|
By: |
/s/ Phillip C. Blum
|
|||||
|
Its: Attorney-In-Fact | Its: Vice President | ||||||
|
Aircraft Acquisitions/SAO |
S1-2
Purchase Agreement No. 3157
Aircraft Delivery, Description, Price and Advance Payments
purchase of 15 firm + 15 options
777-Freighter
766000 pounds
GE90-110B1L
110000 pounds
$
231,629,000
$
3,235,800
$
234,864,800
$
0
$
234,864,800
$
1,950,000
$
0
$
230,000
D019W007-NEW (7/24/2006)
Jul-06
ECI-MFG/CPI
N/A
N/A
180.3
195.4
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%
1
1.0845
$
254,711,000
$
2,317,110
$
10,188,440
$
12,735,550
$
89,148,850
1
1.0918
$
256,425,000
$
2,334,250
$
10,257,000
$
12,821,250
$
89,748,750
1
1.0939
$
256,919,000
$
2,339,190
$
10,276,760
$
12,845,950
$
89,921,650
1
1.0971
$
257,670,000
$
2,346,700
$
10,306,800
$
12,883,500
$
90,184,500
2
1.1136
$
261,545,000
$
2,385,450
$
10,461,800
$
13,077,250
$
91,540,750
1
1.1158
$
262,062,000
$
2,390,620
$
10,482,480
$
13,103,100
$
91,721,700
1
1.1189
$
262,790,000
$
2,397,900
$
10,511,600
$
13,139,500
$
91,976,500
1
1.121
$
263,283,000
$
2,402,830
$
10,531,320
$
13,164,150
$
92,149,050
1
1.1231
$
263,777,000
$
2,407,770
$
10,551,080
$
13,188,850
$
92,321,950
1
1.125
$
264,223,000
$
2,412,230
$
10,568,920
$
13,211,150
$
92,478,050
1
1.1281
$
264,951,000
$
2,419,510
$
10,598,040
$
13,247,550
$
92,732,850
1
1.1314
$
265,726,000
$
2,427,260
$
10,629,040
$
13,286,300
$
93,004,100
1
1.1348
$
266,525,000
$
2,435,250
$
10,661,000
$
13,326,250
$
93,283,750
1
1.1456
$
269,061,000
$
2,460,610
$
10,762,440
$
13,453,050
$
94,171,350
Letter 6-1162-RCN-1789
Option Aircraft Delivery, Description, Price and Advance Payments
purchase of 15 firm + 15 options
777-Freighter
766000 pounds
GE90-110B1L
110000 pounds
$
231,629,000
$
3,235,800
$
234,864,800
$
0
$
234,864,800
$
1,950,000
$
0
$
1,925,000
D019W007-NEW (7/24/2006
)
Jul-06
ECI-MFG/CPI
N/A
N/A
180.3
195.4
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%
2
1.1509
$
270,306,000
$
778,060
$
10,812,240
$
13,515,300
$
94,607,100
2
1.1578
$
271,926,000
$
794,260
$
10,877,040
$
13,596,300
$
95,174,100
1
1.168
$
274,322,000
$
818,220
$
10,972,880
$
13,716,100
$
96,012,700
1
1.1766
$
276,342,000
$
838,420
$
11,053,680
$
13,817,100
$
96,719,700
1
1.1847
$
278,244,000
$
857,440
$
11,129,760
$
13,912,200
$
97,385,400
2
1.1914
$
279,818,000
$
873,180
$
11,192,720
$
13,990,900
$
97,936,300
1
1.2034
$
282,636,000
$
901,360
$
11,305,440
$
14,131,800
$
98,922,600
1
1.2117
$
284,586,000
$
920,860
$
11,383,440
$
14,229,300
$
99,605,100
2
1.2197
$
286,465,000
$
939,650
$
11,458,600
$
14,323,250
$
100,262,750
1
1.2268
$
288,132,000
$
956,320
$
11,525,280
$
14,406,600
$
100,846,200
1
1.238
$
290,763,000
$
982,630
$
11,630,520
$
14,538,150
$
101,767,050
2
3
4
5
6
7
8
9
10
11
12
13
14
Anniversary of | ISO | NQO | ||||||
Grant Date | Shares | Shares | ||||||
|
2
FEDEX CORPORATION
|
||||
By: | ||||
CHAIRMAN, PRESIDENT AND | ||||
CHIEF EXECUTIVE OFFICER | ||||
OPTIONEE | ||||
3
4
Number of Shares on | ||||
Date | Which Restrictions Lapse | |||
|
5
ATTEST: | FEDEX CORPORATION | |||||
|
||||||
|
By: | |||||
|
|
|||||
|
Chief Executive Officer | |||||
|
||||||
PARTICIPANT: | ||||||
|
||||||
|
||||||
6
8. | Optionee Acknowledgment . By accepting the stock option grant, Optionee acknowledges: |
| receipt of an online copy of the Plan; | ||
| familiarity with the terms and provisions of the Plan; | ||
| agreement that this stock option is subject to all the Plan terms and provisions; | ||
| understanding that FedEx will not make any loans for the purpose of exercising a stock option or paying any tax liability associated with the exercise; and | ||
| agreement to accept as binding, conclusive and final all decisions or interpretations of the Compensation Committee upon any questions arising under the Plan or this grant. |
7
| receipt of an online copy of the Plan; | ||
| familiarity with the terms and provisions of the Plan; | ||
| agreement that this stock option is subject to all the Plan terms and provisions; | ||
| that neither FedEx or any person acting on behalf of FedEx has advised Optionee with respect to the option or received a fee from Optionee in connection with the option; | ||
| understanding that FedEx will not make any loans for the purpose of exercising a stock option or paying any tax liability associated with the exercise; and | ||
| agreement to accept as binding, conclusive and final all decisions or interpretations of the Compensation Committee upon any questions arising under the Plan or this grant. |
8
(i) | Parity Compensation Credit for any Plan Year shall equal (A) minus (B) as follows: |
(A) | is the Compensation Credit for such Plan Year as calculated under the Qualified Pension Plan but without regard to the limit imposed by Code §401(a)(17) (annual compensation limit) and subject to the provisions in subsections (1) and (2): |
(1) | for Officers and Managing Directors who become participants in this Plan on or before June 1, 2008 (except Managing Directors of FedEx Custom Critical, Inc., FedEx Truckload Brokerage, Inc, and FedEx Supply Chain Services, Inc. who become participants in the Plan as of June 1, 2008) with retroactive credits as if the Officer or Managing Director had been a participant in this Plan as of the date he participated in the Qualified Pension Plan. | ||
(2) | for all Managing Directors of FedEx Custom Critical, Inc., FedEx Truckload Brokerage, Inc, and FedEx Supply Chain Services, Inc. who become participants in the Plan as of June 1, 2008 and all other Managing Directors and Officers who become participants of this Plan after June 1, 2008, only for Plan Years ending after the later of (i) June 1, 2008 and (ii) the date such employee becomes an Officer or Managing Director. |
(B) | is the Compensation Credit accrued under the Qualified Pension Plan for such Plan Year. |
(ii) | Parity Transition Credit for any Plan Year beginning on or after June 1, 2008 shall equal (A) minus (B) as follows: |
(A) | is the Transition Credit for such Plan Year as calculated under the Qualified Pension Plan but without regard to the limit imposed by Code Section 401(a)(17) (annual compensation limit) | ||
(B) | is the Transition Credit accrued under the Qualified Pension Plan for such Plan Year. |
(iii) | Additional Compensation Credit for any Plan Year beginning on or after June 1, 2008 shall equal 3.5% of the excess of (A) over (B), where |
(A) | is such Officers or Managing Directors Compensation, but without regard to the limitations under § 401(a)(17), and | ||
(B) | is the limit set forth under § 401(a)(17) of the Internal Revenue Code (annual compensation limit). |
Additional Compensation Credits shall not be accrued for any Plan Years before June 1, 2008. |
(iv) | Parity Interest Credit shall mean an amount credited to the Parity Portable Pension Account in the same manner and using the same Interest Credit Factor as in the Qualified Pension Plan. | ||
(v) | 415 Limit Credit shall mean, for a participant whose total Qualified Pension Plan Benefit has been limited by §415 of the Internal Revenue Code, a cash balance value equal to the value of the shortfall in the Qualified Pension Plan, except to the extent already provided in Section 3, above. |
(i) | in a single lump sum, payable on the date on which benefit payments commence under the Qualified Pension Plan; | ||
(ii) | in a single lump sum, payable twelve (12) months following the date on which benefit payments commence under the Qualified Pension Plan; | ||
(iii) | in a single lump sum payable twenty-four (24) months following the date on which benefit payments commence under the Qualified Pension Plan; | ||
(iv) | in two equal installments (each being equal to one-half of the lump sum amount described in clause (i) above), the first installment payable on the date on which benefit payments commence under the Qualified Pension Plan, and the second installment payable twelve (12) months following the date on which benefit payments commence under the Qualified Pension Plan; or | ||
(v) | in two equal installments (each being equal to one-half of the lump sum amount described in clause (ii) above), the first installment payable twelve (12) months following the date on which benefit payments commence under the Qualified Pension Plan, and the second installment payable twenty-four (24) months following the date on which benefit payments commence under the Qualified Pension Plan. |
FEDERAL EXPRESS CORPORATION
|
||||
BY: | /s/ Kelly R. Gray | |||
Kelly R. Gray | ||||
Vice President, Global Compensation and Benefits | ||||
FEDEX CORPORATION
|
||||
BY: | /s/ Judith H. Edge | |||
Judith H. Edge | ||||
Corporate Vice President, Human Resources | ||||
FEDEX CORPORATE SERVICES, INC.
|
||||
BY: | /s/ Donna Humphreys | |||
Donna Humphreys | ||||
Staff Vice President, Human Resources | ||||
FEDEX CUSTOMER INFORMATION SERVICES, INC.
|
||||
BY: | /s/ Donna Humphreys | |||
Donna Humphreys | ||||
Staff Vice President, Human Resources | ||||
FEDEX TRADE NETWORKS, INC.
|
||||
BY: | /s/ Penelope Register Shaw | |||
Penelope Register Shaw | ||||
Vice President and General Counsel |
FEDEX TRADE NETWORKS TRADE SERVICES, INC.
|
||||
BY: | /s/ Penelope Register Shaw | |||
Penelope Register Shaw | ||||
Vice President and General Counsel | ||||
FEDEX TRADE NETWORKS TRANSPORT & BROKERAGE, INC.
|
||||
BY: | /s/ Penelope Register Shaw | |||
Penelope Register Shaw | ||||
Vice President and General Counsel |
WORLD TARIFF, LTD.
|
||||
BY: | /s/ Penelope Register Shaw | |||
Penelope Register Shaw | ||||
Vice President and General Counsel |
FEDEX FREIGHT CORPORATION
|
||||
BY: | /s/ Lori Henry | |||
Lori Henry | ||||
Vice President, Human Resources |
FEDEX GROUND PACKAGE SYSTEM, INC.
|
||||
BY: | /s/ Shannon A. Brown | |||
Shannon A. Brown | ||||
Senior Vice President, Human Resources |
FEDEX SMARTPOST, INC.
|
||||
BY: | /s/ Shannon A. Brown | |||
Shannon A. Brown | ||||
Senior Vice President, Human Resources |
FEDEX SUPPLY CHAIN SERVICES, INC.
|
||||
BY: | /s/ Fred Lukachinsky | |||
Fred Lukachinsky | ||||
Vice President, Finance and Administration |
FEDEX CUSTOM CRITICAL, INC.
|
||||
BY: | /s/ Kimble H. Scott | |||
Kimble H. Scott | ||||
Vice President and General Counsel |
FEDEX TRUCKLOAD BROKERAGE, INC.
|
||||
BY: | /s/ Kimble H. Scott | |||
Kimble H. Scott | ||||
Vice President |
FEDERAL EXPRESS VIRGIN ISLANDS, INC.
|
||||
BY: | /s/ Charles Kennedy | |||
Charles Kennedy | ||||
Vice President Legal
Latin America and Caribbean |
||||
Name and | ||||
Current Position | Base Salary | |||
|
||||
Frederick W. Smith
|
$ | 1,485,060 | ||
Chairman, President and
Chief Executive Officer |
||||
|
||||
Alan B. Graf, Jr.
|
$ | 934,380 | ||
Executive Vice President and
Chief Financial Officer |
||||
|
||||
David J. Bronczek
|
$ | 975,756 | ||
President and Chief Executive Officer
FedEx Express |
||||
|
||||
T. Michael Glenn
|
$ | 861,312 | ||
Executive Vice President,
Market Development and Corporate Communications |
||||
|
||||
David F. Rebholz
|
$ | 905,640 | ||
President and Chief Executive Officer
FedEx Ground |
| FedExs stock price performance relative to the Standard & Poors 500 Composite Index, the Dow Jones Transportation Average, the Dow Jones Industrial Average and competitors; | ||
| FedExs stock price to earnings (P/E) ratio relative to the Standard & Poors 500 Composite Index, the Dow Jones Industrial Average and competitors; |
| FedExs market capitalization; | ||
| FedExs revenue and operating income growth relative to competitors; | ||
| FedExs free cash flow (excluding business acquisitions), return on invested capital (excluding certain unusual items), and weighted average cost of capital; | ||
| Analyst coverage and ratings for FedExs stock; | ||
| FedExs U.S. and international revenue market share; and | ||
| FedExs reputation rankings by various publications and surveys. |
Name | Target Payout | |||
|
||||
Alan B. Graf, Jr.
|
90 | % | ||
David J. Bronczek
|
100 | % | ||
T. Michael Glenn
|
90 | % | ||
David F. Rebholz
|
80 | % |
| the achievement of individual objectives established at the beginning of the fiscal year for each executive (30% of each executives target bonus); and | ||
| the achievement of corporate objectives for EPS for fiscal 2009 (70% of each executives target bonus). |
2
Estimated Future Payouts | ||||||||||||||||
Performance | Threshold | Target | Maximum | |||||||||||||
Name | Period | ($) | ($) | ($) | ||||||||||||
|
||||||||||||||||
Frederick W. Smith
|
FY2007 FY2009 | 875,000 | 3,500,000 | 5,250,000 | ||||||||||||
|
FY2008 FY2010 | 875,000 | 3,500,000 | 5,250,000 | ||||||||||||
|
FY2009 FY2011 | 875,000 | 3,500,000 | 5,250,000 | ||||||||||||
|
||||||||||||||||
Alan B. Graf, Jr.
|
FY2007 FY2009 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
FY2008 FY2010 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
FY2009 FY2011 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
||||||||||||||||
David J. Bronczek
|
FY2007 FY2009 | 375,000 | 1,500,000 | 2,250,000 | ||||||||||||
|
FY2008 FY2010 | 375,000 | 1,500,000 | 2,250,000 | ||||||||||||
|
FY2009 FY2011 | 375,000 | 1,500,000 | 2,250,000 | ||||||||||||
|
||||||||||||||||
T. Michael Glenn
|
FY2007 FY2009 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
FY2008 FY2010 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
FY2009 FY2011 | 300,000 | 1,200,000 | 1,800,000 | ||||||||||||
|
||||||||||||||||
David F. Rebholz
|
FY2007 FY2009 | 250,000 | 1,000,000 | 1,500,000 | ||||||||||||
|
FY2008 FY2010 | 250,000 | 1,000,000 | 1,500,000 | ||||||||||||
|
FY2009 FY2011 | 250,000 | 1,000,000 | 1,500,000 |
3
4
| a quarterly retainer of $19,375; | ||
| $2,000 for each in-person Board meeting attended; and | ||
| $2,000 for each in-person committee meeting attended. |
Jurisdiction of | ||
Organization or Registration | ||
1. Federal Express Corporation
|
Delaware | |
I. Federal Express Aviation Services International, Ltd.
|
Delaware | |
II. Federal Express Canada Ltd.
|
Canada | |
III. Federal Express (India) Pvt. Ltd.
|
India | |
IV. Federal Express International, Inc.
|
Delaware | |
A. Dencom Investments Limited
|
Northern Ireland | |
1. Dencom Freight Holdings Limited
|
Northern Ireland | |
a. F.E.D.S. (Ireland) Limited
|
Ireland | |
b. Federal Express (N.I.) Limited
|
Northern Ireland | |
c. Fedex (Ireland) Limited
|
Ireland | |
B. Federal Express (Australia) Pty Ltd.
|
Australia | |
C. Federal Express Czech s.r.o.
|
Czech Republic | |
D. Federal Express Europe, Inc.
|
Delaware | |
1. FedEx UK Holdings Limited
|
England and Wales | |
a. ANC Group Limited
|
England and Wales | |
i. ANC Trustees No. 2 Limited
|
England and Wales | |
ii. ANC Business Services Limited
|
England and Wales | |
a. ANC Group Trustees Limited
|
England and Wales | |
b. ANC Holdings (1995) Limited
|
England and Wales | |
1. FedEx UK Limited
|
England and Wales | |
i. FedEx UK Supply Chain Services Limited
|
England and Wales | |
2. ANC (Scotland) Limited
|
Scotland | |
3. ANC (Nottingham) Limited
|
England and Wales | |
4. ANC International Limited
|
England and Wales | |
i. ANC Holdings Limited
|
England and Wales | |
a. ANC Limited
|
England and Wales | |
b. Esprit-In-Night Express Limited
|
England and Wales | |
2. Federal Express (Austria) GmbH
|
Austria | |
3. Federal Express Corporation Finland Oy
|
Finland | |
4. Federal Express Europe, Inc. & Co., V.O.F./S.N.C.
|
Belgium | |
5. Federal Express European Services, Inc.
|
Delaware | |
6. Federal Express Poland Sp.zo.o.
|
Poland | |
7. FedEx Supply Chain Services Europe B.V.
|
Netherlands | |
a. FedEx Supply Chain Services Belgium B.V.B.A.
|
Belgium | |
b. FedEx Supply Chain Services Ireland Limited
|
Ireland | |
c. FedEx Supply Chain Services Netherlands B.V.
|
Netherlands | |
d. FedEx Supply Chain Services UK Limited
|
United Kingdom | |
8. Federal Express (U.K.) Pension Trustees Ltd.
|
United Kingdom | |
9. FLYING-CARGO Hungary Kft.
|
Hungary | |
10. Prakash Air Freight Private Limited
|
India | |
E. Federal Express Finance P.L.C.
|
United Kingdom | |
F. Federal Express Holdings S.A.
|
Delaware | |
1. Federal Express (Antigua) Limited
|
Antigua | |
2. Federal Express (Antilles Francaises) S.A.R.L.
|
French West Indies | |
3. Federal Express (Barbados) Limited
|
Barbados | |
4. Federal Express (Bermuda) Limited
|
Bermuda | |
5. Federal Express Cayman Limited
|
Cayman Islands | |
6. Federal Express Costa Rica, Limitada
|
Costa Rica | |
7. Federal Express (Dominicana) S.A.
|
Dominican Republic | |
8. Federal Express Entregas Rapidas, Ltd.
|
Brazil | |
9. Federal Express (Grenada) Limited
|
Grenada | |
10. Federal Express (Haiti) S.A.
|
Haiti | |
11. Federal Express Holdings (Mexico) y Compania S.N.C. de C.V.
|
Mexico |
- 1 -
Jurisdiction of | ||
Organization or Registration | ||
12. Federal Express (Jamaica) Limited
|
Jamaica | |
13. Federal Express (St. Kitts) Limited
|
St. Kitts | |
14. Federal Express (St. Lucia) Limited
|
St. Lucia | |
15. Federal Express (St. Maarten) N.V.
|
Netherland Antilles | |
a. Federal Express (Aruba) N.V.
|
Netherland Antilles | |
16. Federal Express (Turks & Caicos) Limited
|
Turks & Caicos Islands | |
17. Federal Express Virgin Islands, Inc.
|
U.S. Virgin Islands | |
18. FedEx (Bahamas) Limited
|
Bahamas | |
19. FedEx Transportes Expresos (Guatemala), Limitada
|
Guatemala | |
G. Federal Express International (France) SNC
|
France | |
H. Federal Express International Limited
|
United Kingdom | |
I. Federal Express International y Compania S.N.C. de C.V.
|
Mexico | |
J. Federal Express Japan K.K.
|
Japan | |
K. Federal Express Korea Co., Ltd.
|
Korea | |
L. Federal Express Luxembourg, Inc.
|
Delaware | |
M. Federal Express Pacific, Inc.
|
Delaware | |
1. Federal Express (Hong Kong) Limited
|
Hong Kong | |
a. Federal Express (China) Company Limited
|
Peoples Republic of China | |
2. Federal Express Management Consulting (Shanghai) Co.,Ltd.
|
Peoples Republic of China | |
3. Federal Express Services (M) Sdn. Bhd.
|
Malaysia | |
4. Federal Express Brokerage Sdn. Bhd.
|
Malaysia | |
N. Federal Express (Singapore) Pte. Ltd.
|
Singapore | |
O. Federal Express (Thailand) Limited
|
Thailand | |
P. Fedex (N. I.) Limited
|
Northern Ireland | |
Q. FedEx Supply Chain Services International, Inc.
|
Delaware | |
R. FedEx Supply Chain Solutions (Logistica) DO Brasil LTDA
|
Brazil | |
S. Winchmore Developments Ltd.
|
England | |
V. Federal Express Leasing Corporation
|
Delaware | |
VI. FEDEX Customs Brokerage Corporation
|
Delaware | |
VII. FedEx Partners, Inc.
|
Delaware | |
VIII. FedEx Spain, S.L.
|
Spain | |
IX. Flying Tigers Limited
|
New Zealand | |
2. Caliber System (Canada), Inc.
|
Canada | |
3. CEDC, Inc.
|
Delaware | |
4. FedEx Corporate Services, Inc.
|
Delaware | |
I. FedEx Customer Information Services, Inc.
|
Delaware | |
II. FedEx Global Supply Chain Services, Inc.
|
Delaware | |
A. FedEx Supply Chain Services, Inc.
|
Ohio | |
1. FedEx Supply Chain Services (Canada), Ltd.
|
Ontario | |
2. Caliber Logistics Healthcare, Inc.
|
Ohio | |
III. FedEx Internet Technologies Corporation
|
Delaware | |
IV. FedEx Services International, Inc.
|
Delaware | |
5. FedEx Custom Critical, Inc.
|
Ohio | |
I. AutoQuik, Inc.
|
Delaware | |
II. FedEx Custom Critical GmbH
|
Germany | |
III. FedEx Custom Critical Passport Auto Transport, Inc.
|
Delaware | |
A. FedEx Custom Critical AutoTrans, Inc.
|
Delaware | |
IV. FedEx Truckload Brokerage, Inc.
|
Delaware | |
V. Third Party Services, Inc.
|
Delaware | |
VI. UrgentFreight, Inc.
|
Delaware | |
6. FedEx Freight Corporation
|
Delaware | |
I. Caribbean Transportation Services, Inc.
|
Delaware | |
II. FedEx Freight West, Inc.
|
California | |
A. Bay Cities Diesel Engine Rebuilders Inc.
|
California | |
B. Viking de Mexico, S.A. de C.V.
|
Mexico | |
III. FedEx Freight East, Inc.
|
Arkansas | |
A. American Freightways, Inc.
|
Arkansas | |
B. FedEx Freight de Mexico, S. de R.L. de C.V.
|
Mexico | |
C. FXF Logistica, S. de R.L. de C.V.
|
Mexico |
- 2 -
Jurisdiction of | ||
Organization or Registration | ||
D. Razorback Servicios de Mexico, S. de R.L. de C.V.
|
Mexico | |
IV. FedEx Freight System, Inc.
|
Delaware | |
V. FedEx National LTL, Inc.
|
Delaware | |
VI. FedEx Freight Canada Holding Company, Inc.
|
Delaware | |
A. FedEx Freight Canada, Corp.
|
Nova Scotia | |
7. FedEx Global Logistics, Inc.
|
Delaware | |
8. FedEx Ground Package System, Inc.
|
Delaware | |
I. FedEx Ground Package System, Ltd.
|
Wyoming | |
II. FedEx SmartPost, Inc.
|
Delaware | |
III. RPS de Mexico, S.A. de C.V.
|
Mexico | |
IV. FXG Urban Renewal Corporation
|
New Jersey | |
V. RPS Urban Renewal Corporation
|
New Jersey | |
9. FedEx Trade Networks, Inc.
|
Delaware | |
I. FedEx Trade Networks Trade Services, Inc.
|
Delaware | |
A. World Tariff, Limited
|
California | |
II. FedEx Trade Networks Transport & Brokerage, Inc.
|
New York | |
A. FedEx Trade Networks Transport & Brokerage (Canada), Inc.
|
Canada | |
B. FedEx Trade Networks Transport & Brokerage (Hong Kong), Inc.
|
Delaware | |
C. FedEx Trade Networks Transport & Brokerage (Hong Kong)Limited
|
Hong Kong | |
1. FedEx International Freight Forwarding Agency Services
(Shanghai) Company Limited
|
People's Republic of China | |
10. Roadway Global Air, Inc.
|
Delaware | |
11. FedEx Office and Print Services, Inc.
|
Texas | |
I. Kinkos Network, Inc.
|
Delaware | |
II. FedEx Kinkos International, Inc.
|
Delaware | |
A. Shanghai Kinkos Copy Service Co., Ltd.
|
People's Republic of China | |
B. Kinkos Netherlands, Inc.
|
Delaware | |
1. FedEx Kinkos Nederland B.V.
|
Netherlands | |
2. Kinkos Amsterdam One
|
Netherlands | |
3. Kinkos Nederland VOF
|
Netherlands | |
C. Kinkos Mexico, Inc.
|
Delaware | |
1. Soluciones Integrales K, S. de R.L. de C.V.
|
Mexico | |
2. FedEx Kinkos de Mexico, S. de R.L. de C.V.
|
Mexico | |
D. Kinkos Corporate Document Solutions B.V.
|
Netherlands | |
E. Kinkos Cayman Limited
|
Cayman Islands | |
F. Beijing Kinkos Copy Service Co., Ltd.
|
People's Republic of China | |
G. Shenzhen Kinkos Pacific Copy Services Company, Ltd.
|
People's Republic of China | |
H. FedEx Kinkos Limited
|
United Kingdom | |
I. FedEx Kinkos Canada Limited
|
Canada | |
J. FedEx Kinkos Korea Ltd.
|
Korea | |
K. FedEx Kinkos Japan Co., Ltd.
|
Japan | |
III. FedEx Kinkos International (Australia), Pty Ltd.
|
Australia | |
IV. FedEx Kinkos Business Stationery Print System, Inc.
|
Washington | |
A. Howard Press, Inc.
|
New Jersey | |
B. Image Press, Inc.
|
California | |
12. Tiger International Insurance Limited
|
Cayman Islands |
- 3 -
|
/s/ Ernst & Young LLP |
/s/ JAMES L. BARKSDALE | ||||
James L. Barksdale |
/s/ SHARON S. LUCIUS | ||||
Notary Public |
/s/ AUGUST A. BUSCH IV | ||||
August A. Busch IV |
/s/ LESA M. NOLLAU | ||||
Notary Public |
/s/ JOHN A. EDWARDSON | ||||
John A. Edwardson |
/s/ JANELL NELSEN | ||||
Notary Public |
/s/ JUDITH L. ESTRIN | ||||
Judith L. Estrin |
/s/ STEVEN A. WAGNER | ||||
Notary Public |
/s/ PHILIP GREER | ||||
Philip Greer |
/s/ ANNE R. COLEMAN | ||||
Notary Public |
/s/ J.R. HYDE, III | ||||
J. R. Hyde, III |
/s/ MELISSA FLECK | ||||
Notary Public |
/s/ SHIRLEY ANN JACKSON | ||||
Shirley Ann Jackson |
/s/ ANNE R. COLEMAN | ||||
Notary Public |
/s/ STEVEN R. LORANGER | ||||
Steven R. Loranger |
/s/ MARIA E. UNDERWOOD | ||||
Notary Public |
/s/ GARY W. LOVEMAN | ||||
Gary W. Loveman |
/s/ STEPHANIE TETREAULT | ||||
Notary Public |
/s/ CHARLES T. MANATT | ||||
Charles T. Manatt |
/s/ L. ANN JONES | ||||
Notary Public |
/s/ JOSHUA I. SMITH | ||||
Joshua I. Smith |
/s/ ANDRE M. CARRINGTON | ||||
Notary Public |
/s/ PAUL S. WALSH | ||||
PAUL S. WALSH |
/s/ JAMES KERR MILLIGAN | ||||
Notary Public |
/s/ PETER S. WILLMOTT | ||||
Peter S. Willmott |
/s/ TERRI A. GRIFFIN | ||||
Notary Public |
/s/ ALAN B. GRAF, JR. | ||||
Alan B. Graf, Jr. |
/s/ MARY T. BRITT | ||||
Notary Public |
/s/ FREDERICK W. SMITH | ||||
Frederick W. Smith |
/s/ ANNE R. COLEMAN | ||||
Notary Public |
/s/ JOHN L. MERINO | ||||
John L. Merino |
/s/ ADRIENNE N. DOHERTY | ||||
Notary Public |
1. | I have reviewed this annual report on Form 10-K 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. |
/s/ Frederick W. Smith | |||
Frederick W. Smith | |||
Chairman, President and
Chief Executive Officer |
1. | I have reviewed this annual report on Form 10-K 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. |
/s/ Alan B. Graf, Jr. | |||
Alan B. Graf, Jr. | |||
Executive Vice President and
Chief Financial Officer |
(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. |
/s/ Frederick W. Smith | |||
Frederick W. Smith | |||
Chairman, President and
Chief Executive Officer |
(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. |
/s/ Alan B. Graf, Jr. | |||
Alan B. Graf, Jr. | |||
Executive Vice President and
Chief Financial Officer |
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