EX-1.1

                                                                    EXHIBIT 1.1


                                FEDEX CORPORATION
                            (a Delaware corporation)

                         AND THE GUARANTORS NAMED HEREIN



                       $250,000,000 6 5/8% Notes due 2004
                       $250,000,000 6 7/8% Notes due 2006
                       $250,000,000 7 1/4% Notes due 2011

                               PURCHASE AGREEMENT


                                                                February 6, 2001




Merrill Lynch, Pierce, Fenner & Smith
                Incorporated
Banc of America Securities LLC
Chase Securities Inc.
Commerzbank Capital Markets Corp.
Credit Suisse First Boston Corporation

c/o Merrill Lynch, Pierce, Fenner & Smith
                    Incorporated
North Tower
World Financial Center
New York, New York  10281

Ladies and Gentlemen:

     FedEx Corporation, a Delaware corporation (the "Company"), and Federal
Express Corporation ("FedEx Express"), FedEx Ground Package System, Inc., FedEx
Custom Critical, Inc. and Viking Freight, Inc. (collectively, the "Initial
Guarantors" and, together with each subsidiary of the Company that pursuant to
the terms of the Indenture referred to below hereafter guarantees the Company's
obligations under such Indenture, the "Guarantors"), hereby confirm their
agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill
Lynch"), Banc of America Securities LLC, Chase Securities Inc., Commerzbank
Capital Markets Corp. and Credit Suisse First Boston Corporation (collectively,
the "Initial Purchasers") for whom Merrill Lynch is acting as representative (in
such capacity, the "Representative"), with respect to the issue and sale by the
Company and the purchase, severally and not jointly, by the Initial Purchasers
of the respective principal amounts set forth in Schedule A hereto, of
$250,000,000 aggregate principal amount of the Company's 6 5/8% Notes due 2004
(the "2004 Notes"), $250,000,000 aggregate principal amount of the Company's 6
7/8% Notes due 2006 (the "2006 Notes") and $250,000,000 aggregate principal
amount of the Company's 7 1/4% Notes due 2011


                                       1



(the "2011 Notes" and, together with the 2004 Notes and the 2006 Notes, the
"Offered Securities"). The Offered Securities are to be issued pursuant to an
indenture (the "Indenture"), to be dated as of February 12, 2001, among the
Company, as issuer, the Initial Guarantors, as guarantors, and The Bank of New
York, as trustee (the "Trustee"). The Offered Securities will be guaranteed as
to principal and interest pursuant to the Indenture by the Guarantors (each such
guarantee, a "Securities Guarantee").

     The Company understands that the Initial Purchasers propose to make an
offering of the Offered Securities on the terms and in the manner set forth
herein and agrees that the Initial Purchasers may resell, subject to the
conditions set forth herein, all or a portion of the Offered Securities to
purchasers ("Subsequent Purchasers") at any time after the date of this
Agreement. The Offered Securities are to be offered and sold through the Initial
Purchasers without being registered under the Securities Act of 1933, as amended
(the "1933 Act"), in reliance upon exemptions therefrom. Pursuant to the terms
of the Offered Securities and the Indenture, investors that acquire Offered
Securities may only resell or otherwise transfer such Offered Securities if such
Offered Securities are hereafter registered under the 1933 Act or if an
exemption from the registration requirements of the 1933 Act is available
(including the exemptions afforded by Rule 144A ("Rule 144A") or Regulation S
("Regulation S") of the rules and regulations promulgated under the 1933 Act
(the "1933 Act Regulations") by the Securities and Exchange Commission (the
"Commission")).

     The Company has prepared and delivered to each Initial Purchaser copies of
a preliminary offering memorandum dated February 2, 2001 (the "Preliminary
Offering Memorandum") and has prepared and will deliver to each Initial
Purchaser, on the date hereof or the next succeeding day, copies of a final
offering memorandum dated February 6, 2001 (the "Final Offering Memorandum"),
each for use by such Initial Purchaser in connection with its solicitation of
purchases of, or offering of, the Offered Securities. "Offering Memorandum"
means, with respect to any date or time referred to in this Agreement, the most
recent offering memorandum (whether the Preliminary Offering Memorandum or the
Final Offering Memorandum, or any amendment or supplement to either such
document), including exhibits thereto and any documents incorporated therein by
reference, which has been prepared and delivered by the Company to the Initial
Purchasers in connection with their solicitation of purchases of, or offering
of, the Offered Securities.

     All references in this Agreement to financial statements and schedules and
other information which are "contained," "included" or "stated" in the Offering
Memorandum (or other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information which
are incorporated by reference in the Offering Memorandum; and all references in
this Agreement to amendments or supplements to the Offering Memorandum shall be
deemed to mean and include the filing of any document under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), which is incorporated by
reference in the Offering Memorandum.

     The holders of Offered Securities will be entitled to the benefits of a
Registration Rights Agreement, in substantially the form attached hereto as
Exhibit C with such changes as shall be agreed to by the parties hereto (the
"Registration Rights Agreement"), pursuant to which the Company will file a
registration statement (the "Registration Statement") with the Commission


                                       2



registering the Offered Securities or the Exchange Notes referred to in the
Registration Rights Agreement under the 1933 Act.

     Section 1. Representations and Warranties of the Company. (a) Each Initial
Guarantor, as to itself, and the Company, as to itself and its subsidiaries,
represents and warrants to each Initial Purchaser, as of the date hereof and as
of the Closing Time (as defined below), and agrees with each Initial Purchaser
as follows:

          (i) Due Incorporation and Qualification. Each of the Company and the
     Initial Guarantors (other than Viking Freight, Inc., but only as of the
     date hereof and not as of the Closing Time) has been duly incorporated and
     is validly existing as a corporation in good standing under the laws of the
     jurisdiction of its incorporation, has the corporate power and authority to
     own, lease and operate its properties and to conduct its business as
     described in the Offering Memorandum, and is duly qualified to do business
     and is in good standing in each jurisdiction in which such qualification is
     required, except where the failure to so qualify would not have a material
     adverse effect on the condition, financial or otherwise, or the earnings,
     business affairs or business prospects of the Company and its subsidiaries
     considered as one enterprise.

          (ii) Subsidiaries. Each subsidiary of the Company which is a
     significant subsidiary as defined in Rule 405 of Regulation C of the 1933
     Act Regulations (each, a "Significant Subsidiary") has been duly
     incorporated and is validly existing as a corporation in good standing
     under the laws of the jurisdiction of its incorporation, has the corporate
     power and authority to own, lease and operate its properties and to conduct
     its business as described in the Offering Memorandum and is duly qualified
     as a foreign corporation to transact business and is in good standing in
     each jurisdiction in which such qualification is required, except where the
     failure to so qualify would not have a material adverse effect on the
     condition, financial or otherwise, or the earnings, business affairs or
     business prospects of the Company and its subsidiaries considered as one
     enterprise; and all of the issued and outstanding capital stock of each
     Significant Subsidiary has been duly authorized and validly issued, is
     fully paid and non-assessable and, except for directors' qualifying shares
     (except as otherwise stated in the Offering Memorandum), is owned by the
     Company, directly or through subsidiaries, free and clear of any security
     interest, mortgage, pledge, lien, encumbrance, claim or equity.

          (iii) Offering Memorandum. The Offering Memorandum does not, and at
     the Closing Time will not, contain an untrue statement of a material fact
     or omit to state a material fact necessary in order to make the statements
     therein, in light of the circumstances under which they were made, not
     misleading; provided, however, that the representations and warranties in
     this subsection shall not apply to statements in or omissions from the
     Offering Memorandum made in reliance upon and in conformity with
     information furnished to the Company in writing by the Representative on
     behalf of an Initial Purchaser expressly for use in the Offering
     Memorandum.

          (iv) Incorporated Documents. The documents incorporated by reference
     in the Offering Memorandum, at the time they were or hereafter are filed
     with the Commission, complied and will comply in all material respects with
     the requirements of the 1934 Act


                                       3



     and the rules and regulations promulgated thereunder (the "1934 Act
     Regulations"), and, when read together and with the other information in
     the Offering Memorandum, did not and will not contain an untrue statement
     of a material fact or omit to state a material fact required to be stated
     therein or necessary in order to make the statements therein, in light of
     the circumstances under which they were or are made, not misleading.

          (v) Accountants. The accountants who certified the financial
     statements included or incorporated by reference in the Offering Memorandum
     are independent public accountants as required by the 1933 Act and the 1933
     Act Regulations.

          (vi) Financial Statements. The financial statements of the Company
     included or incorporated by reference in the Offering Memorandum present
     fairly the financial position of the Company as of the dates thereof and
     the results of operations, changes in common stockholders' investment and
     cash flows of the Company, for the respective periods covered thereby, all
     in conformity with generally accepted accounting principles applied on a
     consistent basis throughout the entire period involved; and the financial
     schedules included or incorporated by reference in the Offering Memorandum
     meet the requirements of the 1933 Act Regulations or the 1934 Act
     Regulations, as applicable.

          (vii) Material Changes or Material Transactions. Except as stated in
     the Offering Memorandum, subsequent to the respective dates as of which
     information is given in the Offering Memorandum, neither the Company nor
     any of its subsidiaries has incurred any liabilities or obligations, direct
     or contingent, or entered into any transactions which are material to the
     Company and its subsidiaries considered as one enterprise, and there has
     not been any material adverse change in the capital stock or short-term
     debt, or any material increase in long-term debt of the Company and its
     subsidiaries considered as one enterprise, or any material adverse change,
     or any development involving a prospective material adverse change, in the
     condition (financial or other), business, prospects, net worth or results
     of operations of the Company and its subsidiaries considered as one
     enterprise.

          (viii) No Defaults; Regulatory Approvals. None of the Company nor any
     of its subsidiaries is in violation of its charter (or similar
     organizational documents) or in default in the performance or observance of
     any material obligation, agreement, covenant or condition contained in any
     contract, indenture, mortgage, loan agreement, note, lease or other
     instrument to which it is a party or by which it or any of them or their
     properties may be bound, except, in the case of the subsidiaries of the
     Company which are not Initial Guarantors, for such violations or defaults
     which individually or in the aggregate do not, or will not, have a material
     adverse effect on the condition (financial or other), business, prospects
     or results of operations of the Company and its subsidiaries considered as
     one enterprise.

          The execution and delivery of this Agreement, the Indenture, the
     Registration Rights Agreement, the Securities Guarantees and the
     consummation of the transactions contemplated herein and therein have been
     duly authorized by all necessary corporate action and executed by the
     Company and each Initial Guarantor and will not conflict with or constitute
     a breach of, or default under, or result in the creation or imposition of
     any


                                       4



     lien, charge or encumbrance upon any property or assets of the Company or
     any of its subsidiaries pursuant to, any contract, indenture, mortgage,
     loan agreement, note, lease or other instrument to which the Company or any
     such subsidiary is a party or by which it or any of them may be bound or to
     which any of the property or assets of the Company or any such subsidiary
     is subject, which conflict, breach or default would have, individually or
     in the aggregate with any other such instances, a material adverse effect
     on the condition (financial or other), business, prospects, net worth or
     results of operations of the Company and its subsidiaries considered as one
     enterprise or reasonably be expected to adversely affect the enforceability
     of this Agreement, the Indenture, the Registration Rights Agreement or the
     Securities Guarantees, nor will such action result in any violation of the
     provisions of the charter or by-laws (or similar organizational documents)
     of the Company or any Initial Guarantor or any law, administrative
     regulation or administrative or court order or decree currently in effect
     or in effect at the time of execution and delivery of this Agreement, the
     Indenture, the Registration Rights Agreement or the Securities Guarantees
     and applicable to the Company or any of its subsidiaries.

          No consent, approval, authorization, order or decree of any court or
     governmental agency or body is required for the consummation by the Company
     and the Initial Guarantors of the transactions contemplated by this
     Agreement, the Indenture, the Registration Rights Agreement or the
     Securities Guarantees, except such as may be required under state
     securities or Blue Sky laws.

          (ix) Legal Proceedings; Contracts. Except for matters described in the
     Offering Memorandum, there is no pending, or to the best knowledge of any
     financial officer of the Company or any Initial Guarantor, threatened
     action or proceeding before any court or administrative agency which
     individually (or in the aggregate in the case of any group of related
     lawsuits) is expected to have a material adverse effect on the financial
     condition of the Company and its subsidiaries considered as one enterprise,
     or the ability of the Company and the Initial Guarantors to perform their
     respective obligations under this Agreement, the Indenture, the
     Registration Rights Agreement or the Securities Guarantees.

          (x) Compliance with Laws. The business and operations of the Company
     and of each of the Initial Guarantors comply in all material respects with
     all laws and regulations applicable thereto and, except as described in the
     Offering Memorandum, there are no known, proposed or threatened changes in
     any laws or regulations which would have a material adverse effect on the
     Company and its subsidiaries considered as one enterprise, or the manner in
     which it conducts its business. Each of the Company and the Initial
     Guarantors possesses all valid and effective certificates, licenses and
     permits required to conduct its business as now conducted, except for
     instances which individually or in the aggregate do not, or will not, have
     a material adverse effect on the condition (financial or other), business,
     prospects or results of operations of the Company and its subsidiaries
     considered as one enterprise.

          (xi) Enforceability. Each of the Indenture and the Registration Rights
     Agreement has been duly authorized by the Company and the Initial
     Guarantors, will be


                                       5



     substantially in the form heretofore supplied to you and, when duly
     executed and delivered by the Company and the Initial Guarantors and the
     other parties thereto, will constitute a valid and binding agreement of the
     Company and the Initial Guarantors, enforceable against the Company and the
     Initial Guarantors in accordance with its terms.

          (xii) Validity of the Offered Securities and the Securities
     Guarantees. When the Offered Securities have been executed, issued,
     authenticated and delivered pursuant to the provisions of the Indenture and
     sold and paid for as provided in this Agreement, and the Securities
     Guarantees have been executed, issued and delivered pursuant to the
     provisions of the Indenture, the Offered Securities and the Securities
     Guarantees will constitute valid and legally binding obligations of the
     Company and the respective Initial Guarantors enforceable in accordance
     with their respective terms; and the holders of such Offered Securities and
     Securities Guarantees will be entitled to the benefits provided by such
     Indenture.

          (xiii) Similar Offerings. Neither the Company nor any of its
     affiliates, as such term is defined in Rule 501(b) under the 1933 Act
     (each, an "Affiliate"), has, directly or indirectly, solicited any offer to
     buy, sold or offered to sell or otherwise negotiated in respect of, or will
     solicit any offer to buy, sell or offer to sell or otherwise negotiate in
     respect of, in the United States or to any United States citizen or
     resident, any security which is or would be integrated with the sale of the
     Offered Securities in a manner that would require the Offered Securities to
     be registered under the 1933 Act.

          (xiv) Rule 144A Eligibility. The Offered Securities are eligible for
     resale pursuant to Rule 144A and will not be, at the Closing Time, of the
     same class as securities listed on a national securities exchange
     registered under Section 6 of the 1934 Act, or quoted in a U.S. automated
     interdealer quotation system.

          (xv) No General Solicitation. None of the Company, its Affiliates or
     any person acting on its or any of their behalf (other than the Initial
     Purchasers, as to whom the Company makes no representation) has engaged or
     will engage, in connection with the offering of the Offered Securities, in
     any form of general solicitation or general advertising within the meaning
     of Rule 502(c) under the 1933 Act.

          (xvi) No Registration Required. Subject to compliance by the Initial
     Purchasers with the representations and warranties set forth in Section 2
     and the procedures set forth in Section 6 hereof, it is not necessary in
     connection with the offer, sale and delivery of the Offered Securities to
     the Initial Purchasers and to each Subsequent Purchaser in the manner
     contemplated by this Agreement and the Offering Memorandum to register the
     Offered Securities under the 1933 Act or to qualify the Indenture under the
     Trust Indenture Act of 1939, as amended (the "1939 Act").

          (xvii) No Directed Selling Efforts. With respect to those Offered
     Securities sold in reliance on Regulation S, (A) none of the Company, its
     Affiliates or any person acting on its or their behalf (other than the
     Initial Purchasers, as to whom the Company makes no representation) has
     engaged or will engage in any directed selling efforts within the meaning
     of Regulation S and (B) each of the Company and its Affiliates and any
     person


                                       6



     acting on its or their behalf (other than the Initial Purchasers, as to
     whom the Company makes no representation) has complied and will comply with
     the offering restrictions requirement of Regulation S.

     The representations and warranties made by the Company and the Initial
Guarantors as to the enforceability of the Indenture, the Registration Rights
Agreement , the Offered Securities and the Securities Guarantees set forth in
subparagraphs (xi) and (xii) above are limited by bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
the enforcement of creditors' rights or by general equity principles, and the
enforceability of the Indenture is also limited by applicable laws which may
affect the remedies provided therein but which do not affect the validity of
such Indenture or make such remedies inadequate for the practical realization of
the benefits intended to be provided thereby.

     (b) Additional Certifications. Any certificate signed by any officer of the
Company or any Initial Guarantor and delivered to you or your counsel in
connection with an offering of the Offered Securities shall be deemed a
representation and warranty by the Company or such Initial Guarantor to each
Initial Purchaser participating in such offering as to the matters covered
thereby on the date of such certificate unless subsequently amended or
supplemented subsequent thereto.

     Section 2. Purchase and Sale. (a) On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each Initial Purchaser, and each Initial
Purchaser agrees, severally and not jointly, to purchase from the Company, at
the purchase price specified in Schedule B hereto, the amount of Offered
Securities set forth opposite the name of such Initial Purchaser in Schedule A
plus any additional principal amount of Offered Securities which such Initial
Purchaser may become obligated to purchase pursuant to the provisions of Section
11 hereof. It is understood that you propose to offer the Offered Securities for
sale as set forth in the Offering Memorandum.

     (b) Payment of the purchase price for, and delivery of the certificates
for, the Offered Securities to be purchased by the Initial Purchasers shall be
made at the office of Davis Polk & Wardwell, 450 Lexington Avenue, New York, New
York 10017, or at such other place as shall be agreed upon by the Representative
and the Company, at 9:00 A.M., Eastern time, on the third business day after the
date hereof (unless postponed in accordance with the provisions of Section 11),
or such other time not later than ten business days after such date as shall be
agreed upon by the Representative and the Company (such time and date of payment
and delivery being herein called the "Closing Time").

     Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against book-entry
delivery through the facilities of The Depository Trust Company to the
Representative for the respective accounts of the Initial Purchasers of the
Offered Securities to be purchased by them. It is understood that each Initial
Purchaser has authorized the Representative, for its account, to accept delivery
of, receipt for, and make payment of the purchase price for, the Offered
Securities which it has agreed to purchase. Merrill Lynch, individually and not
as representative of the Initial Purchasers, may (but shall not be obligated to)
make payment of the purchase price for the Offered Securities to


                                       7



be purchased by any Initial Purchaser whose funds have not been received by the
Closing Time, but such payment shall not relieve such Initial Purchaser from its
obligations hereunder.

     (c) Each Initial Purchaser, severally and not jointly, represents and
warrants to, and agrees with, the Company that it is a "qualified institutional
buyer" within the meaning of Rule 144A under the 1933 Act (a "Qualified
Institutional Buyer").

     (d) Certificates for the Offered Securities shall be in such denominations
and registered in such names as the Initial Purchasers may request in writing at
least one full business day before the Closing Time.

     Section 3. Covenants of the Company and the Initial Guarantors. The Company
and each of the Initial Guarantors covenants with each Initial Purchaser
participating in the offering as follows:

     (a) Notice of Certain Proposed Filings. At any time when the Offering
Memorandum is required to be delivered pursuant to Section 6(a)(vi) hereof, the
Company will give you notice of its intention to prepare any amendment to the
Offering Memorandum, whether by the filing of documents pursuant to the 1934 Act
or otherwise, and will furnish you with copies of any such amendment or
supplement or other documents proposed to be filed or prepared a reasonable time
in advance of such proposed filing or preparation, as the case may be.

     (b) Copies of the Offering Memorandum. The Company will deliver to you as
many copies of the Offering Memorandum and of each amendment thereto (including
documents incorporated by reference in the Offering Memorandum) as you may
reasonably request.

     (c) Revisions of Offering Memorandum--Material Changes. If at any time when
the Offering Memorandum is required to be delivered pursuant to Section 6(a)(vi)
hereof any event shall occur or condition exist as a result of which it is
necessary, in the reasonable opinion of counsel for the Company or the Initial
Purchasers, to further amend or supplement the Offering Memorandum in order that
the Offering Memorandum will not include an untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the time it
is delivered to a Subsequent Purchaser, the Company will promptly prepare such
amendment or supplement, whether by filing documents pursuant to the 1934 Act or
otherwise, as may be necessary to correct such untrue statement or omission.

     (d) Blue Sky Qualifications. The Company and the Initial Guarantors will
endeavor, in cooperation with you, to qualify the Offered Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Initial Purchasers may designate, and
will maintain such qualifications in effect for so long as may be required for
the distribution of the Offered Securities; provided, however, that neither the
Company nor the Initial Guarantors shall be obligated to file any general
consent to service of process or to qualify as a foreign corporation or to
subject itself to taxation as doing business in any jurisdiction in which it is
not otherwise required to be so qualified. The Company and the Initial
Guarantors will file such statements and reports as may be required by the laws
of each jurisdiction in which the Offered Securities have been qualified as
provided above.


                                       8



     (e) 1934 Act Filings. The Company and FedEx Express, during the period when
the Offering Memorandum is required to be delivered pursuant to Section 6(a)(vi)
hereof, will file, within the required time periods, all documents required to
be filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the 1934 Act.

     (f) Stand-Off Agreement. The Company will not, between the date of this
Agreement and the Closing Time, without your consent, offer or sell, or enter
into any agreement to sell, any debt securities of the Company (other than the
Offered Securities which are to be sold pursuant hereto and commercial paper in
the ordinary course of business).

     Section 4. Payment of Expenses.

     (a) The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:

          (i) the preparation of the Offering Memorandum and all amendments
     thereto and the Preliminary Offering Memorandum;

          (ii) the preparation, issuance and delivery of the Offered Securities;

          (iii) the reasonable fees and disbursements of the Company's
     accountants and counsel, of the Trustee and its counsel, and of any
     registrar, paying agent and authenticating agent;

          (iv) the qualification of the Offered Securities under securities laws
     in accordance with the provisions of Section 3(d), including filing fees
     and the reasonable fees and disbursements of counsel to the Initial
     Purchasers in connection therewith and in connection with the preparation
     of any Blue Sky Survey and any Legal Investment Survey;

          (vi) the printing and delivery to the Initial Purchasers in quantities
     as may be reasonably requested of copies of the Offering Memorandum and any
     amendments or supplements thereto, and the delivery by the Initial
     Purchasers of the Offering Memorandum and any amendments or supplements
     thereto in connection with solicitations or confirmations of sales of the
     Offered Securities;

          (vii) the preparation and delivery to the Initial Purchasers of copies
     of the Indenture; and

          (viii) any fees charged by rating agencies for the rating of the
     Offered Securities.

     (b) If this Agreement is terminated by the Initial Purchasers in accordance
with the provisions of Section 5 or clause (i) of Section 10 hereof, the Company
shall reimburse upon demand the Initial Purchasers for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Initial Purchasers, that shall have been incurred by them in
connection with the proposed purchase and sale of the Offered Securities.


                                       9



     Section 5. Conditions of Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase the Offered Securities
pursuant to this Agreement will be subject at all times to the accuracy of the
representations and warranties on the part of the Company and the Initial
Guarantors herein, to the accuracy of the statements of the officers of the
Company or of any of the Initial Guarantors made in any certificate furnished
pursuant to the provisions hereof, to the performance and observance by the
Company and the Initial Guarantors of their respective covenants and agreements
contained herein to be performed and observed on their respective parts and to
the following additional conditions precedent:

          (a) Ratings Change; etc. At the Closing Time, (i) the rating assigned
     as of the date of this Agreement by any "nationally recognized statistical
     rating organization," as such term is defined for purposes of Rule 436(g)
     under the 1933 Act Regulations, to any debt securities of the Company
     (including for purposes of this Section 5(a)(i) any rating indicated by the
     Company as of the date of this Agreement as the rating orally confirmed to
     the Company by any such rating organization as the rating to be assigned to
     the Offered Securities) shall not have been lowered since the execution of
     this Agreement nor shall any such rating organization have publicly
     announced that it has placed any debt securities of the Company on what is
     commonly termed a "watch list" for possible downgrading, and (ii) there
     shall not have come to the attention of any of the Initial Purchasers any
     facts that would cause them to believe that the Offering Memorandum, at the
     time it was required to be delivered to a purchaser of the Offered
     Securities pursuant to Section 6(a)(vi) hereof, contained an untrue
     statement of a material fact or omitted to state a material fact necessary
     in order to make the statements therein, in light of the circumstances
     existing at such time, not misleading.

          (b) Legal Opinions. At the Closing Time, you shall have received the
     following documents:

               (i) Opinion of the Executive Vice President, General Counsel and
          Secretary of the Company. The opinion of Kenneth R. Masterson,
          Executive Vice President and General Counsel of the Company, dated as
          of the Closing Time, in form and substance reasonably satisfactory to
          the Initial Purchasers, to the effect as set forth in Exhibit A.

               (ii) Opinion of Davis Polk & Wardwell. The opinion of Davis Polk
          & Wardwell, counsel to the Company, dated as of the Closing Time, in
          form and substance reasonably satisfactory to the Initial Purchasers,
          to the effect as set forth in Exhibit B.

               (iii) Opinion of Brown & Wood LLP. The opinion of Brown & Wood
          LLP, counsel to the Initial Purchasers, dated as of the Closing Time,
          with respect to such matters as the Initial Purchasers may reasonably
          request.

          (c) Officers' Certificate. At the Closing Time, there shall not have
     been, since the respective dates as of which information is given in the
     Offering Memorandum, any material adverse change in the condition
     (financial or other), business, prospects or results of operations of the
     Company and its subsidiaries considered as one enterprise;


                                       10



     and you shall have received a certificate of the President or any Vice
     President of the Company and of each Initial Guarantor, dated as of the
     Closing Time, to the effect (i) in the case of the certificate to be
     provided by the President or a Vice President of the Company, that there
     has been no such material adverse change, (ii) that the other
     representations and warranties contained in Section 1 are true and correct
     with the same force and effect as though expressly made at and as of the
     date of such certificate, except to the extent that such representations
     and warranties expressly relate to an earlier date or later date (in which
     case such representations and warranties are true and correct on and as of
     such earlier date or will be true and correct on and as of such later date,
     as the case may be), and (iii) that the Company or such Initial Guarantor,
     as the case may be, has complied with all agreements and satisfied all
     conditions on their respective parts to be performed or satisfied at or
     prior to the date of such certificate. The officer signing and delivering
     each such certificate may rely upon the best of his or her knowledge as to
     proceedings threatened.

          (d) Accountants' Comfort Letter. At the time of the execution of this
     Agreement, the Representative shall have received from Arthur Andersen LLP
     a letter dated such date, in form and substance satisfactory to the
     Representative, together with signed or reproduced copies of such letter
     for each of the other Initial Purchasers containing statements and
     information of the type ordinarily included in accountants' "comfort
     letters" to Initial Purchasers with respect to the financial statements and
     certain financial information contained in the Offering Memorandum.

          (e) Bring-down Comfort Letter. At the Closing Time, the Representative
     shall have received from Arthur Andersen LLP a letter, dated as of the
     Closing Time, to the effect that they reaffirm the statements made in the
     letter furnished pursuant to subsection (d) of this Section, except that
     the specified date referred to shall be a date not more than three business
     days prior to the Closing Time.

          (f) Registration Rights Agreement. At the Closing Time, the
     Registration Rights Agreement shall have been fully executed and delivered
     by the Company.

          (g) Other Documents. At the Closing Time, counsel for the Initial
     Purchasers shall have been furnished with such documents and opinions as
     such counsel may reasonably require for the purpose of enabling such
     counsel to pass upon the issuance and sale of Offered Securities as herein
     contemplated and related proceedings, or in order to evidence the accuracy
     and completeness of any of the representations and warranties, or the
     fulfillment of any of the conditions, herein contained; and all proceedings
     taken by the Company or the Initial Guarantors in connection with the
     issuance and sale of Offered Securities as herein contemplated shall be
     satisfactory in form and substance to you.

     If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
Initial Purchasers by notice to the Company at any time at or prior to the
Closing Time, and such termination shall be without liability of any party
except as provided in Section 4 hereof.


                                       11



     Section 6. Subsequent Offers and Resales of the Offered Securities.

     (a) Offer and Sale Procedures. Each of the Initial Purchasers and the
Company hereby establish and agree to observe the following procedures in
connection with the offer and sale of the Offered Securities:

          (i) Offers and Sales only to Qualified Institutional Buyers or
     Pursuant to Regulation S. Offers and sales of the Offered Securities shall
     only be made (A) to persons whom the offeror or seller reasonably believes
     to be qualified institutional buyers, as defined in Rule 144A under the
     1933 Act ("Qualified Institutional Buyers"), or (B) non-U.S. persons
     outside the United States, as defined in Regulation S under the 1933 Act,
     to whom the offeror or seller reasonably believes offers and sales of the
     Offered Securities may be made in reliance upon Regulation S under the 1933
     Act. Each Initial Purchaser severally agrees that it will not offer, sell
     or deliver any of the Offered Securities in any jurisdiction outside the
     United States except under circumstances that will result in compliance
     with the applicable laws thereof, and that it will take at its own expense
     whatever action is required to permit its purchase and resale of the
     Offered Securities in such jurisdictions.

          (ii) No General Solicitation. No general solicitation or general
     advertising (within the meaning of Rule 502(c) under the 1933 Act) will be
     used in the United States in connection with the offering or sale of the
     Offered Securities.

          (iii) Purchases by Non-Bank Fiduciaries. In the case of a non-bank
     Subsequent Purchaser of an Offered Security acting as a fiduciary for one
     or more third parties, each third party shall, in the reasonable judgment
     of the applicable Initial Purchaser, be a Qualified Institutional Buyer or
     a non-U.S. person outside the United States.

          (iv) Subsequent Purchaser Notification. Each Initial Purchaser will
     take reasonable steps to inform, and cause each of its U.S. Affiliates to
     take reasonable steps to inform, persons acquiring Offered Securities from
     such Initial Purchaser or Affiliate, as the case may be, in the United
     States that the Offered Securities (A) have not been and will not be
     registered under the 1933 Act, (B) are being sold to them without
     registration under the 1933 Act in reliance on Rule 144A or in accordance
     with another exemption from registration under the 1933 Act, as the case
     may be, and (C) may not be offered, sold or otherwise transferred except
     (1) to the Company, (2) outside the United States in accordance with
     Regulation S, or (3) inside the United States in accordance with (x) Rule
     144A to a person whom the seller reasonably believes is a Qualified
     Institutional Buyer that is purchasing such Offered Securities for its own
     account or for the account of a Qualified Institutional Buyer to whom
     notice is given that the offer, sale or transfer is being made in reliance
     on Rule 144A or (y) pursuant to another available exemption from
     registration under the 1933 Act.

          (v) Restrictions on Transfer. The transfer restrictions and the other
     provisions set forth in the Offering Memorandum under the heading "Notice
     to


                                       12



     Investors," including the legends required thereby, shall apply to the
     Offered Securities except as otherwise agreed by the Company and the
     Initial Purchasers.

          (vi) Delivery of Offering Memorandum. Each Initial Purchaser will
     deliver to each purchaser of the Offered Securities from such Initial
     Purchaser, in connection with its original distribution of the Offered
     Securities, a copy of the Offering Memorandum, as amended and supplemented
     at the date of such delivery.

     (b) Covenants of the Company. The Company covenants with each Initial
Purchaser as follows:

          (i) Integration. Except following the effectiveness of the
     Registration Statement, the Company agrees that it will not and will cause
     its Affiliates not to, directly or indirectly, solicit any offer to buy,
     sell or make any offer or sale of, or otherwise negotiate in respect of,
     securities of the Company of any class if, as a result of the doctrine of
     "integration" referred to in Rule 502 under the 1933 Act, such offer or
     sale would render invalid (for the purpose of (i) the sale of the Offered
     Securities by the Company to the Initial Purchasers, (ii) the resale of the
     Offered Securities by the Initial Purchasers to Subsequent Purchasers or
     (iii) the resale of the Offered Securities by such Subsequent Purchasers to
     others) the exemption from the registration requirements of the 1933 Act
     provided by Section 4(2) thereof or by Rule 144A or by Regulation S
     thereunder or otherwise.

          (ii) Rule 144A Information. Each of the Company and the Initial
     Guarantors agrees that, in order to render the Offered Securities eligible
     for resale pursuant to Rule 144A under the 1933 Act, until the earlier of
     (A) the second anniversary of the original issuance date of the Offered
     Securities and (B) the date when no Offered Securities remain outstanding,
     it will make available, upon request, to any holder of Offered Securities
     or prospective purchasers of Offered Securities the information specified
     in Rule 144A(d)(4), unless the Company or the Initial Guarantors furnish
     information to the Commission pursuant to Section 13 or 15(d) of the 1934
     Act.

          (iii) Restriction on Repurchases. Until the expiration of two years
     after the original issuance of the Offered Securities, the Company will
     not, and will cause its Affiliates not to, resell any Offered Securities
     which are "restricted securities" (as such term is defined under Rule
     144(a)(3) under the 1933 Act), whether as beneficial owner or otherwise
     (except as agent acting as a securities broker on behalf of and for the
     account of customers in the ordinary course of business in unsolicited
     broker's transactions).

     (c) Resale Pursuant to Rule 903 of Regulation S or Rule 144A. Each Initial
Purchaser understands that the Offered Securities have not been and will not be
registered under the 1933 Act and may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. persons except in
accordance with Regulation S under the 1933 Act or pursuant to an exemption from
the registration requirements of the 1933 Act. Each Initial Purchaser severally
represents and agrees, that, except as permitted by Section 6(a) above, it has
offered and sold Offered Securities and will offer and sell Offered Securities
(i) as part of their distribution at any time and (ii) otherwise until forty
days after the later of the date upon which


                                       13



the offering of the Offered Securities commences and the Closing Time, only in
accordance with Rule 903 of Regulation S, Rule 144A under the 1933 Act or
another applicable exemption from the registration requirements of the 1933 Act.
Accordingly, neither the Initial Purchasers, their affiliates nor any persons
acting on their behalf have engaged or will engage in any directed selling
efforts with respect to Offered Securities sold hereunder pursuant to Regulation
S, and the Initial Purchasers, their Affiliates and any person acting on their
behalf have complied and will comply with the offering restriction requirements
of Regulation S. Each Initial Purchaser severally agrees that, at or prior to
confirmation of a sale of Offered Securities pursuant to Regulation S it will
have sent to each distributor, dealer or person receiving a selling concession,
fee or other remuneration that purchases Offered Securities from it or through
it during the restricted period a confirmation or notice to substantially the
following effect:

               "The Securities covered hereby have not been registered
          under the United States Securities Act of 1933 (the
          "Securities Act") and may not be offered or sold within the
          United States or to or for the account or benefit of U.S.
          persons (i) as part of their distribution at any time and
          (ii) otherwise until forty days after the later of the date
          upon which the offering of the Securities commenced and the
          date of closing, except in either case in accordance with
          Regulation S or Rule 144A under the Securities Act. Terms
          used above have the meaning given to them by Regulation S."

     Terms used in the above paragraph have the meanings given to them by
Regulation S.

     (d) Additional Representations and Warranties of Initial Purchasers. Each
Initial Purchaser severally represents and agrees that it has not entered and
will not enter into any contractual arrangements with respect to the
distribution of the Offered Securities, except with its Affiliates or with the
prior written consent of the Company.

     (e) Compliance with United Kingdom Law. Each Initial Purchaser, severally
and not jointly, represents and agrees that it (a) has not offered or sold and
will not offer or sell any Offered Securities to persons in the United Kingdom
except to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the purposes of
their business or otherwise in circumstances which have not resulted and will
not result in an offer to the public in the United Kingdom within the meaning of
the Public Offers of Securities Regulation 1995, (b) has complied with and will
comply with all applicable provisions of the Financial Services Act 1986 with
respect to anything done by it in relation to the Offered Securities, in, from
or otherwise involving the United Kingdom, and (c) has only issued or passed on
and will only issue or pass on in the United Kingdom any document received by it
in connection with the issue or sale of the Offered Securities to a person who
is a kind described in Article 11(3) of the Financial Services Act 1986
(Investment Advertisements) (Exemptions) Order 1996, as amended by the Financial
Services Act 1986 (Investment Advertisements) (Exemptions) Order 1997, or is a
person to whom the document may otherwise lawfully be issued or passed on.


                                       14



     (f) Compliance with Law of the Netherlands. Each Initial Purchaser,
severally and not jointly, represents and agrees that it has not, directly or
indirectly, offered or sold and will not, directly or indirectly, offer or sell
in the Netherlands any Offered Securities other than to persons who trade or
invest in securities in the conduct of a profession or business (which include
banks, stockbrokers, insurance companies, pension funds, other institutional
investors and finance companies and treasury departments of large enterprises).

     Section 7. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Initial Purchaser and each person, if any, who controls any
Initial Purchaser within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act as follows:

          (i) against any and all loss, liability, claim, damage and expense
     whatsoever, as incurred, arising out of any untrue statement or alleged
     untrue statement of a material fact contained in the Offering Memorandum
     (or any amendment thereto), or the omission or alleged omission therefrom
     of a material fact required to be stated therein or necessary to make the
     statements therein, in light of the circumstances under which they were
     made, not misleading;

          (ii) against any and all loss, liability, claim, damage and expense
     whatsoever, as incurred, to the extent of the aggregate amount paid in
     settlement of any litigation, or investigation or proceeding by any
     governmental agency or body, commenced or threatened, or of any claim
     whatsoever arising out of or based upon any such untrue statement or
     omission, or any such alleged untrue statement or omission, if such
     settlement is effected with the written consent of the Company; and

          (iii) against any and all expense whatsoever, as incurred, reasonably
     incurred in investigating, preparing or defending against any litigation,
     or investigation or proceeding by any governmental agency or body,
     commenced or threatened, or any claim whatsoever arising out of or based
     upon any such untrue statement or omission, or any such alleged untrue
     statement or omission, to the extent that any such expense is not paid
     under (i) or (ii) above;

provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser expressly for use in the Offering Memorandum; and provided,
further, that the foregoing indemnity agreement, with respect to any Preliminary
Offering Memorandum shall not inure to the benefit of any Initial Purchaser from
whom the person asserting any such losses, claims, damages or liabilities
purchased Offered Securities, or any person controlling such Initial Purchaser,
if a copy of the Offering Memorandum (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of such Initial Purchaser to such person, if required
by law so to have been delivered, at or prior to the written confirmation of the
sale of the Offered Securities to such person, and if the Offering Memorandum
(as so amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.


                                       15



     (b) Each Initial Purchaser severally agrees to indemnify and hold harmless
the Company, each Initial Guarantor, their respective directors and officers and
each person, if any, who controls the Company or any Initial Guarantor within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Offering Memorandum in reliance upon and in conformity
with written information furnished to the Company by such Initial Purchaser
expressly for use in the Offering Memorandum (or any amendment thereto).

     (c) Each indemnified party shall give prompt notice to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability which it may have otherwise
than on account of this indemnity agreement. An indemnifying party may
participate at its own expense in the defense of such action. In no event shall
the indemnifying parties be liable for the fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.

     Section 8. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 7 is for any reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the Company and the Initial
Purchasers of each offering of Offered Securities shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by said indemnity agreement incurred by the Company and the Initial
Guarantors, on the one hand, and one or more of the Initial Purchasers, on the
other hand, in respect of such offering, as incurred, in such proportions that
the Initial Purchasers are responsible for that portion represented by the
percentage that the underwriting discount appearing on the cover page of the
Offering Memorandum in respect of such offering bears to the initial public
offering price appearing thereon and the Company is responsible for the balance;
provided, however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.

     For purposes of this Section, each person, if any, who controls an Initial
Purchaser within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as such Initial Purchaser,
and each officer or director of the Company or any Initial Guarantor, and each
person, if any, who controls the Company or any Initial Guarantor within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as the Company.

     Section 9. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company or any Initial Guarantor
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Initial Purchaser or
controlling person, or by or on behalf of the Company or any


                                       16



Initial Guarantor, and shall survive each delivery of and payment for any of the
Offered Securities.

     Section 10. Termination of Agreement. You may terminate this Agreement,
immediately upon notice to the Company, at any time prior to the Closing Time
if: (i) there has been, since the date hereof or since the respective dates as
of which information is given in the Offering Memorandum, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries considered as
one enterprise, (ii) there shall have occurred any material adverse change in
the financial markets in the United States or any outbreak or escalation of
hostilities or other national or international calamity or crisis, the effect of
which shall be such as to make it, in your judgment, impracticable to market the
Offered Securities or enforce contracts for the sale of the Offered Securities,
(iii) trading in any securities of the Company shall have been suspended by the
Commission or a national securities exchange, or if trading generally on either
the American Stock Exchange or the New York Stock Exchange shall have been
suspended, or minimum or maximum prices for trading shall have been fixed, or
maximum ranges for prices for securities shall have been required, by either of
said exchanges or by order of the Commission or any other governmental
authority, or (iv) if a banking moratorium shall have been declared by either
federal or New York authorities.

     In the event of any termination of this Agreement, the provisions of
Section 4 hereof, the indemnity and contribution agreements set forth in
Sections 7 and 8 hereof, and the provisions of Sections 9 and 14 hereof shall
remain in effect.

     Section 11. Default by One or More Initial Purchasers. If any Initial
Purchaser shall fail at the Closing Time to purchase the Offered Securities
which it is obligated to purchase hereunder (the "Defaulted Securities"), and
the aggregate amount of Defaulted Securities is not more than one-tenth of the
aggregate amount of the Offered Securities to be purchased on such date, the
other Initial Purchasers shall be obligated severally in the proportions that
the amount of the Offered Securities set forth opposite their respective names
in Schedule A hereto bears to the aggregate amount of Offered Securities set
forth opposite the names of all such non-defaulting Initial Purchasers to
purchase the Defaulted Securities; provided that in no event shall the amount of
Defaulted Securities that any Initial Purchaser has agreed to purchase pursuant
to this Agreement be increased by an amount in excess of one-tenth of such
amount of Offered Securities without the written consent of such Initial
Purchaser. If the aggregate amount of Defaulted Securities is more than
one-tenth of the aggregate amount of the Offered Securities to be purchased at
the Closing Time, and arrangements satisfactory to the Initial Purchasers and
the Company for the purchase of such Defaulted Securities are not made within 36
hours after such default, this Agreement shall terminate without liability on
the part of any non-defaulting Initial Purchasers or the Company.

     No action taken pursuant to this Section shall relieve a defaulting Initial
Purchaser from liability in respect of its default under this Agreement.

     In the event of any such default which does not result in a termination of
this Agreement, either the non-defaulting Initial Purchasers or the Company
shall have the right to postpone the


                                       17



Closing Time for a period not exceeding seven days in order to effect any
required changes in the Offering Memorandum or in any other documents or
arrangements.

     Section 12. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed, delivered
by Federal Express service or transmitted by any facsimile communication.
Notices to the Initial Purchasers shall be directed to Merrill Lynch & Co.,
North Tower, World Financial Center, New York, New York 10281, Attention: George
Ackert (Fax: 212-449-0776). Notices to the Company shall be directed to it at
942 South Shady Grove Road, Memphis, Tennessee 38120 (if by mail or Federal
Express service), Attention: Corporate Vice President and Treasurer, Fax:
901-818-7121 with copies thereof directed to the Legal Department of the Company
at 942 South Shady Grove Road, Memphis, Tennessee 38120 (if by mail or Federal
Express Service), Attention: Staff Vice President - Securities and Corporate
Law, Fax: 901-818-7103.

     Section 13. Parties. This Agreement shall inure to the benefit of and be
binding upon the Company, the Initial Guarantors and any Initial Purchaser who
becomes a party hereto and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto, their respective successors and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of
no other person, firm or corporation. No purchaser of Offered Securities from
any Initial Purchaser shall be deemed to be a successor by reason merely of such
purchase.

     Section 14. Governing Law. This Agreement and the rights and obligations of
the parties created hereby and thereby shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed in such state. Any suit, action or proceeding brought by the
Company or any Initial Guarantor against any Initial Purchaser or, any suit
action or proceeding brought by any Initial Purchaser against the Company or any
Initial Guarantor, in connection with or arising under this Agreement shall be
brought solely in the state or federal court of appropriate jurisdiction located
in the Borough of Manhattan, The City of New York.


                                       18





     If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
you, the Company and the Initial Guarantors in accordance with its terms.




                                     Very truly yours,

                                     FEDEX CORPORATION


                                     By:   /s/ Charles M. Buchas, Jr.
                                          ---------------------------------
                                          Name:  Charles M. Buchas, Jr.
                                          Title: Corporate Vice President and
                                                   Treasurer


                                     FEDERAL EXPRESS CORPORATION


                                     By:   /s/ Tracy G. Schmidt
                                          ---------------------------------
                                          Name:  Tracy G. Schmidt
                                          Title: Senior Vice President and
                                                   Chief Financial Officer


                                     FEDEX GROUND PACKAGE SYSTEM, INC.


                                     By:   /s/ Ronald R. Trombetta
                                          ---------------------------------
                                          Name:  Ronald R. Trombetta
                                          Title: Sr. Vice President & CFO


                                     FEDEX CUSTOM CRITICAL, INC.


                                     By:   /s/ R. Bruce Simpson
                                          ---------------------------------
                                          Name:  R. Bruce Simpson
                                          Title: President and CEO


                                     VIKING FREIGHT, INC.


                                     By:   /s/ Tilton G. Gore
                                          ---------------------------------
                                          Name:  Tilton G. Gore
                                          Title: President and CEO


                                       19



CONFIRMED AND ACCEPTED, as of the date first
above written:

MERRILL LYNCH, PIERCE, FENNER & SMITH
         INCORPORATED
BANC OF AMERICA SECURITIES LLC
CHASE SECURITIES INC.
COMMERZBANK CAPITAL MARKETS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION


By: MERRILL LYNCH, PIERCE, FENNER & SMITH
            INCORPORATED

By:     /s/ Jay Caldwell
   ---------------------------------------
          Authorized Representative

Acting on behalf of itself and the other
named Initial Purchasers




                                       20





                                    EXHIBIT A

                               Form of Opinion of
         the Executive Vice President and General Counsel of the Company

                       Form of Opinion of Company Counsel


                                                               February 12, 2001

MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
            Incorporated
Banc of America Securities LLC
Chase Securities Inc.
Commerzbank Capital Markets Corp.
Credit Suisse First Boston Corporation

                  Re:   FedEx Corporation
                        Debt Securities (the "Offered Securities")

Ladies and Gentlemen:

     This opinion is directed to the Initial Purchasers pursuant to Section
5(b)(i) of the Purchase Agreement dated February 6, 2001 (the "Purchase
Agreement"), among the Company, the Initial Guarantors and you, with respect to
the offer and sale of the Offered Securities and the Securities Guarantees. All
terms defined or used in the Purchase Agreement have the same meaning when used
herein, unless otherwise noted.

     I am the Executive Vice President and General Counsel of the Company and
have acted as such in connection with the Offered Securities, the Securities
Guarantees and the Purchase Agreement. I or attorneys under my supervision have
made such examination and investigation as we have deemed necessary in order to
give the following opinion.

     I do not express any opinion as to matters governed by any law other than
the federal laws of the United States of America, the General Corporation Law of
the State of Delaware and the laws of the State of Tennessee.

     Based on the foregoing, it is my opinion that:

     1. Each of the Company and the Initial Guarantors is a corporation duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has full corporate power and authority
under such laws to own its properties and to conduct its business as described
in the Offering Memorandum; each of the Company and the Initial Guarantors is
duly qualified to do business and is in good standing in each jurisdiction in
which it owns or leases real property or in which the conduct of its business
requires such qualification, except for such instances which in the aggregate
will not have a material adverse


                                       A-1




effect on the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its subsidiaries considered as
one enterprise;

     2. Each subsidiary of the Company which is a significant subsidiary as
defined in Rule 405 of Regulation C of the 1933 Act Regulations (each a
"Significant Subsidiary") has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Offering Memorandum,
and, to the best of my knowledge, is duly qualified to do business and is in
good standing in each jurisdiction in which such qualification is required,
except where the failure to so qualify would not have a material adverse effect
on the condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise; all of the issued and outstanding capital stock of each Significant
Subsidiary has been duly authorized and validly issued and is fully paid and
non-assessable, and all of such capital stock, except for directors' qualifying
shares, is owned by the Company, directly or through subsidiaries, free and
clear of any mortgage, pledge, lien, encumbrance, claim or equity;

     3. Except for matters described in the Offering Memorandum, there is no
pending, or to my knowledge, threatened action or proceeding before any court or
administrative agency which individually (or in the aggregate in the case of any
group of related lawsuits) is expected to have a material adverse effect on the
financial condition of the Company or its subsidiaries considered as one
enterprise or the ability of the Company or the Initial Guarantors to perform
their respective obligations under the Purchase Agreement, the Indenture, the
Registration Rights Agreement or the Securities Guarantee;

     4. The Indenture has been duly and validly authorized, executed and
delivered by the Company and the Initial Guarantors;

     5. The Registration Rights Agreement has been duly and validly authorized,
executed and delivered by the Company and the Initial Guarantors;

     6. The Offered Securities and Securities Guarantees have been duly and
validly authorized by all necessary corporate action of the Company and the
Initial Guarantors;

     7. Each of the Company and the Initial Guarantors possesses all permits,
approvals, franchises and other rights from federal aviation, aeronautical,
communications, transportation and shipping authorities which are requisite for
the conduct of its business as described in the Offering Memorandum or for the
actions contemplated by the Purchase Agreement and the Registration Rights
Agreement and the offering contemplated by the Offering Memorandum; and the
actions contemplated by the Purchase Agreement, the Indenture and the
Registration Rights Agreement and the offering contemplated by the Offering
Memorandum, are not in violation of any federal statute or regulation relating
to aviation, aeronautics, communications, transportation or shipping;

     8. I have reviewed or caused to be reviewed by attorneys under my
supervision the Offering Memorandum and each amendment and supplement thereto
(including the documents incorporated by reference) and have no reason to
believe that, as of its issue date, or as of the


                                      A-2



Closing Time, the Offering Memorandum or any such amendment or supplement (or
any such documents incorporated by reference) contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading;

     9. I do not know of any statute or regulation or legal or governmental
proceeding material to the business of the Company and its subsidiaries
considered as one enterprise which is not described in the Offering Memorandum,
nor of any contract or document material to the business of the Company and its
subsidiaries considered as one enterprise which is not described in the Offering
Memorandum; and the descriptions in the Offering Memorandum of the contracts and
other documents therein described are accurate and fairly present the
information shown;

     10. The execution and delivery by the Company and the Initial Guarantors of
the Purchase Agreement and the consummation by the Company and the Initial
Guarantors of the transactions herein and therein contemplated and compliance
with the terms of the Purchase Agreement do not and will not conflict with or
result in a breach of any of the terms of the Certificate of Incorporation or
By-laws of the Company or of any Initial Guarantor, and will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan, credit or note
agreement, lease or other agreement or instrument material to the Company or any
Initial Guarantor to which the Company or any Initial Guarantor is a party or by
which it or any of its properties are bound, or any existing applicable law,
rule, regulation, judgment, order or decree of any government, governmental
instrumentality or court, having jurisdiction over the Company or any Initial
Guarantor or any of their respective properties;

     11. The Offered Securities, the Securities Guarantees, the Registration
Rights Agreement and the Indenture conform in all material respects to the
description thereof contained in the Offering Memorandum.

     12. No authorization, approval, consent or license of any regulatory body
or authority (other than under the securities or Blue Sky laws of the various
states) is required for the valid authorization, issuance, sale and delivery of
the Offered Securities and the Securities Guarantees as herein contemplated or
the valid authorization, execution, delivery and performance by the Company or
the Initial Guarantors of the Purchase Agreement and the Indenture or the
consummation by the Company and the Initial Guarantors of the transactions
contemplated herein or therein, or, if so required, all such authorizations,
approvals, consents and licenses, specifying the sale, have been obtained and
are in full force and effect;

     13. The documents incorporated by reference in the Offering Memorandum
comply as to form in all material respects with the requirements of the 1934 Act
and the 1934 Act Regulations in effect at the time such documents were filed
with the Commission; and

     14. The Purchase Agreement has been duly and validly authorized, executed
and delivered by the Company and the Initial Guarantors.


                                   A-3





     With respect to the opinions set forth in paragraphs (4), (5), (6) and (14)
above, I have relied upon the opinion of local counsel in respect of Initial
Guarantors not incorporated in Delaware or Tennessee.

     In rendering the foregoing opinion, we have assumed that (i) all signatures
on all documents examined by us are genuine and that where any such signature
(other than a signature purporting to have been made on behalf of the Company or
any Initial Guarantor) purports to have been made in a corporate, governmental,
fiduciary or other capacity, the person who affixed such signature had the due
authority to do so, (ii) certain factual matters contained in certificates of
public officials are accurate, true and correct, and (iii) photostat copies of
such documents, records and certificates conform to the originals.

     This opinion is intended solely for the benefit of the Initial Purchasers
and is not to be relied on by, and no copies of it are to be delivered to, any
other person without my prior written consent, except that Davis Polk &
Wardwell, special counsel to the Company, and counsel to the Initial Purchasers
may rely upon this opinion as to all matters of Tennessee law in rendering its
opinion of even date herewith. I am not assuming any professional responsibility
to any other person by rendering this opinion. It is understood that this
opinion speaks as of the date given, notwithstanding any delivery as
contemplated above on any other date.

                                             Very truly yours,


                                             Kenneth R. Masterson




                                      A-4





                                    EXHIBIT B

                    Form of Opinion of Davis Polk & Wardwell


1. The Indenture has been duly and validly authorized, executed and delivered by
the Company and the Initial Guarantors and (assuming the Indenture has been duly
authorized, executed and delivered by the Trustee) constitutes a valid and
binding agreement of the Company and the Initial Guarantors, enforceable in
accordance with its terms;

2. Each of the Purchase Agreement and the Registration Rights Agreement has been
duly and validly authorized, executed and delivered by the Company and the
Initial Guarantors and (assuming the due execution thereof by the other parties
thereto) constitutes a valid and binding agreement of the Company and the
Initial Guarantors, enforceable in accordance with its terms;

3. The Offered Securities and Securities Guarantees are in due and proper form
and have been duly and validly authorized by all necessary corporate action and,
when executed and authenticated as specified in the Indenture and delivered
against payment of the consideration therefor determined in accordance with the
Purchase Agreement, will be valid and binding obligations of the Company and the
Initial Guarantors, enforceable in accordance with their terms, and each holder
of the Offered Securities and Securities Guarantees will be entitled to the
benefits of the Indenture;

4. It is not necessary in connection with the offer, sale and delivery of the
Offered Securities and Securities Guarantees to the Initial Purchasers and to
each Subsequent Purchaser in the manner contemplated by the Purchase Agreement
and the Offering Memorandum (it being understood that no opinion is expressed as
to any other offer or resale of the Offered Securities) to register the Offered
Securities and the Securities Guarantees under the 1933 Act or to qualify the
Indenture under the 1939 Act; and

5. We have reviewed the Offering Memorandum and each amendment and supplement
thereto (including the documents incorporated by reference) and have no reason
to believe that, as of its issue date, or as of the Closing Time, the Offering
Memorandum or any such amendment or supplement (or any such documents
incorporated by reference) contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstance under which they were
made, not misleading.

     Our opinions as to the enforceability of the Indenture, the Registration
Rights Agreement, the Offered Securities, the Securities Guarantees and Purchase
Agreement set forth in subparagraphs (1), (2) and (3) above are limited by
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting enforcement of creditors' rights or by general equity
principles and subject to any principles of public policy limiting the right to
enforce the indemnification and contribution provisions contained in Sections 7
and 8 of the Purchase Agreement and in Section 5 of the Registration Rights
Agreement.


                                      B-1





     In rendering the foregoing opinion, we have assumed that (i) all signatures
on all documents examined by us are genuine and that where any such signature
purports to have been made in a corporate, governmental, fiduciary or other
capacity, the person who affixed such signature had the due authority to do so,
(ii) certain factual matters contained in certificates of public officials are
accurate, true and correct, and (iii) photostat copies of such documents,
records and certificates conform to the originals.

     With respect to the opinions set forth in paragraphs (1), (2) and (3)
above, Davis Polk and Wardwell may rely on the opinion of the Executive Vice
President and General Counsel of the Company and local counsel with respect to
Initial Guarantors not incorporated in Delaware or Tennessee with respect to
issues involving the corporate law of states other than New York and Delaware.
This opinion is being rendered at the request of the Company solely for the
benefit of the Initial Purchasers and is not to be relied on by, and no copies
of it to be delivered to, any other person without prior written consent of
Davis Polk & Wardwell, except that Kenneth R. Masterson, Executive Vice
President and General Counsel of the Company may rely on this opinion as to all
matters of New York law in rendering his opinion of even date herewith.


                                           Very truly yours,



                                      B-2





                                    EXHIBIT C

                      Form of Registration Rights Agreement




                                      C-1




                                   SCHEDULE A


                                                                  Principal
                                                                  Amount of
             Name of Initial Purchaser                            2004 Notes
             --------------------------                           ----------

Merrill Lynch, Pierce, Fenner & Smith
                      Incorporated............................  $125,000,000

Banc of America Securities LLC................................    50,000,000

Chase Securities Inc..........................................    50,000,000

Commerzbank Capital Markets Corp..............................    12,500,000

Credit Suisse First Boston Corporation........................    12,500,000
                                                                ------------


Total.........................................................  $250,000,000
                                                                ============


                                                                  Principal
                                                                  Amount of
             Name of Initial Purchaser                            2006 Notes
             --------------------------                           ----------

Merrill Lynch, Pierce, Fenner & Smith
                      Incorporated............................  $125,000,000

Banc of America Securities LLC................................    50,000,000

Chase Securities Inc..........................................    50,000,000

Commerzbank Capital Markets Corp..............................    12,500,000

Credit Suisse First Boston Corporation........................    12,500,000
                                                                ------------


Total.........................................................  $250,000,000
                                                                ============


                                    Sch A-1






                                                                  Principal
                                                                  Amount of
             Name of Initial Purchaser                            2011 Notes
             --------------------------                           ----------

Merrill Lynch, Pierce, Fenner & Smith
                      Incorporated............................  $125,000,000

Banc of America Securities LLC................................    50,000,000

Chase Securities Inc..........................................    50,000,000

Commerzbank Capital Markets Corp..............................    12,500,000

Credit Suisse First Boston Corporation........................    12,500,000
                                                                -------------


Total.........................................................  $250,000,000
                                                                ============




                                    Sch A-2




                                   SCHEDULE B


                                FEDEX CORPORATION


                                  $250,000,000
                              6 5/8% Notes due 2004


     1. The initial public offering price of the 2004 Notes shall be 99.885% of
the principal amount thereof, plus accrued interest, if any, from the date of
issuance.

     2. The purchase price to be paid by the Initial Purchasers for the 2004
Notes shall be 99.435% of the principal amount thereof.

     3. The interest rate on the 2004 Notes shall be 6 5/8% per annum.



                                  $250,000,000
                              6 7/8% Notes due 2006


     1. The initial public offering price of the 2006 Notes shall be 99.928% of
the principal amount thereof, plus accrued interest, if any, from the date of
issuance.

     2. The purchase price to be paid by the Initial Purchasers for the 2006
Notes shall be 99.328% of the principal amount thereof.

     3. The interest rate on the 2006 Notes shall be 6 7/8% per annum.



                                  $250,000,000
                              7 1/4% Notes due 2011


     1. The initial public offering price of the 2011 Notes shall be 99.278% of
the principal amount thereof, plus accrued interest, if any, from the date of
issuance.

     2. The purchase price to be paid by the Initial Purchasers for the 2011
Notes shall be 98.628% of the principal amount thereof.

     3. The interest rate on the 2011 Notes shall be 7 1/4% per annum.


                                    Sch B-1

EX-4.1

                                                                    EXHIBIT 4.1


                                    INDENTURE


                      ------------------------------------


                          Dated as of February 12, 2001

                                      among


                          FEDEX CORPORATION, as Issuer,

                           THE GUARANTORS NAMED HEREIN

                                       and

                        THE BANK OF NEW YORK, as Trustee

                      ------------------------------------




                       $250,000,000 6 5/8% Notes due 2004
                       $250,000,000 6 7/8% Notes due 2006
                       $250,000,000 7 1/4% Notes due 2011









                         RECONCILIATION AND TIE BETWEEN
                           TRUST INDENTURE ACT OF 1939
                    (THE "TRUST INDENTURE ACT") AND INDENTURE



Trust Indenture Act Section                                    Indenture Section

ss.310 (a)(1)..................................................      6.09
       (a)(2)..................................................      6.09
       (b).....................................................      6.10
ss.311 (b)(4)..................................................      6.13
       (b)(6)..................................................      6.13
ss.312 (a).....................................................      7.01
       (b).....................................................      7.02
       (c).....................................................      7.02
ss.313 (a).....................................................      7.03
       (b)(2)..................................................      7.03
       (c).....................................................      7.03
       (d).....................................................      7.03
ss.314 (a).....................................................      7.04
       (c)(1)..................................................      1.02
       (c)(2)..................................................      1.02
       (e).....................................................      1.02
       (f).....................................................      1.02
ss.316 (a) (last sentence).....................................      1.01
       (a)(1)(A)...............................................  5.02 and 5.12
       (a)(1)(B)...............................................      5.13
       (b).....................................................      5.08
ss.317 (a)(1)..................................................      5.03
       (a)(2)..................................................      5.04
       (b).....................................................      10.03
ss.318 (a).....................................................      1.07
- -------------------

This reconciliation and tie shall not, for any purpose, be deemed to be a part
of the Indenture.

NOTE: Section 318(c) of the Trust Indenture Act provides that the provisions of
      Sections 310-317 are a part of and govern every qualified indenture,
      whether or not physically contained therein.









                               TABLE OF CONTENTS*


                             ----------------------


                                                                            PAGE



                                    ARTICLE 1
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION



SECTION 1.01.  Definitions.....................................................2

SECTION 1.02.  Compliance Certificates and Opinions...........................10

SECTION 1.03.  Form of Documents Delivered to Trustee.........................11

SECTION 1.04.  Acts of Holders................................................11

SECTION 1.05.  Notices, Etc. to Trustee, Company and Guarantors...............13

SECTION 1.06.  Notice to Holders; Waiver......................................13

SECTION 1.07.  Conflict with Trust Indenture Act..............................14

SECTION 1.08.  Effect of Headings and Table of Contents.......................14

SECTION 1.09.  Successors and Assigns.........................................14

SECTION 1.10.  Separability Clause............................................14

SECTION 1.11.  Benefits of Indenture..........................................14

SECTION 1.12.  Governing Law..................................................14

SECTION 1.13.  Legal Holidays.................................................14

SECTION 1.14.  Language of Notices............................................14

SECTION 1.15.  Counterparts...................................................15



                                    ARTICLE 2
                                   NOTE FORMS



SECTION 2.01.  Forms Generally................................................15

SECTION 2.02.  Form of Trustee's Certificate of Authentication................15

SECTION 2.03.  Global Notes...................................................16







                                                                            PAGE

                                    ARTICLE 3
                                    THE NOTES



SECTION 3.01.  Issue Amount; Issuable in Series...............................21

SECTION 3.02.  Denominations..................................................21

SECTION 3.03.  Execution, Authentication, Delivery and Dating.................21

SECTION 3.04.  Temporary Notes................................................23

SECTION 3.05.  Registration, Transfer and Exchange............................24

SECTION 3.06.  Special Transfer Provisions....................................26

SECTION 3.07.  Mutilated, Destroyed, Lost and Stolen Notes....................28

SECTION 3.08.  Payment of Interest; Interest Rights Preserved.................29

SECTION 3.09.  Persons Deemed Owners..........................................30

SECTION 3.10.  Cancellation...................................................31

SECTION 3.11.  Computation of Interest........................................31



                                    ARTICLE 4
                           SATISFACTION AND DISCHARGE



SECTION 4.01.  Satisfaction and Discharge of Indenture........................31

SECTION 4.02.  Application of Trust Money.....................................33



                                    ARTICLE 5
                                    REMEDIES



SECTION 5.01.  Events of Default..............................................33

SECTION 5.02.  Acceleration of Maturity; Rescission and Annulment.............34

SECTION 5.03.  Collection of Indebtedness and Suits for Enforcement by
         Trustee..............................................................35

SECTION 5.04.  Trustee May File Proofs of Claim...............................36



                                       ii





                                                                            PAGE

SECTION 5.05.  Trustee May Enforce Claims Without Possession of Notes.........37

SECTION 5.06.  Application of Money Collected.................................37

SECTION 5.07.  Limitation on Suits............................................38

SECTION 5.08.  Unconditional Right of Holders to Receive Principal and
         Interest.............................................................39

SECTION 5.09.  Restoration of Rights and Remedies.............................39

SECTION 5.10.  Rights and Remedies Cumulative.................................39

SECTION 5.11.  Delay or Omission Not Waiver...................................39

SECTION 5.12.  Control by Holders.............................................39

SECTION 5.13.  Waiver of Past Defaults........................................40

SECTION 5.14.  Undertaking for Costs..........................................40

SECTION 5.15.  Waiver of Stay or Extension Laws...............................41



                                    ARTICLE 6
                                   THE TRUSTEE



SECTION 6.01.  Certain Duties and Responsibilities............................41

SECTION 6.02.  Notice of Defaults.............................................42

SECTION 6.03.  Certain Rights of Trustee......................................43

SECTION 6.04.  Not Responsible for Recitals or Issuance of Notes..............44

SECTION 6.05.  May Hold Notes.................................................44

SECTION 6.06.  Money Held in Trust............................................44

SECTION 6.07.  Compensation and Reimbursement.................................44

SECTION 6.08.  Intentionally Left Blank.......................................45

SECTION 6.09.  Corporate Trustee Required; Eligibility........................45

SECTION 6.10.  Resignation and Removal; Appointment of Successor..............46

SECTION 6.11.  Acceptance of Appointment by Successor.........................47

SECTION 6.12.  Merger, Conversion, Consolidation or Succession to
         Business.............................................................49



                                      iii





                                                                            PAGE

SECTION 6.13.  Preferential Claims............................................49

SECTION 6.14.  Appointment of Authenticating Agent............................50



                                    ARTICLE 7
                HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY



SECTION 7.01.  Company to Furnish Trustee Names and Addresses of
         Holders..............................................................52

SECTION 7.02.  Preservation of Information; Communications to Holders.........52

SECTION 7.03.  Reports by Trustee.............................................53

SECTION 7.04.  Reports by Company and the Guarantors..........................54



                                    ARTICLE 8
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE



SECTION 8.01.  Company May Consolidate, Etc. on Certain Terms.................55

SECTION 8.02.  Successor Corporation Substituted..............................55



                                    ARTICLE 9
                             SUPPLEMENTAL INDENTURES



SECTION 9.01.  Supplemental Indentures Without Consent of Holders.............56

SECTION 9.02.  Supplemental Indentures with Consent of Holders................57

SECTION 9.03.  Execution of Supplemental Indentures...........................58

SECTION 9.04.  Effect of Supplemental Indentures..............................58

SECTION 9.05.  Conformity with Trust Indenture Act............................58

SECTION 9.06.  Reference in Notes to Supplemental Indentures..................58



                                       iv







                                                                            PAGE

                                   ARTICLE 10
                                    COVENANTS



SECTION 10.01.  Payment of Principal, Interest and Additional Amounts.........59

SECTION 10.02.  Maintenance of Office or Agency...............................59

SECTION 10.03.  Money for Notes Payments to Be Held in Trust..................59

SECTION 10.04.  Corporate Existence...........................................61

SECTION 10.05.  Statement as to Default.......................................61

SECTION 10.06.  Additional Amounts............................................61

SECTION 10.07.  Application of Proceeds upon Release of a 10%
         Subsidiary Guarantor.................................................63



                                   ARTICLE 11
                               REDEMPTION OF NOTES



SECTION 11.01.  Redemption Upon a Tax Event...................................64

SECTION 11.02.  Notice of Redemption..........................................64

SECTION 11.03.  Deposit of Redemption Price...................................65

SECTION 11.04.  Notes Payable on Redemption Date..............................65



                                   ARTICLE 12
                               GUARANTEE OF NOTES



SECTION 12.01.  Unconditional Guarantee.......................................66

SECTION 12.02.  Execution and Delivery of Guarantee...........................67

SECTION 12.03.  Future Guarantors.............................................68

SECTION 12.04.  Release of a Guarantor........................................68

SECTION 12.05.  Waiver of Subrogation.........................................68

SECTION 12.06.  Reliance on Judicial Order or Certificate of Liquidating
         Agent Regarding Dissolution, etc. of Guarantors .....................69



                                       v






                                                                            PAGE

SECTION 12.07.  Limitation of Guarantor's Liability ..........................69

SECTION 12.08.  Obligations Reinstated........................................69

SECTION 12.09.  No Obligation to Take Action Against the Company..............70



                                   ARTICLE 13
                       DEFEASANCE AND COVENANT DEFEASANCE



SECTION 13.01.  Applicability of Article; Company's Option to Effect
         Defeasance or Covenant Defeasance....................................70

SECTION 13.02.  Defeasance and Discharge......................................70

SECTION 13.03.  Covenant Defeasance...........................................71

SECTION 13.04.  Conditions to Defeasance or Covenant Defeasance...............72

SECTION 13.05.  Deposited Money and Government Obligations to be
         Held in Trust; Other Miscellaneous Provisions........................73


- --------

     *This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.



                                       vi






EXHIBIT A           Form of Supplemental Indenture to add Additional
                    Guarantors

EXHIBIT B           Form of Individual Note

EXHIBIT C           Form of Guarantee

EXHIBIT D           Form of Global Note

EXHIBIT E           Form of Regulation S Transfer Certificate

EXHIBIT F           Form of Restricted Notes Transfer Certificate

EXHIBIT G           Form of Owner Notes Certificate to be delivered in
                    connection with exchange of the Temporary Regulation S
                    Global Note

EXHIBIT H           Form of Depositary Certification to be delivered in
                    connection with exchanges of the Temporary Regulation S
                    Global Note




                                      vii








                                    INDENTURE

     INDENTURE, dated as of February 12, 2001, among FedEx Corporation, a
Delaware corporation (the "Company"), the Guarantors referred to below and The
Bank of New York, a New York banking corporation, as trustee (the "Trustee").

                                    RECITALS

     WHEREAS, the Company has duly authorized the execution and delivery of this
Indenture to provide, among other things, for the issuance, execution,
authentication, delivery and administration of $250,000,000 aggregate principal
amount of its 6 5/8% Notes due 2004 (the "Notes due 2004"), $250,000,000
aggregate principal amount of its 6 7/8% Notes due 2006 (the "Notes due 2006")
and $250,000,000 aggregate principal amount of its 7 1/4% Notes due 2011 (the
"Notes due 2011" and, together with the Notes due 2004 and the Notes due 2006,
the "Notes");

     WHEREAS, the Guarantors named herein have duly authorized the execution and
delivery of this Indenture to provide for the Guarantee of the Notes; and

     WHEREAS, all things necessary to make the Notes, when executed and
delivered by the Company and authenticated by the Trustee or an Authenticating
Agent and delivered as provided in this Indenture and the Guarantees when
executed and delivered by the Guarantors, the valid, binding and legal
obligations of the Company and the Guarantors, as the case may be, and to
constitute these presents a valid indenture and agreement of the Company and the
Guarantors according to its terms have been done.

     NOW, THEREFORE, THIS INDENTURE WITNESSETH:

     For and in consideration of the premises and the purchase of the Notes by
the Holders (as herein defined) thereof, it is mutually covenanted and agreed,
for the equal and proportionate benefit of all Holders of the Notes, as follows:








                                    ARTICLE 1
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

     SECTION 1.01. Definitions. For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:

          (i) the terms defined in this Article have the meanings assigned to
     them in this Article and include the plural as well as the singular;

          (ii) all other terms used herein which are defined in the Trust
     Indenture Act, either directly or by reference therein, have the meanings
     assigned to them therein;

          (iii) all accounting terms not otherwise defined herein have the
     meanings assigned to them in accordance with generally accepted accounting
     principles and, except as otherwise herein expressly provided, the term
     "generally accepted accounting principles" or "GAAP" with respect to any
     computation required or permitted hereunder shall mean such accounting
     principles as are generally accepted in the United States of America as of
     the date of such computation; and

          (iv) the words "herein," "hereof," "hereto" and "hereunder" and other
     words of similar import refer to this Indenture as a whole and not to any
     particular Article, Section or other subdivision.

     Certain terms used principally in certain Articles hereof are defined in
those Articles.

     "Act" when used with respect to any Holder, has the meaning specified in
Section 1.04.

     "Additional Amounts" has the meaning set forth in Section 10.06 hereof,
including, without limitation, any Additional Amounts payable as a result of an
assumption of obligations pursuant to Section 8.01. Any reference in this
Indenture to principal or interest in respect of the Notes shall be deemed also
to refer to any Additional Amounts that may be payable as set forth herein and
under the Notes or the Guarantees.

     "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through



                                       2






the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.

     "Authenticating Agent" means any Person authorized by the Trustee to act on
behalf of the Trustee to authenticate Notes of one or more series.

     "Board of Directors" means the board of directors of the Company or any
duly authorized committee of the board of directors of the Company.

     "Board Resolution" means a copy of one or more resolutions certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, delivered to the Trustee.

     "Business Day" means any day other than Saturday, Sunday or other day on
which banking institutions in New York or Tennessee are authorized or obligated
by law to close.

     "Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock of
such Person.

     "Clearstream" means Clearstream Banking, societe anonyme, or any successor
thereto.

     "Closing Date" means February 12, 2001.

     "Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or, if at any time after the execution of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.

     "Company" means FedEx Corporation or any successor Corporation which shall
have become such under this Indenture.

     "Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its President or any Vice President and
delivered to the Trustee.

     Consolidated Total Assets" as of any date means the consolidated total
assets of a Person and its Subsidiaries as of such date determined on a
consolidated basis in accordance with generally accepted accounting principles.



                                       3





     "Corporate Trust Office" means the principal corporate trust office of the
Trustee at which at any particular time its corporate trust business shall be
principally administered, which office at the date of original execution of this
Indenture is located at 101 Barclay Street, New York, New York 10286.

     "Corporation" includes corporations and limited liability companies and,
except for purposes of Article Eight, associations, companies and business
trusts.

     "CUSIP Number" means the alphanumeric designation assigned to a Note by
Standard & Poor's Ratings Group, CUSIP Service Bureau.

     "Custodian" means The Bank of New York, as custodian of the Global Notes
for DTC under a custody agreement or any similar successor agreement.

     "DTC" means The Depository Trust Company, or any successor thereto.

     "Defaulted Interest" has the meaning specified in Section 3.08.

     "Depositary" means, with respect to the Global Notes, DTC or such other
Person as shall be designated as Depositary by the Company pursuant to Section
2.03(b).

     "Depositary Certification" has the meaning specified in Section 2.03(a).

     "Dollars" means a dollar or other equivalent unit of legal tender for
payment of debts in the United States of America.

     "Euroclear" means Euroclear Bank S.A./N.V., as operator of the Euroclear
System, or any successor thereto.

     "Event of Default" has the meaning specified in Section 5.01.

     "Exchange Notes" means any securities of the Company to be offered to
Noteholders in exchange for Notes of a series pursuant to the Exchange Offer or
otherwise pursuant to a Registration of Notes containing terms identical in all
material respects to the Notes of such series for which they are exchanged
(which securities will be guaranteed by the Guarantors with terms identical to
the Guarantee), except that (i) interest thereon shall accrue from the last date
on which interest was paid on the Notes or, if no such interest has been paid,
from the date of issuance of the Notes and (ii) the Exchange Notes will not
contain terms with respect to transfer restrictions or the payment of additional
interest upon the occurrence of a Registration Default.



                                       4






     "Exchange Offer" means the exchange offer by the Company of Exchange Notes
for Notes pursuant to the Registration Rights Agreement.

     "Exchange Registration Statement" means a registration statement of the
Company and the Guarantors under the Securities Act registering Exchange Notes,
and Guarantees for distribution pursuant to the Exchange Offer.

     "Global Note" means a Note bearing the legend specified in Section 2.03
evidencing all or part of a series of Notes, issued to the Depositary or its
nominee with respect to such series and registered in the name of such
Depositary or nominee.

     "Government Obligations" means securities which are (x) direct full faith
and credit obligations of the United States of America or (y) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality of
the United States of America, in each case where the payment or payments
thereunder are unconditionally guaranteed as a full faith and credit obligation
by the United States of America and which are not callable or redeemable at the
option of the issuer thereof, and shall also include a depository receipt issued
by a bank as custodian with respect to any such Government Obligation or a
specific payment of principal of or interest on any such Government Obligation
held by such custodian for the account of the holder of a depository receipt,
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect to the Government
Obligation or the specific payment of principal of or interest on the Government
Obligation evidenced by such depository receipt.

     "Guarantee" means the Guarantee made by each of the Guarantors as set forth
in Article 12 hereof and as endorsed on the Notes as provided herein.

     "Guarantor" means (i) each of Federal Express Corporation, a Delaware
corporation, FedEx Ground Package System, Inc., a Delaware corporation, FedEx
Custom Critical, Inc., an Ohio corporation, and Viking Freight, Inc., a
California corporation, each a Subsidiary of the Company, and (ii) each Person
who becomes a Guarantor hereunder after the Closing Date upon the execution of
an indenture supplemental hereto pursuant to Section 12.03.

     "Holder" means a Person in whose name a Note is registered in the Register.

     "Indebtedness" of any person means indebtedness for borrowed money and
indebtedness under purchase money liens or other conditional sales or similar



                                       5






title retention agreements, in each case where such indebtedness has been
created, incurred, or assumed by such person to the extent such indebtedness
would appear as a liability upon a balance sheet of such Person prepared in
accordance with GAAP, guarantees by such Person of such indebtedness, and
indebtedness for borrowed money secured by any lien, pledge or other security
interest or encumbrance upon property owned by such Person, even though such
Person has not assumed or become liable for the payment of such indebtedness.

     "Indenture" means this instrument as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and shall include the terms of
each particular series of Notes established as contemplated by Section 3.01.

     "Individual Note" has the meaning set forth in Section 2.03(b).

     "Interest Payment Date," with respect to any Note, means the Stated
Maturity of an installment of interest on such Note.

     "Maturity," with respect to any Note, means the date on which the principal
of such Note, or an installment of principal, becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, notice of redemption or repurchase or otherwise and includes any
Redemption Date.

     "Officers' Certificate" means a certificate signed by the Chairman of the
Board of Directors, the President or any Vice President, and attested by the
Secretary or any Assistant Secretary of the Company, and delivered to the
Trustee.

     "Opinion of Counsel" means a written opinion of counsel, who may be an
employee of or of counsel to the Company, or other counsel reasonably
satisfactory to the Trustee.

     "Original Notes" means all Notes other than Exchange Notes.

     "Outstanding," when used with respect to Notes of any series, means, as
of the date of determination, all Notes of such series theretofore authenticated
and delivered under this Indenture, except:

          (i) Notes theretofore canceled by the Trustee or delivered to the
     Trustee for cancellation;

          (ii) Notes for whose payment at the Maturity thereof money in the
     necessary amount has been theretofore deposited with the Trustee or



                                       6






     any Paying Agent (other than the Company) in trust or set aside and
     segregated in trust by the Company (if the Company shall act as its own
     Paying Agent) for the Holders of such Notes; provided that, if such Notes
     are to be redeemed, notice of such redemption has been duly given pursuant
     to this Indenture or provision therefor satisfactory to the Trustee has
     been made;

          (iii) Notes for whose payment or redemption money or Government
     Obligations as contemplated by Section 13.04 in the necessary amount have
     been theretofore deposited with the Trustee (or another trustee satisfying
     the requirements of Section 6.09) in trust for the Holders of such Notes in
     accordance with Section 13.05; and

          (iv) Notes which have been paid pursuant to Section 3.07 or in
     exchange for or in lieu of which other Notes have been authenticated and
     delivered pursuant to this Indenture, unless there shall have been
     presented to the Trustee proof satisfactory to it that such Notes are held
     by a bona fide purchaser in whose hands such Notes are valid obligations of
     the Company;

     provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Notes of any series have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Notes
owned by the Company or any other obligor or any Affiliate of the Company or of
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Notes which the Trustee knows, meaning actual knowledge of a Responsible
Officer, to be so owned shall be so disregarded. Notes so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Notes and that the pledgee is not the Company or any other obligor or any
Affiliate of the Company or of such other obligor.

     "Owner Notes Certification" has the meaning specified in Section 2.03(a).

     "Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Notes on behalf of the Company.

     "Person" means any individual, Corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.



                                       7






     "Place of Payment," with respect to the Notes of any series, means the
place where the principal of, interest on, and Additional Amounts with respect
to, the Notes of that series are payable as provided in or pursuant to this
Indenture or such Notes.

     "Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 3.07 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.

     "Readily Marketable Securities" means securities for which a public market
exists or which the Company reasonably believes can be reduced to cash within 12
months of the receipt thereof.

     "Redemption Date," with respect to any Note or portion thereof to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture or such Note.

     "Redemption Price," with respect to any Note or portion thereof to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture or such Note.

     "Register" and "Note Registrar" have the respective meanings specified in
Section 3.05.

     "Registration" means a registered exchange offer for the Notes by the
Company pursuant to the Exchange Offer Registration Statement or other
registration for resale of the Notes under the Securities Act pursuant to a
Shelf Registration Statement, in each case in accordance with the terms of the
Registration Rights Agreement.

     "Registration Default" has the meaning set forth in the Registration Rights
Agreement.

     "Registration Rights Agreement" means the Registration Rights Agreement,
dated as of February 12, 2001, among the Issuer, the Guarantors and Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Banc of America Securities LLC,
Chase Securities Inc., Commerzbank Capital Markets Corp. and Credit Suisse First
Boston Corporation (the "Purchasers"), and certain permitted assigns specified
therein.



                                       8






     "Regular Record Date" for the interest payable on any Interest Payment Date
on the Notes of any series means the date specified in or pursuant to this
Indenture or such Note as the "Regular Record Date."

     "Regulation S" means Regulation S under the Securities Act.

     "Regulation S Global Note" has the meaning set forth in Section 2.03(a) .

     "Regulation S Legend" has the meaning set forth in Section 2.03(a).

     "Regulation S Restricted Period" means the 40 calendar days after the
original issue date of the Notes.

     "Responsible Officer" means any officer or authorized agent of the Trustee
in its Corporate Trust Office and also means, with respect to a particular
corporate trust matter, any other officer or authorized agent to whom such
matter is referred because of knowledge of and familiarity with the particular
subject.

     "Restricted Individual Note" has the meaning set forth in Section 2.03(a).

     "Rule 144A Global Note" has the meaning set forth in Section 2.03(a).

     "Rule 144A Legend" has the meaning set forth in Section 2.03(a).

     "Shelf Registration Statement" means a shelf registration statement under
the Securities Act filed by the Company and the Guarantors, if required by, and
meeting the requirements of, the Registration Rights Agreement, registering
Original Notes for resale.

     "60% Subsidiary Guarantor" means any Guarantor whose Consolidated Total
Assets as of any determination date constitute more than 60% of the Consolidated
Total Assets of the Company, determined as of the date of the most recent
interim or fiscal year-end balance sheet of the Company filed with the
Commission prior to such determination date.

     "Special Record Date" for the payment of any Defaulted Interest on any Note
means a date fixed by the Trustee pursuant to Section 3.08.

     "Stated Maturity," with respect to any Note or any installment of principal
thereof or interest thereon or any Additional Amounts, means the date
established by or pursuant to this Indenture or such Note as the fixed date on



                                       9






which the principal of such Note or such installment of principal or interest
is, or such Additional Amounts are, due and payable.

     "Subsidiary" means any Corporation of which at the time of determination
the Company or one or more Subsidiaries owns or controls, directly or
indirectly, more than 50% of the shares of voting stock. For the purposes of
this definition, "voting stock" means stock which ordinarily has voting power
for the election of directors, whether at all times or only so long as no senior
class of stock has such voting power by reason of any contingency.

     "Temporary Regulation S Global Note" has the meaning set forth in Section
2.03(a).

     "10% Subsidiary Guarantor" means any Guarantor whose Consolidated Total
Assets as of any determination date constitute more than 10% of the Consolidated
Total Assets of the Company, determined as of the date of the most recent
interim or fiscal year-end balance sheet of the Company filed with the
Commission prior to such determination date.

     "Trustee" means the Person named as the "Trustee" in the first paragraph of
this Indenture until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder. If at any time there is
more than one such Person, "Trustee" shall mean such Person and as used with
respect to the Notes of any series shall mean the Trustee with respect to Notes
of such series.

     "Trust Indenture Act" means the Trust Indenture Act of 1939, as amended, as
in force at the date as of which this instrument was executed, except as
provided in Section 9.05.

     "Unrestricted Individual Note" means any Individual Note other than a
Restricted Individual Note.

     "Vice President," when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."

     SECTION 1.02. Compliance Certificates and Opinions. Except as otherwise
expressly provided in this Indenture, upon any application or request by the
Company to the Trustee to take any action under any provision of this Indenture,
the Company and, if applicable, the Guarantors, shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any,



                                       10






provided for in this Indenture relating to the proposed action have been
complied with or an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that, in the case of any such application or request as to which the furnishing
of such documents or any of them is specifically required by any provision of
this Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished. Any Officers' Certificate will comply
with Section 314(e) of the Trust Indenture Act.

     SECTION 1.03. Form of Documents Delivered to Trustee. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.

     Any certificate or opinion of an officer of the Company or a Guarantor may
be based, insofar as it relates to legal matters, upon an Opinion of Counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the opinion with respect to the matters upon which the certificate or
opinion is based are erroneous. Any such Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or a Guarantor stating
that the information with respect to such factual matters is in the possession
of the Company or such Guarantor, unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.

     Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture or any Note, they may, but need not, be
consolidated and form one instrument.

     SECTION 1.04. Acts of Holders. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company or the Guarantors. Such instrument or instruments (and the action



                                       11






embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Trustee and the Company and the Guarantors, if made
in the manner provided in this Section.

     (b) The fact and date of the execution by any Person of any such instrument
or writing may be proved in any reasonable manner which the Trustee deems
sufficient and in accordance with such reasonable rules as the Trustee may
determine; and the Trustee may in any instance require further proof with
respect to any of the matters referred to in this Section.

     (c) The ownership of Notes shall be proved by the Register.

     (d) If the Company shall solicit from the Holders of Notes of any series
any request, demand, authorization, direction, notice, consent, waiver or other
Act, the Company may, at its option, fix in advance a record date for the
determination of Holders of Notes entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. Any such record date shall be fixed at the
Company's discretion. If not set by the Company prior to the first solicitation
of a Holder made by any Person in respect of any such matters referred to in the
foregoing sentence, such record date shall be the date 30 days prior to such
first solicitation of Holders. If such a record date is fixed, such request,
demand, authorization, direction, notice, consent and waiver or other Act may be
sought or given before or after the record date, but only the Holders of Notes
of record at the close of business on such record date shall be deemed to be
Holders of Notes for the purpose of determining whether Holders of the requisite
proportion of Notes of such series Outstanding have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the Notes of such series Outstanding
shall be computed as of such record date.

     (e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Note shall bind every future Holder of the
same Note and the Holder of every Note issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustee, any Note Registrar, any Paying
Agent or the Company or any Guarantor in reliance thereon, whether or not
notation of such action is made upon such Note.



                                       12







     SECTION 1.05. Notices, Etc. to Trustee, Company and Guarantors. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with:

          (i) the Trustee by any Holder or the Company or a Guarantor shall be
     sufficient for every purpose hereunder if made, given, furnished or filed
     in writing to or with the Trustee at its Corporate Trust Office with a copy
     to: 100 Ashford Center North, Suite 520, Atlanta, Georgia 30338, Attn:
     Corporate Trust Department; or

          (ii) the Company or a Guarantor by the Trustee or by any Holder shall
     be sufficient for every purpose hereunder (unless otherwise herein
     expressly provided) if in writing and mailed, first-class postage prepaid,
     to the Company at 942 South Shady Grove Road, Memphis, Tennessee 38120,
     attention: Corporate Vice President and Treasurer, or at any other address
     previously furnished in writing to the Trustee by the Company or a
     Guarantor, as applicable.

     SECTION 1.06. Notice to Holders; Waiver. Where this Indenture or any Note
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein or in such Note expressly provided) if in writing
and mailed, first-class postage prepaid, to each Holder affected by such event,
at the Holder's address as it appears in the Register, not later than the latest
date, or not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given or provided.

     Where this Indenture or any Note provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.

     In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.



                                       13






     SECTION 1.07. Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof which is required
to be included in this Indenture by any of the provisions of the Trust Indenture
Act, such required provision shall control.

     SECTION 1.08. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.

     SECTION 1.09. Successors and Assigns. All covenants and agreements in this
Indenture by the Company and the Guarantors shall bind their respective
successors and assigns, whether so expressed or not.

     SECTION 1.10. Separability Clause. In case any provision in this Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

     SECTION 1.11. Benefits of Indenture. Nothing in this Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder and the Holders, any benefit or any legal
or equitable right, remedy or claim under this Indenture.

     SECTION 1.12. Governing Law. This Indenture, the Notes and the Guarantees
shall be governed by and construed in accordance with the laws of the State of
New York.

     SECTION 1.13. Legal Holidays. In any case where any Interest Payment Date,
Redemption Date or Stated Maturity of any Note shall not be a Business Day at
any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Notes) payment of interest or principal or any Additional
Amounts need not be made at such Place of Payment on such date, but may be made
on the next succeeding Business Day at such Place of Payment with the same force
and effect as if made on the Interest Payment Date or Redemption Date, or at the
Stated Maturity, and no interest shall accrue with respect to such payments for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, to the next succeeding Business Day.

     SECTION 1.14. Language of Notices. Any request, demand, authorization,
direction, notice, consent, election or waiver required or permitted under this
Indenture shall be in the English language, except that, if the Company so
elects, any published notice may be in an official language of the country of
publication.



                                       14






     SECTION 1.15. Counterparts. This Indenture may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.



                                    ARTICLE 2
                                   NOTE FORMS

     SECTION 2.01. Forms Generally. (a) The Notes (including the Trustee's
certification of authentication) and, the notation thereon relating to the
Guarantees shall be in substantially the forms attached hereto as Exhibits B, C
and D hereof; provided that Exchange Notes shall not contain terms with respect
to transfer restrictions or additional interest payable upon occurrence of a
Registration Default. On the Closing Date, the Notes shall be issued in the form
provided in 2.03(a), with the Guarantees duly endorsed thereon. The Notes shall
be numbered, lettered, or otherwise distinguished in such manner or in
accordance with such plans as the officers of the Company executing the same may
determine with the approval of the Trustee.

     The Notes may be issued with appropriate insertions, omissions,
substitutions and variations, and may have imprinted or otherwise reproduced
thereon such legend or legends, not inconsistent with the provisions of this
Indenture, as may be required to comply with any law or with any rules or
regulations pursuant thereto, or with the rules of any securities market in
which the Notes are admitted to trading, or to conform to general usage.

     (b) Each Note shall be dated the date of its authorization.

     Unless otherwise provided in or pursuant to this Indenture or any Notes,
the Notes shall be issuable in registered form without coupons.

     SECTION 2.02. Form of Trustee's Certificate of Authentication. Only such
Notes as shall bear thereon a certification of authentication substantially as
set forth in the forms of the Notes in Exhibits B and D hereto, executed by the
Trustee by manual signature of one of its authorized signatories, shall be
entitled to the benefits of this Indenture or be valid or obligatory for any
purpose. Such certification by the Trustee upon any Note executed by or on
behalf of the Company shall be conclusive evidence that the Note so
authenticated has been duly authenticated and delivered hereunder and that the
holder is entitled to the benefits of this Indenture.



                                       15






     SECTION 2.03. Global Notes. (a) On the Closing Date, the Company shall
cause to be executed and delivered to the Trustee in the manner specified in
Section 3.03 (i) for Notes of each series sold within the United States to
"qualified institutional buyers" as defined in and pursuant to Rule 144A under
the Securities Act, one or more restricted global Notes (each, a "Rule 144A
Global Note"), with the Guarantees endorsed thereon, in definitive, fully
registered form without interest coupons, in denominations of US$1,000 and any
integral multiples of US$1,000, substantially in the form of Exhibit D hereto
and (ii) for Notes of each series sold outside the United States in offshore
transactions in reliance on Regulation S under the Securities Act, one or more
Temporary Global Notes (each, a "Temporary Regulation S Global Note") with the
Guarantees endorsed thereon, in definitive, fully registered form without
interest coupons, in denominations of US$1,000 and any integral multiples of
US$1,000, substantially in the form of Exhibit D hereto. The aggregate principal
amount of the Rule 144A Global Notes and the Temporary Regulation S Global Notes
of each series shall equal the aggregate principal amount of the Notes of such
series that are to be issued on the Closing Date.

     Beneficial interests in a Regulation S Temporary Global Note may only be
held through Euroclear and Clearstream until such interests are exchanged for
corresponding interests in an unrestricted Global Note (the "Regulation S Global
Note") as provided in the next sentence. A holder of a beneficial interest in a
Regulation S Temporary Global Note must provide written certification (an "Owner
Notes Certification") to Euroclear or Clearstream, as the case may be, that the
beneficial owner of the interest in such Global Note is not a U.S. Person (as
defined in Rule 902(k) under the Securities Act) or is a U.S. Person who
purchased such beneficial interest in a transaction that did not require
registration under the Securities Act in the form set forth in Exhibit G, and
Euroclear or Clearstream, as the case may be, must provide to the Trustee a
similar certification in the form set forth in Exhibit H (a "Depositary
Certification"), prior to any exchange of such beneficial interest for a
beneficial interest in a Regulation S Global Note. Any such exchange may take
place only after the expiration of the Regulation S Restricted Period.

     Unless and until a Note is exchanged for an Exchange Note in connection
with an effective Registration pursuant to the Registration Rights Agreement,
each Rule 144A Global Note and each Individual Note (as defined below) issued in
exchange for an interest in a Rule 144A Global Note (a "Restricted Individual
Note") shall bear the following legend (the "Rule 144A Legend") on the face
thereof:

               THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
               1933, AS AMENDED (THE



                                       16






               "SECURITIES ACT"), OR ANY STATE OR OTHER SECURITIES LAWS. NEITHER
               THIS NOTE NOR ANY INTEREST HEREIN MAY BE REOFFERED, SOLD,
               ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED
               OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
               IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
               OF THE SECURITIES ACT. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
               REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
               DEFINED IN RULE 144A ("RULE 144A") UNDER THE SECURITIES ACT), (2)
               AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE PRIOR
               TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF
               TIME AS PERMITTED BY RULE 144(k) OF THE SECURITIES ACT) AFTER THE
               LATER OF THE ORIGINAL ISSUE DATE OF THE NOTES AND THE LAST DATE
               ON WHICH FEDEX CORPORATION OR ANY "AFFILIATE" (AS DEFINED IN RULE
               144 UNDER THE SECURITIES ACT) OF FEDEX CORPORATION WAS THE OWNER
               OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) OR (Y) SUCH LATER
               DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE
               RESTRICTION TERMINATION DATE") EXCEPT (A) TO FEDEX CORPORATION,
               (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
               EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES
               ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT
               REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
               DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
               THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, IN EACH CASE TO
               WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE
               ON RULE 144A, (D) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
               RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR
               (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
               REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN EACH OF THE
               FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF
               ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR



                                       17






               ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL,
               AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE
               IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
               LEGEND; PROVIDED THAT FEDEX CORPORATION AND THE TRUSTEE SHALL
               HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I)
               PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF
               COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
               EACH OF THEM, AND (II) IN EACH OF THE FOREGOING CASES, BUT ONLY
               IF THIS NOTE IS NOT A GLOBAL NOTE (AS DEFINED IN THE INDENTURE
               REFERRED TO HEREIN), TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN
               THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED
               AND DELIVERED BY THE TRANSFEROR TO FEDEX CORPORATION AND THE
               TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
               HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

     Unless and until a Note is exchanged for an Exchange Note pursuant to an
effective Exchange Offer Registration Statement or for an interest in a
Regulation S Global Note after the expiration of the Regulation S Restricted
Period, each Temporary Regulation S Global Note shall bear the following legend
(the "Regulation S Legend") on the face thereof:

               THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
               1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR OTHER
               SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE
               REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
               OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
               UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
               REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. BY ITS
               ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS NOT A
               "U.S. PERSON" (AS DEFINED IN REGULATION S ("REGULATION S") UNDER
               THE SECURITIES ACT), (2) AGREES NOT TO OFFER, SELL OR OTHERWISE
               TRANSFER THIS NOTE PRIOR TO THE DATE WHICH IS 40 DAYS AFTER THE
               ORIGINAL ISSUE



                                       18






               DATE OF THE NOTES (THE "REGULATION S RESTRICTED PERIOD") EXCEPT
               (A) TO FEDEX CORPORATION, (B) PURSUANT TO A REGISTRATION
               STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
               ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE
               PURSUANT TO RULE 144A ("RULE 144A") UNDER THE SECURITIES ACT, TO
               A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
               BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
               OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, IN EACH
               CASE TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
               RELIANCE ON RULE 144A, (D) IN AN OFFSHORE TRANSACTION IN
               ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S OR (E)
               PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
               REQUIREMENTS OF THE SECURITIES ACT, AND (3) AGREES THAT IT WILL
               GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
               SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT FEDEX
               CORPORATION AND THE TRUSTEE SHALL HAVE THE RIGHT PRIOR TO ANY
               SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO
               REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
               AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II)
               IN EACH OF THE FOREGOING CASES, BUT ONLY IF THIS NOTE IS NOT A
               GLOBAL NOTE (AS DEFINED IN THE INDENTURE REFERRED TO HEREIN), TO
               REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON
               THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE
               TRANSFEROR TO FEDEX CORPORATION AND THE TRUSTEE. THIS LEGEND WILL
               BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE TERMINATION
               OF THE REGULATION S RESTRICTED PERIOD FOLLOWING COMPLIANCE WITH
               THE CERTIFICATION REQUIREMENTS SET FORTH IN THE INDENTURE.

     Each Global Note (i) shall be delivered by the Trustee to DTC acting as the
Depositary or, pursuant to DTC's instructions, shall be delivered by the Trustee
on behalf of DTC to and deposited with the Custodian, and in either case



                                       19






shall be registered in the name of Cede & Co., or such other name as DTC shall
specify, and (ii) shall also bear a legend substantially to the following
effect:

               "Unless this certificate is presented by an authorized
               representative of The Depository Trust Company, a New York
               corporation ("DTC"), to the Company or its agent for registration
               of transfer, exchange or payment, and any certificate issued is
               registered in the name of Cede & Co. or in such other name as is
               requested by an authorized representative of DTC (and any payment
               is made to Cede & Co. or to such other entity as is requested by
               an authorized representative of DTC), ANY TRANSFER, PLEDGE OR
               OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
               WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
               an interest herein."

     (b) If at any time the Depositary for any Global Note notifies the Company
that it is unwilling or unable to continue as Depository for such Global Notes
or if at any time the Depositary for such Global Notes shall no longer be a
clearing agency registered under the Exchange Act, the Company shall appoint a
successor Depositary with respect to such Global Notes. If (i) a successor
Depositary for such Global Notes is not appointed by the Company within 90 days
after the Company receives such notice or becomes aware of such ineligibility,
or (ii) an Event of Default has occurred and is continuing with respect to the
Notes, the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate if the Company directing the authentication and delivery thereof,
will authenticate and deliver notes of such series in certificated form
("Individual Notes") in any authorized denominations in an aggregate principal
amount equal to the principal amount of such Global Notes in exchange for such
Global Notes.

     If the Trustee has instituted or has been directed to institute any
judicial proceeding in a court to enforce the rights of the Holders under the
Notes, and the Trustee has been advised by counsel that in connection with such
proceeding it is necessary or appropriate for the Trustee to obtain possession
of the Notes, the Notes shall no longer be represented by such Global Notes. In
such event, the Company hereby agrees to execute and the Trustee will
authenticate and deliver, in exchange for such Global Notes, Individual Notes
(and if the Trustee has in its possession Individual Notes previously executed
by the Company, the Trustee will authenticate and deliver such Notes) of such
series, in authorized denominations, in an aggregate principal amount equal to
the principal amount of such Global Notes and registered in such name or names
as the Trustee deems appropriate.



                                       20






     (c) Global Notes shall in all respects be entitled to the same benefits
under this Indenture as Individual Notes authenticated and delivered hereunder.

     (d) Each Note shall be dated the date of its authentication, shall bear
interest from the applicable date and shall be payable on the dates specified as
set forth in the Officers' Certificate delivered pursuant to Section 2.03(b).



                                    ARTICLE 3
                                    THE NOTES

     SECTION 3.01. Issue Amount; Issuable in Series. The Notes due 2004, the
Notes due 2006 and the Notes due 2011 shall each constitute a separate series
hereunder. The aggregate principal amount of Notes which may be authenticated
and delivered under this Indenture, except for Notes authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, other Notes
pursuant to this Indenture, is limited to $250,000,000 in the case of the Notes
due 2004, $250,000,000 in the case of the Notes due 2006 and $250,000,000 in the
case of the Notes due 2011; provided, that subject to applicable law, the
maximum aggregate principal amount of Notes of any series hereunder may be
increased at any time upon delivery to the Trustee of a Company Order. Unless
the context otherwise requires, Original Notes and the Exchange Notes of like
tenor and terms shall constitute one series for all purposes under the
Indenture, including with respect to any amendment, waiver, acceleration or
other Act of the Holders or upon redemption.

     SECTION 3.02. Denominations. Unless otherwise provided in or pursuant to
this Indenture, the principal of and interest on and any Additional Amounts with
respect to the Notes shall be payable in Dollars. The Notes of each series shall
be issuable in such forms and in such denominations as are specified in Section
2.03.

     SECTION 3.03. Execution, Authentication, Delivery and Dating. The Notes
shall be executed on behalf of the Company by its President or any Vice
President, under its corporate seal reproduced thereon attested by its Secretary
or any Assistant Secretary. The signature of any of these officers on the Notes
may be manual or facsimile.

     Notes bearing the manual or facsimile signatures of individuals who were
the proper officers of the Company when their signatures were affixed to such
Notes shall bind the Company, notwithstanding that such individuals or any of



                                       21






them have ceased to hold such offices prior to the authentication and delivery
of such Notes or did not hold such offices at the date of such Notes.

     At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes of any series, together with the
Guarantees of the Guarantors endorsed thereon, executed by the Company and the
Guarantors to the Trustee for authentication, together with a Company Order for
the authentication and delivery of such Notes with the Guarantees endorsed
thereon, and the Trustee in accordance with the Company Order shall authenticate
and deliver such Notes. At any time and from time to time after the execution
and delivery of this Indenture and after the effectiveness of the Exchange Offer
Registration Statement under the Securities Act with respect thereto, the
Company may deliver Exchange Notes executed by the Company, and having endorsed
thereon the Guarantees executed by the Guarantors, to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Exchange Notes and a like principal amount of Original Notes
for cancellation in accordance with Section 3.10, and the Trustee in accordance
with the Company Order shall authenticate and make available for delivery such
Notes, with the Guarantees endorsed thereon. Prior to authenticating such
Exchange Notes, and accepting any additional responsibilities under this
Indenture in relation to such Notes, the Trustee shall be entitled to receive,
upon request, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating in substance:

     (a) that all conditions hereunder precedent to the authentication and
delivery of such Exchange Notes with the Guarantees of the Guarantors endorsed
thereon have been complied with and that such Exchange Notes and the Guarantees
of the Guarantors endorsed thereon, when such Notes have been duly authenticated
and delivered by the Trustee (and subject to any other conditions specified in
such Opinion of Counsel), will have been duly issued and delivered and will
constitute valid and legally binding obligations of the Company and the
Guarantors, respectively, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles; and

     (b) that the issuance of the Exchange Notes in exchange for Original Notes
has been effected in compliance with the Securities Act.

     Each Note shall be dated the date of its authentication.

     No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose unless there appears on such Note a certificate of



                                       22






authentication substantially in the form provided for herein executed by, or on
behalf of, the Trustee or by the Authenticating Agent by manual signature. Such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.

     Notwithstanding the foregoing, if any Note shall have been authenticated
and delivered hereunder but never issued and sold by the Company, and the
Company shall deliver such Note to the Trustee for cancellation as provided in
Section 3.10 together with a written statement (which need not comply with
Section 1.02 and need not be accompanied by an Opinion of Counsel) stating that
such Note has never been issued and sold by the Company, for all purposes of
this Indenture such Note shall be deemed never to have been authenticated and
delivered hereunder and shall not be entitled to the benefits of this Indenture.

     The Trustee shall not be required to authenticate or to cause an
Authentication Agent to authenticate any Notes if the issue of such Notes
pursuant to this Indenture will affect the Trustee's own rights, duties,
indemnities or immunities under the Notes and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.

     SECTION 3.04. Temporary Notes. Pending the preparation of definitive Notes
of any series and Guarantees, the Company may execute and deliver to the
Trustee, and, upon Company Order, the Trustee shall authenticate and deliver in
the manner provided in Section 3.03, temporary Notes with the Guarantees
endorsed thereon which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Notes and Guarantees in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers of the Company executing such Notes may determine, as evidenced by
their execution of such Notes. Such temporary Notes may be in global form.

     If temporary Notes of any series are issued, the Company will cause
definitive Notes to be prepared without unreasonable delay. After the
preparation of definitive Notes of such series, the temporary Notes of such
series shall be exchangeable for definitive Notes of such series upon surrender
of the temporary Notes at the office or agency of the Company in a Place of
Payment for that series, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes of any series the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Notes of the same series and of like tenor
of authorized denomination containing terms and provisions that are identical to
those of any temporary Notes. Until so exchanged the temporary Notes of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Notes of the same series.



                                       23






     SECTION 3.05. Registration, Transfer and Exchange. The Company shall cause
to be kept at the Corporate Trust Office a register (the register maintained in
such office and in any other office or agency of the Company in a Place of
Payment being herein sometimes collectively referred to as the "Register") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Notes and of transfers of Notes. Such
Register shall distinguish between Original Notes and Exchange Notes of each
series. The Trustee is hereby appointed "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided.

     The Company shall have the right to remove and replace from time to time
the Note Registrar for any series of Notes; provided that no such removal or
replacement shall be effective until a successor Note Registrar with respect to
such series of Notes shall have been appointed by the Company and shall have
accepted such appointment by the Company. In the event that the Trustee shall
not be or shall cease to be Note Registrar with respect to a series of Notes, it
shall have the right to examine in the United States the Register for such
series at all reasonable times. There shall be only one Register for each series
of Notes.

     Upon surrender for registration of transfer of any Note of any series at
the office or agency of the Company in a Place of Payment for such series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Notes of the
same series, of any authorized denominations and of a like aggregate principal
amount and tenor containing identical terms and provisions.

     At the option of the Holder, Notes of any series may be exchanged for other
Notes of the same series bearing such restrictive legends as may be required by
this Indenture and containing identical terms and provisions in any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Notes to be exchanged at such office or agency. Whenever any Notes are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Notes, with Guarantees endorsed thereon, which the
Holder making the exchange is entitled to receive.

     All Notes and Guarantees endorsed thereon issued upon any registration of
transfer or exchange of Notes with Guarantees of the Guarantors endorsed thereon
shall be the valid obligations of the Company and the respective Guarantors,
evidencing the same debt, and (subject to the provisions of the Original Notes
regarding payment of additional interest upon a Registration Default) entitled
to the same benefits under this Indenture, as the Notes and Guarantees endorsed
thereon surrendered upon such registration of transfer or exchange.




                                       24





     Every Note presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Note Registrar duly executed, by the Holder thereof or the
Holder's attorney duly authorized in writing.

     No service charge shall be made for any registration of transfer or
exchange of Notes, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes, other than exchanges
pursuant to Section 3.04 or 9.06 not involving any transfer.

     Except as otherwise provided herein, the Company shall not be required (i)
to issue, register the transfer of or exchange Notes of any series during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of Notes of such series and ending at the
close of business on the day of such mailing, or (ii) to register the transfer
of or exchange any Note so selected for redemption.

     If the beneficial owners of interests in a Global Note are entitled to
exchange such interests for definitive Notes as the result of an event described
in Section 2.03(b), then without unnecessary delay but in any event not later
than the earliest date on which such interests may be so exchanged, the Company
shall deliver to the Trustee definitive Notes with the Guarantees endorsed
thereon in such form and denominations as are required by or pursuant to this
Indenture, and of the same series, containing identical terms and in aggregate
principal amount equal to the principal amount of such Global Note, executed by
the Company and the Guarantors. On or after the earliest date on which such
interests may be so exchanged, such Global Note shall be surrendered from time
to time by the Depositary and in accordance with instructions given to the
Trustee and the Depositary (which instructions shall be in writing but need not
be contained in or accompanied by an Officers' Certificate or be accompanied by
an Opinion of Counsel), as shall be specified in the Company Order with respect
thereto to the Trustee, as the Company's agent for such purpose, to be
exchanged, in whole or in part, for definitive Notes with the Guarantees
endorsed thereon as described above without charge.

     The Trustee shall authenticate and make available for delivery, in exchange
for each portion of such surrendered Global Note, a like aggregate principal
amount of definitive Notes of the same series of authorized denominations and of
like tenor with the Guarantees endorsed thereon as the portion of such Global
Note to be exchanged, as shall be specified by the beneficial owner thereof,
provided, however, that no such exchanges may occur



                                       25






during a period beginning at the opening of business 15 days before any
selection of Notes of the same series to be redeemed and ending on the relevant
Redemption Date.

     Promptly following any such exchange in part, such Global Note shall be
returned by the Trustee to such Depositary in accordance with the instructions
of the Company referred to above. If a Note is issued in exchange for any
portion of a Global Note after the close of business at the office or agency for
such Note where such exchange occurs on or after (i) any Regular Record Date for
such Note and before the opening of business at such office or agency on the
next Interest Payment Date, or (ii) any Special Record Date for such Note and
before the opening of business at such office or agency on the related proposed
date for payment of interest or Defaulted Interest, as the case may be, interest
shall not be payable on such Interest Payment Date or proposed date for payment,
as the case may be, in respect of such Note, but shall be payable on such
Interest Payment Date or proposed date for payment, as the case may be, only to
the Person to whom interest in respect of such portion of such Global Note shall
be payable in accordance with the provisions of this Indenture.

     SECTION 3.06. Special Transfer Provisions. Unless and until an Original
Note is exchanged for an Exchange Note in connection with an effective
Registration Statement pursuant to the Registration Rights Agreement, the
following provisions shall apply to each such Note:

     (a) Transfers of Restricted Individual Notes and Interests in a Rule 144A
Global Note. With respect to the registration of any proposed transfer of a
Restricted Individual Note or an interest in a Rule 144A Global Note, if the
Note to be transferred consists of (x) a Restricted Individual Note, the
Registrar shall register the transfer if such transfer is being made by a
proposed transferor who has delivered (i) to the Company and the Registrar a
certificate from the transferor substantially in the form of Exhibit E or (ii)
to the Company and the Registrar a certificate from the transferor substantially
in the form of Exhibit F or a certificate from the transferee advising the
Company and the Registrar that it is purchasing the Note for its own account or
an account with respect to which it exercises sole investment discretion and
that it and any such account is a QIB within the meaning of Rule 144A, and is
aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company and the
Guarantors as it has requested pursuant to Rule 144A and that it is aware that
the transferor is relying upon its foregoing representations in order to claim
the exemption from registration provided by Rule 144A or (y) an interest in a
Rule 144A Global Note (A) to be transferred to a transferee who takes delivery
in the form of an interest in a Temporary Regulation S Global Note or a
Regulation S Global Note (if after the Regulation S Restricted Period), the



                                       26






Registrar shall register the transfer if such transfer is being made by a
proposed transferor who has delivered to the Registrar a certificate
substantially in the form of Exhibit E or (B) to be transferred to a transferee
who takes delivery in the form of an interest in a Rule 144A Global Note, the
transfer of such interest may be effected only through the book entry system
maintained by the Depositary.

     (b) Transfers of Interests in a Temporary Regulation S Global Note. With
respect to registration of any proposed transfer of an interest in a Temporary
Regulation S Global Note to a person who takes delivery in the form of a
Restricted Individual Note or an interest in a Rule 144A Global Note, the
Registrar shall register the transfer of any Note if the proposed transferor has
delivered to the Company and the Registrar a certificate from the transferor
substantially in the form of Exhibit F or a certificate from the transferee
advising the Company and the Registrar that it is purchasing the Note for its
own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a QIB within the meaning of Rule
144A, and is aware that the sale to it is being made in reliance of Rule 144A
and that the Notes delivered to it shall bear the Rule 144A Legend and
acknowledges that it has received such information regarding the Company and the
Guarantors as it has requested pursuant to Rule 144A and that it is aware that
the transferor is relying upon its foregoing representations in order to claim
the exemption from registration provided by Rule 144A. The Company shall use its
best efforts to cause the Depositary to ensure that beneficial interests in a
Regulation S Temporary Global Note may be held only in or through accounts
maintained at the Depositary by or on behalf of Euroclear or Clearstream, and no
person shall be entitled to effect any transfer or exchange that would result in
any such interest being held otherwise than in or through such account, except
as provided in this Section 3.06(b).

     (c) Transfers of Unrestricted Individual Notes or Interests in the
Regulation S Global Note. With respect to any transfer of Unrestricted
Individual Notes or interests in the Regulation S Global Note, the Registrar
shall register the transfer of any such Note without requiring any additional
certification.

     (d) Legends. Upon the transfer, exchange or replacement of Notes that do
not bear the Rule 144A Legend or the Regulation S Legend, the Registrar shall
deliver Notes that do not bear either the Rule 144A Legend or the Regulation S
Legend. Upon the transfer, exchange or replacement of Notes bearing the Rule
144A Legend or the Regulation S Legend, the Registrar shall deliver only Notes
that bear the Rule 144A Legend or the Regulation S Legend, as the case may be,
unless (i) the circumstances contemplated by subparagraphs (a)(x)(i) or (a)(y)
of this Section 3.06 exist or (ii) in the case of an exchange of an interest in
a Temporary Regulation S Global Note for an interest in an Unrestricted
Individual



                                       27






Note or a Regulation S Global Note in the manner contemplated in 2.03(a) after
the expiration of the Regulation S Restricted Period or (iii) there is delivered
to the Registrar an Opinion of Counsel reasonably satisfactory to the Company
and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act.

     (e) General. By its acceptance of any Note bearing the Rule 144A Legend or
the Regulation S Legend, each holder of such a Note acknowledges the
restrictions on transfer of such Note set forth in this Indenture and in such
restrictive legend and agrees that it will transfer such Note only as provided
in this Indenture and such restrictive legend. The Registrar shall not register
a transfer of any Note unless such transfer complies with the restrictions on
transfer of such Note set forth in this Indenture. In connection with any
transfer of Notes, each holder agrees by its acceptance of the Notes to furnish
the Registrar or the Company such certifications, legal opinions or other
information as either of them may reasonably require to confirm that such
transfer is being made pursuant to an exemption from, or a transaction not
subject to, the registration requirements of the Securities Act; provided that
the Registrar shall not be required to determine (but may rely on a
determination made by the Company with respect to) the sufficiency of any such
certifications, legal opinions or other information.

     SECTION 3.07. Mutilated, Destroyed, Lost and Stolen Notes. If (i) any
mutilated Note is surrendered to the Trustee or if there shall be delivered to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of any Note and (ii) there shall be delivered to the Company and
the Trustee such indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Note has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such mutilated, destroyed, lost or
stolen Note, a new Note of the same series with the Guarantees endorsed thereon
containing identical terms and of like tenor and principal amount and bearing a
number not contemporaneously outstanding.

     In case any such mutilated, destroyed, lost or stolen Note has become or is
about to become due and payable, the Company in its discretion may, instead of
issuing a new Note, pay such Note.

     Upon the issuance of any new Note under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.



                                       28






     Every new Note of any series and Guarantee issued pursuant to this Section
in lieu of any destroyed, lost or stolen Note shall constitute a separate
obligation of the Company and the respective Guarantors, whether or not the
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes of the same series and Guarantees
duly issued hereunder.

     The provisions of this Section, as amended or supplemented pursuant to this
Indenture, are exclusive and shall preclude (to the extent lawful) all other
rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes.

     SECTION 3.08. Payment of Interest; Interest Rights Preserved. Interest on,
and any Additional Amounts with respect to, any Note which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Note (or one or more Predecessor Notes) is
registered at the close of business on the Regular Record Date for such
interest.

     Any interest on, and any Additional Amounts with respect to, any Note of
any series which is payable, but is not punctually paid or duly provided for, on
any Interest Payment Date (herein called "Defaulted Interest") shall forthwith
cease to be payable to the Holder on the relevant Regular Record Date by virtue
of having been such Holder, and such Defaulted Interest may be paid by the
Company, at its election in each case, as provided in clause (i) or (ii) below:

          (i) The Company may elect to make payment of any Defaulted Interest to
     the Person in whose name the Notes of such series (or their respective
     Predecessor Notes) are registered at the close of business on a Special
     Record Date for the payment of such Defaulted Interest, which shall be
     fixed in the following manner. The Company shall notify the Trustee in
     writing of the amount of Defaulted Interest proposed to be paid on each
     Note of such series and the date of the proposed payment, and at the same
     time the Company shall deposit with the Trustee an amount of money equal to
     the aggregate amount proposed to be paid in respect of such Defaulted
     Interest or shall make arrangements satisfactory to the Trustee for such
     deposit prior to the date of the proposed payment. Such money when
     deposited will be held in trust for the benefit of the Persons entitled to
     such Defaulted Interest as in this Clause provided. Thereupon the Trustee
     shall fix a Special Record Date for the payment of such Defaulted Interest
     which shall be not more than 15 days and not less than 10 days prior to the
     date of the proposed payment and not less than 10 days after the receipt by
     the Trustee of the notice of the proposed payment. The Trustee shall
     promptly notify the Company of such Special Record



                                       29






     Date and, in the name and at the expense of the Company, shall cause notice
     of the proposed payment of such Defaulted Interest and the Special Record
     Date therefor to be mailed, first-class postage prepaid, to each Holder of
     Notes of such series at the Holder's address as it appears in the Register,
     not less than 10 days prior to such Special Record Date. Notice of the
     proposed payment of such Defaulted Interest and the Special Record Date
     therefor having been so mailed, such Defaulted Interest shall be paid to
     the Persons in whose names the Notes of such series (or their respective
     Predecessor Notes) are registered at the close of business on such Special
     Record Date and shall no longer be payable pursuant to the following clause
     (ii).

          (ii) The Company may make payment of any Defaulted Interest on the
     Notes of any series in any other lawful manner not inconsistent with the
     requirements of any securities exchange on which such Notes may be listed,
     and upon such notice as may be required by such exchange, if, after notice
     given by the Company to the Trustee of the proposed payment pursuant to
     this Clause, such manner of payment shall be deemed practicable by the
     Trustee.

     Unless otherwise provided in or pursuant to this Indenture or the Notes of
any particular series pursuant to the provisions of this Indenture, at the
option of the Company, interest on Notes may be paid by mailing a check to the
address of the Person entitled thereto as such address shall appear in the
Register or by transfer to an account maintained by the payee with a bank
located in the United States.

     Subject to the foregoing provisions of this Section, each Note delivered
under this Indenture upon registration of transfer of or in exchange for or in
lieu of any other Note shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Note.

     SECTION 3.09. Persons Deemed Owners. Prior to due presentment of a Note for
registration of transfer, the Company, the Guarantors, the Trustee and any agent
of the Company, the Guarantors or the Trustee may treat the Person in whose name
such Note is registered as the owner of such Note for the purpose of receiving
payment of principal of and (subject to Sections 3.05 and 3.08) interest on and
any Additional Amounts with respect to such Note and for all other purposes
whatsoever, whether or not any payment with respect to such Note shall be
overdue, and neither the Company, the Guarantors, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.



                                       30






     No Holder of any beneficial interest in any Global Note held on its behalf
by a Depositary shall have any rights under this Indenture with respect to such
Global Note, and such Depositary may be treated by the Company, the Guarantors,
the Trustee, and any agent of the Company, the Guarantors or the Trustee as the
owner of such Global Note for all purposes whatsoever. None of the Company, the
Trustee, any Paying Agent or the Note Registrar will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of a Global Note or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.

     SECTION 3.10. Cancellation. All Notes surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee at its Corporate Trust Office and
shall be promptly canceled by it. The Company may at any time deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever and may
deliver to the Trustee (or to an Authenticating Agent for delivery to the
Trustee) for cancellation any Notes previously authenticated hereunder which the
Company has not issued and sold, and all Notes so delivered shall be promptly
canceled by the Trustee. No Notes shall be authenticated in lieu of or in
exchange for any Notes canceled as provided in this Section, except as expressly
permitted by this Indenture. All canceled Notes held by the Trustee shall be
disposed of as directed by a Company Order.

     SECTION 3.11. Computation of Interest. Interest on the Notes of each series
shall be computed on the basis of a 360-day year of twelve 30-day months.



                                    ARTICLE 4
                           SATISFACTION AND DISCHARGE

     SECTION 4.01. Satisfaction and Discharge of Indenture. This Indenture shall
upon Company Request cease to be of further effect with respect to any series of
Notes specified in such Company Request (except as to rights of registration of
transfer or exchange of Notes), and the Trustee on receipt of the Company
Request, at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture as to such series,
when:

     (a) either



                                       31







               (i) all Notes of such series theretofore authenticated and
          delivered (other than (A) Notes of such series which have been
          destroyed, lost or stolen and which have been replaced or paid as
          provided in Section 3.07 and (B) Notes of such series for whose
          payment money has theretofore been deposited in trust or segregated
          and held in trust by the Company and thereafter repaid to the Company
          or discharged from such trust, as provided in Section 10.03) have been
          delivered to the Trustee for cancellation; or

               (ii) all such Notes not theretofore delivered to the Trustee for
          cancellation:

                    (A) have become due and payable, or

                    (B) will become due and payable at their Stated Maturity
               within one year, or

                    (C) if redeemable at the option of the Company are to be
               called for redemption within one year under arrangements
               satisfactory to the Trustee for the giving of notice of
               redemption by the Trustee in the name, and at the expense, of the
               Company,

          and the Company, in the case of (A), (B) or (C) above, has deposited
          or caused to be deposited with the Trustee as trust funds in trust for
          the purpose an amount sufficient to pay and discharge the entire
          indebtedness on such Notes not theretofore delivered to the Trustee
          for cancellation, for principal and interest and any Additional
          Amounts to the date of such deposit (in the case of Notes which have
          become due and payable) or to the Stated Maturity or Redemption Date,
          as the case may be.

     (b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and

     (c) the Company has delivered to the Trustee an Officers' Certificate or an
Opinion of Counsel, stating that all conditions precedent herein relating to the
satisfaction and discharge of this Indenture with respect to such Notes have
been complied with.

     In the event there are Notes of two or more series hereunder, the Trustee
shall be required to execute an instrument acknowledging satisfaction and
discharge of this Indenture only if requested to do so with respect to Notes of
such series as to which it is Trustee and if the other conditions thereto are
met.



                                       32






     Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Notes of any series, the obligations of the Company to the
Trustee under Section 6.07, the obligations of the Trustee to any Authenticating
Agent under Section 6.14 and, if money shall have been deposited with the
Trustee pursuant to subclause (B) of clause (1) of this Section, the obligations
of the Company and the Guarantors under Sections 3.04, 3.05, 3.07 and 10.02, and
the obligation to pay Additional Amounts, if any, with respect to such Notes as
contemplated by Section 10.06 (but only to the extent that any Additional
Amounts payable with respect to such Notes exceed the amount deposited in
respect of such Additional Amounts pursuant to Section 4.01(a)(ii)), shall
survive.

     SECTION 4.02. Application of Trust Money. Subject to the provisions of the
penultimate paragraph of Section 10.03, all money and Government Obligations
deposited with the Trustee pursuant to Section 4.01 and Article Thirteen shall
be held in trust and applied by it, in accordance with the provisions of the
Notes of the series for which such deposit was made and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal, interest and Additional Amounts for whose
payment such money and Government Obligations has been deposited with the
Trustee; but such money and Government Obligations need not be segregated from
other funds except to the extent required by law.



                                    ARTICLE 5
                                    REMEDIES

     SECTION 5.01. Events of Default. "Event of Default," wherever used herein
with respect to the Notes of any series, means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

          (a) default in the payment of any interest upon any Note of such
     series when it becomes due and payable, and continuance of such default for
     a period of 30 days;

          (b) default in the payment of the principal of any Note of such series
     at its Maturity;



                                       33







          (c) default in the performance, or breach, of any covenant, agreement
     or warranty of the Company or any Guarantor in this Indenture (other than a
     covenant, agreement or warranty a default in whose performance is elsewhere
     in this Section specifically dealt with or which has expressly been
     included in this Indenture solely for the benefit of a series of Notes
     other than such series) and continuance of such default for a period of 60
     days after there has been given, by registered or certified mail, to the
     Company and such Guarantor by the Trustee or to the Company, such Guarantor
     and the Trustee by the Holders of at least 50% in principal amount of the
     Outstanding Notes of such series a written notice specifying such default
     and requiring it to be remedied and stating that such notice is a "Notice
     of Default" hereunder;

          (d) the entry by a court having jurisdiction of a decree or order
     adjudging the Company or a 60% Subsidiary Guarantor a bankrupt or
     insolvent, or approving as properly filed a petition seeking
     reorganization, arrangement, adjustment or composition of or in respect of
     the Company or a 60% Subsidiary Guarantor under federal bankruptcy law or
     any other applicable federal or state law, or appointing a custodian,
     receiver, liquidator, assignee, trustee, sequestrator or other similar
     official of the Company or a 60% Subsidiary Guarantor or of any substantial
     part of any of their property, or ordering the winding up or liquidation of
     any of their affairs, and the continuance of any such decree or order
     unstayed and in effect for a period of 60 consecutive days; or

          (e) the commencement by the Company or a 60% Subsidiary Guarantor of
     proceedings to be adjudicated a bankrupt or insolvent, or the consent by
     any of them to the commencement of bankruptcy or insolvency proceedings
     against them, or the filing by any of them of a petition or answer or
     consent seeking reorganization or relief under federal bankruptcy law or
     any other applicable federal or state law, or the consent by any of them to
     the appointment of or taking possession by a custodian, receiver,
     liquidator, assignee, trustee, sequestrator or similar official of the
     Company or a 60% Subsidiary Guarantor or of any substantial part of any of
     their property, or the making by any of them of a general assignment for
     the benefit of creditors, or the admission by any of them in writing of
     their inability to pay their respective debts generally as they become due,
     or the taking of corporate action by the Company or a 60% Subsidiary
     Guarantor in furtherance of any such action.

     SECTION 5.02. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default with respect to Notes of any series at the time Outstanding
occurs and is continuing, then in every such case the Trustee or the Holders of
not



                                       34






less than 50% in principal amount of the Outstanding Notes of such series may
declare the principal amount of all the Notes of such series to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by Holders), and upon any such declaration such principal amount shall
become immediately due and payable.

     At any time after such a declaration of acceleration with respect to Notes
of any series has been made and before the Stated Maturity thereof, the Holders
of a majority in principal amount of the Outstanding Notes of such series, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:

          (i) the Company has paid or deposited with the Trustee a sum
     sufficient to pay:

               (A) all overdue installments of interest on and any Additional
          Amounts with respect to all Outstanding Notes of such series;

               (B) the principal of any Outstanding Notes of such series which
          have become due otherwise than by such declaration of acceleration and
          interest thereon at the rate borne by the Notes of such series and any
          Additional Amounts;

               (C) to the extent that payment of such interest or Additional
          Amounts is lawful, interest upon overdue interest or Additional
          Amounts at the rate borne by the Notes of such series; and

               (D) all sums paid or advanced by the Trustee hereunder and the
          reasonable compensation, expenses, disbursements and advances of the
          Trustee, its agents and counsel; and

          (ii) all Events of Default with respect to the Notes of such series,
     other than the non-payment of the principal of Notes of such series which
     have become due solely by such declaration of acceleration, have been cured
     or waived as provided in Section 5.13.

     No such rescission shall affect any subsequent default or impair any right
consequent thereon.

     SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that if:



                                       35






          (i) default is made in the payment of any interest on any Notes when
     such interest becomes due and payable and such default continues for a
     period of 30 days, or

          (ii) default is made in the payment of the principal of any Notes at
     the Maturity thereof,

the Company will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Notes, the whole amount then due and payable on
such Notes for principal and interest and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal and on
any overdue interest, at the rate borne by the Notes and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

     If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sum so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Notes and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon such Notes, wherever situated.

     If an Event of Default with respect to Notes of any series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of the Notes of such series by such
judicial proceedings as the Trustee shall deem appropriate to protect and
enforce any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power granted
herein, or to enforce any other proper remedy.

     SECTION 5.04. Trustee May File Proofs of Claim. In case of the pendency of
any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Notes or the property of the Company
or of such other obligor or their creditors, the Trustee (irrespective of
whether the principal of the Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest or Additional Amounts) shall be entitled and empowered, by
intervention in such proceeding or otherwise,



                                       36






          (i) to file and prove a claim for the whole amount of principal and
     interest and Additional Amounts owing and unpaid in respect of the Notes
     and to file such other papers and documents as may be necessary or
     advisable in order to have the claims of the Trustee (including any claim
     for the reasonable compensation, expenses, disbursements and advances of
     the Trustee, its agents and counsel) and of the Holders allowed in such
     judicial proceeding, and

          (ii) to collect and receive any moneys or other property payable or
     deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee or to which it may become entitled under Section 6.07.

     Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding; provided that the Trustee
may, on behalf of the Holders, vote for the election of a Trustee in bankruptcy
or similar official proceeding, and be a member of a creditors' or other similar
committee.

     SECTION 5.05. Trustee May Enforce Claims Without Possession of Notes. All
rights of action and claims under this Indenture or the Notes may be prosecuted
by the Trustee without the possession of any of the Notes or the production
thereof in any proceeding relating thereto, and any such proceeding instituted
by the Trustee shall be brought in its own name as trustee of an express trust
and any recovery of judgment shall, after provision for the payment of the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders of the Notes
in respect of which such judgment has been recovered.

     SECTION 5.06. Application of Money Collected. Any money collected by the
Trustee pursuant to this Article shall be applied in the following order, at the
date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal, interest or Additional Amounts, upon presentation
of the Notes and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:



                                       37






     First: To the payment of all amounts due the Trustee under Section 6.07;

     Second: To the payment of the amounts then due and unpaid for principal of,
interest and Additional Amounts on the Notes in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such Notes for
principal, interest and Additional Amounts, respectively; and

     Third: To the payment of the remainder, if any, to the Company or any other
Person lawfully entitled thereto.

         SECTION 5.07.  Limitation on Suits. No Holder of any Note of any series
shall have any right to institute any  proceeding,  judicial or otherwise,  with
respect to this Indenture,  or for the appointment of a receiver or trustee,  or
for any other remedy hereunder, unless:

          (i) such Holder has previously given written notice to the Trustee of
     a continuing Event of Default with respect to the Notes of such series;

          (ii) the Holders of not less than 50% in principal amount of the
     Outstanding Notes of such series shall have made written request to the
     Trustee to institute proceedings in respect of such Event of Default in its
     own name as Trustee hereunder;

          (iii) such Holder or Holders have offered to the Trustee indemnity
     reasonably acceptable to the Trustee against the costs, expenses and
     liabilities to be incurred in compliance with such request;

          (iv) the Trustee for 60 days after its receipt of such notice, request
     and offer of indemnity has failed to institute any such proceedings; and

          (v) no direction inconsistent with such written request has been given
     to the Trustee during such 60-day period by the Holders of a majority in
     principal amount of the Outstanding Notes of such series.

It being understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the right of any other such
Holders of Notes of such series, or to obtain or to seek to obtain priority or
preference over any other such Holders or to enforce any right under this
Indenture, except in the



                                       38






manner herein provided and for the equal and ratable benefit of all such Holders
of Notes.

     SECTION 5.08. Unconditional Right of Holders to Receive Principal and
Interest. Notwithstanding any other provision in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and (subject to Section 3.08) interest on, and any
Additional Amounts with respect to, such Note on the respective Stated
Maturities expressed in such Note (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment
and such rights shall not be impaired without the consent of such Holder.

     SECTION 5.09. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.

     SECTION 5.10. Rights and Remedies Cumulative. Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Notes in the last paragraph of Section 3.07, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

     SECTION 5.11. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article or by law to the Trustee or to the Holders may be exercised from
time to time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.

     SECTION 5.12. Control by Holders. The Holders of a majority in principal
amount of the Outstanding Notes of any series shall have the right to direct the




                                       39





time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee, with
respect to the Notes of such series, provided that:

          (i) such direction shall not be in conflict with any rule of law or
     with this Indenture or with such Notes and the Trustee shall have been
     offered reasonably acceptable indemnity as therein provided;

          (ii) the Trustee may take any other action deemed proper by the
     Trustee which is not inconsistent with such direction; and

          (iii) subject to Section 6.01, the Trustee need not take any action
     which might be prejudicial to the Holders of such series not consenting.

     SECTION 5.13. Waiver of Past Defaults. The Holders of not less than a
majority in principal amount of the Outstanding Notes of any series may on
behalf of the Holders of all the Notes of such series waive any past default
hereunder with respect to such series and its consequences, except a default:

          (i) in the payment of the principal of or interest on any Note of such
     series, or

          (ii) in respect of a covenant or provision hereof which under Article
     Nine cannot be modified or amended without the consent of the Holder of
     each Outstanding Note of such series affected.

     Upon any such waiver, such default shall cease to exist with respect to
such series, and any Event of Default arising therefrom shall be deemed to have
been cured, for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other default or impair any right consequent thereon.

     SECTION 5.14. Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Note by acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken, suffered or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall not apply to any
suit instituted by the Company, to any suit instituted by the Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate
more than 10% in principal amount of the Outstanding



                                       40






Notes of any series, or to any suit instituted by any Holder for the enforcement
of the payment of the principal of or interest on any Note on or after the
respective Stated Maturities expressed in such Note (or, in the case of
redemption, on or after the Redemption Date).

     SECTION 5.15. Waiver of Stay or Extension Laws. Each of the Company and the
Guarantors covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and each of the Company and the Guarantors (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.



                                    ARTICLE 6
                                   THE TRUSTEE

     SECTION 6.01. Certain Duties and Responsibilities. (a) Except during the
continuance of an Event of Default,

          (i) the Trustee undertakes to perform such duties and only such duties
     as are specifically set forth in this Indenture, and no implied covenants
     or obligations shall be read into this Indenture against the Trustee; and

          (ii) in the absence of bad faith on its part, the Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates or opinions furnished to
     the Trustee and conforming to the requirements of this Indenture; but in
     the case of any such certificates or opinions which by any provision hereof
     are specifically required to be furnished to the Trustee, the Trustee shall
     be under a duty to examine the same to determine whether or not they
     conform to the requirements of this Indenture.

     (b) In case an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.



                                       41







     (c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct; except that:

          (i) this Subsection shall not be construed to limit the effect of
     Subsection (a) of this Section;

          (ii) the Trustee shall not be liable for any error of judgment made in
     good faith by a Responsible Officer, unless it shall be proved that the
     Trustee was negligent in ascertaining the pertinent facts;

          (iii) the Trustee shall not be liable with respect to any action taken
     or omitted to be taken by it in good faith in accordance with the direction
     of the Holders of a majority in principal amount of the Outstanding Notes
     of any series relating to the time, method and place of conducting any
     proceeding for any remedy available to the Trustee, or exercising any trust
     or power conferred upon the Trustee, under this Indenture with respect to
     the Notes of such series; and

          (iv) no provision of this Indenture shall require the Trustee to
     expend or risk its own funds or otherwise incur any financial liability in
     the performance of any of its duties hereunder, or in the exercise of any
     of its rights or powers, if it shall have reasonable grounds for believing
     that repayment of such funds or adequate indemnity against such risk or
     liability is not reasonably assured to it.

     (d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.

     SECTION 6.02. Notice of Defaults. Within 90 days after the occurrence of
any default hereunder with respect to the Notes of any series, the Trustee shall
transmit by mail to all Holders of Notes of such series, as their names and
addresses appear in the Register, notice of such default hereunder known to the
Trustee, unless such default shall have been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of or
interest on any Note, the Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive committee or a trust
committee of directors or Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the interest of the Holders
of Notes of such series; and provided, further, that in the case of any default
of the character specified in Section 5.01(c) with respect to the Notes of such
series no such notice to Holders



                                       42






shall be given until at least 60 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Notes of such series.

     SECTION 6.03. Certain Rights of Trustee. Subject to the provisions of
Section 6.01:

     (a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;

     (b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;

     (c) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;

     (d) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;

     (e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee indemnity reasonably acceptable to the Trustee against the costs,
expenses and liabilities which might be incurred by it or the counsel or agents
in compliance with such request or direction;

     (f) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit; and



                                       43







     (g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.

     SECTION 6.04. Not Responsible for Recitals or Issuance of Notes. The
recitals contained herein and in the Notes, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company, and neither the
Trustee nor any Authenticating Agent assumes any responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Notes or the Guarantees, except that the
Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Notes and perform its obligations hereunder and that
the statements made by it in a Statement of Eligibility and Qualification on
Form T-1 supplied to the Company are true and accurate, subject to the
qualifications set forth therein. The Trustee or any Authenticating Agent shall
not be accountable for the use or application by the Company of Notes or the
proceeds thereof.

     SECTION 6.05. May Hold Notes. The Trustee, any Authenticating Agent, any
Paying Agent, any Note Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of Notes and,
subject to Section 6.13, may otherwise deal with the Company with the same
rights it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Note Registrar or such other agent.

         SECTION  6.06.  Money  Held in  Trust.  Except as  otherwise  expressly
provided  herein,  money  held by the  Trustee  in trust  hereunder  need not be
segregated  from other funds  except to the extent  required by law. The Trustee
shall be under no liability  for interest on any money  received by it hereunder
except as otherwise agreed with the Company.

     SECTION 6.07. Compensation and Reimbursement. The Company agrees:

          (i) to pay to the Trustee from time to time reasonable compensation
     for all services rendered by it hereunder;

          (ii) except as otherwise expressly provided herein, to reimburse the
     Trustee upon its request for all reasonable expenses, disbursements and
     advances incurred or made by the Trustee in accordance with any provision
     of this Indenture (including the reasonable compensation and the expenses
     and disbursements of its agents and counsel), except any such



                                       44






     expense, disbursement or advance as may be attributable to its negligence
     or bad faith; and

          (iii) to indemnify the Trustee for, and to hold it harmless against,
     any loss, liability or expense, including reasonable expenses of counsel,
     incurred without negligence or bad faith on its part, arising out of or in
     connection with the acceptance or administration of the trust or trusts
     hereunder, including the costs and expenses of defending itself against any
     claim or liability in connection with the exercise or performance of any of
     its powers or duties hereunder, except to the extent that any such loss,
     liability or expense was due to the Trustee's negligence or bad faith.

     SECTION 6.08. Intentionally Left Blank.

     SECTION 6.09. Corporate Trustee Required; Eligibility. (a) There shall at
all times be a Trustee hereunder which shall:

          (i) be a Corporation organized and doing business under the laws of
     the United States of America, any State thereof or the District of Columbia
     authorized under such laws to exercise corporate trust powers;

          (ii) be eligible under Section 310(a) of the Trust Indenture Act to
     act as trustee under an indenture qualified under the Trust Indenture Act;
     and

          (iii) have a combined capital and surplus of at least $100,000,000 and
     subject to supervision or examination by federal or state authority.

     If such Corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.

     (b) The following Indenture shall be considered specifically described
herein for purposes of clause (i) of the proviso contained in Section 310(b)(1)
of the Trust Indenture Act: the indenture dated as of May 15, 1989 between
Federal Express Corporation and the Bank of New York, as successor Trustee.



                                       45







     SECTION 6.10. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 6.11. The indemnities existing in favor of the Trustee
hereunder shall survive the Trustee's resignation or removal or termination of
this Indenture.

     (b) The Trustee may resign at any time with respect to the Notes of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 6.11 shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Notes of such series.

     (c) The Trustee may be removed at any time with respect to the Notes of any
series by the Company or by Act of the Holders of a majority in principal amount
of the Outstanding Notes of such series, delivered to the Trustee, and to the
Company in the case of an Act of the Holders.

     (d) If at any time:

          (i) the Trustee shall fail to comply with the obligations imposed upon
     it under Section 310(b) of the Trust Indenture Act with respect to the
     Notes after written request therefor by the Company or by any Holder who
     has been a bona fide Holder of a Note for at least six months;

          (ii) the Trustee shall cease to be eligible under Section 6.09 and
     shall fail to resign after written request therefor by the Company or by
     any such Holder; or

          (iii) the Trustee shall become incapable of acting or shall be
     adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
     property shall be appointed or any public officer shall take charge or
     control of the Trustee or of its property or affairs for the purpose of
     rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company may remove the Trustee with respect to
all Notes or the Notes of such series, or (ii) subject to Section 5.14, any
Holder who has been a bona fide Holder of a Note for at least six months may, on
behalf of such Holder and all others similarly situated, petition any court of
competent



                                       46






jurisdiction for the removal of the Trustee with respect to all Notes of such
series and the appointment of a successor Trustee.

     (e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Notes of one or more series, the Company shall promptly appoint a
successor Trustee or Trustees with respect to the Notes of that or those series
(it being understood that any such successor Trustee may be appointed with
respect to the Notes of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Notes of any particular
series).

     If, within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Notes of any
series shall be appointed by Act of the Holders of 75% in principal amount of
the Outstanding Notes of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
6.11, become the successor Trustee with respect to the Notes of such series and
supersede the successor Trustee appointed by the Company.

     If no successor Trustee with respect to the Notes of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 6.11, any Holder who has been a bona fide Holder of a
Note of such series for at least six months may, on behalf of such Holder and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Notes of such series.

     (f) The Company shall give notice of each resignation and each removal of
the Trustee with respect to the Notes of any series and each appointment of a
successor Trustee with respect to the Notes of any series by mailing written
notice of such event by first-class mail, postage prepaid, to all Holders of
Notes of such series as their names and addresses appear in the Register. Each
notice shall include the name of the successor Trustee with respect to the Notes
of such series and the address of its Corporate Trust Office.

     SECTION 6.11. Acceptance of Appointment by Successor. (a) In case of the
appointment hereunder of a successor Trustee with respect to all Notes, every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
successor



                                       47






Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder.

     (b) In case of the appointment hereunder of a successor Trustee with
respect to the Notes of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Notes of one or
more series shall execute and deliver an indenture supplemental hereto wherein
each successor Trustee shall accept such appointment and which,

          (i) shall contain such provisions as shall be necessary or desirable
     to transfer and confirm to, and to vest in, each successor Trustee all the
     rights, powers, trusts and duties of the retiring Trustee with respect to
     the Notes of that or those series to which the appointment of such
     successor Trustee relates,

          (ii) if the retiring Trustee is not retiring with respect to all
     Notes, shall contain such provisions as shall be deemed necessary or
     desirable to confirm that all the rights, powers, trusts and duties of the
     retiring Trustee with respect to the Notes of that or those series as to
     which the retiring Trustee is not retiring shall continue to be vested in
     the retiring Trustee, and

          (iii) shall add to or change any of the provisions of this Indenture
     as shall be necessary to provide for or facilitate the administration of
     the trusts hereunder by more than one Trustee.

It being understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.

     Upon the execution and delivery of such supplemental indenture, the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Notes of that or those
series to which the appointment of such successor Trustee relates; but, on
request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Notes of that
or those series to which the appointment of such successor Trustee relates.



                                       48






     (c) Upon request of any such successor Trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in
paragraph (a) or (b) of this Section, as the case may be.

     (d) No successor Trustee shall accept its appointment unless at the time of
such a acceptance such successor Trustee shall be qualified and eligible under
this Article.

     SECTION 6.12. Merger, Conversion, Consolidation or Succession to Business.
Any Corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any Corporation resulting from any merger, conversion
or consolidation to which the Trustee shall be a party, or any Corporation
succeeding to all or substantially all the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
Corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. Notwithstanding the foregoing, at the request of the
Trustee, the parties shall execute and deliver such writings as the Trustee
reasonably may request to reflect such succession. In case any Notes shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Notes so authenticated with the
same effect as if such successor Trustee had itself authenticated such Notes.

     SECTION 6.13. Preferential Claims. Reference is made to Section 311 of
the Trust Indenture Act.  For purposes of Section 311(b)(4) and (6) of such Act:

          (i) "cash transaction" means any transaction in which full payment for
     goods or securities sold is made within seven days after delivery of the
     goods or securities in currency or in checks or other orders drawn upon
     banks or bankers and payable upon demand; and

          (ii) "self-liquidating paper" means any draft, bill of exchange,
     acceptance or obligation which is made, drawn, negotiated or incurred by
     the Company for the purpose of financing the purchase, processing,
     manufacturing, shipment, storage or sale of goods, wares or merchandise and
     which is secured by documents evidencing title to, possession of, or a lien
     upon, the goods, wares or merchandise or the receivables or proceeds
     arising from the sale of the goods, wares or merchandise previously
     constituting the security, provided the security is received by the Trustee
     simultaneously with the creation of the creditor relationship with the



                                       49






     Company arising from the making, drawing, negotiating or incurring of the
     draft, bill of exchange, acceptance or obligation.

     SECTION 6.14. Appointment of Authenticating Agent. At any time when any of
the Notes remain Outstanding the Trustee may appoint an Authenticating Agent or
Agents with respect to one or more series of Notes which shall be authorized to
act on behalf of the Trustee to authenticate Notes of such series issued upon
original issuance, exchange, registration of transfer or partial redemption
thereof or pursuant to Section 3.07, and Notes so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in the Indenture to the authentication and delivery of Notes by the Trustee
or the Trustee's certificate of authentication, such reference shall be deemed
to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent.

     Each Authenticating Agent shall be acceptable to the Company and shall at
all times be a Corporation organized and doing business under the laws of the
United States of America, any state thereof or the District of Columbia,
authorized under such laws to act as Authenticating Agent, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by federal or state authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Authenticating Agent
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.

     Any Corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any Corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided that such Corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

     An Authenticating Agent may resign at any time by giving 30 days' written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice




                                       50





thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of Notes
of the series with respect to which such Authenticating Agent will serve, as
their names and addresses appear in the Register. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.

     The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 6.07.

     If an appointment with respect to one or more series is made pursuant to
this Section, the Notes of such series may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternate certificate of
authentication in the following form:

          This is one of the Notes of the series designated therein
     referred to in the within-mentioned Indenture.


     THE BANK OF NEW YORK, as
     Trustee


     By:
             As Authenticating Agent


     By:
              Authorized Signatory




                                    51







                                 ARTICLE 7
             HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

     SECTION 7.01. Company to Furnish Trustee Names and Addresses of
Holders. The Company will furnish or cause to be furnished to the Trustee
with respect to the Notes of each series:

          (i) semi-annually, not later than each Interest Payment Date for such
     series a list, in such form as the Trustee may reasonably require, of the
     names and addresses of the Holders as of the preceding Regular Record Date
     therefor, and

          (ii) at such other times as the Trustee may request in writing, within
     30 days after the receipt by the Company of any such request, a list of
     similar form and content as of a date not more than 15 days prior to the
     time such list is furnished;

provided, however, that so long as the Trustee is the Note Registrar no such
list shall be required to be furnished.

     SECTION 7.02. Preservation of Information; Communications to Holders. (a)
The Trustee shall preserve, in as current a form as is reasonably practicable,
the names and addresses of Holders of the Notes of each series contained in the
most recent list furnished to the Trustee as provided in Section 7.01 and the
names and addresses of such Holders received by the Trustee in its capacity as
Note Registrar. The Trustee may destroy any list of the Holders of Notes of any
series furnished to it as provided in Section 7.01 upon receipt of a new list of
such Holders.

     (b) If three or more Holders of Notes of any series (herein referred to as
"applicants") apply in writing to the Trustee, and furnish to the Trustee
reasonable proof that each such applicant has owned a Note of such series for a
period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
of Notes of such series with respect to their rights under this Indenture or
under the Notes of such series and is accompanied by a copy of the form of proxy
or other communication which such applicants propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such application,
at its election, either:

          (i) afford such applicants access to the information preserved at the
     time by the Trustee in accordance with Section 7.02(a) with respect to the
     Notes of such series, or



                                       52







          (ii) inform such applicants as to the approximate number of Holders of
     Notes of such series whose names and addresses appear in the information
     preserved at the time by the Trustee in accordance with Section 7.02(a),
     and as to the approximate cost of mailing to such Holders the form of proxy
     or other communication, if any, specified in such application.

     If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each Holder of Notes of such series whose name and address appear in the
information preserved at the time by the Trustee in accordance with Section
7.02(a) a copy of the form or proxy or other communication which is specified in
such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interest of the Holders or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such objections or if,
after the entry of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such Holders with reasonable
promptness after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.

     (c) Every Holder of Notes, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of the disclosure of
any such information as to the names and addresses of the Holders in accordance
with Section 7.02(b), regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under Section 7.02(b).

     SECTION 7.03. Reports by Trustee. (a) Within 60 days after March 1 of each
year commencing with the year 2002, the Trustee shall transmit by mail to all
Holders, as their names and addresses appear in the Register, a brief report
dated as of such March 1, if any, as may be required by Section 313(a) of the
Trust Indenture Act.



                                       53






     (b) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any Notes
are listed, with the Commission and with the Company. The Company will notify
the Trustee when any Notes are listed on any stock exchange.

     SECTION 7.04. Reports by Company and the Guarantors. The Company and the
Guarantors shall:

     (a) file with the Trustee, within 15 days after the Company or any
Guarantor is required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports which the Company or
any Guarantor may be required to file with the Commission pursuant to Section 13
or Section 15(d) of the Securities Exchange Act of 1934; or, if the Company or
any Guarantor is not required to file information, documents or reports pursuant
to either of said Sections, then it shall file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports which may be required pursuant to Section 13 of the
Securities Exchange Act of 1934 in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in such
rules and regulations;

     (b) If the Company or a Guarantor is no longer required (or is not
required, as the case may be) to file reports pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934, then it shall promptly furnish or cause to
be furnished such information as is specified pursuant to Rule 144A(d)(4) under
the Securities Act of 1933 (or any successor provision thereto) to such Holder
or to a prospective purchaser of a Note who is designated by such Holder and is
a qualified institutional buyer (as defined in Rule 144A), upon the request of
such Holder or prospective purchaser, in order to permit compliance by such
Holder with Rule 144A under the Securities Act of 1933.

     (c) file with the Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such additional
information, documents and reports with respect to compliance by the Company
with the conditions and covenants of this Indenture as may be required from time
to time by such rules and regulations; and

     (d) transmit by mail to all Holders, as their names and addresses appear in
the Register, within 30 days after the filing thereof with the Trustee, such
summaries of any information, documents and reports required to be filed by the
Company pursuant to paragraphs (a) through (c) of this Section as may be
required by rules and regulations prescribed from time to time by the
Commission.



                                       54









                                    ARTICLE 8
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

     SECTION 8.01. Company May Consolidate, Etc. on Certain Terms. The Company
shall not in a single transaction or a series of related transactions,
consolidate with or merge into any other Person or permit any other Person to
consolidate with or merge into the Company unless:

     (a) in case the Company shall consolidate with or merge into another
Corporation or convey, transfer or lease its properties and assets as, or
substantially as, an entirety to any Person, the Corporation formed by such
consolidation or into which the Company is merged or the Person which acquires
by conveyance, transfer, or lease the properties and assets of the Company, as,
or substantially as, an entirety shall be a Corporation organized and existing
under the laws of the United States of America, any state thereof or the
District of Columbia and shall expressly assume, by an indenture supplemental
hereto executed and delivered to the Trustee, in form satisfactory to the
Trustee, the due and punctual payment of the principal of, interest on and any
Additional Amounts with respect to all the Notes and the performance of every
covenant of this Indenture on the part of the Company to be performed or
observed;

     (b) immediately after giving effect to such transaction, no Event of
Default, or event which after notice or lapse of time, or both, would become an
Event of Default, shall have occurred and be continuing; and

     (c) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to such
transaction have been complied with.

     SECTION 8.02. Successor Corporation Substituted. Upon any consolidation by
the Company with or merger by the Company into any other Corporation or any
conveyance, transfer or lease of the properties and assets of the Company as, or
substantially as, an entirety to any Person in accordance with Section 8.01, the
successor Corporation formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor Corporation has
been named as the Company herein, and thereafter,



                                       55






except in the case of a lease to another Person, the predecessor Corporation
shall be relieved of all obligations and covenants under this Indenture and the
Notes.



                                    ARTICLE 9
                             SUPPLEMENTAL INDENTURES

     SECTION 9.01. Supplemental Indentures Without Consent of Holders. Without
the consent of any Holders, the Company, the Guarantors and the Trustee, at any
time and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:

     (a) to evidence the succession of another Person to the Company or any
Guarantor and the assumption by any such successor of the covenants of the
Company or such Guarantor herein and in the Notes or such Guarantee, as the case
may be;

     (b) to add to the covenants of the Company or any Guarantor for the benefit
of the Holders of all or any series of Notes (and, if such covenants are to be
for the benefit of less than all series of Notes, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company or any Guarantor;

     (c) to add any additional Events of Default with respect to Notes of any or
all series;

     (d) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective only when
there is no Note Outstanding of any series created prior to the execution of
such supplemental indenture which is entitled to the benefit of such provision;

     (e) to secure the Notes of any or all series;

     (f) to add new Guarantors pursuant to Section 12.03.

     (g) to cure any ambiguity, to correct or supplement any provision herein
which may be inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this Indenture,
provided such action shall not adversely affect the interests of the Holders of
Notes of any series in any material respect;



                                       56







     (h) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee with respect to the Notes of one or more series and to add
to or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 6.11(b);

     (i) to add to, delete from or revise the conditions, limitations and
restrictions on the authorized amount, terms or purposes of issue,
authentication and delivery of Notes, as herein set forth;

     (j) to supplement any of the provisions of this Indenture to such extent as
shall be necessary to permit or facilitate the defeasance and discharge of any
series of Notes pursuant to Article Thirteen, provided that no such supplement
shall materially adversely affect the interest of the Holders of any Notes then
Outstanding; or

     (k) to amend or supplement any provision contained herein or in any
supplemental indenture, provided that no such amendment or supplement shall
materially adversely affect the interest of the Holders of any Notes then
Outstanding.

     SECTION 9.02. Supplemental Indentures with Consent of Holders. With the
consent of the Holders of a majority in principal amount of the Outstanding
Notes of each series affected by such supplemental indenture, by Act of said
Holders delivered to the Company, the Guarantors, and the Trustee, the Company,
the Guarantors and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Notes of such series under
this Indenture; provided, however, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Note affected thereby,

     (a) change the Stated Maturity of the principal of, or any installment of
interest on, any such Note, or reduce the principal amount thereof or any
interest thereon, or change any Place of Payment where, or the currency in
which, any such Note or the interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the Stated
Maturity thereof (or, in the case of redemption, on or after the Redemption
Date);

     (b) reduce the percentage in principal amount of the Outstanding Notes of
any series, the consent of whose Holders is required for any such supplemental
indenture, or the consent of those Holders is required for any waiver (of



                                       57






compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture; or

     (c) modify any of the provisions of this Section or Section 5.13, except to
increase any such percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the Holder of each
Outstanding Note affected thereby.

     A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Notes, or which modifies the rights
of the Holders of Notes of such series with respect to such covenant or the
provision, shall be deemed not to affect the rights under this Indenture of the
Holders of Notes or any other series.

     It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.

     SECTION 9.03. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
6.01) shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.

     SECTION 9.04. Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Notes theretofore or thereafter
authenticated and delivered hereunder shall be bound thereby.

     SECTION 9.05. Conformity with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article shall conform to the requirements of
the Trust Indenture Act as then in effect.

     SECTION 9.06. Reference in Notes to Supplemental Indentures. Notes of any
series authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in
such



                                       58






supplemental indenture. If the Company shall so determine, new Notes of any
series so modified as to conform, in the opinion of the Trustee and the Company,
to any such supplemental indenture may be prepared and executed by the Company
and authenticated and delivered by the Trustee in exchange for Outstanding Notes
of such series.



                                   ARTICLE 10
                                    COVENANTS

     SECTION 10.01. Payment of Principal, Interest and Additional Amounts. The
Company covenants and agrees for the benefit of the Holders of each series of
Notes that it will duly and punctually pay the principal of and interest on and
any Additional Amounts with respect to the Notes of that series in accordance
with the terms of the Notes and this Indenture.

     SECTION 10.02. Maintenance of Office or Agency. The Company will maintain
in each Place of Payment for any series of Notes an office or agency where Notes
of such series may be presented or surrendered for registration or transfer or
exchange and where notices and demands to or upon the Company in respect of the
Notes of such series and this Indenture may be served. The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of Trustee, and the Company
hereby appoints the Trustee as its agent to receive all such presentations,
surrenders, notices and demands.

     The Company may also from time to time designate one or more other offices
or agencies where the Notes of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Notes of any series for such purposes. The Company
will give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.

     SECTION 10.03. Money for Notes Payments to Be Held in Trust. If the Company
shall at any time act as its own Paying Agent with respect to any series of
Notes, it will, on or before each due date of the principal of or interest on
any of the Notes of such series, segregate and hold in trust for the benefit of
the



                                       59






Persons entitled thereto a sum sufficient to pay the principal or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and will promptly notify the Trustee of its action or
failure so to act.

     Whenever the Company shall have one or more Paying Agents for any series of
Notes, it will, on or before each due date of the principal of or interest on
any Notes of such series, deposit with a Paying Agent a sum sufficient to pay
the principal or interest so becoming due, such sum to be held in trust for the
benefit of the Persons entitled to such principal or interest, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
action or failure so to act.

     The Company will cause each Paying Agent for any series of Notes other than
the Trustee to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee, subject to the provisions of this
Section, that such Paying Agent will:

          (i) hold all sums held by it for the payment of the principal of or
     interest on Notes of such series in trust for the benefit of the Persons
     entitled thereto until such sums shall be paid to such Persons or otherwise
     disposed of as herein provided;

          (ii) give the Trustee notice of any default by the Company (or any
     other obligor upon the Notes of such series) in the making of any payment
     of principal or interest on the Notes of such series; and

          (iii) at any time during the continuance of any such default, upon the
     written request of the Trustee, forthwith pay to the Trustee all sums so
     held in trust by such Paying Agent.

     The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.

     Any money deposited with the Trustee or any Paying Agent, or received by
the Trustee (or another trustee satisfying the requirements of Section 6.09) in
respect of Government Obligations deposited with the Trustee (or such other



                                       60






trustee) pursuant to Section 13.04, or then held by the Company, in trust for
the payment of the principal of or interest on any Note of any series and
remaining unclaimed for two years after such principal or interest has become
due and payable shall be paid to the Company on Company Request, or (if then
held by the Company) shall be discharged from such trust. The Holder of such
Note shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease.

     The Trustee or such Paying Agent, before being required to make any such
repayment, shall publish, at the Company's expense, in the English language, in
a newspaper customarily published on each Business Day and of general
circulation in the City of New York, New York, or to be mailed to such Holder,
or both, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the earlier of the
date of such publication or such mailing, any unclaimed balance of such money
then remaining will be repaid to the Company.

     SECTION 10.04. Corporate Existence. Subject to Article Eight, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence, rights (charter and statutory) and
franchises; provided, however, that the foregoing shall not obligate the Company
to preserve any such right or franchise if the Company shall determine that the
preservation thereof is no longer desirable in the conduct of its business and
that the loss thereof is not disadvantageous in any material respect to any
Holder.

     SECTION 10.05. Statement as to Default. The Company will deliver to the
Trustee, within 120 days after the end of each fiscal year, an Officers'
Certificate, stating as to each signer thereof that he or she is familiar with
the affairs of the Company and whether or not to such officer's knowledge the
Company is in compliance (without regard to any period of grace or requirement
of notice) with all conditions and covenants of this Indenture. The officer
executing such certificate shall be the Company's principal executive, finance
or accounting officer and such certificate need not comply with Section 1.02 of
this Indenture.

     SECTION 10.06. Additional Amounts. The Company will, subject to the
exceptions and limitations set forth below, pay as additional interest on the
Notes such Additional Amounts ("Additional Amounts") as are necessary so that
the net payment by the Company or any Paying Agent of the principal of and
interest on the Notes to a person that is not a United States Holder, after
deduction for any present or future tax, assessment or governmental charge of
the United States or a political subdivision or taxing authority thereof or
therein, imposed by



                                       61






withholding with respect to such payment, will not be less than the amount that
would have been payable in respect of such Notes had no such withholding or
deduction been required.

     The obligation of the Company to pay Additional Amounts shall not apply:

     (1) to a tax, assessment or governmental charge that is imposed or withheld
solely because the Holder, or a fiduciary, settlor, beneficiary, member or
shareholder of the Holder if the holder is an estate, trust, partnership or
corporation, or a Person holding a power over an estate or trust administered by
a fiduciary Holder:

          (a) is or was present or engaged in trade or business in the United
     States or has or had a permanent establishment in the United States;

          (b) has a current or former relationship with the United States,
     including a relationship as a citizen or resident thereof;

          (c) is or has been a foreign or domestic personal holding company, a
     passive foreign investment company or a controlled foreign corporation with
     respect to the United States or a corporation that has accumulated earnings
     to avoid United States federal income tax; or

          (d) is or was a "10-percent shareholder" of the Company as defined in
     section 871(h)(3) of the United States Internal Revenue Code or any
     successor provision;

     (2) to any Holder that is not the sole beneficial owner of such Notes, or a
portion thereof, or that is a fiduciary or partnership, but only to the extent
that the beneficial owner, a beneficiary or settlor with respect to the
fiduciary, or a member of the partnership would not have been entitled to the
payment of such Additional Amounts had such beneficial owner, beneficiary,
settlor or member received directly its beneficial or distributive share of the
payment;

     (3) to a tax, assessment or governmental charge that is imposed or withheld
solely because the Holder or any other Person failed to comply with
certification, identification or information reporting requirements concerning
the nationality, residence, identity or connection with the United States of the
Holder or beneficial owner of such Notes, if compliance is required by statute,
by regulation of the United States Treasury Department or by an applicable
income



                                       62






tax treaty to which the United States is a party as a precondition to exemption
from such tax, assessment or other governmental charge;

     (4) to a tax, assessment or governmental charge that is imposed other than
by withholding by the Company or a Paying Agent from such payment;

     (5) to a tax, assessment or governmental charge that is imposed or withheld
solely because of a change in law, regulation, or administrative or judicial
interpretation that becomes effective more than 15 days after the payment
becomes due or is duly provided for, whichever occurs later;

     (6) to an estate, inheritance, gift, sales, excise, transfer, wealth or
personal property tax or a similar tax, assessment or governmental charge;

     (7) to any tax, assessment or other governmental charge any Paying Agent
must withhold from any payment of principal of or interest on any Note, if such
payment can be made without such withholding by any other Paying Agent; or

     (8) in the case of any combination of the above items.

     SECTION 10.07. Application of Proceeds upon Release of a 10% Subsidiary
Guarantor. The Company will not enter into any transaction which would result in
the release pursuant to Section 12.04 of the Guarantee of any Guarantor which
would be a 10% Subsidiary Guarantor on the date such Guarantee is released,
unless at least 75% of the proceeds from such transaction consist of any
combination of: (i) cash (including assumption by the acquiror of any
Indebtedness of the Company or its subsidiaries) or Readily Marketable
Securities, (ii) property or assets (other than current assets) of a nature or
type similar or related to the nature or type of the property or assets of the
Company and its subsidiaries existing on the date such transaction is
consummated and (iii) interests in companies or businesses having property or
assets or engaged in businesses similar or related to the nature or type of the
property or assets of the Company and its subsidiaries on the date such
transaction is consummated. In the event that the net proceeds from the sale or
other disposition of a 10% Subsidiary Guarantor consist of cash or Readily
Marketable Securities, the Company shall apply, within 12 months of the
consummation of such sale or other disposition, an amount equal to 100% of the
fair market value, as determined in good faith by the Company's Board of
Directors, of such net proceeds to (i) repay unsubordinated Indebtedness of the
Company or any Guarantor, in each case owing to a person other than an Affiliate
of the Company or (ii) invest in property or assets (other than current assets)
of a nature or type similar or related to the nature or type of the property or
assets of the Company and its subsidiaries existing on the date of



                                       63






such investment or (iii) invest in a company or business having property or
assets or engaged in a business similar or related to the nature or type of the
property or assets of FedEx and its subsidiaries on the date of such investment.

                                   ARTICLE 11
                               REDEMPTION OF NOTES

     SECTION 11.01. Redemption Upon a Tax Event. If (a) the Company becomes or
will become obligated to pay Additional Amounts in accordance with Section 10.06
as a result of any change in, or amendment to, the laws (or any regulations or
rulings promulgated thereunder) of the United States (or any political
subdivision or taxing authority thereof or therein), or any change in, or
amendments to, any official position regarding the application or interpretation
of such laws, regulations or rulings, which change or amendment is announced or
becomes effective on or after February 6, 2001, or (b) a taxing authority of the
United States takes an action on or after February 6, 2001, whether or not with
respect to the Company or any of its Affiliates, that results in a substantial
probability that the Company will or may be required to pay such Additional
Amounts, then the Company may, at its option, redeem, as a whole, but not in
part, the Notes of any series on any Interest Payment Date, at a Redemption
Price equal to 100% of their principal amount, together with interest accrued
thereon to the Redemption Date; provided that the Company determines, in its
business judgment, that the obligation to pay such Additional Amounts cannot be
avoided by the use of reasonable measures available to it, not including
substitution of the obligor under the Notes. No redemption pursuant to clause
(b) above may be made unless the Company delivers to the Trustee (i) an opinion
of independent U.S. tax counsel of recognized standing to the effect that an act
taken by a taxing authority of the United States results in a substantial
probability that the Company will or may be required to pay such Additional
Amounts and (ii) an Officers' Certificate stating that, based on such opinion,
the Company is entitled to redeem the Notes pursuant to their terms.

     SECTION 11.02. Notice of Redemption. Notice of redemption shall be given by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Notes to be redeemed. Failure to
give notice by mailing in the manner herein provided to the Holder of any Notes
designated for redemption as a whole or in part, or any defect in the notice to
any such Holder, shall not affect the validity of the proceedings for the
redemption of any other Notes or portion thereof.

     All notices of redemption shall state:

          (i) the Redemption Date;



                                       64







          (ii) the Redemption Price;

          (iii) that on the Redemption Date the Redemption Price will become due
     and payable upon each such Note to be redeemed and that interest thereon
     will cease to accrue on and after said date;

          (iv) the place or places where such Notes are to be surrendered for
     payment of the Redemption Price;

          (v) the CUSIP Number or the Euroclear or Clearstream reference numbers
     of such Notes, if any (or any other numbers used by a Depositary to
     identify such Notes); and

          (vi) that, unless the Company or the Guarantors default in paying the
     Redemption Price, interest will cease to accrue on the Notes called for
     redemption on the Redemption Date.

     Notice of redemption of Notes to be redeemed shall be given by the Company
or, on Company Request, by the Trustee at the expense of the Company.

     SECTION 11.03. Deposit of Redemption Price. On or before any Redemption
Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if
the Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 10.03) an amount of money sufficient to pay the Redemption
Price of, and accrued interest on, all the Notes which are to be redeemed on
that date.

     SECTION 11.04. Notes Payable on Redemption Date. Notice of redemption
having been given as aforesaid, the Notes so to be redeemed shall, on the
Redemption Date, become due and payable at the Redemption Price therein
specified, and from and after such date (unless the Company or the Guarantors
shall default in the payment of the Redemption Price) such Notes shall cease to
bear interest. Upon surrender of any such Note for redemption in accordance with
said notice, such Note shall be paid by the Company or the Guarantors at the
Redemption Price, together with accrued interest to the Redemption Date;
provided, however, that installments of interest whose Stated Maturity is on or
prior to the Redemption Date shall be payable to the Holders of such Notes, or
one or more Predecessor Notes, registered as such at the close of business on
the relevant Regular or Special Record Dates according to their terms and the
provisions of Section 3.08.



                                       65






     If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from the
Redemption Date at the rate borne by the Note.



                                   ARTICLE 12
                               GUARANTEE OF NOTES

     SECTION 12.01. Unconditional Guarantee. Each of the Guarantors hereby fully
and unconditionally, jointly and severally, guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Notes or the obligations of the Company to the Holders or the Trustee
hereunder or thereunder, that: (a) the principal of and interest and Additional
Amounts, if any, on the Notes will be duly and punctually paid in full when due,
whether at maturity, upon redemption, by acceleration or otherwise, and interest
on the overdue principal and (to the extent permitted by law) interest, if any,
on the Notes and all other obligations of the Company or the Guarantors to the
Holders or the Trustee hereunder or thereunder (including fees, expenses or
other) and all other obligations under the Indenture or the Notes will be
promptly paid in full or performed, all in accordance with the terms hereof and
thereof; and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations under the Indenture or the Notes or any
change in the time, manner or place of payment of, or in any other term in
respect thereof, or waiver of or consent to any departure from any other
agreement relating to any obligations under the Indenture or the Notes, the same
will be promptly paid in full when due or performed in accordance with the terms
of the extension or renewal, whether at Stated Maturity, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed, or failing
performance of any other obligation of the Company to the Holders, for whatever
reason, the Guarantors shall be obligated to pay, or to perform or cause the
performance of, the same immediately. An Event of Default under this Indenture
or the Notes shall constitute an event of default under this Guarantee and shall
entitle the Holders of Notes to accelerate the obligations of the Guarantors
hereunder in the same manner and to the same extent as the obligations of the
Company.

     The Guarantors hereby agree that their obligations hereunder shall be
absolute and unconditional, not subject to any reduction, limitation,
impairment, termination, defense, offset, counterclaim or recoupment whatsoever
(all of which are expressly hereby waived by the Guarantors) whether by reason
of any claim of any character whatsoever, including, without limitation, any
claim of waiver, release, surrender, alteration or compromise, or by reason of
any liability at any



                                       66






time to any Guarantor or otherwise, whether based upon any obligations or any
other agreement or otherwise, and howsoever arising, whether out of action or
inaction or otherwise and whether resulting from default, willful misconduct,
negligence or otherwise, and without limiting the foregoing, irrespective of the
validity, regularity or enforceability of the Notes or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Notes with respect to any provisions hereof or thereof, the recovery of
any judgment against the Company, any action to enforce the same, any release or
amendment or waiver of or consent to any departure from or failure to enforce
any other guarantee, for all or any of the Notes or other obligations under this
Indenture, whether or not a Guarantee is affixed to any particular Note, any
insolvency, bankruptcy, reorganization or dissolution, or any other proceeding
of the Company, or any Guarantor, including, without limitation, rejection of
any Guarantee in such bankruptcy or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a guarantor.

     Each Guarantor hereby waives the benefit of diligence, presentment, demand
of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenants that its
Guarantee shall not be discharged except by complete performance of the
obligations contained in the Notes, this Indenture and this Guarantee. This
Guarantee is a guarantee of payment and not of collection. If any Holder or the
Trustee is required by any court or otherwise to return to the Company or to the
Guarantors, or any custodian, trustee, liquidator or other similar official
acting in relation to the Company or any Guarantor, any amount paid by the
Company or any Guarantor to the Trustee or such Holder, this Guarantee to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders of Notes and the Trustee, on the other hand (a) subject to this Article
Twelve, the maturity of the obligations guaranteed hereby may be accelerated as
provided in Article Five hereof for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (b) in the
event of any acceleration of such obligations as provided in Article Five
hereof, such obligations (whether or not due and payable) shall forthwith become
due and payable by the Guarantors for the purpose of this Guarantee.

     SECTION 12.02. Execution and Delivery of Guarantee. To further evidence the
Guarantee, set forth in Section 12.01, each Guarantor hereby agrees that a
notation of such Guarantee shall be endorsed on each Note authenticated and
delivered by the Trustee and executed by either manual or facsimile signature of
an Officer of such Guarantor.



                                       67






     The Guarantors hereby agree that its Guarantee set forth in Section 12.01
shall remain in full force and effect notwithstanding any failure to endorse on
each Note a notation of such Guarantee.

     If an Officer of the Guarantor whose signature is on this Indenture or a
Guarantee no longer holds that office at the time the Trustee authenticates such
Note or at any time thereafter, such Guarantor's Guarantee of such Note shall be
valid nevertheless.

     The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Guarantee set forth in this
Indenture on behalf of the Guarantors.

     SECTION 12.03. Future Guarantors. The Company and the Guarantors covenant
and agree that they shall cause each Person that is or becomes a Guarantor
hereunder to execute and deliver to the Trustee an indenture supplemental
hereto, substantially in the form of Exhibit A hereto, evidencing the same.

     SECTION 12.04. Release of a Guarantor. Upon the sale, exchange, transfer or
other disposition (by merger or otherwise), other than a lease, of a Guarantor,
or of all of the Capital Stock of a Guarantor, or all, or substantially all, the
assets of a Guarantor, to any Person that is not an Affiliate of the Company,
such Guarantor shall be deemed to be automatically and unconditionally released
and discharged from all its obligations under its Guarantee and under this
Article Twelve without any further action required on the part of the Trustee or
any Holder. The Trustee shall deliver an appropriate instrument evidencing such
release upon receipt of a request of the Company accompanied by an Officers'
Certificate certifying as to the compliance with this Section.

     SECTION 12.05. Waiver of Subrogation. Until this Indenture is discharged
and all of the Notes are discharged and paid in full, each Guarantor hereby
irrevocably waives and agrees not to exercise any claim or other rights which it
may now or hereafter acquire against the Company that arise from the existence,
payment, performance or enforcement of the Company's obligations under the Notes
or this Indenture and such Guarantor's obligations under this Guarantee and this
Indenture, in any such instance including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, indemnification, and any
right to participate in any claim or remedy against the Company, whether or not
such claim, remedy or right arises in equity, or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security on account of such claim or other rights.
If any



                                       68






amount shall be paid to any Guarantor in violation of the preceding sentence and
any amounts owing to the Trustee or the Holders of Notes under the Notes, this
Indenture, or any other document or instrument delivered under or in connection
with such agreements or instruments, shall not have been paid in full, such
amount shall have been deemed to have been paid to such Guarantor for the
benefit of, and held in the trust for the benefit of, the Holders of the Notes,
and shall forthwith be paid to the Trustee for the benefit of such Holders to be
credited and applied to the Notes, whether matured or unmatured, in accordance
with the terms of this Indenture. Each Guarantor acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated by this Indenture and that the waiver set forth in this Section
12.05 is knowingly made in contemplation of such benefits.

     SECTION 12.06. Reliance on Judicial Order or Certificate of Liquidating
Agent Regarding Dissolution, etc. of Guarantors . Upon any payment or
distribution of assets of any Guarantor referred to in this Article Twelve, the
Trustee, subject to the provisions of Section 6.01, and the Holders, shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding-up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee for the benefit of creditors, agent or other person
making such payment or distribution, delivered to the Trustee or to the Holders,
for the purpose of ascertaining the persons entitled to participate in such
payment or distribution, the amount thereof or payable thereon, the amounts or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Twelve.

     SECTION 12.07. Limitation of Guarantor's Liability . Each Guarantor, and by
its acceptance hereof each Holder, hereby confirms that it is the intention of
all such parties that the Guarantee by such Guarantor pursuant to its Guarantee
does not constitute a fraudulent transfer or conveyance for purposes of title 11
of the United States Code, as amended, the Uniform Fraudulent Conveyance Act,
the Uniform Fraudulent Transfer Act or any similar Federal or state law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of the Guarantor under this Guarantee
shall be limited to the maximum amount which, after giving effect to all other
contingent and fixed liabilities of the Guarantor, will result in the
obligations of the Guarantor under its Guarantee not constituting such
fraudulent transfer or conveyance.

     SECTION 12.08. Obligations Reinstated. The obligations of each Guarantor
hereunder shall continue to be effective or shall be reinstated, as the case may
be, if at any time any payment which would otherwise have reduced the



                                       69






obligations of such Guarantor hereunder (whether such payment shall have been
made by or on behalf of the Company is rescinded or reclaimed from any of the
Holders upon the insolvency, bankruptcy, liquidation or reorganization of the
Company or such Guarantor or otherwise, all as though such payment had not been
made. If demand for, or acceleration of the time for, payment by the Company is
stayed upon the insolvency, bankruptcy, liquidation or reorganization of the
Company, all such Indebtedness otherwise subject to demand for payment or
acceleration shall nonetheless be payable by each Guarantor as provided herein.

     SECTION 12.09. No Obligation to Take Action Against the Company. Neither
the Trustee nor any other Person shall have any obligation to enforce or exhaust
any rights or remedies or to take any other steps under any security for the
obligations under this Indenture or against the Company or any other Person or
any property of the Company or any other Person before the Trustee is entitled
to demand payment and performance by any Guarantor of its liabilities and
obligations under its Guarantee or under this Indenture.



                                   ARTICLE 13
                       DEFEASANCE AND COVENANT DEFEASANCE

     SECTION 13.01. Applicability of Article; Company's Option to Effect
Defeasance or Covenant Defeasance. If pursuant to Section 3.01 provision is made
for either or both of (a) defeasance of the Notes of a series under Section
13.02 or (b) covenant defeasance of the Notes of a series under Section 13.03 to
apply to Notes of any series, then the provisions of such Section or Sections,
as the case may be, together with the other provisions of this Article Thirteen,
shall be applicable to the Notes of such series, and the Company may at its
option, at any time, with respect to the Notes of such series, elect to have
either Section 13.02 (if applicable) or Section 13.03 (if applicable) be applied
to the Outstanding Notes of such series upon compliance with the conditions set
forth below in this Article Thirteen.

     SECTION 13.02. Defeasance and Discharge. Upon the Company's exercise of the
above option applicable to this Section, the Company and the Guarantors shall be
deemed to have been discharged from their respective obligations with respect to
the Outstanding Notes of such series on the date the conditions set forth below
are satisfied (hereinafter, "defeasance").

     For this purpose, such defeasance means that the Company shall be deemed to
have paid and discharged the entire indebtedness represented by the Outstanding
Notes of such series and to have satisfied all its other obligations



                                       70






under such Notes and this Indenture insofar as such Notes are concerned (and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder:

     (a) the rights of Holders of Outstanding Notes of such series to receive,
solely from the trust fund described in Section 13.04 and as more fully set
forth in such Section, payments in respect of the principal of and interest on
and Additional Amounts, if any, with respect to, such Notes when such payments
are due;

     (b) the Company's obligations with respect to such Notes under Sections
3.04, 3.05, 3.07, 6.07, 10.02, 10.03 and 10.06 (but only to the extent that any
Additional Amounts payable exceed the amount deposited in respect of such
Additional Amounts pursuant to Section 13.04(a) below);

     (c) the rights, powers, trusts, duties and immunities and other provisions
in respect of the Trustee hereunder; and

     (d) this Article Thirteen.

     Subject to compliance with this Article Thirteen, the Company may exercise
its option under this Section 13.02 notwithstanding the prior exercise of its
option under Section 13.03 with respect to the Notes of such series.

     SECTION 13.03. Covenant Defeasance. Upon the Company's exercise of the
above option applicable to this Section, the Company shall be released from its
obligations under Sections 8.01, 10.05, 12.05, 5.01(c) (as to Sections 8.01 and
10.05), 5.01(d) and 5.01(e) with respect to the Outstanding Notes of such series
on and after the date the conditions set forth below are satisfied (hereinafter,
"covenant defeasance").

     For this purpose, such covenant defeasance means that, with respect to the
Outstanding Notes of such series, the Company and the Guarantors may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such Section, whether directly or indirectly by
reason of any reference elsewhere herein to any such Section or by reason of any
reference in any such Section to any other provision herein or in any other
document, but the remainder of this Indenture and such Notes shall be unaffected
thereby. Following a covenant defeasance, payment of the Notes of such series
may not be accelerated because of an Event of Default specified above in this
Section 13.03.



                                       71






     SECTION 13.04. Conditions to Defeasance or Covenant Defeasance. The
following shall be the conditions to application of either Section 13.02 or
Section 13.03 to the Outstanding Notes of such series.

     (a) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee satisfying the requirements of Section 6.09
who shall agree to comply with the provisions of this Article Thirteen
applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Notes, (A) an amount in Dollars, or (B)
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, within
two weeks of the due date of any payment, money in an amount, or (C) a
combination thereof, sufficient, without reinvestment, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee (or other qualifying trustee) to pay
and discharge, the principal of and each installment of interest on the
Outstanding Notes of such series on the Stated Maturity of such principal or
interest in accordance with the terms of this Indenture and of such Notes.
Before such a deposit, the Company may make arrangements satisfactory to the
Trustee for the redemption of any series of Notes at a future date in accordance
with any redemption provisions relating to such series, which shall be given
effect in applying the foregoing.

     (b) No Event of Default or event with which notice of lapse of time or both
would become an Event of Default with respect to the Notes of such series shall
have occurred and be continuing on the date of such deposit and, with respect to
defeasance only, at any time during the period ending on the 123rd day after the
date of such deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period).

     (c) Such defeasance or covenant defeasance shall not cause the Trustee for
the Notes of such series to have a conflicting interest for purposes of the
Trust Indenture Act with respect to any Notes of the Company.

     (d) Such defeasance or covenant defeasance shall not result in a breach or
violation of, or constitute a default under, this Indenture or any other
agreement or instrument to which the Company is a party or by which it is bound.

     (e) Such defeasance or covenant defeasance shall not cause any Notes of
such series then listed on any registered national securities exchange under the
Securities Exchange Act of 1934, as amended, to be deleted.



                                       72







     (f) In the case of an election under Section 13.02, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (x) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling, or (y) since the date of this Indenture there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the Outstanding Notes of
such series will not recognize income, gain or loss for federal income tax
purposes as a result of such defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would have
been the case if such defeasance had not occurred.

     (g) In the case of an election under Section 13.03, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders of
the Outstanding Notes of such series will not recognize income, gain or loss for
federal income tax purposes as a result of such covenant defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such covenant defeasance had not
occurred.

     (h) Such defeasance or covenant defeasance shall be effected in compliance
with any additional terms, conditions or limitations which may be imposed on the
Company in connection therewith pursuant to Section 3.01.

     (i) The Company shall have delivered to the Trustee an Officers'
Certificate or an Opinion of Counsel, stating that all conditions precedent
provided for in the Indenture relating to either the defeasance under Section
13.02 or the covenant defeasance under Section 13.03 (as the case may be) have
been complied with.

     SECTION 13.05. Deposited Money and Government Obligations to be Held in
Trust; Other Miscellaneous Provisions. Subject to the provisions of the last two
paragraphs of Section 10.03, all money and Government Obligations (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee --
collectively, for purposes of this Section, the "Trustee") pursuant to Section
13.04 in respect of the Outstanding Notes of such series shall be held in trust
and applied by the Trustee, in accordance with the provisions of such Notes and
this Indenture, to the payment, either directly or through any Paying Agent (but
not including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Notes, of all sums due and to become due
thereon in respect of principal and interest and Additional Amounts, if any, but
such money need not be segregated from other funds except to the extent required
by law.



                                       73






     The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the Government Obligations deposited
pursuant to Section 13.04 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of the Outstanding Notes of such series.

     Anything in this Article Thirteen to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or Government Obligations held by it as provided in Section
13.04 which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent defeasance or covenant defeasance.



                                       74






     IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed and attested, all as of the day and year first above written.


                                            FEDEX CORPORATION, Issuer
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Burnetta B. Williams
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Burnetta B. Williams
   Title: Assistant Secretary                  Title: Staff Vice President and
                                                        Assistant Treasurer



                                            FEDERAL EXPRESS CORPORATION, as
                                               Guarantor
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Tracy G. Schmidt
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Tracy G. Schmidt
   Title: Assistant Secretary                  Title: Senior Vice President and
                                                        Chief Financial Officer



                                            FEDEX GROUND PACKAGE SYSTEM,
                                              INC., as Guarantor
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Daniel J. Sullivan
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Daniel J. Sullivan
   Title: Assistant Secretary                  Title: President and Chief
                                                        Executive Officer



                                            FEDEX CUSTOM CRITICAL, INC., as
                                               Guarantor
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Brendan L. O'Sullivan
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Brendan L. O'Sullivan
   Title: Assistant Secretary                  Title: Vice President, Finance
                                                        and CFO



                                     75



                                            VIKING FREIGHT, INC., as Guarantor
Attest:

By: /s/ Richard S. Goldaber                 By: /s/ Tilton G. Gore
   --------------------------------            --------------------------------
   Name:  Richard S. Goldaber                  Name:  Tilton G. Gore
   Title: VP and General Counsel               Title: President and CEO



                                            THE BANK OF NEW YORK, as Trustee


                                            By: /s/ Stefan Victory
                                               --------------------------------
                                               Name:  Stefan Victory
                                               Title: Agent



                                       76






                                                                       EXHIBIT A


                          FEDEX CORPORATION, as Issuer,
                          THE GUARANTORS NAMED HEREIN,
                      THE ADDITIONAL GUARANTOR NAMED HEREIN
                                       AND
                              THE BANK OF NEW YORK,
                                   as Trustee

                             Supplemental Indenture
                                     No. __

                       6 5/8% Notes due February 12, 2004
                       6 7/8% Notes due February 15, 2006
                       7 1/4% Notes due February 15, 2011

     SUPPLEMENTAL INDENTURE NO. ___, dated as of __________, _____ between FedEx
Corporation, a Delaware Corporation (the "Company"), the Guarantors referred to
in the Indenture defined below, __________ (the "Additional Guarantor") and The
Bank of New York, a New York banking corporation, as Trustee (the "Trustee").

                                    RECITALS

     The Company, the Guarantors and the Trustee have executed and delivered an
Indenture dated as of February 12, 2001, (the "Indenture") to provide for the
issuance of the 6 5/8% Notes due 2004, the 6 7/8% Notes due 2006 and the 7 1/4%
Notes due 2011;

     Section 12.03 of the Indenture provides that each Person who becomes a
Guarantor shall execute a supplemental indenture evidencing the same;

     The Additional Guarantor desires to become a Guarantor under the Indenture;
and

     All acts and proceedings required by law, the Indenture and the
organizational documents of the Company, the Guarantors and the Additional
Guarantor necessary to constitute this Supplemental Indenture No. __ a valid and
binding agreement for the uses and purposes set forth herein have been done and
performed, and the execution and delivery of this Supplemental Indenture No. __
have in all respects been duly authorized.




                                       A-1





     NOW, THEREFORE, this Indenture witnesseth:

     For and in consideration of the premises and good and valuable
consideration the receipt whereof is hereby acknowledged, it is mutually
covenanted and agreed, for the equal and proportionate benefit of the holders of
the Notes of each series, as follows:



                                    ARTICLE 1
     RELATION TO THE INDENTURE; DEFINITIONS AND OTHER PROVISIONS OF GENERAL
                                   APPLICATION

     SECTION 1.01. Relation to the Indenture. This Supplemental Indenture No.
___ constitutes an integral part of the Indenture.

     SECTION 1.02. Definitions and Other Provisions of General Application. For
all purposes of this Supplemental Indenture No. ___ unless otherwise specified
herein:

     (a) all terms defined in this Indenture which are used and not otherwise
defined herein shall have the meanings they are given in the Indenture; and

     (b) the provisions of general application stated in Section 1.01 of the
Indenture shall apply to this Supplemental Indenture No. __, except that the
words "herein," "hereof," "hereto" and "hereunder" and other words of similar
import refer to this Supplemental Indenture as a whole and not to the Indenture
or any particular Article, Section or other subdivision of the Indenture or this
Supplemental Indenture No. ___.



                                    ARTICLE 2


     SECTION 2.01. Addition of Guarantor. The Additional Guarantor is hereby
made a party to the Indenture as a Guarantor thereunder.




                                       A-2





                                    ARTICLE 3
                            MISCELLANEOUS PROVISIONS

     SECTION 3.01. Supplemental Indenture. The Indenture, as supplemented and
amended by this Supplemental Indenture No. __, is in all respects hereby
adopted, ratified and confirmed.

     SECTION 3.02. Effectiveness. This Supplemental Indenture No. __ shall take
effect as of the date hereof.

     SECTION 3.03. Execution by the Trustee. The Trustee has executed this
Supplemental Indenture No. __ only upon the terms and conditions set forth in
the Indenture. Without limiting the generality of the foregoing, the Trustee
shall not be responsible for the correctness of the recitals herein contained,
which shall be taken as the statements of the Company, the Guarantors and the
Additional Guarantor, and the Trustee makes no representation and shall have no
responsibility for, or in respect of, the validity or sufficiency of this
Supplemental Indenture No. __ or the execution hereof by any Person (other than
the Trustee).

     SECTION 3.04. Governing Law. This Supplemental Indenture No. __ shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of said State.

     SECTION 3.05. Counterparts. This Supplemental Indenture No. __ may be
executed in any number of counterparts, each of which shall be an original; but
such counterparts shall together constitute but one and the same instrument.






                                       A-3





     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. __ to be duly executed, as of the day and year first written
above.

                                            FEDEX CORPORATION
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                            FEDERAL EXPRESS CORPORATION
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                            FEDEX GROUND PACKAGE SYSTEM,
                                            INC.
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                            FEDEX CUSTOM CRITICAL, INC.
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                            VIKING FREIGHT, INC.
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                       A-4







                                            [ADDITIONAL GUARANTOR]
Attest:

By:                                         By:
   --------------------------------            --------------------------------
   Name:                                       Name:
   Title:                                      Title:



                                            THE BANK OF NEW YORK, as Trustee


                                            By:
                                               --------------------------------
                                               Name:
                                               Title:



                                   A-5







                                                                       EXHIBIT B


                         FORM OF FACE OF INDIVIDUAL NOTE

     [If this is a Restricted Individual Note, add: THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
("RULE 144A") UNDER THE SECURITIES ACT), (2) AGREES NOT TO OFFER, SELL OR
OTHERWISE TRANSFER THIS NOTE PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) OF THE SECURITIES ACT) AFTER
THE LATER OF THE ORIGINAL ISSUE DATE OF THIS NOTE AND THE LAST DATE ON WHICH
FEDEX CORPORATION OR ANY "AFFILIATE" (AS DEFINED IN RULE 144 UNDER THE
SECURITIES ACT) OF FEDEX CORPORATION WAS THE OWNER OF THIS NOTE (OR ANY
PREDECESSOR OF THIS NOTE) OR (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY
APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE") EXCEPT (A) TO FEDEX
CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, IN EACH CASE TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) IN
AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN EACH OF THE
FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY
OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS
OR THEIR CONTROL, AND




                                       B-1





(3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT FEDEX
CORPORATION AND THE TRUSTEE SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND (II) IN EACH OF THE FOREGOING CASES, BUT ONLY IF THIS NOTE IS NOT A GLOBAL
SECURITY (AS DEFINED IN THE INDENTURE REFERRED TO HEREIN), TO REQUIRE THAT A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO FEDEX CORPORATION AND THE TRUSTEE.
THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.]





                                       B-2






REGISTERED                                                  PRINCIPAL AMOUNT:

No.                                                         $
    ------------------                                       -------------------

CUSIP NO.
          --------------------


                                FEDEX CORPORATION

                                   % Note due
                                ---           ------

     FedEx Corporation, a Delaware Corporation, (the "Company" which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay              or registered
assigns, the principal sum of                                         DOLLARS

on            ,      (the "Maturity Date") and to pay interest thereon from    ,
      or from the most recent "Interest Payment Date" to which interest has been
paid or duly provided for, semi-annually on           and                of each
year, commencing           ,        , and on the Maturity Date, at the rate of
      % per annum, until the principal hereof is paid or duly provided for;
provided that if any Registration Default with respect to this Note occurs under
the Registration Rights Agreement, then the per annum interest rate on this Note
will increase for the period from the occurrence of such Registration Default
until such time as no Registration Default is in effect with respect to this
Note (at which time the interest rate will be reduced to its initial rate) at a
per annum rate of 0.25% for the first 90-day period following the occurrence of
such Registration Default, and by an additional 0.25% thereafter (up to a
maximum of 0.50%). The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, be paid to
the Person in whose name this Note (or one or more Predecessor Notes) is
registered at the close of business on the "Regular Record Date" for such
interest, which shall be the         or       (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date. [if this Note is
an Original Note, then insert - ; provided that any accrued and unpaid interest
(including any Additional Amounts and additional interest payable upon the
occurrence of a Registration Default) on this Note upon the issuance of an
Exchange Note in exchange for this Note shall cease to be payable to the Holder
hereof and shall be payable on the next Interest Payment Date for such Exchange
Note to the Holder thereof on the related Regular Record Date.] Any such
interest not so punctually paid or duly provided for shall forthwith cease to be
payable to the registered Holder on such Regular Record Date and may either be
paid to the Person in whose name this Note (or one or more Predecessor Notes) is
registered at the close of business on a




                                       B-3





Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee referred to on the reverse hereof, notice of which shall be given to
Holders of Notes of this series not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes of this
series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in the Indenture.

     The Company will at all times appoint and maintain a Paying Agent (which
may be the Trustee) authorized by the Company to pay the principal of and
interest on any Notes of this series on behalf of the Company and having an
office or agency in New York, New York and in such other cities, if any, as the
Company may designate in writing to the Trustee (the "Place of Payment") where
Notes of this series may be presented or surrendered for payment and where
notices, designations or requests in respect for payments with respect to Notes
of this series may be served. The Company has initially appointed The Bank of
New York, 101 Barclay Street, New York, New York 10286, as such Paying Agent.

     Interest payments on this Note will be computed and paid on the basis of a
360-day year of twelve 30-day months. Interest payable on this Note on any
Interest Payment Date and on the Maturity Date will include interest accrued
from and including the most recent Interest Payment Date to which interest has
been paid or duly provided for (or from and including February 12, 2001, if no
interest has been paid on this Note) to but excluding such Interest Payment Date
or the Maturity Date, as the case may be.

     If any Interest Payment Date or the Maturity Date falls on a day that is
not a Business Day (as defined below), principal or interest payable with
respect to such Interest Payment Date or Maturity Date, as the case may be, will
be paid on the next succeeding Business Day with the same force and effect as if
it were paid on the date such payment was due, and no interest shall accrue on
the amount so payable for the period from and after such Interest Payment Date
or the Maturity Date, as the case may be. "Business Day" means any day other
than Saturday, Sunday or other day on which banking institutions in New York or
Tennessee are obligated or authorized by law to close.

     The principal and interest payable on this Note will be made by wire
transfer of immediately available funds to the Holder hereof in such currency of
the United States of America as at the time of payment is legal tender for the
payment of public and private debts.




                                       B-4





     Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.

     Unless the Certificate of Authentication hereon has been executed by the
Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.




                                       B-5







     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.


                                        FEDEX CORPORATION


                                        By:  -----------------------------------
                                             Name:
                                             Title:

Attest:

By: ---------------------------
    Name:
    Title:






                                       B-6






                          CERTIFICATE OF AUTHENTICATION

     This is one of the Notes of the series designated therein referred to in
the within-mentioned Indenture.


THE BANK OF NEW YORK, as
Trustee


By:         ------------------------------------
            Authorized Signatory


Dated:     ------------------------------------








                                       B-7






                      [FORM OF REVERSE OF INDIVIDUAL NOTE]

                                FEDEX CORPORATION

                                  % Note due                  ,
                               ---          ------------------   --------

     This Note is one of a duly authorized issue of notes of the Company (herein
called the "Notes"), issued under an Indenture (the "Indenture") dated as of
February   , 2001 among the Company, the Guarantors referred to in the Indenture
and The Bank of New York, as Trustee (the "Trustee," which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Guarantors, the Trustee and the Holders of the Notes and of the terms upon
which the Notes are, and are to be, authenticated and delivered. This Note is
one of the series designated on the face hereof, limited initially in aggregate
principal amount to US$     . Capitalized terms used herein and in the Guarantee
endorsed hereon but not defined have the meanings ascribed to such terms in the
Indenture.

     Except to the extent set forth below, this Note is not redeemable at the
option of the Company or at the option of the Holder prior to the Maturity Date
and is not subject to any sinking fund.

     The Indenture provides that if the Company is required to pay Additional
Amounts as a result of any change in, or amendment to, the laws (or any
regulations or regulations promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change in,
or amendment to, any official position regarding the application or
interpretation of such laws, regulations or rulings, which change or amendment
is announced or becomes effective on or after February   , 2001, or a taxing
authority of the United States (or any political subdivision or taxing authority
thereof or therein) takes an action on or after February   , 2001, whether or
not with respect to the Company or any of its affiliates, that results in a
substantial probability that the Company will or may be required to pay such
Additional Amounts, then the Company may, at its option, redeem, as a whole, but
not in part, this Note on any Interest Payment Date on not less than 30 nor more
than 60 calendar days' prior notice, at a Redemption Price equal to 100% of this
Note's principal amount, together with interest accrued thereon to the date
fixed for redemption; provided that the Company determines, in its business
judgment, that the obligation to pay such Additional Amounts cannot be avoided
by the use of reasonable measures available to it, not including substitution of
the obligor under the Note.




                                       B-8





     The Notes are unconditionally guaranteed as to the due and punctual payment
of the principal and interest in respect thereof by the Guarantors as evidenced
by their guarantees (the "Guarantees") set forth hereon. The Guarantees are
direct and unconditional obligations of such Guarantors and rank and will rank
equally in priority of payment and in all other respects with all other
unsecured and unsubordinated obligations of such Guarantors now or hereafter
outstanding.

     In case an Event of Default with respect to the Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.

     The Indenture contains provisions for defeasance at any time of (i) the
entire indebtedness of this Note or (ii) certain respective covenants and Events
of Default with respect to this Note, in each case upon compliance with certain
conditions set forth therein, which provisions apply to the Notes.

     The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the Guarantors and the rights of the Holders of the Notes of each
series to be affected under the Indenture at any time by the Company, the
Guarantors and the Trustee with the consent of the Holders of at least 51% in
principal amount of the Notes at the time Outstanding or the consent of 51% in
principal amount of each series of Notes to be affected if less than all series
are to be affected by such modification or amendment. The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Notes of each series at the time Outstanding, on behalf of the
Holders of all Notes of such series, to waive compliance by the Company and the
Guarantors with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note or Notes issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not notation of such consent or waiver is made upon this Note.

     No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, places and rate, and in the currency herein prescribed.

     As provided in the Indenture and subject to certain limitations herein and
therein set forth, the transfer of this Note is registrable in the Register,
upon surrender of this Note for registration of transfer at the office or agency
of the Company in the Place of Payment, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the Note
Registrar, duly executed




                                       B-9





by, the Holder hereof or its attorney duly authorized in writing, and thereupon
one or more new Notes of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.

     The Notes of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple of $1,000 in excess
thereof. As provided in the Indenture and subject to certain limitations herein
and therein set forth, Notes of this series are exchangeable for the same
aggregate principal amount of Notes of this series and of like tenor and
authorized denominations, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

     No recourse under or upon any obligation, covenant or agreement of the
Company or any Guarantor in the Indenture or any indenture supplemental thereto
or in any Note, or because of the creation of any indebtedness represented
thereby, shall be had against any incorporator, stockholder, officer or
director, as such, of the Company or any Guarantor or of any successor thereto,
either directly or through the Company or any Guarantor or any successor
thereto, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance hereof and as part of the consideration for the issue hereof.

     This Note shall be governed by and construed in accordance with the laws of
the State of New York.

     All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.






                                      B-10





                                  ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.


TEN COM           as tenants in common

TEN ENT           as tenants by the entireties

JT TEN            as joint tenants with right of survivorship and not as tenants
                  in common

UNIF GIFT MIN ACT                Custodian
                  --------------           -------------
                      (Cust)                  (Minor)
                  under Uniform Gifts to Minors Act

                  --------------------------------------------------------------
                                              (State)


     Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sell(s), assigns(s) and
transfer(s) unto
                 -----------------------------------------------------------

- ----------------------------------------------------------------------------
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
         -------------------------------------------------------------------
Please Print or Type Name and Address including Postal Zip Code of Assignee:

- ----------------------------------------------------------------------------

- ----------------------------------------------------------------------------
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints
            ----------------------------------------------------------------
to transfer said Note on the books of the Company, with full power of
substitution in the premises.




                                      B-11







Dated:
       -------------------

Signature Guaranteed


- -------------------------------------
NOTICE:  Signature must be guaranteed    NOTICE:  The signature to this
by a member firm of the New York         assignment must correspond with the
Stock Exchange or a commercial bank or   name as written upon the face of the
trust company.                           within Note in every particular,
                                         withoutalteration or enlargement or any
                                         change whatever.

[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL RESTRICTED
INDIVIDUAL NOTES ONLY.]

In connection with any transfer of this Note occurring prior to the date which
is the earlier of (i) the date of an effective Registration or (ii) two years
after the later of the original issuance of this Note or the last date on which
this Note was held by the Company or an Affiliate of the Company, the
undersigned confirms that without utilizing any general solicitation or general
advertising that:

                                   [Check one]

[  ](a) this Note is being transferred in compliance with the exemption from
        registration under the Securities Act of 1933, as amended, provided by
        Rule 144A thereunder;

                                       or

[  ](b) this Note is being transferred other than in accordance with (a)
        above and documents are being furnished which comply with the conditions
        of transfer set forth in this Note and the Indenture.

If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Note in the name of any Person other
than the Noteholder hereof unless and until the conditions to any such transfer
or registration set forth herein and in Section 3.06 of the Indenture shall have
been satisfied.


Date:
      --------------------------            ------------------------------------



                                      B-12






                                                                       EXHIBIT C



                                    GUARANTEE

                    the "Guarantor") hereby, jointly and severally with each
other Guarantor, fully and unconditionally guarantees (such guarantee being
referred to herein as the "Guarantee") the due and punctual payment of the
principal of and interest on the Notes, whether at maturity, upon redemption, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal and interest, if any, on the Notes, and the due and punctual
performance of all other obligations of the Company to the Holders or the
Trustee, all in accordance with the terms set forth in Article Twelve of the
Indenture.

     The obligations of the Guarantor to the Holders of Notes and to the Trustee
pursuant to the Guarantee and the Indenture are expressly set forth, to the
extent and in the manner provided, in Article Twelve of the Indenture, and
reference is hereby made to such Indenture for the precise terms of the
Guarantee therein made.

     The Guarantee shall not be valid or obligatory for any purpose until the
certificate of authentication on the Notes upon which the Guarantee is noted
shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized signatories.

     This Guarantee shall be governed by and construed in accordance with the
laws of the State of New York.

     This Guarantee is subject to release upon the terms set forth in the
Indenture.



                                            ------------------------,
                                                 as Guarantor


                                            By:
                                                -----------------------------
                                            Name:
                                            Title:





                                       C-1





                                                                       EXHIBIT D


                               FORM OF GLOBAL NOTE

[If this is a Rule 144A Global Note, add THIS NOTE HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT
IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A ("RULE 144A")
UNDER THE SECURITIES ACT), (2) AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER
THIS NOTE PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF
TIME AS PERMITTED BY RULE 144(k) OF THE SECURITIES ACT) AFTER THE LATER OF THE
ORIGINAL ISSUE DATE OF THIS NOTE AND THE LAST DATE ON WHICH FEDEX CORPORATION OR
ANY "AFFILIATE" (AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT) OF FEDEX
CORPORATION WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) OR (Y)
SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE
RESTRICTION TERMINATION DATE") EXCEPT (A) TO FEDEX CORPORATION, (B) PURSUANT TO
A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,
TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER, IN EACH CASE TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) IN AN OFFSHORE TRANSACTION
IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT
OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO
ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF
SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL,
AND (3) AGREES THAT IT WILL GIVE TO




                                       D-1





EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND; PROVIDED THAT FEDEX CORPORATION AND THE TRUSTEE SHALL
HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE
(E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING
CASES, BUT ONLY IF THIS NOTE IS NOT A GLOBAL SECURITY (AS DEFINED IN THE
INDENTURE REFERRED TO HEREIN), TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO FEDEX CORPORATION AND THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.]

[If this is a Temporary Regulation S Global Note, add THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS NOT A "U.S.
PERSON" (AS DEFINED IN REGULATION S ("REGULATION S") UNDER THE SECURITIES ACT),
(2) AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE PRIOR TO THE DATE
WHICH IS 40 DAYS AFTER THE ORIGINAL ISSUE DATE OF THE NOTES (THE "REGULATION S
RESTRICTED PERIOD") EXCEPT (A) TO FEDEX CORPORATION, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
("RULE 144A") UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, IN EACH CASE
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS




                                       D-2





OF THE SECURITIES ACT, AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM
THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND;
PROVIDED THAT FEDEX CORPORATION AND THE TRUSTEE SHALL HAVE THE RIGHT PRIOR TO
ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER
THE TERMINATION OF THE REGULATION S RESTRICTED PERIOD FOLLOWING COMPLIANCE WITH
THE CERTIFICATION REQUIREMENTS SET FORTH IN THE INDENTURE.]






                                       D-3







         No.                                          CUSIP No.

     Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.

                                FEDEX CORPORATION

                             [RULE 144A GLOBAL NOTE]

                      [TEMPORARY REGULATION S GLOBAL NOTE]

                           [REGULATION S GLOBAL NOTE]

                             [GLOBAL EXCHANGE NOTE]

                               representing up to

                                  US$       ,000,000
                                      -----

                                   % Notes due
                               ----            -------

               Guaranteed as to Payment of Principal and Interest
                    by the Guarantors named in the Indenture

     FedEx Corporation, a Delaware Corporation, (the "Company" which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay

                  Cede & Co.
                  C/O the Depository Trust Company
                  55 Water Street
                  New York, New York  10041

or registered assigns, the principal sum set forth on Schedule 1 hereto




                                       D-4





on          ,     (the "Maturity Date") and to pay interest thereon from       ,
         or from the most recent "Interest Payment Date" to which interest has
been paid or duly provided for, semi-annually on         and       of each year,
commencing          ,        , and on the Maturity Date, at the rate of    % per
annum, until the principal hereof is paid or duly provided for; provided that if
any Registration Default with respect to this Note occurs under the Registration
Rights Agreement, then the per annum interest rate on this Note will increase
for the period from the occurrence of such Registration Default until such time
as no Registration Default is in effect with respect to this Note (at which time
the interest rate will be reduced to its initial rate) at a per annum rate of
0.25% for the first 90-day period following the occurrence of such Registration
Default, and by an additional 0.25% thereafter (up to a maximum of 0.50%). The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in the Indenture, be paid to the Person in whose
name this Note (or one or more Predecessor Notes) is registered at the close of
business on the "Regular Record Date" for such interest, which shall be the
           or          (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. [if this Note is an Original Note, then
insert - ; provided that any accrued and unpaid interest (including any
Additional Amounts and additional interest payable upon the occurrence of a
Registration Default) on this Note upon the issuance of an Exchange Note in
exchange for this Note shall cease to be payable to the Holder hereof and shall
be payable on the next Interest Payment Date for such Exchange Note to the
Holder thereof on the related Regular Record Date.] Any such interest not so
punctually paid or duly provided for shall forthwith cease to be payable to the
registered Holder on such Regular Record Date and may either be paid to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Trustee referred to on the reverse hereof,
notice of which shall be given to Holders of Notes of this series not less than
10 days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.

     The Company will at all times appoint and maintain a Paying Agent (which
may be the Trustee) authorized by the Company to pay the principal of and
interest on any Notes of this series on behalf of the Company and having an
office or agency in New York, New York and in such other cities, if any, as the
Company may designate in writing to the Trustee (the "Place of Payment") where
Notes of this series may be presented or surrendered for payment and where
notices, designations or requests in respect for payments with respect to Notes
of this series may be served. The Company has initially appointed The Bank of
New York, 101 Barclay Street, New York, New York 10286, as such Paying Agent.




                                       D-5





     Interest payments on this Note will be computed and paid on the basis of a
360-day year of twelve 30-day months. Interest payable on this Note on any
Interest Payment Date and on the Maturity Date will include interest accrued
from and including the most recent Interest Payment Date to which interest has
been paid or duly provided for (or from and including       ,         , if no
interest has been paid on this Note) to but excluding such Interest Payment Date
or the Maturity Date, as the case may be.

     If any Interest Payment Date or the Maturity Date falls on a day that is
not a Business Day (as defined below), principal or interest payable with
respect to such Interest Payment Date or Maturity Date, as the case may be, will
be paid on the next succeeding Business Day with the same force and effect as if
it were paid on the date such payment was due, and no interest shall accrue on
the amount so payable for the period from and after such Interest Payment Date
or the Maturity Date, as the case may be. "Business Day" means any day other
than Saturday, Sunday or other day on which banking institutions in New York or
Tennessee are obligated or authorized by law to close.

     The principal and interest payable on this Note will be made by wire
transfer of immediately available funds to the Holder hereof in such currency of
the United States of America as at the time of payment is legal tender for the
payment of public and private debts.

     Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.

     Unless the Certificate of Authentication hereon has been executed by the
Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.




                                       D-6





     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.


                                            FEDEX CORPORATION


                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:

By:
   ------------------------------------
   Name:
   Title:






                                       D-7





                          Certificate of Authentication

     This is one of the Global Notes described in the within-mentioned
Indenture.


                                          THE BANK OF NEW YORK,
                                                as Trustee


                                           By:
                                               -------------------------------
                                                   Authorized Signatory

Dated:




                                       D-8





                        [FORM OF REVERSE OF GLOBAL NOTE]

                                FEDEX CORPORATION

                                  % Note due         ,
                             -----          --------- -----

     This Note is one of a duly authorized issue of notes of the Company (herein
called the "Notes"), issued under an Indenture (the "Indenture") dated as of
February   , 2001 among the Company, the Guarantors referred to in the Indenture
and The Bank of New York, as Trustee (the "Trustee," which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Guarantors, the Trustee and the Holders of the Notes and of the terms upon
which the Notes are, and are to be, authenticated and delivered. This Note is
one of the series designated on the face hereof, limited initially in aggregate
principal amount to US$           . Capitalized terms used herein and in the
Guarantee endorsed hereon but not defined have the meanings ascribed to such
terms in the Indenture.

     Except to the extent set forth below, this Note is not redeemable at the
option of the Company or at the option of the Holder prior to the Maturity Date
and is not subject to any sinking fund.

     The Indenture provides that if the Company is required to pay Additional
Amounts as a result of any change in, or amendment to, the laws (or any
regulations or regulations promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change in,
or amendment to, any official position regarding the application or
interpretation of such laws, regulations or rulings, which change or amendment
is announced or becomes effective on or after February   , 2001, or a taxing
authority of the United States (or any political subdivision or taxing authority
thereof or therein) takes an action on or after February   , 2001, whether or
not with respect to the Company or any of its affiliates, that results in a
substantial probability that the Company will or may be required to pay such
Additional Amounts, then the Company may, at its option, redeem, as a whole, but
not in part, this Note on any Interest Payment Date on not less than 30 nor more
than 60 calendar days' prior notice, at a Redemption Price equal to 100% of this
Note's principal amount, together with interest accrued thereon to the date
fixed for redemption; provided that the Company determines, in its business
judgment, that the obligation to pay such Additional Amounts cannot be avoided
by the use of reasonable measures available to it, not including substitution of
the obligor under the Note.




                                       D-9





     The Notes are unconditionally guaranteed as to the due and punctual payment
of the principal and interest in respect thereof by the Guarantors as evidenced
by their guarantees (the "Guarantees") set forth hereon. The Guarantees are
direct and unconditional obligations of such Guarantors and rank and will rank
equally in priority of payment and in all other respects with all other
unsecured and unsubordinated obligations of such Guarantors now or hereafter
outstanding.

     In case an Event of Default with respect to the Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.

     The Indenture contains provisions for defeasance at any time of (i) the
entire indebtedness of this Note or (ii) certain respective covenants and Events
of Default with respect to this Note, in each case upon compliance with certain
conditions set forth therein, which provisions apply to the Notes.

     The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the Guarantors and the rights of the Holders of the Notes of each
series to be affected under the Indenture at any time by the Company, the
Guarantors and the Trustee with the consent of the Holders of at least 51% in
principal amount of the Notes at the time Outstanding or the consent of 51% in
principal amount of each series of Notes to be affected if less than all series
are to be affected by such modification or amendment. The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Notes of each series at the time Outstanding, on behalf of the
Holders of all Notes of such series, to waive compliance by the Company and the
Guarantors with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note or Notes issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not notation of such consent or waiver is made upon this Note.

     No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, places and rate, and in the currency herein prescribed.

     As provided in the Indenture and subject to certain limitations herein and
therein set forth, the transfer of this Note is registrable in the Register,
upon surrender of this Note for registration of transfer at the office or agency
of the




                                      D-10





Company in the Place of Payment, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Note
Registrar, duly executed by, the Holder hereof or its attorney duly authorized
in writing, and thereupon one or more new Notes of this series and of like
tenor, of authorized denominations and for the same aggregate principal amount,
will be issued to the designated transferee or transferees.

     The Notes of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple of $1,000 in excess
thereof. As provided in the Indenture and subject to certain limitations herein
and therein set forth, Notes of this series are exchangeable for the same
aggregate principal amount of Notes of this series and of like tenor and
authorized denominations, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

     No recourse under or upon any obligation, covenant or agreement of the
Company or any Guarantor in the Indenture or any indenture supplemental thereto
or in any Note, or because of the creation of any indebtedness represented
thereby, shall be had against any incorporator, stockholder, officer or
director, as such, of the Company or any Guarantor or of any successor thereto,
either directly or through the Company or any Guarantor or any successor
thereto, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance hereof and as part of the consideration for the issue hereof.

     This Note shall be governed by and construed in accordance with the laws of
the State of New York.

     All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.




                                      D-11





                                                                      Schedule 1

               SCHEDULE OF CHANGES IN OUTSTANDING PRINCIPAL AMOUNT

     The following notations in respect of changes in the outstanding principal
amount of this Global Note have been made:


              Initial          Change in Outstanding         New        Notation
 Date     Principal Amount       Principal Amount          Balance      Made by
 ----     ----------------     ---------------------       -------      --------






                                      D-12





                                                                       EXHIBIT E
                                                Form of Regulation S Certificate


                            REGULATION S CERTIFICATE

             (For transfers pursuant to ss. 3.06(b) of the Indenture)


The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attn:  Corporate Trust Administration

         Re:       % Notes due          of FedEx Corporation (the
             -----             --------
             "Notes")

     Reference is made to the Indenture, dated as of February    , 2001 (the
"Indenture"), among FedEx Corporation (the "Company"), the Guarantors named
therein, and The Bank of New York, as Trustee. Terms used herein and defined in
the Indenture or in Regulation S or Rule 144 under the U.S. Securities Act of
1933 (the "Securities Act") are used herein as so defined.

     This certificate relates to U.S. $               principal amount of Notes,
which are evidenced by the following certificate(s) (the "Specified Notes"):

         CUSIP No(s).
                      ---------------------------

         CERTIFICATE No(s).
                            ---------------------

     The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Notes or (ii) it is acting on behalf of all the beneficial
owners of the Specified Notes and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
If the Specified Notes are represented by a Global Note, they are held through
the Depositary or a participant of such Depositary in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Notes are not
represented by a Global Note, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

     The Owner has requested that the Specified Notes be transferred to a person
(the "Transferee") who will take delivery in the form of a Regulation S Note or
an Unrestricted Individual Note. In connection with such transfer, the




                                       E-1





Owner hereby certifies that, unless such transfer is being effected pursuant to
an effective registration statement under the Securities Act, it is being
effected in accordance with Rule 904 or Rule 144 under the Securities Act and
with all applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:

     1. Rule 904 Transfers. If the transfer is being effected in accordance with
Rule 904:

          (a) the Owner is not a distributor of the Notes, an affiliate of the
     Company or any such distributor or a person acting on behalf of any of the
     foregoing;

          (b) the offer of the Specified Notes was not made to a person in the
     United States;

          (c) either:

               (i) at the time the buy order was originated, the Transferee was
          outside the United States or the Owner and any person acting on its
          behalf reasonably believed that the Transferee was outside the United
          States, or

               (ii) the transaction is being executed in, on or through the
          facilities of the Eurobond market, as regulated by the Association of
          International Bond Dealers, or another designated offshore securities
          market and neither the Owner nor any person acting on its behalf knows
          that the transaction has been prearranged with a buyer in the United
          States;

          (d) no directed selling efforts have been made in the United States by
     or on behalf of the Owner or any affiliate thereof;

          (e) if the Owner is a dealer in securities or has received a selling
     concession, fee or other remuneration in respect of the Specified Notes,
     and the transfer is to occur during the Restricted Period, then the
     requirements of Rule 904(b)(1) or (b)(3) have been satisfied; and

          (f) the transaction is not part of a plan or scheme to evade the
     registration requirements of the Securities Act.

     2. Rule 144 Transfers. If the transfer is being effected pursuant to Rule
144:



                                      E-2







          (a) the transfer is occurring after a holding period of at least one
     year (computed in accordance with paragraph (d) of Rule 144) has elapsed
     since the Specified Notes were last acquired from the Company or from an
     affiliate of the Company, whichever is later, and is being effected in
     accordance with the applicable amount, manner of sale and notice
     requirements of Rule 144; or

          (b) the transfer is occurring after a holding period of at least two
     years has elapsed since the Specified Notes were last acquired from the
     Company or from an affiliate of the Company, whichever is later, and the
     Owner is not, and during the preceding three months has not been, an
     affiliate of the Company.

     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company, the Guarantors and the Initial
Purchasers.


Dated:                                  ----------------------------------------
                                        (Print the name of the Undersigned, as
                                        such term is defined in the second
                                        paragraph of this certificate.)



                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                        (If the Undersigned is a corporation,
                                        partnership or fiduciary, the title of
                                        the person signing on behalf of the
                                        Undersigned must be stated.)





                                      E-3






                                                                       EXHIBIT F
                                            Form of Restricted Notes Certificate


                          RESTRICTED NOTES CERTIFICATE

             (For transfers pursuant to ss. 3.06(a) of the Indenture)



The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attn:  Corporate Trust Administration


         Re: _____% Notes due _______ of FedEx Corporation (the
             "Notes")

     Reference is made to the Indenture, dated as of February    , 2001 (the
"Indenture"), among FedEx Corporation (the "Company"), the Guarantors named
therein and The Bank of New York, as Trustee. Terms used herein and defined in
the Indenture or in Rule 144A under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

     This certificate relates to U.S. $             principal amount of Notes,
which are evidenced by the following certificate(s) (the "Specified Notes"):

         CUSIP No(s).
                       -------------------------------

         ISIN No(s), If any.
                            --------------------------

         CERTIFICATE No(s).
                            --------------------------

     The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Notes or (ii) it is acting on behalf of all the beneficial
owners of the Specified Notes and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Notes are represented by a Global Note, they are held through
the Depositary or an Agent Member in the name of the Undersigned, as or on
behalf of the Owner.




                                       F-1





If the Specified Notes are not represented by a Global Note, they are registered
in the name of the Undersigned, as or on behalf of the Owner.

     The Owner has requested that the Specified Notes be transferred to a person
(the "Transferee") who will take delivery in the form of an interest in the Rule
144A Global Note or a Restricted Individual Note. In connection with such
transfer, the Owner hereby certifies that (i) the Owner is not a U.S. Person (as
defined in the Indenture) and (ii) such transfer is being effected in accordance
with Rule 144A under the Securities Act and all applicable securities laws of
the states of the United States and other jurisdictions. Accordingly, the Owner
hereby further certifies as follows:

          (a) the Specified Notes are being transferred to a person that the
     Owner and any person acting on its behalf reasonably believe is a
     "qualified institutional buyer" within the meaning of Rule 144A, acquiring
     for its own account or for the account of a qualified institutional buyer;
     and

          (b) the Owner and any person acting on its behalf have taken
     reasonable steps to ensure that the Transferee is aware that the Owner may
     be relying on Rule 144A in connection with the transfer.

     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company, the Guarantors and the Initial
Purchasers.

Dated:                                  ----------------------------------------

                                        (Print the name of the Undersigned, as
                                        such term is defined in the second
                                        paragraph of this certificate.)



                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                        (If the Undersigned is a corporation,
                                        partnership or fiduciary, the title of
                                        the person signing on behalf of the
                                        Undersigned must be stated.)



                                      F-2







                                                                       EXHIBIT G
                                               Form of Certification to Be Given
                                          by Holders of Beneficial Interest in a
                                              Regulation S Temporary Global Note


                            OWNER NOTES CERTIFICATION

                                FEDEX CORPORATION

                                   % Notes due
                              -----            -------

     This is to certify that, as of the date hereof, $             of the above-
captioned Notes are beneficially owned by non-U.S. person(s). As used in this
paragraph, the term "U.S. person" has the meaning given to it by Regulation S
under the Securities Act of 1933, as amended.

     We undertake to advise you promptly by tested telex on or prior to the date
on which you intend to submit your certification relating to the Notes held by
you for our account in accordance with your operating procedures if any
applicable statement herein is not correct on such date, and in the absence of
any such notification it may be assumed that this certification applies as of
such date.

     We understand that this certificate is required in connection with certain
securities laws of the United States. In connection therewith, if administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate to any interested party in such proceedings.

Dated:              ,
      -------------  -----

By:
    ---------------------------------------------
     As, or as agent for, the beneficial owner(s)
     of the Notes to which this certificate
     relates.




                                       G-1





                                                                       EXHIBIT H
                                            Form of Certification to Be Given by
                              the Euroclear Operator or Clearstream Banking S.A.


                            DEPOSITARY CERTIFICATION

                                FEDEX CORPORATION

                                   % Notes due
                              -----            --------

     This is to certify that, with respect to U.S.$           principal amount
of the above-captioned Notes, except as set forth below, we have received in
writing, by tested telex or by electronic transmission, from member
organizations appearing in our records as persons being entitled to a portion of
the principal amount of Notes of the series set forth above (our "Member
Organizations"), certifications with respect to such portion, substantially to
the effect set forth in the Indenture.

     We further certify (i) that we are not making available herewith for
exchange (or, if relevant, exercise of any rights or collection of any interest)
any portion of the Regulation S Temporary Global Note (as defined in the
Indenture) excepted in such certifications and (ii) that as of the date hereof
we have not received any notification from any of our Member Organizations to
the effect that the statements made by such Member Organizations with respect to
any portion of the part submitted herewith for exchange (or, if relevant,
exercise of any rights or collection of any interest) are no longer true and
cannot be relied upon as of the date hereof.

     We understand that this certification is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this




                                       H-1





certification is or would be relevant, we irrevocably authorize you to produce
this certification to any interested party in such proceedings.

Dated:                  ,
       ----------------   ----------

Yours faithfully,
[EUROCLEAR BANK, S.A./N.V.,
as operator of the Euroclear System]

     or

[CLEARSTREAM, S.A.]

By
   ---------------------------------




                                       H-2

EX-4.3

                                                                    EXHIBIT 4.3


                         FEDEX CORPORATION, as Issuer,
                          THE GUARANTORS NAMED HEREIN,
                     THE ADDITIONAL GUARANTORS NAMED HEREIN
                                      AND
                             THE BANK OF NEW YORK,
                                   as Trustee

                             Supplemental Indenture
                                     No. 1

                       6 5/8% Notes due February 12, 2004
                       6 7/8% Notes due February 15, 2006
                       7 1/4% Notes due February 15, 2011

     SUPPLEMENTAL INDENTURE NO. 1, dated as of February 20, 2001 between FedEx
Corporation, a Delaware Corporation (the "Company"), the Guarantors referred to
in the Indenture defined below, Federal Express Canada Ltd. and Federal Express
Japan K.K. (the "Additional Guarantors"), and The Bank of New York, a New York
banking corporation, as Trustee (the "Trustee").

                                    RECITALS

     The Company, the Guarantors and the Trustee have executed and delivered an
Indenture dated as of February 12, 2001 (the "Indenture") to provide for the
issuance of the 6 5/8% Notes due 2004, the 6 7/8% Notes due 2006 and the 7 1/4%
Notes due 2011;

     Section 12.03 of the Indenture provides that each Person who becomes a
Guarantor shall execute a supplemental indenture evidencing the same;

     The Additional Guarantors each desire to become a Guarantor under the
Indenture; and

     All acts and proceedings required by law, the Indenture and the
organizational documents of the Company, the Guarantors and the Additional
Guarantors necessary to constitute this Supplemental Indenture No. 1 a valid and
binding agreement for the uses and purposes set forth herein have been done and
performed, and the execution and delivery of this Supplemental Indenture No. 1
have in all respects been duly authorized.







     NOW, THEREFORE, this Indenture witnesseth:

     For and in consideration of the premises and good and valuable
consideration the receipt whereof is hereby acknowledged, it is mutually
covenanted and agreed, for the equal and proportionate benefit of the holders of
the Notes of each series, as follows:



                                    ARTICLE 1
     RELATION TO THE INDENTURE; DEFINITIONS AND OTHER PROVISIONS OF GENERAL
                                   APPLICATION

     SECTION 1.01. Relation to the Indenture. This Supplemental Indenture No. 1
constitutes an integral part of the Indenture.

     SECTION 1.02. Definitions and Other Provisions of General Application. For
all purposes of this Supplemental Indenture No. 1 unless otherwise specified
herein:

     (a) all terms defined in this Indenture which are used and not otherwise
defined herein shall have the meanings they are given in the Indenture; and

     (b) the provisions of general application stated in Section 1.01 of the
Indenture shall apply to this Supplemental Indenture No. 1, except that the
words "herein," "hereof," "hereto" and "hereunder" and other words of similar
import refer to this Supplemental Indenture as a whole and not to the Indenture
or any particular Article, Section or other subdivision of the Indenture or this
Supplemental Indenture No. 1.



                                    ARTICLE 2


     SECTION 2.01. Addition of Guarantors. The Additional Guarantors are each
hereby made a party to the Indenture as a Guarantor thereunder.




                                        2





                                    ARTICLE 3
                            MISCELLANEOUS PROVISIONS

     SECTION 3.01. Supplemental Indenture. The Indenture, as supplemented and
amended by this Supplemental Indenture No. 1, is in all respects hereby adopted,
ratified and confirmed.

     SECTION 3.02. Effectiveness. This Supplemental Indenture No. 1 shall take
effect as of the date hereof.

     SECTION 3.03. Execution by the Trustee. The Trustee has executed this
Supplemental Indenture No. 1 only upon the terms and conditions set forth in the
Indenture. Without limiting the generality of the foregoing, the Trustee shall
not be responsible for the correctness of the recitals herein contained, which
shall be taken as the statements of the Company, the Guarantors and the
Additional Guarantors, and the Trustee makes no representation and shall have no
responsibility for, or in respect of, the validity or sufficiency of this
Supplemental Indenture No. 1 or the execution hereof by any Person (other than
the Trustee).

     SECTION 3.04. Governing Law. This Supplemental Indenture No. 1 shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of said State.

     SECTION 3.05. Counterparts. This Supplemental Indenture No. 1 may be
executed in any number of counterparts, each of which shall be an original; but
such counterparts shall together constitute but one and the same instrument.






                                        3





     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 1 to be duly executed, as of the day and year first written above.


                                            FEDEX CORPORATION
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Burnetta B. Williams
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Burnetta B. Williams
   Title: Assistant Secretary                  Title: Staff Vice President and
                                                        and Assistant Treasurer



                                            FEDERAL EXPRESS CORPORATION
Attest:

By: /s/ Andrew M. Paalborg                  By: /s/ Tracy G. Schmidt
   --------------------------------            --------------------------------
   Name:  Andrew M. Paalborg                   Name:  Tracy G. Schmidt
   Title: Assistant Secretary                  Title: Senior Vice President and
                                                        Chief Financial Officer



                                            FEDEX GROUND PACKAGE SYSTEM,
                                            INC.
Attest:

By: /s/ Steven H. Taylor                    By: /s/ Ronald R. Trombetta
   --------------------------------            --------------------------------
   Name:  Steven H. Taylor                     Name:  Ronald R. Trombetta
   Title: Senior Vice President                Title: Senior Vice President and
            and General Counsel                         Chief Financial Officer



                                            FEDEX CUSTOM CRITICAL, INC.
Attest:

By: /s/ Kimble H. Scott                     By: /s/ R. Bruce Simpson
   --------------------------------            --------------------------------
   Name:  Kimble H. Scott                      Name:  R. Bruce Simpson
   Title: Vice President and                   Title: President and CEO
            General Counsel



                                            VIKING FREIGHT, INC.
Attest:

By: /s/ Richard S. Goldaber                 By: /s/ Tilton G. Gore
   --------------------------------            --------------------------------
   Name:  Richard S. Goldaber                  Name:  Tilton G. Gore
   Title: VP and General Counsel               Title: President and CEO



                                        4






                                            FEDERAL EXPRESS CANADA LTD.
Attest:

By: /s/ Lisa Goldschleger                   By: /s/ Karl O. Stingily
   --------------------------------            --------------------------------
   Name:  Lisa Goldschleger                    Name:  Karl O. Stingily
   Title: Secretary                            Title: VP - Finance/P&A



                                            FEDERAL EXPRESS JAPAN K.K.
Attest:

By: /s/ Harold W. West                      By: /s/ David J. Ross
   --------------------------------            --------------------------------
   Name:  Harold W. West                       Name:  David J. Ross
   Title: Representative Director              Title: Representative Director



                                            THE BANK OF NEW YORK, as Trustee


                                            By: /s/ Stefan Victory
                                               --------------------------------
                                               Name:  Stefan Victory
                                               Title: Agent




                                        5

EX-4.4

                                                                    EXHIBIT 4.4


                         FEDEX CORPORATION, as Issuer,
                          THE GUARANTORS NAMED HEREIN,
                     THE ADDITIONAL GUARANTORS NAMED HEREIN
                                      AND
                             THE BANK OF NEW YORK,
                                   as Trustee

                             Supplemental Indenture
                                     No. 2

                       6 5/8% Notes due February 12, 2004
                       6 7/8% Notes due February 15, 2006
                       7 1/4% Notes due February 15, 2011


     SUPPLEMENTAL INDENTURE NO. 2, dated as of April 27, 2001 between FedEx
Corporation, a Delaware Corporation (the "Company"), the Guarantors referred to
in the Indenture defined below, FedEx Trade Networks, Inc., Tower Group
International, Inc., Tower Group International Canada Inc., Caribbean
Transportation Services, Inc., World Tariff, Limited, FedEx Ground Package
System, Ltd., FedEx Corporate Services, Inc., FedEx Supply Chain Services,
Inc., FedEx Freight System, Inc., American Freightways, Inc., Federal Express
Aviation Services, Incorporated, Federal Express (Australia) Pty Ltd., Federal
Express International (France) SNC, Federal Express (Singapore) Pte. Ltd.,
Federal Express Europe, Inc., Federal Express Europe, Inc. & Co.,
V.O.F./S.N.C., Federal Express Holdings (Mexico) y Compania S.N.C. de C.V.,
Federal Express Holdings S.A., Federal Express International, Inc., Federal
Express Pacific, Inc., and Federal Express Virgin Islands, Inc. (the
"Additional Guarantors"), and The Bank of New York, a New York banking
corporation, as Trustee (the "Trustee").

                                    RECITALS

     The Company, the Guarantors and the Trustee have executed and delivered an
Indenture dated as of February 12, 2001 and a Supplemental Indenture No. 1
dated as of February 20, 2001 (as supplemented, the "Indenture") to provide for
the issuance of the 6 5/8% Notes due 2004, the 6 7/8% Notes due 2006 and the 7
1/4% Notes due 2011;

     Section 12.03 of the Indenture provides that each Person who becomes a
Guarantor shall execute a supplemental indenture evidencing the same;





     The Additional Guarantors each desire to become a Guarantor under the
Indenture; and

     All acts and proceedings required by law, the Indenture and the
organizational documents of the Company, the Guarantors and the Additional
Guarantors necessary to constitute this Supplemental Indenture No. 2 a valid
and binding agreement for the uses and purposes set forth herein have been done
and performed, and the execution and delivery of this Supplemental Indenture
No. 2 have in all respects been duly authorized.

     NOW, THEREFORE, this Indenture witnesseth:

     For and in consideration of the premises and good and valuable
consideration the receipt whereof is hereby acknowledged, it is mutually
covenanted and agreed, for the equal and proportionate benefit of the holders
of the Notes of each series, as follows:

                                   ARTICLE 1
     RELATION TO THE INDENTURE; DEFINITIONS AND OTHER PROVISIONS OF GENERAL
                                  APPLICATION

     Section 1.01. Relation to the Indenture. This Supplemental Indenture No. 2
constitutes an integral part of the Indenture.

     Section 1.02. Definitions and Other Provisions of General Application. For
all purposes of this Supplemental Indenture No. 2 unless otherwise specified
herein:

     (a) all terms defined in this Indenture which are used and not otherwise
defined herein shall have the meanings they are given in the Indenture; and

     (b) the provisions of general application stated in Section 1.01 of the
Indenture shall apply to this Supplemental Indenture No. 2, except that the
words "herein," "hereof," "hereto" and "hereunder" and other words of similar
import refer to this Supplemental Indenture as a whole and not to the Indenture
or any particular Article, Section or other subdivision of the Indenture or
this Supplemental Indenture No. 2.

                                   ARTICLE 2


     Section 2.01. Addition Of Guarantors. The Additional Guarantors are each
hereby made a party to the Indenture as a Guarantor thereunder.





                                   ARTICLE 3
                            MISCELLANEOUS PROVISIONS

     Section 3.01. Supplemental Indenture. The Indenture, as supplemented and
amended by this Supplemental Indenture No. 2, is in all respects hereby
adopted, ratified and confirmed.

     Section 3.02. Effectiveness. This Supplemental Indenture No. 2 shall take
effect as of the date hereof.

     Section 3.03. Execution By The Trustee. The Trustee has executed this
Supplemental Indenture No. 2 only upon the terms and conditions set forth in
the Indenture. Without limiting the generality of the foregoing, the Trustee
shall not be responsible for the correctness of the recitals herein contained,
which shall be taken as the statements of the Company, the Guarantors and the
Additional Guarantors, and the Trustee makes no representation and shall have
no responsibility for, or in respect of, the validity or sufficiency of this
Supplemental Indenture No. 2 or the execution hereof by any Person (other than
the Trustee).

     Section 3.04. Governing Law. This Supplemental Indenture No. 2 shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of said State.

     Section 3.05. Counterparts. This Supplemental Indenture No. 2 may be
executed in any number of counterparts, each of which shall be an original; but
such counterparts shall together constitute but one and the same instrument.





     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 2 to be duly executed, as of the day and year first written
above.

                                       FEDEX CORPORATION
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ BURNETTA B. WILLIAMS
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Burnetta B. Williams
   Title: Assistant Secretary             Title: Staff Vice President and
                                                   Assistant Treasurer

                                       FEDERAL EXPRESS CORPORATION
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ TRACY G. SCHMIDT
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Tracy G. Schmidt
   Title: Assistant Secretary             Title: Senior Vice President and
                                                   Chief Financial Officer

                                       FEDEX GROUND PACKAGE SYSTEM, INC.
Attest:

By: /s/ STEVEN H. TAYLOR               By: /s/ RONALD R. TROMBETTA
   -------------------------------        ----------------------------------
   Name:  Steven H. Taylor                Name:  Ronald R. Trombetta
   Title: S.V.P. & Gen. Counsel           Title: S.V.P. Finance/CFO

                                       FEDEX CUSTOM CRITICAL, INC.
Attest:

By: /s/ KIMBLE H. SCOTT                By: /s/ BRENDAN L. O'SULLIVAN
   -------------------------------        ----------------------------------
   Name:  Kimble H. Scott                 Name:  Brendan L. O'Sullivan
   Title: VP & General Counsel            Title: VP Finance and CFO

                                       VIKING FREIGHT, INC.
Attest:

By: /s/ RICHARD GOLDABER               By: /s/ MARSHALL WITT
   -------------------------------        ----------------------------------
   Name:  Richard Goldaber                Name:  Marshall Witt
   Title: Vice President and              Title: Vice President of Finance
            General Counsel                        and Administration and
                                                   Chief Financial Officer





                                       FEDERAL EXPRESS CANADA LTD.
Attest:

By: /s/ LISA GOLDSCHLEGER              By: /s/ KARL O. STINGILY
   -------------------------------        ----------------------------------
   Name:  Lisa Goldschleger               Name:  Karl O. Stingily
   Title: Secretary                       Title: V.P. Finance/P&A

                                       FEDERAL EXPRESS JAPAN K.K.
Attest:

By: /s/ HAROLD W. WEST                 By: /s/ DAVID J. ROSS
   -------------------------------        ----------------------------------
   Name:  Harold W. West                  Name:  David J. Ross
   Title: Representative Director         Title: Representative Director

                                       FEDEX TRADE NETWORKS, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ ALAN J. MELUSKEY
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Alan J. Meluskey
   Title: Assistant Secretary             Title: Vice President-Finance and
                                                   Administration and Chief
                                                   Financial Officer

                                       TOWER GROUP INTERNATIONAL, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ DONALD P. VOGEL
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Donald P. Vogel
   Title: Assistant Secretary             Title: Vice President Finance

                                       TOWER GROUP INTERNATIONAL CANADA INC.
Attest:

By: /s/ PENELOPE W. REGISTER           By: /s/ G. EDMOND CLARK
   -------------------------------        ----------------------------------
   Name:  Penelope W. Register            Name:  G. Edmond Clark
   Title: VP and General Counsel          Title: Chairman of the Board and
                                                 Chief Executive Officer





                                       CARIBBEAN TRANSPORTATION SERVICES, INC.
Attest:

By: /s/ RICHARD FAIETA                 By: /s/ LYNN H. TURMAN
   -------------------------------        ----------------------------------
   Name:  Richard Faieta                  Name:  Lynn H. Turman
   Title: President/CEO                   Title: Vice President, Controller and
                                                   Assistant Treasurer

                                       WORLD TARIFF, LIMITED
Attest:

By: /s/ ROBERT T. MOLINET              By: /s/ ALAN J. MELUSKEY
   -------------------------------        ----------------------------------
   Name:  Robert T. Molinet               Name:  Alan J. Meluskey
   Title: Assistant Secretary             Title: Vice President, Chief Financial
                                                   Officer and Treasurer

                                       FEDEX GROUND PACKAGE SYSTEM, LTD.
Attest:

By: /s/ STEVEN H. TAYLOR               By: /s/ RONALD R. TROMBETTA
   -------------------------------        ----------------------------------
   Name:  Steven H. Taylor                Name:  Ronald R. Trombetta
   Title: S.V.P. & Gen. Counsel           Title: S.V.P. Finance/CFO

                                       FEDEX CORPORATE SERVICES, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ ROBERT A. GREEN
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Robert A. Green
   Title: Assistant Secretary             Title: Vice President - Finance

                                       FEDEX SUPPLY CHAIN SERVICES, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ LORI A. LUTEY
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Lori A. Lutey
   Title: Assistant Secretary             Title: Vice President - Finance
                                                   and Administration





                                       FEDEX FREIGHT SYSTEM, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ DONALD C. BROWN
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Donald C. Brown
   Title: Assistant Secretary             Title: Senior Vice President and
                                                   Chief Financial Officer

                                       AMERICAN FREIGHTWAYS, INC.
Attest:

By: /s/ C. EDWARD KLANK III            By: /s/ FRANK CONNER
   -------------------------------        ----------------------------------
   Name:  C. Edward Klank III             Name:  Frank Conner
   Title: Assistant Secretary             Title: Executive Vice President -
                                                   Accounting & Finance and
                                                   Chief Financial Officer

                                       FEDERAL EXPRESS AVIATION SERVICES,
                                         INCORPORATED
Attest:

By: /s/ KENNETH R. MASTERSON           By: /s/ JAMES R. PARKER
   -------------------------------        ----------------------------------
   Name:  Kenneth R. Masterson            Name:  James R. Parker
   Title: Secretary                       Title: President and
                                                   Chief Executive Officer

                                       FEDERAL EXPRESS (AUSTRALIA) PTY LTD.
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ ANDREW J. DA ROZA
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Andrew J. da Roza
   Title: Assistant Secretary,            Title: Director
            FedEx Corporation

                                       FEDERAL EXPRESS INTERNATIONAL (FRANCE)
                                         SNC
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ ALAIN CHAILLE
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Alain Chaille
   Title: Assistant Secretary,            Title: Director
            FedEx Corporation





                                       FEDERAL EXPRESS (SINGAPORE) PTE. LTD.
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ ANDREW J. DA ROZA
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Andrew J. da Roza
   Title: Assistant Secretary,            Title: Director
            FedEx Corporation

                                       FEDERAL EXPRESS EUROPE, INC.
Attest:

By: /s/ BURNETTA B. WILLIAMS           By: /s/ KENNETH F. KOVAL
   -------------------------------        ----------------------------------
   Name:  Burnetta B. Williams            Name:  Kenneth F. Koval
   Title: Treasurer                       Title: Vice President and
                                                   Chief Financial Officer

                                       FEDERAL EXPRESS EUROPE, INC. & CO.,
                                         V.O.F./S.N.C.
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ KENNETH F. KOVAL
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Kenneth F. Koval
   Title: Assistant Secretary,            Title: Director
            FedEx Corporation

                                       FEDERAL EXPRESS HOLDINGS (MEXICO) Y
                                         COMPANIA S.N.C. DE C.V.
Attest:

By: /s/ ANDREW M. PAALBORG             By: /s/ JUAN N. CENTO
   -------------------------------        ----------------------------------
   Name:  Andrew M. Paalborg              Name:  Juan N. Cento
   Title: Assistant Secretary,            Title: Director
            FedEx Corporation

                                       FEDERAL EXPRESS HOLDINGS S.A.
Attest:

By: /s/ BURNETTA B. WILLIAMS           By: /s/ JUAN N. CENTO
   -------------------------------        ----------------------------------
   Name:  Burnetta B. Williams            Name:  Juan N. Cento
   Title: Treasurer                       Title: President





                                       FEDERAL EXPRESS INTERNATIONAL, INC.
Attest:

By: /s/ BURNETTA B. WILLIAMS           By: /s/ DAVID J. BRONCZEK
   -------------------------------        ----------------------------------
   Name:  Burnetta B. Williams            Name:  David J. Bronczek
   Title: Treasurer                       Title: Chairman of the Board and
                                                   Chief Executive Officer

                                       FEDERAL EXPRESS PACIFIC, INC.
Attest:

By: /s/ BURNETTA B. WILLIAMS           By: /s/ MICHAEL L. DUCKER
   -------------------------------        ----------------------------------
   Name:  Burnetta B. Williams            Name:  Michael L. Ducker
   Title: Treasurer                       Title: Chairman of the Board and
                                                   Chief Executive Officer

                                       FEDERAL EXPRESS VIRGIN ISLANDS, INC.
Attest:

By: /s/ CHARLES E. KENNEDY             By: /s/ JULIO COLOMBA
   -------------------------------        ----------------------------------
   Name:  Charles E. Kennedy              Name:  Julio Colomba
   Title: Secretary                       Title: President

                                       THE BANK OF NEW YORK, as Trustee


                                       By: /s/ STEFAN VICTORY
                                          ----------------------------------
                                          Name:  Stefan Victory
                                          Title: Agent

- -------------------------------------------------------------------------------

EX-4.5

                                                                    EXHIBIT 4.5



- --------------------------------------------------------------------------------





                          REGISTRATION RIGHTS AGREEMENT

                          Dated as of February 12, 2001

                                      among

                               FEDEX CORPORATION,

                           THE GUARANTORS NAMED HEREIN

                                       and

                      MERRILL LYNCH, PIERCE FENNER & SMITH
                                  INCORPORATED
                         BANC OF AMERICA SECURITIES LLC
                              CHASE SECURITIES INC.
                        COMMERZBANK CAPITAL MARKETS CORP.
                     CREDIT SUISSE FIRST BOSTON CORPORATION

                            as the Initial Purchasers




- --------------------------------------------------------------------------------





                          REGISTRATION RIGHTS AGREEMENT

     REGISTRATION RIGHTS AGREEMENT (the "Agreement") dated as of February 12,
2001 among FEDEX CORPORATION, a Delaware corporation (the "Company"), FEDERAL
EXPRESS CORPORATION, FEDEX GROUND PACKAGE SYSTEM, INC., FEDEX CUSTOM CRITICAL,
INC. and VIKING FREIGHT, INC. (collectively, the "Initial Guarantors" and,
together with each subsidiary of the Company that hereafter and pursuant to the
terms of the Indenture referred to herein guarantees the Company's obligations
under such Indenture, the "Guarantors"), and MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED, BANC OF AMERICA SECURITIES LLC, CHASE SECURITIES INC.,
COMMERZBANK CAPITAL MARKETS CORP. and CREDIT SUISSE FIRST BOSTON CORPORATION
(collectively, the "Initial Purchasers").

     This Agreement is made pursuant to the Purchase Agreement dated February 6,
2001 by and among the Company, the Initial Guarantors and the Initial Purchasers
(the "Purchase Agreement"), which provides for the sale by the Company to the
Initial Purchasers of $250,000,000 aggregate principal amount of the Company's 6
5/8% Notes due 2004 (the "2004 Notes"), $250,000,000 aggregate principal amount
of the Company's 6 7/8% Notes due 2006 (the "2006 Notes") and $250,000,000
aggregate principal amount of the Company's 7 1/4% Notes due 2011 (the "2011
Notes" and, together with the 2004 Notes and the 2006 Notes, the "Securities,"
which term shall include the Guarantees in respect thereof). The Securities will
be guaranteed as to principal, premium, if any, and interest pursuant to the
Indenture by the Guarantors (each such guarantee, a "Guarantee"). In order to
induce the Initial Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to the Initial Purchasers' obligations thereunder,
the Company and the Initial Guarantors have agreed to provide to the Initial
Purchasers and their respective direct and indirect transferees and assigns the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the closing under the Purchase Agreement.

     In consideration of the foregoing, the parties hereto agree as follows:

     1. Definitions. As used in this Agreement, the following capitalized
defined terms shall have the following meanings:

          "1933 Act" shall mean the Securities Act of 1933, as amended from time
     to time, and the rules and regulations of the SEC promulgated thereunder.

          "1934 Act" shall mean the Securities Exchange Act of 1934, as amended
     from time to time, and the rules and regulations of the SEC promulgated
     thereunder.

          "Additional Interest" shall have the meaning set forth in Section 2(e)
     hereof.

          "Closing Time" shall mean February 12, 2001.

          "Company" shall have the meaning set forth in the preamble to this
     Agreement and also includes the Company's successors.




          "Depositary" shall mean The Depository Trust Company, or any other
     depositary appointed by the Company, including any agent thereof; provided,
     however, that any such depositary must at all times have an address in the
     Borough of Manhattan, The City of New York.

          "Exchange Offer" shall mean the exchange offer by the Company and the
     Guarantors of Exchange Securities for Registrable Securities pursuant to
     Section 2(a) hereof.

          "Exchange Offer Registration" shall mean a registration under the 1933
     Act effected pursuant to Section 2(a) hereof.

          "Exchange Offer Registration Statement" shall mean an exchange offer
     registration statement on Form S-4 (or, if applicable, on another
     appropriate form) covering the Registrable Securities, and all amendments
     and supplements to such registration statement, in each case including the
     Prospectus contained therein, all exhibits thereto and all material
     incorporated or deemed to be incorporated by reference therein.

          "Exchange Securities" shall mean the 6 5/8% Notes due 2004, the 6 7/8%
     Notes due 2006 and the 7 1/4% Notes due 2011 and the Guarantees in respect
     thereof issued by the Company and the Guarantors under the Indenture
     containing terms identical to the 2004 Notes, 2006 Notes and the 2011
     Notes, respectively (except that (i) interest thereon shall accrue from the
     last date to which interest has been paid or duly provided for on the
     Securities or, if no such interest has been paid or duly provided for, from
     the Interest Accrual Date, (ii) provisions relating to an increase in the
     stated rate of interest thereon upon the occurrence of a Registration
     Default shall be eliminated, (iii) the Exchange Securities may provide for
     Guarantees executed by Guarantors prior to the effective date of the
     Exchange Offer Registration Statement with the SEC in addition to the
     Guarantees provided by the Initial Guarantors in respect of the Securities,
     (iv) the transfer restrictions and legends relating to restrictions on
     ownership and transfer thereof as a result of the issuance of the
     Securities without registration under the 1933 Act shall be eliminated, and
     (v) each of the 6 5/8% Notes due 2004, the 6 7/8% Notes due 2006 and the 7
     1/4% Notes due 2011 will be represented by one or more global Exchange
     Securities in book-entry form unless exchanged for Exchange Securities in
     definitive certificated form under the circumstances provided in the
     Indenture) to be offered to Holders of Registrable Securities in exchange
     for Registrable Securities pursuant to the Exchange Offer.

          "Guarantee" shall have the meaning set forth in the preamble to this
     Agreement.

          "Guarantors" shall have the meaning set forth in the preamble to this
     Agreement and also includes the respective successors to the Initial
     Guarantors.

          "Holders" shall mean (i) the Initial Purchasers, for so long as they
     own any Registrable Securities, and each of their respective successors,
     assigns and direct and indirect transferees who become registered owners of
     Registrable Securities under the Indenture and (ii) each Participating
     Broker-Dealer that holds Exchange Securities for so


                                       2



     long as such Participating Broker-Dealer is required to deliver a
     prospectus meeting the requirements of the 1933 Act in connection with any
     resale of such Exchange Securities.

          "Indenture" shall mean the Indenture dated as of February 12, 2001
     among the Company, the Initial Guarantors and The Bank of New York, as
     trustee, as the same may be further amended or supplemented from time to
     time in accordance with the terms thereof.

          "Initial Guarantors" shall have the meaning set forth in the preamble
     to this Agreement and also includes the respective successors to the
     Initial Guarantors.

          "Interest Accrual Date" means February 12, 2001.

          "Initial Purchasers" shall have the meaning set forth in the preamble
     of this Agreement.

          "Majority Holders" shall mean the Holders of a majority of the
     aggregate principal amount of Registrable Securities outstanding, excluding
     Exchange Securities referred to in clause (ii) of the definition of
     "Holders" above; provided that whenever the consent or approval of Holders
     of a specified percentage of Registrable Securities or Exchange Securities
     is required hereunder, Registrable Securities and Exchange Securities held
     by the Company or any of its affiliates (as such term is defined in Rule
     405 under the 1933 Act) shall be disregarded in determining whether such
     consent or approval was given by the Holders of such required percentage.

          "Merrill Lynch" shall mean Merrill Lynch, Pierce, Fenner & Smith
     Incorporated and its successors.

          "NASD" shall mean the National Association of Securities Dealers, Inc.

          "Notifying Broker-Dealer" shall have the meaning set forth in Section
     3(f).

          "Participating Broker-Dealer" shall have the meaning set forth in
     Section 3(f).

          "Person" shall mean an individual, partnership, joint venture, limited
     liability company, corporation, trust or unincorporated organization, or a
     government or agency or political subdivision thereof.

          "Private Exchange Securities" shall have the meaning set forth in
     Section 2(a) hereof.

          "Prospectus" shall mean the prospectus included in a Registration
     Statement, including any preliminary prospectus, and any such prospectus as
     amended or supplemented by any prospectus supplement, including a
     prospectus supplement with respect to the terms of the offering of any
     portion of the Registrable Securities covered by a Shelf Registration
     Statement, and by all other amendments and supplements to a prospectus,
     including post-effective amendments, and in each case including all
     material incorporated or deemed to be incorporated by reference therein.


                                       3



          "Purchase Agreement" shall have the meaning set forth in the preamble
     to this Agreement.

          "Registrable Securities" shall mean the Securities; provided, however,
     that any Securities shall cease to be Registrable Securities when (i) a
     Registration Statement with respect to such Securities shall have been
     declared effective under the 1933 Act and such Securities shall have been
     disposed of pursuant to such Registration Statement, (ii) such Securities
     shall have been sold to the public pursuant to Rule 144 (or any similar
     provision then in force, but not Rule 144A) under the 1933 Act, (iii) such
     Securities shall have ceased to be outstanding, (iv) such Securities have
     been exchanged for Exchange Securities which have been registered pursuant
     to the Exchange Offer Registration Statement upon consummation of the
     Exchange Offer unless, in the case of any Exchange Securities referred to
     in this clause (iv), such Exchange Securities are held by Participating
     Broker-Dealers or otherwise are not freely tradable without any limitations
     or restrictions under the 1933 Act (in which case such Exchange Securities
     will be deemed to be Registrable Securities until such time as such
     Exchange Securities are sold to a purchaser in whose hands such Exchange
     Securities are freely tradeable without any limitations or restrictions
     under the 1933 Act) or (v) such Securities have been exchanged for Private
     Exchange Securities pursuant to the Registration Rights Agreement (in which
     case such Private Exchange Securities will be deemed to be Registrable
     Securities until such time as such Private Exchange Securities are sold to
     a purchaser in whose hands such Private Exchange Securities are freely
     tradeable without any limitations or restrictions under the 1933 Act).

          "Registration Default" shall have the meaning set forth in Section
     2(e).

          "Registration Expenses" shall mean any and all expenses incident to
     performance of or compliance by the Company with this Agreement, including
     without limitation: (i) all SEC, stock exchange or NASD registration and
     filing fees, (ii) all fees and expenses incurred in connection with
     compliance with state or other securities or blue sky laws and compliance
     with the rules of the NASD (including reasonable fees and disbursements of
     counsel for any underwriters or Holders in connection with qualification of
     any of the Exchange Securities or Registrable Securities under state or
     other securities or blue sky laws and any filing with and review by the
     NASD), (iii) all expenses of any Persons in preparing, printing and
     distributing any Registration Statement, any Prospectus, any amendments or
     supplements thereto, any underwriting agreements, securities sales
     agreements, certificates representing the Securities or Exchange Securities
     and other documents relating to the performance of and compliance with this
     Agreement, (iv) all rating agency fees, (v) all fees and expenses incurred
     in connection with the listing, if any, of any of the Securities, Private
     Exchange Securities (if any) or Exchange Securities on any securities
     exchange or exchanges or on any quotation system, (vi) all fees and
     disbursements relating to the qualification of the Indenture under
     applicable securities laws, (vii) the fees and disbursements of counsel for
     the Company and the fees and expenses of independent public accountants for
     the Company or for any other Person, business or assets whose financial
     statements are included in any Registration Statement or Prospectus,
     including the expenses of any special audits or "cold comfort" letters
     required by or incident to such performance and compliance, (viii) the fees
     and expenses


                                       4



     of a "qualified independent underwriter" as defined by Conduct Rule 2720 of
     the NASD (if required by the NASD rules) and the fees and disbursements of
     its counsel, (ix) the fees and expenses of the Trustee, any registrar, any
     depositary, any paying agent, any escrow agent or any custodian, in each
     case including fees and disbursements of their respective counsel, and (x)
     in the case of an underwritten offering, any fees and disbursements of the
     underwriters customarily paid by issuers or sellers of securities and the
     fees and expenses of any special experts retained by the Company in
     connection with any Registration Statement but excluding (except as
     otherwise provided herein) fees of counsel to the underwriters or the
     Holders and underwriting discounts and commissions and transfer taxes, if
     any, relating to the sale or disposition of Registrable Securities by a
     Holder.

          "Registration Statement" shall mean any registration statement of the
     Company and the Guarantors relating to any offering of the Exchange
     Securities or Registrable Securities pursuant to the provisions of this
     Agreement (including, without limitation, any Exchange Offer Registration
     Statement and any Shelf Registration Statement), and all amendments and
     supplements to any such Registration Statement, including post-effective
     amendments, in each case including the Prospectus contained therein, all
     exhibits thereto and all material incorporated or deemed to be incorporated
     by reference therein.

          "SEC" shall mean the Securities and Exchange Commission or any
     successor thereto.

          "Securities" shall have the meaning set forth in the preamble to this
     Agreement.

          "Shelf Registration" shall mean a registration effected pursuant to
     Section 2(b) hereof.

          "Shelf Registration Statement" shall mean a "shelf" registration
     statement of the Company and the Guarantors pursuant to the provisions of
     Section 2(b) of this Agreement which covers all of the Registrable
     Securities or Private Exchange Securities (if any), as the case may be, on
     an appropriate form under Rule 415 under the 1933 Act, or any similar rule
     that may be adopted by the SEC, and all amendments and supplements to such
     registration statement, including post-effective amendments, in each case
     including the Prospectus contained therein, all exhibits thereto and all
     material incorporated or deemed to be incorporated by reference therein.

          "TIA" shall mean the Trust Indenture Act of 1939, as amended from time
     to time, and the rules and regulations of the SEC promulgated thereunder.

          "Trustee" shall mean the trustee with respect to the Securities, the
     Private Exchange Securities (if any) and the Exchange Securities under the
     Indenture.

     For purposes of this Agreement, (i) all references in this Agreement to any
Registration Statement, preliminary prospectus or Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the SEC pursuant to its Electronic Data Gathering, Analysis and Retrieval
system; (ii) all references in this Agreement to financial


                                       5



statements and schedules and other information which is "contained", "included"
or "stated" in any Registration Statement or Prospectus (or other references of
like import) shall be deemed to mean and include all such financial statements
and schedules and other information which is incorporated or deemed to be
incorporated by reference in such Registration Statement or Prospectus, as the
case may be; (iii) all references in this Agreement to amendments or supplements
to any Registration Statement or Prospectus shall be deemed to mean and include
the filing of any document under the 1934 Act which is incorporated or deemed to
be incorporated by reference in such Registration Statement or Prospectus, as
the case may be; (iv) all references in this Agreement to Rule 144, Rule 144A or
Rule 405 under the 1933 Act, and all references to any sections or subsections
thereof or terms defined therein, shall in each case include any successor
provisions thereto; and (v) all references in this Agreement to days (but not to
business days) shall mean calendar days.

     2. Registration Under the 1933 Act.

     (a) Exchange Offer Registration. The Company shall (A) file with the SEC on
or prior to the 135th day after the Closing Time an Exchange Offer Registration
Statement covering the offer by the Company and the Guarantors to the Holders to
exchange all of the Registrable Securities for a like aggregate principal amount
of Exchange Securities, (B) use its reasonable best efforts to cause such
Exchange Offer Registration Statement to be declared effective by the SEC no
later than the 180th day after the Closing Time, (C) use its reasonable best
efforts to cause such Registration Statement to remain effective until the
closing of the Exchange Offer and (D) use its reasonable best efforts to
consummate the Exchange Offer no later than 45 days after the effective date of
the Exchange Offer Registration Statement. Upon the effectiveness of the
Exchange Offer Registration Statement, the Company shall promptly commence the
Exchange Offer, it being the objective of such Exchange Offer to enable each
Holder eligible and electing to exchange Registrable Securities for Exchange
Securities (assuming that such Holder is not an affiliate of the Company within
the meaning of Rule 405 under the 1933 Act, acquires the Exchange Securities in
the ordinary course of such Holder's business and has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing such Exchange Securities) to trade such Exchange
Securities from and after their receipt without any limitations or restrictions
under the 1933 Act or under the securities or blue sky laws of the states of the
United States.

     In connection with the Exchange Offer, the Company shall:

          (i) promptly mail to each Holder a copy of the Prospectus forming part
     of the Exchange Offer Registration Statement, together with an appropriate
     letter of transmittal and related documents;

          (ii) keep the Exchange Offer open for not less than 20 business days
     (or longer if required by applicable law) after the date notice thereof is
     mailed to the Holders and, during the Exchange Offer, offer to all Holders
     who are legally eligible to participate in the Exchange Offer the
     opportunity to exchange their Registrable Securities for Exchange
     Securities;


                                       6



          (iii) use the services of a depositary with an address in the Borough
     of Manhattan, The City of New York for the Exchange Offer;

          (iv) permit Holders to withdraw tendered Registrable Securities at any
     time prior to the close of business, New York City time, on the last
     business day on which the Exchange Offer shall remain open, by sending to
     the institution specified in the Prospectus or the related letter of
     transmittal or related documents a telegram, telex, facsimile transmission
     or letter setting forth the name of such Holder, the principal amount of
     Registrable Securities delivered for exchange, and a statement that such
     Holder is withdrawing its election to have such Securities exchanged; and

          (v) otherwise comply in all material respects with all applicable laws
     relating to the Exchange Offer.

     If, at or prior to the consummation of the Exchange Offer, any of the
Initial Purchasers holds any Securities acquired by it and having the status of
an unsold allotment in the initial distribution, the Company shall, upon the
request of any such Initial Purchaser, simultaneously with the delivery of the
Exchange Securities in the Exchange Offer, issue and deliver to such Initial
Purchaser in exchange for such Securities a like principal amount of debt
securities of the Company that are identical (except that such debt securities
shall be subject to transfer restrictions and shall bear a legend relating to
restrictions on ownership and transfer as a result of the issuance thereof
without registration under the 1933 Act and shall provide for the payment of
Additional Interest) to the Exchange Securities (the "Private Exchange
Securities"). The Company shall use its reasonable best efforts to have the
Private Exchange Securities bear the same CUSIP number as the Exchange
Securities and, if unable to do so, the Company will, at such time as any
Private Exchange Security ceases to be a "restricted security" within the
meaning of Rule 144 under the 1933 Act, permit any such Private Exchange
Security to be exchanged for a like principal amount of Exchange Securities. The
Company shall not have any liability under this Agreement solely as a result of
any such Private Exchange Securities not bearing the same CUSIP number as the
Exchange Securities.

     The Exchange Securities and the Private Exchange Securities (if any) shall
be issued under the Indenture, which shall be qualified under the TIA. The
Indenture shall provide that the Exchange Securities, the Private Exchange
Securities (if any) and the Securities shall vote and consent together on all
matters as a single class and shall constitute a single series of debt
securities issued under the Indenture.

     As soon as practicable after the close of the Exchange Offer, the Company
shall:

          (i) accept for exchange all Registrable Securities duly tendered and
     not validly withdrawn pursuant to the Exchange Offer in accordance with the
     terms of the Exchange Offer Registration Statement and the letter of
     transmittal which is an exhibit thereto;

          (ii) deliver, or cause to be delivered, to the Trustee for
     cancellation all Registrable Securities so accepted for exchange by the
     Company; and


                                       7



          (iii) cause the Trustee promptly to authenticate and deliver Exchange
     Securities to each Holder of Registrable Securities so accepted for
     exchange equal in principal amount to the principal amount of the
     Registrable Securities of such Holder so accepted for exchange.

     Interest on each Exchange Security and such Private Exchange Security (if
any) will accrue from the last date on which interest was paid or duly provided
for on the Securities surrendered in exchange therefor or, if no interest has
been paid or duly provided for on such Securities, from the Interest Accrual
Date. The Exchange Offer shall not be subject to any conditions, other than (i)
that the Exchange Offer, or the making of any exchange by a Holder, does not
violate any applicable law or any applicable interpretation of the staff of the
SEC, (ii) that no action or proceeding shall have been instituted or threatened
in any court or by or before any governmental agency with respect to the
Exchange Offer which, in the Company's judgment, would reasonably be expected to
impair the ability of the Company to proceed with the Exchange Offer, and (iii)
that the Holders tender the Registrable Securities to the Company in accordance
with the Exchange Offer. Each Holder of Registrable Securities (other than
Participating Broker-Dealers) who wishes to exchange such Registrable Securities
for Exchange Securities in the Exchange Offer will be required to represent that
(i) it is not an affiliate (as defined in Rule 405 under the 1933 Act) of the
Company, (ii) any Exchange Securities to be received by it will be acquired in
the ordinary course of business and (iii) it has no arrangement with any Person
to participate in the distribution (within the meaning of the 1933 Act) of the
Exchange Securities, and shall be required to make such other representations as
may be reasonably necessary under applicable SEC rules, regulations or
interpretations to render the use of Form S-4 or another appropriate form under
the 1933 Act available. To the extent permitted by law, the Company shall inform
the Initial Purchasers of the names and addresses of the Holders of Securities
to whom the Exchange Offer is made and, to the extent such information is
available to the Company, the names and addresses of the beneficial owners of
such Securities, and the Initial Purchasers shall have the right to contact such
Holders and beneficial owners and otherwise facilitate the tender of Registrable
Securities in the Exchange Offer.

     (b) Shelf Registration. (i) If, because of any change in law or applicable
interpretations thereof by the staff of the SEC, the Company and the Guarantors
are not permitted to effect the Exchange Offer as contemplated by Section 2(a)
hereof, or (ii) if for any other reason (A) the Exchange Offer Registration
Statement is not declared effective within 180 days following the Closing Time
or (B) the Exchange Offer is not consummated within 45 days after effectiveness
of the Exchange Offer Registration Statement (provided that if the Exchange
Offer Registration Statement shall be declared effective after such 180-day
period or if the Exchange Offer shall be consummated after such 45-day period,
then the Company's obligations under this clause (ii) arising from the failure
of the Exchange Offer Registration Statement to be declared effective within
such 180-day period or the failure of the Exchange Offer to be consummated
within such 45-day period, respectively, shall terminate), or (iii) if any
Holder (other than an Initial Purchaser holding Securities acquired directly
from the Company) is not eligible to participate in the Exchange Offer or elects
to participate in the Exchange Offer but does not receive Exchange Securities
which are freely tradeable without any limitations or restrictions under the
1933 Act or (iv) upon the request of any of the Initial Purchasers within 90
days following the consummation of the Exchange Offer (provided that, in the
case of this clause (iv), such Initial Purchaser shall hold Registrable
Securities (including, without limitation,


                                       8



Private Exchange Securities) that it acquired directly from the Company), the
Company shall, at its cost:

          (A) as promptly as practicable, but no later than (a) the 180th day
     after the Closing Time or (b) the 60th day after any such filing obligation
     arises, whichever is later, file with the SEC a Shelf Registration
     Statement relating to the offer and sale of the Registrable Securities by
     the Holders from time to time in accordance with the methods of
     distribution elected by the Majority Holders of such Registrable Securities
     and set forth in such Shelf Registration Statement;

          (B) use its reasonable best efforts to cause such Shelf Registration
     Statement to be declared effective by the SEC as promptly as practicable,
     but in no event later than the 225th day after the Closing Time (or, in the
     case of a request by any of the Initial Purchasers pursuant to clause (iv)
     above, within 90 days after such request). In the event that the Company is
     required to file a Shelf Registration Statement pursuant to clause (iii) or
     (iv) above, the Company shall file and use its reasonable best efforts to
     have declared effective by the SEC both an Exchange Offer Registration
     Statement pursuant to Section 2(a) with respect to all Registrable
     Securities and a Shelf Registration Statement (which may be a combined
     Registration Statement with the Exchange Offer Registration Statement) with
     respect to offers and sales of Registrable Securities held by such Holder
     or such Initial Purchaser, as applicable;

          (C) use its reasonable best efforts to keep the Shelf Registration
     Statement continuously effective, supplemented and amended as required, in
     order to permit the Prospectus forming part thereof to be usable by Holders
     for a period of two years after the latest date on which any Securities and
     Guarantees are originally issued by the Company and the Guarantors
     respectively (subject to extension pursuant to the last paragraph of
     Section 3) or, if earlier, when all of the Registrable Securities covered
     by such Shelf Registration Statement (i) have been sold pursuant to the
     Shelf Registration Statement in accordance with the intended method of
     distribution thereunder, (ii) become eligible for resale pursuant to Rule
     144(k) under the 1933 Act or (iii) cease to be Registrable Securities; and

          (D) notwithstanding any other provisions hereof, use its reasonable
     best efforts to ensure that (i) any Shelf Registration Statement and any
     amendment thereto and any Prospectus forming a part thereof and any
     supplements thereto comply in all material respects with the 1933 Act and
     the rules and regulations thereunder, (ii) any Shelf Registration Statement
     and any amendment thereto does not, when it becomes effective, contain an
     untrue statement of a material fact or omit to state a material fact
     required to be stated therein or necessary to make the statements therein
     not misleading and (iii) any Prospectus forming part of any Shelf
     Registration Statement and any amendment or supplement to such Prospectus
     does not include an untrue statement of a material fact or omit to state a
     material fact necessary in order to make the statements therein, in the
     light of the circumstances under which they were made, not misleading;
     provided, however, clauses (ii) and (iii) shall not apply to any statement
     in or omission from a Shelf Registration Statement or a Prospectus made in
     reliance upon and conformity with information relating to any Initial
     Purchaser, Holder, Participating Broker-Dealer or


                                       9



     underwriter of Registrable Securities furnished to the Company in writing
     by such Initial Purchaser, Holder, Participating Broker-Dealer or
     underwriter, respectively, expressly for use in such Shelf Registration
     Statement or Prospectus.

     The Company agrees, if necessary, to supplement or amend the Shelf
Registration Statement if reasonably requested by the Majority Holders with
respect to information relating to the Holders and otherwise as required by
Section 3(b) below, to use its reasonable best efforts to cause any such
amendment to become effective and such Shelf Registration Statement to become
usable as soon as practicable thereafter and to furnish to the Holders of
Registrable Securities copies of any such supplement or amendment promptly after
its being used or filed with the SEC.

     (c) Expenses. The Company shall pay all Registration Expenses in connection
with the registration pursuant to Section 2(a) and 2(b) and, in the case of any
Shelf Registration Statement, will reimburse the Holders or the Initial
Purchasers for the reasonable fees and disbursements of one counsel (in addition
to any local counsel) designated in writing by the Majority Holders (or, if a
Shelf Registration Statement is filed solely pursuant to clause (iv) of the
first paragraph of Section 2(b), designated by the Initial Purchasers) to act as
counsel for the Holders of the Registrable Securities in connection therewith.
Each Holder shall pay all fees and disbursements of its counsel other than as
set forth in the preceding sentence or in the definition of Registration
Expenses and all underwriting discounts and commissions and transfer taxes, if
any, relating to the sale or disposition of such Holder's Registrable Securities
pursuant to a Shelf Registration Statement.

     (d) Effective Registration Statement.

          (i) An Exchange Offer Registration Statement pursuant to Section 2(a)
     hereof or a Shelf Registration Statement pursuant to Section 2(b) hereof
     shall not be deemed to have become effective unless it has been declared
     effective by the SEC; provided, however, that if, after it has been
     declared effective, the offering of Registrable Securities pursuant to a
     Registration Statement is interfered with by any stop order, injunction or
     other order or requirement of the SEC or any other governmental agency or
     court, such Registration Statement shall be deemed not to have been
     effective during the period of such interference until the offering of
     Registrable Securities pursuant to such Registration Statement may legally
     resume.

          (ii) During any 365-day period, the Company may, by notice as
     described in Section 3(e), suspend the availability of a Shelf Registration
     Statement (and, if the Exchange Offer Registration Statement is being used
     in connection with the resale of Exchange Securities by Participating
     Broker-Dealers as contemplated by Section 3(f), the Exchange Offer
     Registration Statement) and the use of the related Prospectus for up to two
     periods of up to 45 consecutive days each, but no more than an aggregate of
     90 days during any 365-day period, upon the happening of any event or the
     discovery of any fact referred to in Section 3(e)(vi), but subject to
     compliance by the Company with its obligations under the last paragraph of
     Section 3.



                                       10


     (e) Increase in Interest Rate. In the event that:

          (i) the Exchange Offer Registration Statement is not filed with the
     SEC on or prior to the 135th day following the Closing Time, or

          (ii) the Exchange Offer Registration Statement is not declared
     effective by the SEC on or prior to the 180th day following the Closing
     Time, or

          (iii) the Exchange Offer is not consummated on or prior to the 45th
     day following the effective date of the Exchange Offer Registration
     Statement, or

          (iv) if required, a Shelf Registration Statement is not filed with the
     SEC on or prior to (A) the 180th day following the Closing Time or (B) the
     60th day after the filing obligation arises, whichever is later, or

          (v) if required, a Shelf Registration Statement is not declared
     effective on or prior to the 225th day following the Closing Time (or, if a
     Shelf Registration Statement is required to be filed upon the request of
     any Initial Purchaser, within 90 days after such request), or

          (vi) a Shelf Registration Statement is declared effective by the SEC
     but such Shelf Registration Statement ceases to be effective or such Shelf
     Registration Statement or the Prospectus included therein ceases to be
     usable in connection with resales of Registrable Securities for any reason
     and either (A) the aggregate number of days in any consecutive 365-day
     period for which the Shelf Registration Statement or such Prospectus shall
     not be effective or usable exceeds 90 days, (B) the Shelf Registration
     Statement or such Prospectus shall not be effective or usable for more than
     two periods (regardless of duration) in any consecutive 365-day period or
     (C) the Shelf Registration Statement or such Prospectus shall not be
     effective or usable for a period of more than 45 consecutive days, or

          (vii) the Exchange Offer Registration Statement is declared effective
     by the SEC but, if the Exchange Offer Registration Statement is being used
     in connection with the resale of Exchange Securities as contemplated by
     Section 3(f) of this Agreement, the Exchange Offer Registration Statement
     ceases to be effective or the Exchange Offer Registration Statement or the
     Prospectus included therein ceases to be usable in connection with resales
     of Exchange Securities for any reason during the 180-day period referred to
     in Section 3(f)(B) of this Agreement (as such period may be extended
     pursuant to the last paragraph of Section 3 of this Agreement) and either
     (A) the aggregate number of days in any consecutive 365-day period for
     which the Exchange Offer Registration Statement or such Prospectus shall
     not be effective or usable exceeds 90 days, (B) the Exchange Offer
     Registration Statement or such Prospectus shall not be effective or usable
     for more than two periods (regardless of duration) in any consecutive
     365-day period or (C) the Exchange Offer Registration Statement or the
     Prospectus shall not be effective or usable for a period of more than 45
     consecutive days,

(each of the events referred to in clauses (i) through (vii) above being
hereinafter called a "Registration Default"), the per annum interest rate borne
by the Registrable Securities shall be


                                       11



increased ("Additional Interest") by one-quarter of one percent (0.25%) per
annum immediately following such 135-day period in the case of clause (i) above,
immediately following such 180-day period in the case of clause (ii) above,
immediately following such 45-day period in the case of clause (iii) above,
immediately following any such 180-day period or 60-day period, whichever ends
later, in the case of clause (iv) above, immediately following any such 225-day
period or 90-day period, whichever ends first, in the case of clause (v) above,
immediately following the 90th day in any consecutive 365-day period, as of the
first day of the third period in any consecutive 365-day period or immediately
following the 45th consecutive day, whichever occurs first, that a Shelf
Registration Statement shall not be effective or a Shelf Registration Statement
or the Prospectus included therein shall not be usable as contemplated by clause
(vi) above, or immediately following the 90th day in any consecutive 365-day
period, as of the first day of the third period in any consecutive 365-day
period or immediately following the 45th consecutive day, whichever occurs
first, that the Exchange Offer Registration Statement shall not be effective or
the Exchange Offer Registration Statement or the Prospectus included therein
shall not be usable as contemplated by clause (vii) above, which rate will be
increased by an additional one-quarter of one percent (0.25%) per annum
immediately following each 90-day period that any Additional Interest continues
to accrue under any circumstances; provided that the aggregate increase in such
annual interest rate may in no event exceed one-half of one percent (0.50%) per
annum. Upon the filing of the Exchange Offer Registration Statement after the
135-day period described in clause (i) above, the effectiveness of the Exchange
Offer Registration Statement after the 180-day period described in clause (ii)
above, the consummation of the Exchange Offer after the 45-day period described
in clause (iii) above, the filing of the Shelf Registration Statement after the
180-day period or 60-day period day, as the case may be, described in clause
(iv) above, the effectiveness of a Shelf Registration Statement after the
225-day period or 90-day period, as the case may be, described in clause (v)
above, or the Shelf Registration Statement once again being effective or the
Shelf Registration Statement and the Prospectus included therein becoming usable
in connection with resales of Registrable Securities, as the case may be, in the
case of clause (vi) above, or the Exchange Offer Registration Statement once
again becoming effective or the Exchange Offer Registration Statement and the
Prospectus included therein becoming usable in connection with resales of
Exchange Securities, as the case may be, in the case of clause (vii) thereof,
the interest rate borne by the Securities from the date of such filing,
effectiveness, consummation or resumption of effectiveness or useability, as the
case may be, shall be reduced to the original interest rate so long as no other
Registration Default shall have occurred and shall be continuing at such time
and the Company is otherwise in compliance with this paragraph; provided,
however, that, if after any such reduction in interest rate, one or more
Registration Defaults shall again occur, the interest rate shall again be
increased pursuant to the foregoing provisions.

     Anything herein to the contrary notwithstanding, any Holder who was, at the
time the Exchange Offer was pending and consummated, eligible to exchange, and
did not validly tender, its Securities for Exchange Securities in the Exchange
Offer will not be entitled to receive any Additional Interest. For purposes of
clarity, it is hereby acknowledged and agreed that, under current
interpretations of law by the SEC, Initial Purchasers holding unsold allotments
of Securities acquired from the Company are not eligible to participate in the
Exchange Offer.


                                       12



     3. Registration Procedures. In connection with the obligations of the
Company with respect to the Registration Statements pursuant to Sections 2(a)
and 2(b) hereof, the Company shall:

          (a) prepare and file with the SEC a Registration Statement or, if
     required, Registration Statements, within the time periods specified in
     Section 2, on the appropriate form under the 1933 Act, which form (i) shall
     be selected by the Company, (ii) shall, in the case of a Shelf Registration
     Statement, be available for the sale of the Registrable Securities by the
     selling Holders thereof and (iii) shall comply as to form in all material
     respects with the requirements of the applicable form and include or
     incorporate by reference all financial statements required by the SEC to be
     filed therewith, and use its reasonable best efforts to cause such
     Registration Statement to become effective and remain effective in
     accordance with Section 2 hereof;

          (b) prepare and file with the SEC such amendments and post-effective
     amendments to each Registration Statement as may be necessary under
     applicable law to keep such Registration Statement effective for the
     applicable period; cause each Prospectus to be supplemented by any required
     prospectus supplement, and as so supplemented to be filed pursuant to Rule
     424 under the 1933 Act; and comply with the provisions of the 1933 Act and
     the 1934 Act with respect to the disposition of all Securities covered by
     each Registration Statement during the applicable period in accordance with
     the intended method or methods of distribution by the selling Holders
     thereof;

          (c) in the case of a Shelf Registration, (i) notify each Holder of
     Registrable Securities, at least ten business days prior to filing, that a
     Shelf Registration Statement with respect to the Registrable Securities is
     being filed and advising such Holders that the distribution of Registrable
     Securities will be made in accordance with the method elected by the
     Majority Holders; (ii) furnish to each Holder of Registrable Securities, to
     counsel for the Initial Purchasers, to counsel for the Holders and to each
     underwriter of an underwritten offering of Registrable Securities, if any,
     without charge, as many copies of each Prospectus, including each
     preliminary Prospectus, and any amendment or supplement thereto and such
     other documents as such Holder, counsel or underwriter may reasonably
     request, including financial statements and schedules and, if such Holder,
     counsel or underwriter so requests, all exhibits (including those
     incorporated by reference) in order to facilitate the public sale or other
     disposition of the Registrable Securities; and (iii) subject to the
     penultimate paragraph of this Section 3, the Company hereby consents to the
     use of the Prospectus, including each preliminary Prospectus, or any
     amendment or supplement thereto by each of the Holders and underwriters of
     Registrable Securities in connection with the offering and sale of the
     Registrable Securities covered by any Prospectus or any amendment or
     supplement thereto;

          (d) use its reasonable best efforts to register or qualify the
     Registrable Securities under all applicable state securities or "blue sky"
     laws of such jurisdictions as any Holder of Registrable Securities covered
     by a Registration Statement and each underwriter of an underwritten
     offering of Registrable Securities shall reasonably request, to cooperate
     with the Holders and the underwriters of any Registrable Securities in


                                       13



     connection with any filings required to be made with the NASD, to keep each
     such registration or qualification effective during the period such
     Registration Statement is required to be effective and do any and all other
     acts and things which may be reasonably necessary or advisable to enable
     such Holder to consummate the disposition in each such jurisdiction of such
     Registrable Securities owned by such Holder; provided, however, that
     neither the Company nor any Guarantor shall be required to (i) qualify as a
     foreign corporation or as a dealer in securities in any jurisdiction where
     it would not otherwise be required to qualify but for this Section 3(d) or
     (ii) take any action which would subject it to general service of process
     or taxation in any such jurisdiction if it is not then so subject;

          (e) in the case of a Shelf Registration, notify each Holder of
     Registrable Securities and counsel for such Holders promptly and, if
     requested by such Holder or counsel, confirm such advice in writing
     promptly (i) when a Registration Statement has become effective and when
     any post-effective amendments and supplements thereto become effective,
     (ii) of any request by the SEC or any state securities authority for
     post-effective amendments or supplements to a Registration Statement or
     Prospectus or for additional information after a Registration Statement has
     become effective, (iii) of the issuance by the SEC or any state securities
     authority of any stop order suspending the effectiveness of a Registration
     Statement or the initiation of any proceedings for that purpose, (iv) if
     between the effective date of a Registration Statement and the closing of
     any sale of Registrable Securities covered thereby the representations and
     warranties of the Company contained in any underwriting agreement,
     securities sales agreement or other similar agreement, if any, relating to
     such offering cease to be true and correct, (v) of the receipt by the
     Company of any notification with respect to the suspension of the
     qualification of the Registrable Securities for sale in any jurisdiction or
     the initiation or threatening of any proceeding for such purpose, (vi) of
     the happening of any event or the discovery of any facts during the period
     a Shelf Registration Statement is effective which makes any statement made
     in such Shelf Registration Statement or the related Prospectus untrue in
     any material respect or which constitutes an omission to state a material
     fact in such Shelf Registration Statement or Prospectus and (vii) of any
     determination by the Company that a post-effective amendment to a
     Registration Statement would be appropriate. Without limitation to any
     other provisions of this Agreement, the Company agrees that this Section
     3(e) shall also be applicable, mutatis mutandis, with respect to the
     Exchange Offer Registration Statement and the Prospectus included therein
     to the extent that such Prospectus is being used by Participating
     Broker-Dealers as contemplated by Section 3(f);

          (f) (A) in the case of an Exchange Offer, (i) include in the Exchange
     Offer Registration Statement (x) a "Plan of Distribution" section
     (substantially in the form set forth in Annex A hereto) covering the use of
     the Prospectus included in the Exchange Offer Registration Statement by
     broker-dealers who have exchanged their Registrable Securities for Exchange
     Securities for the resale of such Exchange Securities and (y) a statement
     to the effect that any such broker-dealers who wish to use the related
     Prospectus in connection with the resale of Exchange Securities acquired as
     a result of market-making or other trading activities will be required to
     notify the Company to that effect, together with instructions for giving
     such notice (which instructions shall include a


                                       14



     provision for giving such notice by checking a box or making another
     appropriate notation on the related letter of transmittal) (each such
     broker-dealer who gives notice to the Company as aforesaid being
     hereinafter called a "Notifying Broker-Dealer"), (ii) furnish to each
     Notifying Broker-Dealer who desires to participate in the Exchange Offer,
     without charge, as many copies of each Prospectus included in the Exchange
     Offer Registration Statement and any amendment or supplement thereto, as
     such broker-dealer may reasonably request, (iii) include in the Exchange
     Offer Registration Statement a statement that any broker-dealer who holds
     Registrable Securities acquired for its own account as a result of
     market-making activities or other trading activities (a "Participating
     Broker-Dealer"), and who receives Exchange Securities for Registrable
     Securities pursuant to the Exchange Offer, may be a statutory underwriter
     and must deliver a prospectus meeting the requirements of the 1933 Act in
     connection with any resale of such Exchange Securities, (iv) subject to the
     penultimate paragraph of this Section 3, the Company hereby consents to the
     use of the Prospectus forming part of the Exchange Offer Registration
     Statement or any amendment or supplement thereto by any Notifying
     Broker-Dealer in connection with the sale or transfer of Exchange
     Securities, and (v) include in the transmittal letter or similar
     documentation to be executed by an exchange offeree in order to participate
     in the Exchange Offer the following provision:

          "If the undersigned is not a broker-dealer, the undersigned represents
     that it is not engaged in, and does not intend to engage in, a distribution
     of Exchange Securities. If the undersigned is a broker-dealer that will
     receive Exchange Securities for its own account in exchange for Registrable
     Securities, it represents that the Registrable Securities to be exchanged
     for Exchange Securities were acquired by it as a result of market-making
     activities or other trading activities and acknowledges that it will
     deliver a prospectus meeting the requirements of the 1933 Act in connection
     with any resale of such Exchange Securities pursuant to the Exchange Offer;
     however, by so acknowledging and by delivering a prospectus, the
     undersigned will not be deemed to admit that it is an "underwriter" within
     the meaning of the 1933 Act;"

          (B) to the extent any Notifying Broker-Dealer participates in the
     Exchange Offer, (i) the Company shall use its reasonable best efforts to
     maintain the effectiveness of the Exchange Offer Registration Statement for
     a period of 180 days (subject to extension pursuant to the last paragraph
     of this Section 3) following the last date on which exchanges are accepted
     pursuant to the Exchange Offer, and (ii) the Company will comply, insofar
     as relates to the Exchange Offer Registration Statement, the Prospectus
     included therein and the offering and sale of Exchange Securities pursuant
     thereto, with its obligations under Section 2(b)(D), the last paragraph of
     Section 2(b), Section 3(c), 3(d), 3(e), 3(i), 3(j), 3(k), 3(o) and 3(p),
     and the last two paragraphs of this Section 3 as if all references therein
     to a Shelf Registration Statement, the Prospectus included therein and the
     Holders of Registrable Securities referred, mutatis mutandis, to the
     Exchange Offer Registration Statement, the Prospectus included therein and
     the applicable Notifying Broker-Dealers and, for purposes of this Section
     3(f), all references in any such paragraphs or sections to the "Majority
     Holders" shall be deemed to mean, solely insofar as relates to this Section
     3(f), the Notifying Broker-Dealers who are the Holders of the majority in
     aggregate principal amount of the Exchange Securities which are Registrable
     Securities; and


                                       15



          (C) the Company shall not be required to amend or supplement the
     Prospectus contained in the Exchange Offer Registration Statement as would
     otherwise be contemplated by Section 3(b) or 3(k) hereof, or take any other
     action as a result of this Section 3(f), for a period exceeding 180 days
     (subject to extension pursuant to the last paragraph of this Section 3)
     after the last date on which exchanges are accepted pursuant to the
     Exchange Offer and Notifying Broker-Dealers shall not be authorized by the
     Company to, and shall not, deliver such Prospectus after such period in
     connection with resales contemplated by this Section 3;

          (g) (i) in the case of an Exchange Offer, furnish counsel for the
     Initial Purchasers and (ii) in the case of a Shelf Registration, furnish
     counsel for the Holders of Registrable Securities and counsel for any
     underwriters of Registrable Securities copies of any request by the SEC or
     any state securities authority for amendments or supplements to a
     Registration Statement or Prospectus or for additional information;

          (h) use its reasonable best effort to obtain the withdrawal of any
     order suspending the effectiveness of a Registration Statement as soon as
     practicable and provide immediate notice to each Holder of the withdrawal
     of any such order;

          (i) in the case of a Shelf Registration, furnish to each Holder of
     Registrable Securities, without charge, at least one conformed copy of each
     Registration Statement and any post-effective amendments thereto (without
     documents incorporated or deemed to be incorporated therein by reference or
     exhibits thereto, unless requested);

          (j) in the case of a Shelf Registration, cooperate with the selling
     Holders of Registrable Securities to facilitate the timely preparation and
     delivery of certificates representing Registrable Securities to be sold and
     not bearing any restrictive legends; and cause such Registrable Securities
     to be in such denominations (consistent with the provisions of the
     Indenture) and in a form eligible for deposit with the Depositary and
     registered in such names as the selling Holders or the underwriters, if
     any, may reasonably request in writing at least one business day prior to
     the closing of any sale of Registrable Securities;

          (k) in the case of a Shelf Registration, upon the occurrence of any
     event or the discovery of any facts as contemplated by Section 3(e)(vi)
     hereof, use its reasonable best efforts to prepare a supplement or
     post-effective amendment to a Registration Statement or the related
     Prospectus or any document incorporated or deemed to be incorporated
     therein by reference or file any other required document so that, as
     thereafter delivered to the purchasers of the Registrable Securities, such
     Prospectus will not contain at the time of such delivery any untrue
     statement of a material fact or omit to state a material fact necessary in
     order to make the statements therein, in light of the circumstances under
     which they were made, not misleading. The Company agrees to notify each
     Holder to suspend use of the Prospectus as promptly as practicable after
     the occurrence of such an event, and each Holder hereby agrees to suspend
     use of the Prospectus until the Company has amended or supplemented the
     Prospectus to correct such misstatement or omission. At such time as such
     public disclosure is otherwise made or the Company determines that such
     disclosure is not necessary, in each case to correct any misstatement of a
     material


                                       16



     fact or to include any omitted material fact, the Company agrees promptly
     to notify each Holder of such determination and to furnish each Holder such
     number of copies of the Prospectus, as amended or supplemented, as such
     Holder may reasonably request;

          (l) obtain CUSIP numbers for all Exchange Securities or Registrable
     Securities, as the case may be, not later than the effective date of a
     Registration Statement, and provide the Trustee with printed or
     word-processed certificates for the Exchange Securities or Registrable
     Securities, as the case may be, in a form eligible for deposit with the
     Depositary;

          (m) (i) cause the Indenture to be qualified under the TIA in
     connection with the registration of the Exchange Securities or Registrable
     Securities, as the case may be, (ii) cooperate with the Trustee and the
     Holders to effect such changes, if any, to the Indenture as may be required
     for the Indenture to be so qualified in accordance with the terms of the
     TIA and (iii) execute, and use its reasonable best efforts to cause the
     Trustee to execute, all documents as may be required to effect such
     changes, if any, and all other forms and documents required to be filed
     with the SEC to enable the Indenture to be so qualified in a timely manner;

          (n) in the case of a Shelf Registration, the holders of a majority in
     principal amount of the Registrable Securities registered pursuant to such
     Shelf Registration Statement shall have the right to direct the Company to
     effect not more than one underwritten registration and, in connection with
     such underwritten registration, the Company shall enter into agreements
     (including underwriting agreements or similar agreements) and take all
     other customary and appropriate actions (including those reasonably
     requested by the holders of a majority in principal amount of the
     Registrable Securities being sold) in order to expedite or facilitate the
     disposition of such Registrable Securities and in such connection, in a
     manner that is reasonable and customary:

          (i) make such representations and warranties to the Holders of such
     Registrable Securities and the underwriters, in form, substance and scope
     as are customarily made by issuers to underwriters in similar underwritten
     offerings as may be reasonably requested by such Holders and underwriters;

          (ii) obtain opinions of counsel to the Company (which counsel and
     opinions (in form, scope and substance) shall be reasonably satisfactory to
     the managing underwriters, and the Holders of a majority in principal
     amount of the Registrable Securities being sold) addressed to each selling
     Holder and the underwriters, covering the matters customarily covered in
     opinions requested in sales of securities or underwritten offerings and
     such other matters as may be reasonably requested by such Holders and
     underwriters;

          (iii) obtain "cold comfort" letters and updates thereof with respect
     to such Shelf Registration Statement and the Prospectus included therein,
     all amendments and supplements thereto and all documents incorporated or
     deemed to be incorporated by reference therein from the Company's
     independent certified public accountants and from the independent certified
     public accountants for any


                                       17



     other Person or any business or assets whose financial statements are
     included or incorporated by reference in the Shelf Registration Statement,
     each addressed to the underwriters, and use reasonable best efforts to have
     such letters addressed to the selling Holders of Registrable Securities,
     such letters to be in customary form and covering matters of the type
     customarily covered in "cold comfort" letters to underwriters in connection
     with similar underwritten offerings and such letters to be delivered at the
     time of the pricing of such underwritten registration with an update to
     such letter to be delivered at the time of closing of such underwritten
     registration;

          (iv) if an underwriting agreement or other similar agreement is
     entered into, cause the same to set forth indemnification and contributions
     provisions and procedures substantially equivalent to the indemnification
     and contributions provisions and procedures set forth in Section 5 hereof
     with respect to the underwriters and all other parties to be indemnified
     pursuant to Section 5 hereof or such other indemnification and
     contributions as shall be satisfactory to the Company, the applicable
     underwriters and the Holders of the majority in principal amount of the
     Registrable Securities being sold; and

          (v) deliver such other documents and certificates as may be reasonably
     requested and as are customarily delivered in similar offerings.

     The documents referred to in Sections 3(n)(ii) and 3(n)(v) shall be
     delivered at the closing under any underwriting or similar agreement as and
     to the extent required thereunder. In the case of any such underwritten
     offering, the Company shall provide written notice to the Holders of all
     Registrable Securities of such underwritten offering at least 30 days prior
     to the filing of a prospectus supplement for such underwritten offering.
     Such notice shall (x) offer each such Holder the right to participate in
     such underwritten offering, (y) specify a date, which shall be no earlier
     than 15 days following the date of such notice, by which such Holder must
     inform the Company of its intent to participate in such underwritten
     offering and (z) include the instructions such Holder must follow in order
     to participate in such underwritten offering;

          (o) in the case of a Shelf Registration, make available for inspection
     by representatives of the Holders of the Registrable Securities and any
     underwriters participating in any disposition pursuant to a Shelf
     Registration Statement and any counsel or accountant retained by such
     Holders or underwriters, all financial statements and other records,
     documents and properties of the Company reasonably requested by any such
     Persons, and cause the respective officers, directors, employees, and any
     other agents of the Company to supply all information reasonably requested
     by any such Persons in connection with a Shelf Registration Statement;

          (p) (i) in the case of an Exchange Offer, a reasonable time prior to
     the filing of any Exchange Offer Registration Statement, any Prospectus
     forming a part thereof, any amendment to an Exchange Offer Registration
     Statement or amendment or supplement to such Prospectus, provide copies of
     such documents to the Initial Purchasers, and make such changes in any such
     documents prior to the filing thereof as the Initial Purchasers or


                                       18



     their counsel may reasonably request; (ii) in the case of a Shelf
     Registration, a reasonable time prior to filing any Shelf Registration
     Statement, any Prospectus forming a part thereof, any amendment to such
     Shelf Registration Statement or amendment or supplement to such Prospectus,
     provide copies of such document to the Holders of Registrable Securities,
     to the Initial Purchasers, to the underwriter or underwriters, of an
     underwritten offering of Registrable Securities, and to counsel for any
     such Holders, Initial Purchasers or underwriters, and make such changes in
     any such document prior to the filing thereof as the Holders of Registrable
     Securities, the Initial Purchasers, any such underwriter or underwriters or
     any of their respective counsel may reasonably request; and (iii) cause the
     representatives of the Company to be available for discussion of such
     documents as shall be reasonably requested by the Holders of Registrable
     Securities, the Initial Purchasers on behalf of such Holders or any
     underwriter, and shall not at any time make any filing of any such document
     of which such Holders, the Initial Purchasers on behalf of such Holders,
     their counsel or any underwriter shall not have previously been advised and
     furnished a copy or to which such Holders, the Initial Purchasers on behalf
     of such Holders, their counsel or any underwriter shall reasonably object
     within a reasonable time period;

          (q) in the case of a Shelf Registration, use its reasonable best
     efforts to cause the Registrable Securities to be rated with the
     appropriate rating agencies, if so requested by the Majority Holders of
     Registrable Securities or by the underwriter or underwriters of an
     underwritten offering, unless the Registrable Securities are already so
     rated;

          (r) otherwise use its reasonable best efforts to comply with all
     applicable rules and regulations of the SEC and, with respect to each
     Registration Statement and each post-effective amendment, if any, thereto
     and each filing by the Company of an Annual Report on Form 10-K, make
     available to its security holders, as soon as reasonably practicable, an
     earnings statement covering at least twelve months which shall satisfy the
     provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder; and

          (s) cooperate and assist in any filings required to be made with the
     NASD and in the performance of any due diligence investigation by any
     underwriter and its counsel.

     In the case of a Shelf Registration Statement, the Company may (as a
condition to such Holder's participation in the Shelf Registration) require each
Holder of Registrable Securities to furnish to the Company such information
regarding such Holder and the proposed distribution by such Holder of such
Registrable Securities as the Company may from time to time reasonably request
in writing and require such Holder to agree in writing to be bound by all
provisions of this Agreement applicable to such Holder.

     In the case of a Shelf Registration Statement, each Holder agrees and, in
the event that any Participating Broker-Dealer is using the Prospectus included
in the Exchange Offer Registration Statement in connection with the sale of
Exchange Securities pursuant to Section 3(f), each such Participating
Broker-Dealer agrees that, upon receipt of any notice from the Company of the
happening of any event or the discovery of any facts of the kind described in
Section 3(e)(ii), 3(e)(iii) or 3(e)(v) through 3(e)(vii) hereof, such Holder or
Participating Broker-Dealer, as the case may be, will forthwith discontinue
disposition of Registrable Securities


                                       19



pursuant to a Registration Statement until receipt by such Holder or
Participating Broker-Dealer, as the case may be, of (i) the copies of the
supplemented or amended Prospectus contemplated by Section 3(k) hereof or (ii)
written notice from the Company that the Shelf Registration Statement or the
Exchange Offer Registration Statement, respectively, are once again effective or
that no supplement or amendment is required. If so directed by the Company, such
Holder or Participating Broker-Dealer, as the case may be, will deliver to the
Company (at the Company's expense) all copies in its possession, other than
permanent file copies then in its possession, of the Prospectus covering such
Registrable Securities current at the time of receipt of such notice. Nothing in
this paragraph shall prevent the accrual of Additional Interest on any
Securities or Exchange Securities.

     If the Company shall give any such notice to suspend the disposition of
Registrable Securities pursuant to the immediately preceding paragraph, the
Company shall be deemed to have used its reasonable best efforts to keep the
Shelf Registration Statement or, in the case of Section 3(f), the Exchange Offer
Registration Statement, as the case may be, effective during such period of
suspension; provided that (i) such period of suspension shall not exceed the
time periods provided in Section 2(d)(ii) hereof and (ii) the Company shall use
its reasonable best efforts to file and have declared effective (if an
amendment) as soon as practicable thereafter an amendment or supplement to the
Shelf Registration Statement or the Exchange Offer Registration Statement or
both, as the case may be, or the Prospectus included therein and shall extend
the period during which the Shelf Registration Statement or the Exchange Offer
Registration Statement or both, as the case may be, shall be maintained
effective pursuant to this Agreement (and, if applicable, the period during
which Participating Broker-Dealers may use the Prospectus included in the
Exchange Offer Registration Statement pursuant to Section 3(f) hereof) by the
number of days during the period from and including the date of the giving of
such notice to and including the earlier of the date when the Holders or
Participating Broker-Dealers, respectively, shall have received copies of the
supplemented or amended Prospectus necessary to resume such dispositions and the
effective date of written notice from the Company to the Holders or
Participating Broker-Dealers, respectively, that the Shelf Registration
Statement or the Exchange Offer Registration Statement, respectively, are once
again effective or that no supplement or amendment is required.

     4. Underwritten Registrations. If any of the Registrable Securities covered
by any Shelf Registration are to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers that will manage
the offering will be selected by the Majority Holders of such Registrable
Securities included in such offering, subject to the consent of the Company,
which consent shall not be unreasonably withheld.

     No Holder of Registrable Securities may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.


                                       20



     5. Indemnification and Contribution.

     (a) The Company agrees to indemnify and hold harmless each Initial
Purchaser, each Holder, each Participating Broker-Dealer, each underwriter who
participates in an offering of Registrable Securities (each, an "Underwriter")
and each Person, if any, who controls any Initial Purchaser, Holder,
Participating Broker-Dealer or Underwriter within the meaning of either Section
15 of the 1933 Act or Section 20 of the 1934 Act, as follows:

          (i) against any and all loss, liability, claim, damage and expense
     whatsoever, as incurred, arising out of any untrue statement or alleged
     untrue statement of a material fact contained in any Registration Statement
     (or any amendment thereto) pursuant to which Exchange Securities or
     Registrable Securities were registered under the 1933 Act or any omission
     or alleged omission therefrom of a material fact required to be stated
     therein or necessary to make the statements therein not misleading, or
     arising out of any untrue statement or alleged untrue statement of a
     material fact contained in any Prospectus (or any amendment or supplement
     thereto) or any omission or alleged omission therefrom of a material fact
     necessary in order to make the statements therein, in the light of the
     circumstances under which they were made, not misleading;

          (ii) against any and all loss, liability, claim, damage and expense
     whatsoever, as incurred, to the extent of the aggregate amount paid in
     settlement of any litigation, or any investigation or proceeding by any
     governmental agency or body, commenced or threatened, or of any claim
     whatsoever based upon any such untrue statement or omission, or any such
     alleged untrue statement or omission; provided that any such settlement is
     effected with the written consent of the Company; and

          (iii) against any and all expense whatsoever, as incurred, reasonably
     incurred in investigating, preparing or defending against any litigation,
     or any investigation or proceeding by any governmental agency or body,
     commenced or threatened, or any claim whatsoever based upon any such untrue
     statement or omission, or any such alleged untrue statement or omission, to
     the extent that any such expense is not paid under subparagraph (i) or (ii)
     above;

provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser, Holder, Participating Broker-Dealer or Underwriter with
respect to such Initial Purchaser, Holder, Participating Broker-Dealer or
Underwriter, as the case may be, expressly for use in the Registration Statement
(or any amendment thereto) or the Prospectus (or any amendment or supplement
thereto) or made in reliance upon the Statements of Eligibility and
Qualification of Trustees (Form T-1) under the 1939 Act filed as exhibits to the
Registration Statement; and provided, further, that the foregoing indemnity
agreement, with respect to any preliminary Prospectus shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of such Underwriter to such person, if required by


                                       21



law so to have been delivered, at or prior to the written confirmation of the
sale of the Securities to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses, claims,
damages or liabilities.

     (b) Each Holder, each Initial Purchaser, each Participating Broker-Dealer
and each Underwriter, severally but not jointly, agrees to indemnify and hold
harmless the Company, each Guarantor, each director of the Company or any
Guarantor, each officer of the Company or any Guarantor, each other Initial
Purchaser, each other Participating Broker-Dealer, each other Underwriter and
each other selling Holder and each Person, if any, who controls the Company, any
Guarantor, any Initial Purchaser, any Underwriter, any Participating
Broker-Dealer or any other selling Holder within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in Section 5(a)
hereof, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the Shelf Registration Statement
(or any amendment thereto) or any Prospectus included therein (or any amendment
or supplement thereto) in reliance upon and in conformity with written
information with respect to such Holder, Initial Purchaser, Underwriter or
Participating Broker-Dealer furnished to the Company by such Holder, Initial
Purchaser, Underwriter or Participating Broker-Dealer expressly for use in the
Shelf Registration Statement (or any amendment thereto) or such Prospectus (or
any amendment or supplement thereto); provided, however, that no such Holder,
Initial Purchaser, Underwriter or Participating Broker-Dealer shall be liable
for any claims hereunder in excess of the amount of net proceeds received by
such Holder from the sale of Registrable Securities pursuant to such Shelf
Registration Statement.

     (c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure so to notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. In no event shall the indemnifying parties be liable for the fees and
expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.

     (d) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in this Section 5 is
for any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, in such proportion
as is appropriate to reflect the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations. The relative fault of such indemnifying party or
parties on the one hand and the indemnified party or parties on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by such indemnifying party
or parties or such indemnified party or parties, and the parties' relative


                                       22



intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.

     (e) The Company, the Holders, and the Initial Purchasers agree that it
would not be just or equitable if contribution pursuant to this Section 5 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in paragraph (d)
above. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 5 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.

     Notwithstanding the provisions of this Section 5, no Initial Purchaser or
Holder, Participating Broker-Dealer or Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
Registrable Securities sold by it were offered exceeds the amount of any damages
that such Initial Purchaser, Holder, Participating Broker-Dealer or Underwriter
has otherwise been required to pay by reason of any such untrue or alleged
untrue statement or omission or alleged omission.

     No Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

     For purposes of this Section 5, each Person, if any, who controls an
Initial Purchaser, Holder, Participating Broker-Dealer or Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as such Initial Purchaser, Holder, Participating
Broker-Dealer or Underwriter, as the case may be, and each director of the
Company, each officer of the Company or any Guarantor who signed the
Registration Statement and each Person, if any, who controls the Company or any
Guarantor within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The
respective obligations of the Initial Purchasers, Holders, Participating
Broker-Dealers and Underwriters to contribute pursuant to this Section 5 are
several in proportion to the principal amount of Securities purchased by them
and not joint.

     The indemnity and contribution provisions contained in this Section 5 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by or on behalf of any Initial
Purchaser, Holder, Participating Broker-Dealer or Underwriter or any Person
controlling any Initial Purchaser, Holder, Participating Broker-Dealer or
Underwriter, or by or on behalf of the Company, any Guarantor, any officers or
directors of the Company or any Guarantor or any Person controlling the Company
or any Guarantor, (iii) acceptance of any of the Exchange Securities and (iv)
any sale of Registrable Securities or Exchange Securities pursuant to a Shelf
Registration Statement.


                                       23



     6. Miscellaneous.

     (a) Rule 144 and Rule 144A. For so long as the Company is subject to the
reporting requirements of Section 13 or 15 of the 1934 Act, the Company
covenants that it will file all reports required to be filed by it under Section
13(a) or 15(d) of the 1934 Act and the rules and regulations adopted by the SEC
thereunder, that if it ceases to be so required to file such reports, it will
upon the request of any Holder or beneficial owner of Registrable Securities (i)
make publicly available such information (including, without limitation, the
information specified in Rule 144(c)(2) under the 1933 Act) as is necessary to
permit sales pursuant to Rule 144 under the 1933 Act, (ii) deliver or cause to
be delivered, promptly following a request by any Holder or beneficial owner of
Registrable Securities or any prospective purchaser or transferee designated by
such Holder or beneficial owner, such information (including, without
limitation, the information specified in Rule 144A(d)(4) under the 1933 Act) as
is necessary to permit sales pursuant to Rule 144A under the 1933 Act, and (iii)
take such further action that is reasonable in the circumstances, in each case
to the extent required from time to time to enable such Holder to sell its
Registrable Securities without registration under the 1933 Act within the
limitation of the exemptions provided by (x) Rule 144 under the 1933 Act, as
such Rule may be amended from time to time, (y) Rule 144A under the 1933 Act, as
such Rule may be amended from time to time, or (z) any similar rules or
regulations hereafter adopted by the SEC. Upon the request of any Holder or
beneficial owner of Registrable Securities, the Company will deliver to such
Holder a written statement as to whether it has complied with such requirements.

     (b) No Inconsistent Agreements. The Company has not entered into nor will
the Company on or after the date of this Agreement enter into any agreement
which is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof;
provided that the Company will not be precluded from entering into any agreement
after the date hereof which may or does result, directly or indirectly, in the
payment of Additional Interest. The rights granted to the Holders hereunder do
not and will not in any way conflict with and are not and will not be
inconsistent with the rights granted to the holders of any of the Company's
other issued and outstanding securities under any other agreements entered into
by the Company or any of its subsidiaries.

     (c) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the Company has obtained the written consent of Holders of at least a
majority in aggregate principal amount of the outstanding Registrable Securities
affected by such amendment, modification, supplement, waiver or departure.

     (d) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, registered first-class
mail, telecopier, or any courier guaranteeing overnight delivery (i) if to a
Holder or Participating Broker-Dealer (other than an Initial Purchaser), at the
most current address set forth on the records of the registrar under the
Indenture, (ii) if to an Initial Purchaser, at the most current address given by
such Initial Purchaser to the Company by means of a notice given in accordance
with the provisions of this Section 6(d), which address initially is the address
set forth in the Purchase Agreement; (iii) if to the Company, initially at the
address set forth in the Purchase Agreement


                                       24



and thereafter at such other address, notice of which is given in accordance
with the provisions of this Section 6(d) and (iv) if to any Underwriter, at the
most current address given by such Underwriter to the Company by means of a
notice given in accordance with the provisions of this Section 6(d), which
address initially shall be the address set forth in the applicable underwriting
agreement.

     All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, first class, postage prepaid, if mailed;
when receipt is acknowledged, if telecopied; and on the next business day if
timely delivered to an air courier guaranteeing overnight delivery.

     Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the
address specified in the Indenture.

     (e) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders; provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms hereof or of the Purchase Agreement or the Indenture.
If any transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable Securities
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Registrable Securities, such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement, including the restrictions on resale set forth in this Agreement
and, if applicable, the Purchase Agreement, and such Person shall be entitled to
receive the benefits hereof.

     (f) Third Party Beneficiary. Each Holder and Participating Broker-Dealer
shall be a third party beneficiary of the agreements made hereunder between the
Company, on the one hand, and the Initial Purchasers, on the other hand, and
shall have the right to enforce such agreements directly to the extent it deems
such enforcement necessary or advisable to protect its rights or the rights of
other Holders hereunder. Each Holder, by its acquisition of Securities, shall be
deemed to have agreed to the provisions of Section 5(b) hereof.

     (g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

     (h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     (i) Restriction on Resales. If (i) the Company or any of its subsidiaries
or affiliates (as defined in Rule 144 under the 1933 Act) shall redeem, purchase
or otherwise acquire any Registrable Security or any Exchange Security which is
a "restricted security" within the meaning of Rule 144 under the 1933 Act, the
Company will deliver or cause to be delivered such Registrable Security or
Exchange Security, as the case may be, to the Trustee for cancellation


                                       25



and neither the Company nor any of its subsidiaries or affiliates will hold or
resell such Registrable Security or Exchange Security or issue any new Security
or Exchange Security to replace the same.

     (j) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

     (k) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.

                            [SIGNATURE PAGE FOLLOWS]


                                       26



     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.

                              FEDEX CORPORATION


                              By:   /s/ Burnetta B. Williams
                                   -------------------------------
                                   Name:  Burnetta B. Williams
                                   Title: Staff Vice President and
                                            Assistant Treasurer


                              FEDERAL EXPRESS CORPORATION


                              By:   /s/ Tracy G. Schmidt
                                   -------------------------------
                                   Name:  Tracy G. Schmidt
                                   Title: Senior Vice President and
                                            Chief Financial Officer


                              FEDEX GROUND PACKAGE SYSTEM, INC.


                              By:   /s/ Ronald R. Trombetta
                                   -------------------------------
                                   Name:  Ronald R. Trombetta
                                   Title: Senior Vice President and
                                            Chief Financial Officer


                              FEDEX CUSTOM CRITICAL, INC.


                              By:   /s/ Brendan L. O'Sullivan
                                   -------------------------------
                                   Name:  Brendan L. O'Sullivan
                                   Title: Vice President, Finance and CFO


                              VIKING FREIGHT, INC.


                              By:   /s/ Tilton G. Gore
                                   -------------------------------
                                   Name:  Tilton G. Gore
                                   Title: President and CEO







Confirmed and accepted
  as of the date first above written:

MERRILL LYNCH, PIERCE FENNER & SMITH
             INCORPORATED
BANC OF AMERICA SECURITIES LLC
CHASE SECURITIES INC.
COMMERZBANK CAPITAL MARKETS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION

By:  MERRILL LYNCH, PIERCE, FENNER & SMITH
                INCORPORATED



By:  /s/ George Ackert
   ------------------------------------------
   Name:  George Ackert
   Title: Vice President










                                                                         ANNEX A

                              PLAN OF DISTRIBUTION

     Each broker-dealer that receives new notes for its own account under the
exchange offer must acknowledge that it will deliver a prospectus in connection
with any resale of those notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer for resales of
new notes received in exchange for original notes that had been acquired as a
result of market-making or other trading activities. We have agreed that, for a
period of 180 days after the expiration date of the exchange offer, we will make
this prospectus, as it may be amended or supplemented, available to any
broker-dealer for use in connection with any such resale. Any broker-dealers
required to use this prospectus and any amendments or supplements to this
prospectus for resales of the new notes must notify us of this fact by checking
the box on the letter of transmittal requesting additional copies of these
documents.

     Notwithstanding the foregoing, we are entitled under the registration
rights agreements to suspend the use of this prospectus by broker-dealers under
specified circumstances. For example, we may suspend the use of this prospectus
if:

     o    the SEC or any state securities authority requests an amendment or
          supplement to this prospectus or the related registration statement or
          additional information;

     o    the SEC or any state securities authority issues any stop order
          suspending the effectiveness of the registration statement or
          initiates proceedings for that purpose;

     o    we receive notification of the suspension of the qualification of the
          new notes for sale in any jurisdiction or the initiation or
          threatening of any proceeding for that purpose;

     o    the suspension is required by law; or

     o    an event occurs which makes any statement in this prospectus untrue in
          any material respect or which constitutes an omission to state a
          material fact in this prospectus.

     If we suspend the use of this prospectus, the 180-day period referred to
above will be extended by a number of days equal to the period of the
suspension.

     We will not receive any proceeds from any sale of new notes by broker-
dealers. New notes received by broker-dealers for their own account under the
exchange offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on those notes or a combination of those methods, at market prices
prevailing at the time of resale, at prices related to prevailing market prices
or at negotiated prices. Any resales may be made directly to purchasers or to or
through brokers or dealers who may receive compensation in the form of
commissions or concessions from the selling broker-dealer or the purchasers of
the new notes. Any broker-dealer that resells new notes received by it for its
own account under the exchange offer and any broker or dealer that participates
in a distribution of the new notes may be deemed to be an "underwriter" within
the






meaning of the Securities Act and any profit on any resale of new notes and any
commissions or concessions received by these persons may be deemed to be
underwriting compensation under the Securities Act. The letter of transmittal
states that, by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

     We have agreed to pay all expenses incidental to the exchange offer other
than commissions and concessions of any broker or dealer and will indemnify
holders of the notes, including any broker-dealers, against certain liabilities,
including liabilities under the Securities Act.

EX-5.1

                                                                     EXHIBIT 5.1


                              DAVIS POLK & WARDWELL
                              450 LEXINGTON AVENUE
                            NEW YORK, NEW YORK 10017

                                                212-450-4000





                                                       April 30, 2001






FedEx Corporation
942 South Shady Grove Road
Memphis, Tennessee 38120

Ladies and Gentlemen:

         We have acted as special counsel to FedEx Corporation, a Delaware
corporation (the "Company"), in connection with the Company's offer (the
"Exchange Offer") to exchange its 6 5/8% notes due February 12, 2004, its 6 7/8%
notes due February 15, 2006 and its 7 1/4% notes due February 15, 2011
(collectively, the "New Notes") for any and all of its outstanding 6 5/8% notes
due February 12, 2004, its 6 7/8% notes due February 15, 2006 and its 7 1/4%
notes due February 15, 2011 (collectively, the "Old Notes"). The Old Notes were
issued, and it is proposed that the New Notes be issued, under an indenture
dated as of February 12, 2001 among the Company, the Guarantors named therein
and The Bank of New York, as trustee (the "Trustee"), as supplemented by a
Supplemental Indenture No. 1 dated as of February 20, 2001 among the Company,
the Guarantors named therein, the Additional Guarantors named therein and the
Trustee and a Supplemental Indenture No. 2 dated as of April 27, 2001 among the
Company, the Guarantors named therein, the Additional Guarantors named therein
and the Trustee, (as so supplemented and as may be further supplemented or
amended from time to time, the "Indenture").

         We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments as we have deemed necessary or advisable
for the purpose of rendering this opinion.








FedEx Corporation                     2                           April 30, 2001

         Upon the basis of the foregoing and assuming the due authorization,
execution and delivery of the Indenture by the parties thereto, we are of the
opinion that the New Notes, when authorized, executed, authenticated and
delivered in exchange for the Old Notes in accordance with the terms of the
Exchange Offer and the Indenture, will be valid and binding obligations of the
Company enforceable in accordance with their terms, except (i) as such
enforcement may be limited by bankruptcy, insolvency, fraudulent conveyance or
similar laws affecting creditors' rights generally, (ii) as such enforcement may
be limited by general principles of equity, regardless of whether enforcement is
sought in a proceeding at law or in equity and (iii) to the extent that a waiver
of rights under any usury or stay law may be unenforceable.

         We hereby confirm the opinion set forth under the caption "Taxation" in
the prospectus that is part of the Registration Statement on Form S-4 filed by
the Company with the Securities and Exchange Commission on April 30, 2001.

         We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York and the federal laws of
the United States of America.

         We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement relating to the Exchange Offer. We also consent to the
references to us under the caption "Validity of the New Notes" in the prospectus
contained in such Registration Statement.

         This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by or furnished to any other person without our prior written
consent except that The Bank of New York, as Exchange Agent for the Exchange
Offer, may rely upon this opinion as if it were addressed directly to it.

                                            Very truly yours,

                                            /s/ Davis Polk & Wardwell

EX-15.1

                                                                   EXHIBIT 15.1


                                                          ARTHUR ANDERSEN

                                                          Arthur Andersen LLP
                                                          Suite 1100
                                                          100 Peabody Place
                                                          Memphis TN 38103-3625

                                                          Tel 901 525 4451
                                                          Fax 901 526 5414

April 25, 2001


FedEx Corporation:

We are aware that FedEx Corporation has incorporated by reference in this
Form S-4 Registration Statement the FedEx Corporation and Federal Express
Corporation Form 10-Q's for the quarters ended August 31, 2000, November 30,
2000 and February 28, 2001 which include our reports dated September 18, 2000,
December 19, 2000 and March 19, 2001 covering the unaudited interim financial
information contained therein. Pursuant to Regulation C of the Securities Act
of 1933, those reports are not considered a part of this Registration Statement
prepared or certified by our Firm or reports prepared or certified by our Firm
within the meaning of Sections 7 and 11 of the Act.

Very truly yours,

/s/ Arthur Andersen LLP

EX-21.1

                                                                                          EXHIBIT 21.1
                                                                                          Subsidiaries

                                           FEDEX CORPORATION

                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
  1.     Federal Express Corporation                                                       Delaware

        I.     Federal Express Aviation Services, Incorporated                             Delaware

               A.   Federal Express Aviation Services International, Ltd.                  Delaware

       II.     Federal Express Canada Ltd.                                                  Canada

      III.     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 Europe, Inc.                                           Delaware

                      1. Federal Express Europe, Inc. & Co., V.O.F./S.N.C.                  Belgium

                      2. Federal Express European Services, Inc.                            Delaware

               D.   Federal Express Europlex, Inc.                                         Delaware

               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


                                      -1-




                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
                      6. Federal Express (Dominicana) S.A.                             Dominican Republic

                         a.   Inversiones Geminis, S.A.                                Dominican Republic

                         b.   Inversiones Sagitario, S.A.                               Dominican Republic

                      7. Federal Express Entregas Rapidas, Ltd.                               Brazil

                      8. Federal Express (Grenada) Limited                                   Grenada

                      9. Federal Express (Haiti) S.A.                                         Haiti

                    10.  Federal Express Holdings (Mexico) y Compania S.N.C. de               Mexico
                         C.V.

                    11. Federal Express (Jamaica) Limited                                   Jamaica

                    12. Federal Express (St. Kitts) Limited                                St. Kitts

                    13. Federal Express (St. Lucia) Limited                                St. Lucia

                    14. Federal Express (St. Maarten) N.V.                            Netherland Antilles

                        a.   Federal Express (Aruba) N.V.                             Netherland Antilles

                    15. Federal Express (Turks & Caicos) Limited                     Turks & Caicos Islands

                    16. Federal Express Virgin Islands, Inc.                          U.S. Virgin Islands

                    17. FedEx (Bahamas) Limited                                             Bahamas

               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 Italy Inc.                                              Delaware

               K.   Federal Express Japan K.K.                                               Japan

               L.   Federal Express Korea Co., Ltd.                                          Korea

               M.   Federal Express Limited                                              United Kingdom

               N.   Federal Express Luxembourg, Inc.                                        Delaware

               O.   Federal Express Pacific, Inc.                                           Delaware

                      1. Federal Express Services (M) Sdn. Bhd.                              Malaysia


                                      -2-




                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
                      2. The Flying Tiger Line, Limited                                     Hong Kong

                      3. Udara Express Courier Services Sdn. Bhd.                            Malaysia

               P.   Federal Express Parcel Services Limited                             United Kingdom

               Q.   Federal Express (Singapore) Pte. Ltd.                                 Singapore

               R.   Federal Express (Thailand) Limited                                     Thailand

               S.   Federal Express (U.K.) Limited                                      United Kingdom

                    1.  Federal Express (U.K.) Pension Trustees Ltd.                    United Kingdom

               T.   FedEx (Mauritius) Ltd.                                                Mauritius

               U.   Fedex (N. I.) Limited                                              Northern Ireland

               V.   Winchmore Developments Ltd.                                            England

                    1.  Concorde Advertising Limited                                       England

       IV.     Federal Express Leasing Corporation                                         Delaware

        V.     Fedex Customs Brokerage Corporation                                         Delaware

       VI.     Fedex FSC Corporation                                                       Barbados

      VII.     FEDEX Partners, Inc.                                                        Delaware

     VIII.     FedEx Peak Employee Services, Inc.                                          Delaware

     VIII.     FedEx Spain, S.L.                                                            Spain

       IX.     Flying Tigers Limited                                                     New Zealand

        X.     The Flying Tiger Line (NZ) Limited                                        New Zealand

       XI.     Tiger International Insurance Ltd.                                       Cayman Islands


                                      -3-




                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
  2.     Caliber System (Canada), Inc.                                                      Canada

  3.     FedEx Corporate Services, Inc.                                                    Delaware

        I.     FedEx Internet Technologies Corporation                                     Delaware

       II.     FedEx Supply Chain Services, Inc.                                             Ohio

               A.   FedEx Supply Chain Services International, Inc.                        Delaware

                    1.  FedEx Supply Chain Services Korea, Inc.                             Korea

                    2.  FedEx Supply Chain Services International Pte, Ltd.               Singapore

               B.   FedEx Supply Chain Services (Canada), Ltd.                             Ontario

               C.   Caliber Logistics de Mexico, S.A. de C.V.                               Mexico

               D.   FedEx Supply Chain Services Europe B.V.                              Netherlands

                    1.  FedEx Supply Chain Services Belgium N.V.                           Belgium

                    2.  FedEx Supply Chain Services France SARL                             France

                    3.  FedEx Supply Chain Services Germany GmbH                           Germany

                    4.  FedEx Supply Chain Services Ireland Limited                        Ireland

                    5.  FedEx Supply Chain Services Italy S.r.L.                            Italy

                    6.  FedEx Supply Chain Services Netherlands B.V.                     Netherlands

                    7.  FedEx Supply Chain Services UK Limited                          United Kingdom

               E.   Caliber Logistics Healthcare, Inc.                                       Ohio

  4.     FedEx Custom Critical, Inc.                                                         Ohio

        I.     AutoQuik, Inc.                                                              Delaware

       II.     FedEx Custom Critical, N.V.                                                 Belgium

      III.     FedEx Custom Critical B.V.                                                Netherlands

               A.   FedEx Custom Critical, S.r.L.                                           Italy

       IV.     FedEx Custom Critical GmbH                                                  Germany


                                      -4-




                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
        V.     FedEx Custom Critical SARL                                                   France

       VI.     FedEx Custom Critical, S.L.                                                  Spain

      VII.     FedEx Custom Critical UK, Inc.                                              Delaware

     VIII.     Passport Transport, Ltd.                                                    Delaware

       IX.     Third Party Services, Inc.                                                  Delaware

        X.     Transportation Technologies, Inc.                                             Ohio

       XI.     UrgentFreight, Inc.                                                         Delaware

  5.     FedEx Freight System, Inc.                                                        Delaware

        I.     Viking Freight, Inc.                                                       California

               A.   Bay Cities Diesel Engine Rebuilders, Inc.                             California

               B.   Viking de Mexico, S.A. de C.V.                                          Mexico

       II.     American Freightways, Inc.                                                  Arkansas

               A.   American Freightways de Mexico, S.A. de C.V.                            Mexico

               B.   A.F. Logistica de Mexico, S.A. de C.V.                                  Mexico

               C.   Tran-Support, Inc.                                                     Arkansas

                    1.  Bright Truck Leasing de Mexico, S.A. de C.V.                        Mexico

  6.     FedEx Global Logistics, Inc.                                                      Delaware

  7.     FedEx Ground Package System, Inc.                                                 Delaware

        I.     FedEx Ground Package System, Ltd.                                           Wyoming

       II.     RPS de Mexico, S.A. de C.V.                                                  Mexico

      III.     RPS Urban Renewal Corporation                                              New Jersey


                                      -5-




                                                                                       Jurisdiction of
                                                                                       Organization or
                                                                                        Registration
                                                                                       ---------------

                                                                                 
  8.     FedEx Trade Networks, Inc.                                                        Delaware

        I.     Caribbean Transportation Services, Inc.                                     Delaware

       II.     Tower Group International, Inc.                                             New York

               A.   Tower Group International Canada Inc.                                   Canada

      III.     World Tariff, Limited                                                      California

       IV.     FTN Consulting, Inc.                                                        Delaware

  9.     Roadway Global Air, Inc.                                                          Delaware

        I.     Roadway Global Air International, Inc.                                      Delaware

               A.   Roadway Global Air, S.r.L.                                              Italy




                                      -6-

EX-23.1

                                                                   EXHIBIT 23.1


                   Consent of Independent Public Accountants

As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-4 Registration Statement of FedEx Corporation of our
reports dated June 27, 2000 included in the FedEx Corporation and Federal
Express Corporation Form 10-K filings for the year ended May 31, 2000, and to
all references to our Firm included in this Registration Statement.

/s/ Arthur Andersen LLP
Memphis, Tennessee
April 25, 2001

EX-23.2

                                                                   EXHIBIT 23.2


                        CONSENT OF INDEPENDENT AUDITORS


We consent to the reference to our firm under the caption "Experts" and to the
use of our report dated January 19, 2001 (except Note 7, as to which the date
is February 9, 2001), with respect to the financial statements of American
Freightways Corporation included in the Registration Statement (Form S-4) and
related Prospectus of FedEx Corporation for the registration of $250,000,000 of
6 5/8% Notes due 2004, $250,000,000 of 6 7/8% notes due 2006 and $250,000,000
of 7 1/4% Notes due 2011.

                                               /s/ Ernst & Young LLP

Little Rock, Arkansas
April 27, 2001

EX-25.1

                                                                   EXHIBIT 25.1


===============================================================================

                                    FORM T-1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                            STATEMENT OF ELIGIBILITY
                   UNDER THE TRUST INDENTURE ACT OF 1939 OF A
                    CORPORATION DESIGNATED TO ACT AS TRUSTEE

                      CHECK IF AN APPLICATION TO DETERMINE
                      ELIGIBILITY OF A TRUSTEE PURSUANT TO
                            SECTION 305(b)(2)    [ ]



                              THE BANK OF NEW YORK
              (Exact name of trustee as specified in its charter)


New York                                              13-5160382
(State of incorporation                               (I.R.S. employer
if not a U.S. national bank)                          identification no.)

48 Wall Street, New York, N.Y.                        10286
(Address of principal executive offices)              (Zip code)


                               FedEx Corporation
              (Exact name of obligor as specified in its charter)


Delaware                                               62-1721435
(State or other jurisdiction of                        (I.R.S. employer
incorporation or organization)                         identification no.)


942 South Shady Grove Rd
Memphis, Tennessee                                     38120
(Address of principal executive offices)               (Zip code)

                             ----------------------

                  FedEx Corporation New 6 5/8% Notes due 2004
                  FedEx Corporation New 6 7/8% Notes due 2006
                  FedEx Corporation New 7 1/4% Notes due 2011
                      (Title of the indenture securities)


===============================================================================




1.   General information. Furnish the following information as to the Trustee:

     (a)  Name and address of each examining or supervising authority to which
          it is subject.

- -------------------------------------------------------------------------------
                  Name                                       Address
- -------------------------------------------------------------------------------
     Superintendent of Banks of the State of    2 Rector Street
     New York                                   New York,  N.Y. 10006,
                                                and Albany, N.Y. 12203

     Federal Reserve Bank of New York           33 Liberty Plaza, New York,
                                                N.Y. 10045

     Federal Deposit Insurance Corporation      Washington, D.C. 20429

     New York Clearing House Association        New York, New York 10005

     (b)  Whether it is authorized to exercise corporate trust powers.

     Yes.

2.   Affiliations with Obligor.

     If the obligor is an affiliate of the trustee, describe each such
     affiliation.

     None.

16.  List of Exhibits.

     Exhibits identified in parentheses below, on file with the Commission, are
     incorporated herein by reference as an exhibit hereto, pursuant to Rule
     7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
     229.10(d).

     1.   A copy of the Organization Certificate of The Bank of New York
          (formerly Irving Trust Company) as now in effect, which contains the
          authority to commence business and a grant of powers to exercise
          corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
          filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
          Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
          to Form T-1 filed with Registration Statement No. 33-29637.)

     4.   A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
          filed with Registration Statement No. 33-31019.)

     6.   The consent of the Trustee required by Section 321(b) of the Act.
          (Exhibit 6 to Form T-1 filed with Registration Statement No.
          33-44051.)

     7.   A copy of the latest report of condition of the Trustee published
          pursuant to law or to the requirements of its supervising or
          examining authority.





                                   SIGNATURE


     Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of Atlanta, and
State of Georgia, on the 24th day of April, 2001.


                                                    THE BANK OF NEW YORK


                                                    By:/s/ Stefan Victory
                                                       -------------------------
                                                       Name:  Stefan Victory
                                                       Title: Agent





                             EXHIBIT 6 TO FORM T-1

                               CONSENT OF TRUSTEE


Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of
1939, in connection with the proposed issuance of FedEx Corporation Notes, The
Bank of New York hereby consents that reports of examinations by Federal,
State, Territorial or District Authorities may be furnished by such authorities
to the Securities and Exchange Commission upon request therefor.


                                            THE BANK OF NEW YORK


                                            By: /s/ Stefan Victory
                                               --------------------------------
                                               Stefan Victory, Agent







                             EXHIBIT 7 TO FORM T-1

                      Consolidated Report of Condition of
                              THE BANK OF NEW YORK
                    of 48 Wall Street, New York, N.Y. 10286


     And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business December 31, 2000, published in accordance
with a call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.

                                                                 Dollar Amounts
                                                                  in Thousands
ASSETS
- ------
Cash and balances due from
         depository institutions:
         Noninterest-bearing balances
           and currency and coin............................     $ 3,083,720
         Interest-bearing balances..........................       4,949,333
Securities:
         Held-to-maturity securities........................         740,315
         Available-for-sale securities......................       5,328,981
Federal funds sold and securities
         purchased under agreements to resell...............       5,695,708
Loans and lease financing receivables:
         Loans and leases,
           net of unearned income. . . . .        36,590,456
         LESS: Allowance for loan and
           lease losses. . . . . . . . . .           598,536
         LESS: Allocated transfer
           risk reserve. . . . . . . . . .            12,575
         Loans and leases, net of unearned
           income and allowance and reserve.................      35,979,345
Trading Assets .............................................      11,912,448
Premises and fixed assets (including
         capitalized leases)................................         763,241
Other real estate owned.....................................           2,925
Investments in unconsolidated
         subsidiaries and associated
         companies..........................................         183,836
Customers' liability to this bank
         on acceptances outstanding.........................         424,303
Intangible assets...........................................       1,378,477
Other assets................................................       3,823,797
                                                                 -----------
Total assets................................................     $74,266,429
                                                                 ===========


LIABILITIES
- -----------
Deposits:


                                      -6-



         In domestic offices................................     $28,328,548
         Noninterest-bearing . . . . . . .        12,637,384
         Interest-bearing. . . . . . . . .        15,691,164
         In foreign offices, Edge and
           Agreement subsidiaries, and IBFs.................      27,920,690
         Noninterest-bearing . . . . . . .           470,130
         Interest-bearing. . . . . . . . .        27,450,560
Federal funds purchased and securities
         sold under agreements to repurchase ...............       1,437,916
Demand notes issued to the
         U.S. Treasury......................................         100,000
Trading liabilities.........................................       2,049,818
Other borrowed money:
         With remaining maturity of one year
           or less..........................................       1,279,125
         With remaining maturity of more
           than one year through three years................               0
         With remaining maturity of more
           than three years.................................          31,080
Bank's liability on acceptances
           executed and outstanding.........................         427,110
Subordinated notes and debentures...........................       1,646,000
Other liabilities...........................................       4,604,478
                                                                 -----------
Total liabilities...........................................      67,824,765
                                                                 ===========


EQUITY CAPITAL
- --------------
Common stock................................................       1,135,285
Surplus.....................................................       1,008,775
Undivided profits and capital
         reserves...........................................       4,308,492
Net unrealized holding gains (losses)
         on available-for-sale securities...................          27,768
Cumulative foreign currency
         translation adjustments............................               0
Total equity capital........................................       6,441,664
                                                                 -----------
Total liabilities and equity capital........................     $74,266,429
                                                                 ===========


     I, Thomas J. Masiro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.

                                                            Thomas J. Masiro


     We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.






Thomas A. Renyi     )
Gerald L. Hassell   )        Directors
Allen R. Griffith   )


                                      -8-

EX-99.1

                                                                   EXHIBIT 99.1


                         FORM OF LETTER OF TRANSMITTAL

                                      for

                             6 5/8% Notes Due 2004
                             6 7/8% Notes Due 2006
                             7 1/4% Notes Due 2011

                                       of


                               FEDEX CORPORATION


                                Pursuant to the

                                 EXCHANGE OFFER

                                 in Respect of
                             All of Its Outstanding


                             6 5/8% Notes due 2004
                             6 7/8% Notes due 2006
                             7 1/4% Notes due 2011

                                      for

                           6 5/8% New Notes due 2004
                           6 7/8% New Notes due 2006
                           7 1/4% New Notes due 2011

                            -----------------------

               Pursuant to the Prospectus Dated           , 2001


- --------------------------------------------------------------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
          TIME, ON        , 2001 UNLESS THE EXCHANGE OFFER IS EXTENDED
                            (THE "EXPIRATION DATE").
- --------------------------------------------------------------------------------

                  To: The Bank of New York, as Exchange Agent

By Mail or Hand/Overnight Delivery:                       By Facsimile:

The Bank of New York                                      (212) 815-6339
Reorganization Unit
101 Barclay Street - 7E                                   Confirm by Telephone:
New York, New York 10286
Attention: Santino Ginocchetti                            (212) 815-6331

                            -----------------------


     DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION VIA
FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

     THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS
LETTER OF TRANSMITTAL IS COMPLETED.

     HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE NEW NOTES FOR THEIR OLD NOTES
PURSUANT TO THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR OLD
NOTES TO THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.

     Capitalized terms used but not defined herein shall have the same meaning
given them in the Prospectus (as defined below). As used herein, the term
"holder" means a holder of Old Notes (as defined below), including any
participant ("DTC Participant") in the book-entry transfer facility system of
The Depository Trust Company ("DTC"), whose name appears on a security position
listing as the owner of the Old Notes. As used herein, the term "certificates"
means physical certificates representing Old Notes.





     To participate in the Exchange Offer (as defined below), holders must
tender by (a) book-entry transfer pursuant to the procedures set forth in the
Prospectus under "The Exchange Offer--Book-Entry Transfer" or (b) forwarding
certificates herewith. Holders who are DTC Participants tendering by book-entry
transfer may execute such tender through the Automated Tender Offer Program
("ATOP") of DTC. A holder using ATOP should transmit its acceptance to DTC on
or prior to the Expiration Date. DTC will verify such acceptance, execute a
book-entry transfer of the tendered Old Notes into the account of The Bank of
New York (the "Exchange Agent") at DTC and then send to the Exchange Agent a
Book-Entry Confirmation (as defined below), including an agent's message (as
defined below) confirming that DTC has received an express acknowledgment from
such holder that such holder has received and agrees to be bound by this Letter
of Transmittal and that the Company (as defined below) may enforce this Letter
of Transmittal against such holder. The Book-Entry Confirmation must be
received by the Exchange Agent in order for the tender relating thereto to be
effective. Book-entry transfer to DTC in accordance with DTC's procedures does
not constitute delivery of the Book-Entry Confirmation to the Exchange Agent.

     If the tender is not made pursuant to the book-entry transfer procedures,
certificates, as well as this Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees,
and any other documents required by this Letter of Transmittal, must be
received by the Exchange Agent at its address set forth herein on or prior to
the Expiration Date in order for such tender to be effective.

     Holders of Old Notes whose certificates for such Old Notes are not
immediately available or who cannot deliver their certificates and all other
required documents to the Exchange Agent on or prior to the Expiration Date or
who cannot complete the procedures for book-entry transfer on or prior to the
Expiration Date, must tender their Old Notes according to the guaranteed
delivery procedures set forth in "The Exchange Offer--Guaranteed Delivery
Procedures" in the Prospectus.

     The Company reserves the right, at any time or from time to time, to
extend the Exchange Offer at its sole discretion, in which event the term
"Expiration Date" shall mean the latest time and date to which the Exchange
Offer is extended. The Company shall notify the holders of the Old Notes of any
extension by means of a press release or other public announcement prior to
9:00 a.m., New York City time, on the next business day after the previously
scheduled Expiration Date.

     DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE
AGENT.


                                       2



     List below the Old Notes to which this Letter of Transmittal relates. If
the space provided below is inadequate, list the certificate numbers, principal
amounts and number of beneficial holders on a separately executed schedule and
affix the schedule to this Letter of Transmittal. See Instruction 3.


- -------------------------------------------------------------------------------------------------------------------------------
                                      DESCRIPTION OF OLD NOTES TENDERED
- -------------------------------------------------------------------------------------------------------------------------------
Name(s) and Address(es) of Registered Holder(s)                                   Principal Amount of          Number of
           (Please Fill In, If Blank)           Description                        Old Notes Tendered      Beneficial Holders
                                                of Old Notes     Certificate       (If Less Than All Are    for which Old Notes
                                                  Tendered        Number(s)*            Tendered)**              are Held
- -------------------------------------------------------------------------------------------------------------------------------
                                                                                               
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
                                                                                     $
TOTAL PRINCIPAL AMOUNT OF OLD NOTES TENDERED                                         $
- -------------------------------------------------------------------------------------------------------------------------------

 *   Need not be completed by holders tendering by book-entry transfer.
**   Old Notes may be tendered in whole or in part in denominations of $1,000
     and integral multiples thereof, provided that if fewer than all of the Old
     Notes of a holder are tendered for exchange, the untendered principal
     amount of the holder's remaining Old Notes must be $1,000 or any integral
     multiple of $1,000 in excess thereof. All Old Notes held shall be deemed
     tendered unless a lesser number is specified in this column. See
     Instruction 4.
- -------------------------------------------------------------------------------------------------------------------------------



(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS (defined in Instruction 1)
ONLY)

[ ]  CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY
     TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND
     COMPLETE THE FOLLOWING:

     Name of Tendering Institution:_____________________________________________
     DTC Account Number:________________________________________________________
     Transaction Code Number:___________________________________________________

[ ]  CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF
     TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED
     DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING:

     Name(s) of Registered Holder(s) of Old Notes:______________________________
     Window Ticket Number (if any):_____________________________________________
     Date of Execution of Notice of Guaranteed Delivery:________________________
     Name of Institution which Guaranteed Delivery:_____________________________
          If Guaranteed Delivery is to be made by Book-Entry Transfer:
     Name of Tendering Institution:_____________________________________________
     DTC Account Number:________________________________________________________
     Transaction Code Number:___________________________________________________

[ ]  CHECK HERE IF OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER AND
     NON-EXCHANGED OR UNTENDERED OLD NOTES ARE TO BE RETURNED BY CREDITING THE
     DTC ACCOUNT NUMBER SET FORTH ABOVE.

[ ]  CHECK HERE IF YOU ARE A BROKER-DEALER WHO HOLDS OLD NOTES ACQUIRED FOR
     YOUR OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING ACTIVITIES
     (A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE ADDITIONAL COPIES OF
     THE PROSPECTUS AND COPIES OF ANY AMENDMENTS OR

                                       3



     SUPPLEMENTS THERETO FOR USE IN CONNECTION WITH RESALES OF NEW NOTES
     RECEIVED FOR YOUR OWN ACCOUNT IN EXCHANGE FOR SUCH OLD NOTES.

     Name:______________________________________________________________________
     Address:___________________________________________________________________
     Area Code and Telephone Number:____________Contact Person:_________________
     Principal Amount of Old Notes so Held: $___________________________________



                                       4



Ladies and Gentlemen:

     The undersigned hereby tenders to FedEx Corporation, a Delaware
corporation (the "Company"), the aggregate principal amount of Old Notes of
each series indicated in this Letter of Transmittal, upon the terms and subject
to the conditions set forth in the Company's Prospectus dated         , 2001 (as
the same may be amended or supplemented from time to time, the "Prospectus"),
receipt of which is hereby acknowledged, and in this Letter of Transmittal,
which together constitute the Company's offer (the "Exchange Offer") to
exchange $250 million principal amount of its 6 5/8% notes due 2004, $250
million principal amount of its 6 7/8% notes due 2006 and $250 million
principal amount of its 7 1/4% notes due 2011, which have been registered under
the Securities Act of 1933, as amended (the "New Notes"), for $250 million
principal amount of its issued and outstanding 6 5/8% notes due 2004, $250
million principal amount of its issued and outstanding 6 7/8% notes due 2006
and $250 million principal amount of its issued and outstanding 7 1/4% notes
due 2011 (the "Old Notes" and, together with the New Notes, the "Notes").

     Subject to, and effective upon, the acceptance for exchange of all or any
portion of the Old Notes tendered herewith in accordance with the terms and
conditions of the Exchange Offer (including, if the Exchange Offer is extended
or amended, the terms and conditions of any such extension or amendment), the
undersigned hereby sells, assigns and transfers to, or upon the order of, the
Company all right, title and interest in and to such Old Notes as are being
tendered hereby and hereby irrevocably constitutes and appoints the Exchange
Agent as attorney-in-fact of the undersigned with respect to such Old Notes
(with full knowledge that the Exchange Agent is also acting as agent of the
Company in connection with the Exchange Offer), with full power of substitution
(such power of attorney being an irrevocable power coupled with an interest),
subject only to the right of withdrawal described in the Prospectus, to (i)
deliver certificates for Old Notes to the Company together with all
accompanying evidences of transfer and authenticity to, or upon the order of,
the Company, upon receipt by the Exchange Agent, as the undersigned's agent, of
the New Notes to be issued in exchange for such Old Notes, (ii) present
certificates for such Old Notes for transfer, and to transfer the Old Notes on
the books of the Company, and (iii) receive for the account of the Company all
benefits and otherwise exercise all rights of beneficial ownership of such Old
Notes, all in accordance with the terms and conditions of the Exchange Offer.

     The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Old Notes
tendered hereby and to acquire New Notes issuable upon exchange of such
tendered Old Notes, and that, when the Old Notes are accepted for exchange, the
Company will acquire good, marketable and unencumbered title thereto, free and
clear of all security interests, liens, restrictions, charges, encumbrances,
conditional sale agreements or other obligations relating to their sale or
transfer, and not subject to any adverse claim when the same are accepted by
the Company. The undersigned will, upon request, execute and deliver any
additional documents deemed by the Company or the Exchange Agent to be
necessary or desirable to complete the exchange, assignment and transfer of the
Old Notes tendered hereby, and the undersigned will comply with any obligations
it may have under the registration rights agreement (as set forth in the
Prospectus). The undersigned further agrees that acceptance of any tendered Old
Notes by the Company and the issuance of New Notes in exchange therefor shall
constitute performance in full by the Company of its obligations under the
registration rights agreement and that the Company shall have no further
obligations or liabilities thereunder (except in certain limited
circumstances).

     The undersigned hereby further represents that any New Notes acquired in
exchange for Old Notes tendered hereby will have been acquired in the ordinary
course of business of the person receiving such New Notes, whether or not such
person is the undersigned, that neither the holder of such Old Notes nor any
such other person is participating, or intends to participate, or has an
arrangement or understanding with any person to participate in the distribution
(within the meaning of the Securities Act of 1933 (as amended, the "Securities
Act")) of such New Notes and that neither the holder of such Old Notes nor any
such other person is an "affiliate," as defined in Rule 405 under the
Securities Act, of the Company.

     The undersigned also acknowledges that this Exchange Offer is being made
in reliance on interpretations by the staff of the Securities and Exchange
Commission (the "SEC"), as set forth in no-action letters issued to third
parties, that the New Notes issued in exchange for the Old Notes pursuant to
the Exchange Offer may be offered for resale, resold and otherwise transferred
by holders thereof (other than any such holder that is an "affiliate" of the
Company within the meaning of Rule 405 under the provisions of the Securities
Act), provided that such New Notes are acquired in the ordinary course of such
holders' business and such holders are not participating, do not intend to
participate, and have no arrangement or understanding with any person to
participate in the distribution of such New Notes. However, the


                                       5



Company does not intend to request the SEC to consider, and the SEC has not
considered, the Exchange Offer in the context of a no-action letter, and there
can be no assurance that the staff of the SEC would make a similar
determination with respect to the Exchange Offer as in other circumstances. If
any holder is an affiliate of the Company, or is engaged in or intends to
engage in or has any arrangement or understanding with respect to the
distribution of the New Notes to be acquired pursuant to the Exchange Offer,
such holder (i) could not rely on the applicable interpretations of the staff
of the SEC and (ii) must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale transaction.
If the undersigned is a broker-dealer that will receive New Notes for its own
account in exchange for Old Notes acquired as a result of market-making or
other trading activities (a "Participating Broker-Dealer"), it represents that
the Old Notes to be exchanged for the New Notes were acquired by it as a result
of market-making or other trading activities and acknowledges that it will
deliver a Prospectus in connection with any resale of such New Notes; however,
by so acknowledging and by delivering a Prospectus, such Participating
Broker-Dealer will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act.

     The Company has agreed that, subject to the provisions of the registration
rights agreement, the Prospectus may be used by a Participating Broker-Dealer
in connection with resales of New Notes received in exchange for Old Notes
which were acquired by such Participating Broker-Dealer for its own account as
a result of market-making or other trading activities, for a period ending 180
days after the Expiration Date or, if earlier, when all such New Notes have
been disposed of by such Participating Broker-Dealer. Any person, including any
Participating Broker-Dealer, who is an "affiliate" may not rely on such
interpretive letters and must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction. In that regard, each Participating Broker- Dealer by tendering
such Old Notes and executing this Letter of Transmittal, agrees that, upon
receipt of notice from the Company of the occurrence of any event or the
discovery of any fact which makes any statement contained or incorporated by
reference in the Prospectus untrue in any material respect or which causes the
Prospectus to omit to state a material fact necessary in order to make the
statements contained or incorporated by reference therein, in light of the
circumstances under which they were made, not misleading, such Participating
Broker-Dealer will suspend the sale of New Notes pursuant to the Prospectus
until the Company has amended or supplemented the Prospectus to correct such
misstatement or omission and has furnished copies of the amended or
supplemented Prospectus to the Participating Broker-Dealer or the Company has
given notice that the sale of the New Notes may be resumed, as the case may be.
If the Company gives such notice to suspend the sale of the New Notes, it shall
extend the 180-day period referred to above during which Participating
Broker-Dealers are entitled to use the Prospectus in connection with the resale
of New Notes by the number of days during the period from and including the
date of the giving of such notice to and including the date when Participating
Broker-Dealers shall have received copies of the supplemental or amended
Prospectus necessary to permit resales of the New Notes or to and including the
date on which the Company has given notice that the sale of New Notes may be
resumed, as the case may be.

     The undersigned will, upon request, execute and deliver any additional
documents deemed by the Company to be necessary or desirable to complete the
sale, assignment and transfer of the Old Notes tendered hereby. All authority
conferred or agreed to be conferred in this Letter of Transmittal and every
obligation of the undersigned hereunder shall be binding upon the successors,
assigns, heirs, executors, administrators, trustees in bankruptcy and legal
representatives of the undersigned and shall not be affected by, and shall
survive, the death or incapacity of the undersigned. This tender may be
withdrawn only in accordance with the procedures set forth in "The Exchange
Offer--Withdrawal of Tenders" section of the Prospectus.

     Holders of Old Notes whose Old Notes are accepted for exchange will not
receive any interest on such Old Notes, and the undersigned hereby waives the
right to receive any interest on such Old Notes in connection with the Exchange
Offer.

     The name(s) and address(es) of the registered holder(s) of the Old Notes
tendered hereby should be printed above in the box entitled "Description of Old
Notes Tendered," if they are not already set forth in such box, as they appear
on the certificates representing such Old Notes. The certificate number(s) of
the Old Notes that the undersigned wishes to tender should be indicated in the
appropriate boxes above.

     If tendered Old Notes are not exchanged pursuant to the Exchange Offer for
any reason, or if certificates are submitted for more Old Notes than are
tendered or accepted for exchange, certificates of such unexchanged or
untendered Old Notes will be returned (or, in the case of Old Notes tendered by
book-entry transfer, such Old Notes


                                       6



will be credited to an account maintained at DTC), without expense to the
tendering holder, promptly following the expiration or termination of the
Exchange Offer.

     The undersigned recognizes that, under certain circumstances set forth in
the Prospectus, the Company may not be required to accept for exchange any of
the Old Notes tendered hereby.

     Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, the undersigned hereby directs that the New Notes be
issued in the name(s) of the undersigned or, in the case of a book-entry
transfer of Old Notes, that such New Notes be credited to the account indicated
above maintained at DTC. If applicable, substitute certificates representing
Old Notes not exchanged or not accepted for exchange will be issued to the
undersigned or, in the case of a book-entry transfer of Old Notes, will be
credited to the account indicated above maintained at DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" below, the
undersigned hereby directs that the New Notes be delivered to the undersigned
at the address shown above in the box entitled "Description of Old Notes
Tendered."


                                       7


- -------------------------------------------------------------------------------
                              HOLDER(S) SIGN HERE
                         (See Instructions 2, 5 and 6)
                (Please Complete Substitute Form W-9 on Page 14)
      (Note: Signature(s) Must be Guaranteed if Required by Instruction 2)

     Must be signed by registered holders exactly as name(s) appear(s) on
certificates for the Old Notes hereby tendered or on a security position
listing, or by any persons authorized to become the registered holders by
endorsements and documents transmitted herewith (including such opinions of
counsel, certifications and other information as may be required by the
Company, the Trustee for the Old Notes, or the Exchange Agent to comply with
the restrictions on transfer applicable to the Old Notes). If signature is by
an attorney-in-fact, executor, administrator, trustee, guardian, officer of a
corporation or another acting in a fiduciary or representative capacity, please
set forth the signer's full title. See Instruction 5.

_______________________________________________________________________________
                            (Signatures of Holders)
Date:________________
Name:__________________________________________________________________________
                                 (Please Print)
Capacity (full title):_________________________________________________________
Address:_______________________________________________________________________
                               (Include Zip Code)
Area Code and Telephone Number:________________________________________________
Taxpayer Identification or Social Security No.:________________________________


                             GUARANTEE OF SIGNATURE
                           (See Instructions 2 and 5)

Authorized Signature:__________________________________________________________
Date:________________
Name of Firm:__________________________________________________________________
                                 (Please Print)
Capacity (full title):_________________________________________________________
Address:_______________________________________________________________________
_______________________________________________________________________________
                               (Include Zip Code)
Area Code and Telephone Number:________________________________________________

- -------------------------------------------------------------------------------


- -----------------------------------------------        -----------------------------------------------
         SPECIAL ISSUANCE INSTRUCTIONS                          SPECIAL ISSUANCE INSTRUCTIONS
         (See Instructions 4, 5 and 6)                          (See Instructions 4, 5 and 6)

                                                    
     To be completed ONLY if the New Notes                  To be completed ONLY if the New Notes
and/or any Old Notes that are not tendered are         and/or any Old Notes that are not tendered are
to be issued in the name of someone other than         to be sent to someone other than the registered
the registered holder of the Old Notes whose           holder of the Old Notes whose name appears
name appears above.                                    above, or to such registered holder at an
                                                       address other than that shown above.
Issue [ ] New Notes  [ ] Old Notes not Tendered
                                                       Mail  [ ] New Notes  [ ] Old Notes not Tendered
to:
Name:__________________________________________        to:
                 (Please Print)                        Name:__________________________________________
                                                                        (Please Print)

Address:_______________________________________
_______________________________________________        Address:_______________________________________
               (Include Zip Code)                      _______________________________________________
                                                                      (Include Zip Code)
_______________________________________________
         (Area Code and Telephone Number)              _______________________________________________
                                                                (Area Code and Telephone Number)
_______________________________________________
          (Taxpayer Identification or                  _______________________________________________
             Social Security Number)                             (Taxpayer Identification or
                                                                    Social Security Number)
- -----------------------------------------------        -----------------------------------------------


                                               8



                                  INSTRUCTIONS

Forming Part of the Terms and Conditions of the Offer of FedEx Corporation to
Exchange its 6 5/8% New Notes Due 2004, 6 7/8% New Notes Due 2006 and 7 1/4%
New Notes Due 2011 for All of its Outstanding 6 5/8% Notes Due 2004, 6 7/8%
Notes Due 2006 and 7 1/4% Notes Due 2011.

     1. Book-Entry Transfer; Delivery of this Letter of Transmittal and Notes;
Guaranteed Delivery Procedures. To tender in the Exchange Offer, holders must
tender by (a) forwarding certificates herewith or (b) book-entry transfer,
pursuant to the procedures set forth in "The Exchange Offer--Procedures for
Tendering" and "--Book-Entry Transfer" in the Prospectus. Holders who are DTC
Participants tendering by book-entry transfer may execute such tender through
DTC's ATOP system. A holder using ATOP should transmit its acceptance to DTC on
or prior to the Expiration Date. DTC will verify such acceptance, execute a
book-entry transfer of the tendered Old Notes into the Exchange Agent's account
at DTC and then send to the Exchange Agent a Book-Entry Confirmation, including
an agent's message confirming that DTC has received an express acknowledgment
from such holder that such holder has received and agrees to be bound by this
Letter of Transmittal and that the Company may enforce this Letter of
Transmittal against such holder. The Book-Entry Confirmation must be received
by the Exchange Agent in order for the tender relating thereto to be effective.
Book-entry transfer to DTC in accordance with DTC's procedures does not
constitute delivery of the Book-Entry Confirmation to the Exchange Agent. The
term "Book-Entry Confirmation" means a timely confirmation of a book-entry
transfer of Old Notes into the Exchange Agent's account at DTC. The term
"agent's message" means a message, transmitted by DTC to and received by the
Exchange Agent and forming a part of a Book-Entry Confirmation, which states
that DTC has received an express acknowledgment from the tendering participant,
which acknowledgment states that such participant has received and agrees to be
bound by the Letter of Transmittal (including the representations contained
herein) and that the Company may enforce the Letter of Transmittal against such
participant.

     If the tender is not made pursuant to the book-entry transfer procedures,
certificates, as well as this Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees,
and any other documents required by this Letter of Transmittal, must be
received by the Exchange Agent at its address set forth herein on or prior to
the Expiration Date in order for such tender to be effective. Old Notes may be
tendered in whole or in part in denominations of $1,000 and integral multiples
thereof, provided that if fewer than all of the Old Notes of a holder are
tendered for exchange, the untendered principal amount of the holder's
remaining Old Notes must be $1,000 or any integral multiple of $1,000 in excess
thereof.

     Holders of Old Notes whose certificates for Old Notes are not immediately
available or who cannot deliver their certificates and all other required
documents to the Exchange Agent on or prior to the Expiration Date, or who
cannot complete the procedure for book-entry transfer on a timely basis, may
tender their Old Notes pursuant to the guaranteed delivery procedures set forth
in "The Exchange Offer--Guaranteed Delivery Procedures" section of the
Prospectus. Pursuant to such procedures, (i) such tender must be made through
an Eligible Institution (as defined below), (ii) prior to the Expiration Date,
the Exchange Agent must receive from such Eligible Institution (by facsimile
transmission, mail or hand delivery) a properly completed and duly executed
Notice of Guaranteed Delivery, substantially in the form provided by the
Company, setting forth the name and address of the holder of Old Notes and the
amount of Old Notes tendered, stating that the tender is being made thereby and
guaranteeing that within three New York Stock Exchange ("NYSE") trading days
after the Expiration Date, the certificates for all physically tendered Old
Notes, or a Book-Entry Confirmation, and any other documents required by this
Letter of Transmittal will be deposited by the Eligible Institution with the
Exchange Agent, and (iii) a properly executed Letter of Transmittal, or an
agent's message in lieu thereof, as well as the certificates for all physically
tendered Old Notes in proper form for transfer or Book-Entry Confirmation, as
the case may be, and all other documents required by this Letter of
Transmittal, must be received by the Exchange Agent within three NYSE trading
days after the Expiration Date.

     The Notice of Guaranteed Delivery must be delivered by hand, overnight
courier or mail, or transmitted by facsimile transmission, to the Exchange
Agent on or prior to the Expiration Date, and must include a guarantee by an
Eligible Institution in the form set forth in such notice. For Old Notes to be
properly tendered pursuant to the guaranteed delivery procedure, the Exchange
Agent must receive a Notice of Guaranteed Delivery on or prior to the
Expiration Date. As used herein and in the Prospectus, "Eligible Institution"
means a firm or other entity identified in Rule 17Ad-15 under the Securities
Exchange Act of 1934 as an "Eligible Guarantor Institution," including (as such
terms are defined


                                       9



therein) (i) a bank; (ii) a broker, dealer, municipal securities broker or
dealer or government securities broker or dealer; (iii) a credit union; (iv) a
national securities exchange, registered securities association or clearing
agency; or (v) a savings association that is a participant in a Securities
Transfer Association.

     THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, THE OLD NOTES AND
ALL OTHER REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE TENDERING
HOLDERS, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT HOLDERS USE
AN OVERNIGHT OR HAND DELIVERY SERVICE, PROPERLY INSURED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT
PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. DO NOT SEND
THIS LETTER OF TRANSMITTAL OR ANY OLD NOTES TO THE COMPANY.

     The Company will not accept any alternative, conditional or contingent
tenders. Each tendering holder, by book-entry transfer through ATOP or
execution of a Letter of Transmittal (or facsimile thereof), waives any right
to receive any notice of the acceptance of such tender.

     2. Guarantee of Signatures. No signature guarantee on this Letter of
Transmittal is required if:

     (i) this Letter of Transmittal is signed by the registered holder (which
term, for purposes of this document, shall include any participant in DTC whose
name appears on a security position listing as the owner of the Old Notes) of
Old Notes tendered herewith, unless such holder has completed either the box
entitled "Special Issuance Instructions" or the box entitled "Special Delivery
Instructions" above; or

    (ii) such Old Notes are tendered for the account of a firm that is an
Eligible Institution.

     In all other cases, an Eligible Institution must guarantee the signature
on this Letter of Transmittal. See Instruction 5.

     3. Inadequate Space. If the space provided in the box captioned
"Description of Old Notes Tendered" is inadequate, the certificate number(s)
and/or the principal amount of Old Notes and any other required information
should be listed on a separate signed schedule which is attached to this Letter
of Transmittal.

     4. Partial Tenders (Not Applicable to Holders of Old Notes Who Tender by
Book-Entry Transfer); Withdrawal Rights. Tenders of Old Notes will be accepted
only in the principal amount of $1,000 and integral multiples thereof, provided
that if fewer than all of the Old Notes of a holder are tendered for exchange,
the untendered principal amount of the holder's remaining Old Notes must be
$1,000 or any integral multiple of $1,000 in excess thereof. If less than all
of the Old Notes evidenced by a submitted certificate are to be tendered, the
tendering holder(s) should fill in the aggregate principal amount of Old Notes
to be tendered in the box above entitled "Description of Old Notes
Tendered--Principal Amount of Old Notes Tendered (If Less Than All Are
Tendered)." A reissued certificate representing the balance of untendered Old
Notes will be sent to such tendering holder, unless otherwise provided in the
appropriate box on this Letter of Transmittal, promptly after the Expiration
Date. ALL OF THE OLD NOTES DELIVERED TO THE EXCHANGE AGENT WILL BE DEEMED TO
HAVE BEEN TENDERED UNLESS OTHERWISE INDICATED.

     Except as otherwise provided herein, tenders of Old Notes may be withdrawn
at any time prior to the Expiration Date. In order for a withdrawal to be
effective prior to that time, a written or facsimile transmission notice of
withdrawal must be timely received by the Exchange Agent at one of its
addresses set forth above prior to the Expiration Date. Any such notice of
withdrawal must specify the name of the person having deposited the Old Notes
to be withdrawn, the aggregate principal amount of Old Notes of each series to
be withdrawn and (if certificates for such Old Notes have been tendered) the
name of the registered holder of the Old Notes as set forth on the certificate
for the Old Notes, if different from that of the person who tendered such Old
Notes. If certificates for the Old Notes have been delivered or otherwise
identified to the Exchange Agent, then prior to the physical release of such
certificates for the Old Notes, the tendering holder must submit the serial
numbers shown on the particular certificates for the Old Notes to be withdrawn
and the signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Old Notes


                                       10



tendered for the account of an Eligible Institution. If Old Notes have been
tendered pursuant to the procedures for book-entry transfer set forth in "The
Exchange Offer--Book-Entry Transfer" section of the Prospectus, the notice of
withdrawal must specify the name and number of the account at the book-entry
transfer facility system of DTC to be credited with the withdrawal of Old
Notes, in which case a notice of withdrawal will be effective if delivered to
the Exchange Agent by written or facsimile transmission. Withdrawals of tenders
of Old Notes may not be rescinded. Old Notes properly withdrawn will not be
deemed to have been validly tendered for purposes of the Exchange Offer, and no
New Notes will be issued with respect thereto unless the Old Notes so withdrawn
are validly retendered. Properly withdrawn Old Notes may be retendered at any
subsequent time on or prior to the Expiration Date by following the procedures
described in the Prospectus under "The Exchange Offer--Procedures for
Tendering."

     All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Company, in its
sole discretion, whose determination shall be final and binding on all parties.
Neither the Company, any employees, agents, affiliates or assigns of the
Company, the Exchange Agent nor any other person shall be under any duty to
give any notification of any irregularities in any notice of withdrawal or
incur any liability for failure to give such notification. Any Old Notes which
have been tendered but which are withdrawn will be returned to the holder
thereof without cost to such holder as promptly as practicable after
withdrawal.

     5. Signatures on this Letter of Transmittal; Bond Powers and Endorsements;
Guarantee of Signatures. If this Letter of Transmittal is signed by the holder
of the Old Notes tendered hereby, the signature must correspond exactly with
the name as written on the face of the certificates or on a securities position
listing without any change whatsoever.

     If any tendered Old Notes are owned of record by two or more joint owners,
all of such owners must sign this Letter of Transmittal.

     If any tendered Old Notes are registered in different names on several
certificates or securities position listings, it will be necessary to complete,
sign and submit as many separate copies of this Letter of Transmittal as there
are different registrations.

     When this Letter of Transmittal is signed by the holder or holders of the
Old Notes specified herein and tendered hereby, no endorsements of certificates
or separate bond powers are required. If, however, the New Notes are to be
issued, or any untendered Old Notes are to be reissued, to a person other than
the holder, then endorsements on any certificates transmitted hereby or
separate bond powers are required. Signatures on such certificate(s) must be
guaranteed by an Eligible Institution.

     In connection with any tender of Old Notes in definitive certificated
form, if this Letter of Transmittal is signed by a person other than the
registered holder or holders of any certificate(s) specified herein, such
certificate(s) must be endorsed or accompanied by appropriate bond powers, in
either case signed exactly as the name or names of the registered holder or
holders appear(s) on the certificate(s), and the signatures on such
certificate(s) must be guaranteed by an Eligible Institution.

     If this Letter of Transmittal or any certificates or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and, unless waived by
the Company, evidence satisfactory to the Company of their authority to so act
must be submitted.

     Endorsements on certificates for Old Notes or signatures on bond powers
required by this Instruction 5 must be guaranteed by an Eligible Institution.

     6. Special Issuance and Delivery Instructions. If New Notes are to be
issued in the name of a person other than the registered holder, or if New
Notes are to be sent to someone other than the registered holder or to the
registered holder at an address other than that shown above, the appropriate
boxes on this Letter of Transmittal should be completed. Certificates for Old
Notes not exchanged will be returned by mail or, if tendered by book-entry
transfer, by crediting the account indicated above maintained at DTC unless the
appropriate boxes on this Letter of Transmittal are completed. See Instruction
4.

                                       11



     7. Tax Identification Number. Under U.S. federal income tax law, a holder
whose tendered Old Notes are accepted for exchange is required to provide the
Exchange Agent (as payor) with such holder's correct taxpayer identification
number ("TIN") on the Substitute Form W-9 below which, in the case of a
tendering holder who is an individual, is his or her Social Security Number. In
the case of a tendering holder who is an individual who does not have and is
not eligible to obtain a Social Security Number (e.g., a resident alien), the
correct TIN is such holder's IRS individual taxpayer identification number
("ITIN"). If the Exchange Agent is not provided with the correct TIN, the
Internal Revenue Service (the "IRS") may subject the holder or other payee to a
$50 penalty. In addition, payments to such holders or other payees with respect
to Old Notes exchanged pursuant to the Exchange Offer may be subject to 31%
backup withholding.

     The box in Part 3 of the Substitute Form W-9 should be checked if the
tendering holder has not been issued a TIN and has applied for a TIN or intends
to apply for a TIN in the near future. If the box in Part 3 is checked, the
holder or other payee must also complete the Certificate of Awaiting Taxpayer
Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 3 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Exchange Agent will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Exchange Agent. The Exchange Agent will retain such amounts
withheld during the 60 day period following the date of the Substitute Form
W-9. If the holder furnishes the Exchange Agent with its TIN within 60 days
after the date of the Substitute Form W-9, the amounts retained during the 60
day period will be remitted to the holder and no further amounts shall be
retained or withheld from payments made to the holder thereafter. If, however,
the holder has not provided the Exchange Agent with its TIN within such 60 day
period, amounts withheld will be remitted to the IRS as backup withholding. In
addition, 31% of all payments made thereafter will be withheld and remitted to
the IRS until a correct TIN is provided.

     The holder is required to give the Exchange Agent the TIN (e.g., social
security number, employer identification number or IRS individual taxpayer
identification number) of the registered owner of the Old Notes or of the last
transferee appearing on the transfers attached to, or endorsed on, the Old
Notes. If the Old Notes are registered in more than one name or are not in the
name of the actual owner, consult the enclosed "Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9" for additional guidance
on which number to report.

     Certain holders (including, among others, corporations, financial
institutions and certain foreign persons) may not be subject to these backup
withholding requirements. Such holders should nevertheless complete the
attached Substitute Form W-9 below, and write "exempt" on the face thereof, to
avoid possible erroneous backup withholding. A foreign person may qualify as an
exempt recipient by submitting a properly completed IRS Form W-8BEN
(Certificate of Foreign Status), or an appropriate successor form, signed under
penalties of perjury, attesting to that holder's exempt status. See the
enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for additional instructions.

     8. Transfer Taxes. The Company will pay all transfer taxes, if any,
applicable to the transfer of Old Notes to it or its order pursuant to the
Exchange Offer. If, however, New Notes and/or substitute Old Notes not
exchanged are to be delivered to, or are to be registered or issued in the name
of, any person other than the holder of the Old Notes tendered hereby, or if
tendered Old Notes are registered in the name of any person other than the
person signing this Letter of Transmittal, or if a transfer tax is imposed for
any reason other than the transfer of Old Notes to the Company or its order
pursuant to the Exchange Offer, the amount of any such transfer taxes (whether
imposed on the holder or any other person) will be payable by the tendering
holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted herewith, the amount of such transfer taxes will be
billed directly to such tendering holder.

     EXCEPT AS PROVIDED IN THIS INSTRUCTION 8, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE OLD NOTES SPECIFIED IN THIS LETTER OF
TRANSMITTAL.

     9. Determination of Validity. The Company will determine, in its sole
discretion, all questions as to the form of documents, validity, eligibility
(including time of receipt) and acceptance for exchange of any tender of Old
Notes, which determination shall be final and binding on all parties. The
Company reserves the absolute right to reject any and all tenders determined by
it not to be in proper form or the acceptance of which, or exchange for which,
may, in the view of counsel to the Company, be unlawful. The Company also
reserves the absolute right, subject to applicable law, to

                                       12



waive any of the conditions of the Exchange Offer set forth in the Prospectus
under the caption "The Exchange Offer" or any conditions or irregularity in any
tender of Old Notes of any particular holder whether or not similar conditions
or irregularities are waived in the case of other holders.

     The Company's interpretation of the terms and conditions of the Exchange
Offer (including this Letter of Transmittal and the instructions hereto) will
be final and binding. No tender of Old Notes will be deemed to have been
validly made until all irregularities with respect to such tender have been
cured or waived. Although the Company intends to notify holders of defects or
irregularities with respect to tenders of Old Notes, neither the Company, any
employees, agents, affiliates or assigns of the Company, the Exchange Agent,
nor any other person shall be under any duty to give notification of any
irregularities in tenders or incur any liability for failure to give such
notification.

     10. No Conditional Tenders. No alternative, conditional, irregular or
contingent tenders will be accepted. All tendering holders of Old Notes, by
execution of this Letter of Transmittal, shall waive any right to receive
notice of the acceptance of their Old Notes for exchange.

     Neither the Company, the Exchange Agent nor any other person is obligated
to give notice of any defect or irregularity with respect to any tender of Old
Notes nor shall any of them incur any liability for failure to give any such
notice.

     11. Lost, Stolen or Destroyed Old Notes. If any certificates representing
Old Notes have been lost, destroyed or stolen, the holder should promptly
notify the Exchange Agent. The holder will then be instructed as to the steps
that must be taken in order to replace the certificates. This Letter of
Transmittal and related documents cannot be processed until the procedures for
replacing lost, destroyed or stolen certificates have been followed.

     12. Requests for Assistance or Additional Copies. Questions relating to
the procedure for tendering, as well as requests for additional copies of the
Prospectus, the Notice of Guaranteed Delivery and this Letter of Transmittal,
may be directed to the Exchange Agent, at the address and telephone number
indicated on the front of this Letter of Transmittal.

     IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF OR AGENT'S
MESSAGE IN LIEU THEREOF) AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY
THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.

                                       13



                    TO BE COMPLETED BY ALL TENDERING HOLDERS
                              (See Instruction 7)



                                 Payer's Name: The Bank of New York
                                                                    
- --------------------------------------------------------------------------------------------------------------------
SUBSTITUTE                    | Part I -- Enter your TIN in the           | Social security number, employer
                              | appropriate box. For individuals, this    | identification number OR IRS individual
Form W-9                      | is your social security number (SSN).     | taxpayer identification number:
                              | For individuals who do not have and are   |
                              | not eligible to obtain a SSN, this is     | ----------------------------------------
                              | your IRS individual taxpayer              |
                              | identification number (ITIN). For other   |
                              | entities, it is your employer             |
                              | identification number (EIN).              |
                              |-------------------------------------------|-----------------------------------------
Department of the Treasury    | Part 2 -- Certification -- Under          | If exempt recipient, write "EXEMPT" in
Internal Revenue Service      | penalties of perjury, I certify that:     | the space below. See the accompanying
                              | (1) The number shown on this form is my   | Guidelines for Certification of Taxpayer
Payer's Request for Taxpayer  | correct TIN (or I am waiting for a        | Identification Number on Substitute Form
Identification Number (TIN)   | number to be issued to me) and (2) I am   | W-9.
                              | not subject to backup withholding either  |
                              | because (a) I am exempt from backup       |
                              | withholding, or (b) I have not been       |
                              | notified by the Internal Revenue Service  |
                              | ("IRS") that I am subject to backup       |
                              | withholding as a result of a failure to   | Part 3 --
                              | report all interest or dividends, or (c)  |
                              | the IRS has notified me that I am no      | Awaiting TIN  [ ]
                              | longer subject to backup withholding.     |
                              |                                           |
                              | Certification Instructions -- You must    |
                              | cross out item (2) above if you have      |
                              | been notified by the IRS that you are     |
                              | currently subject to backup withholding   |
                              | because you have failed to report         |
                              | interest or dividends on your tax         |
                              | return. However, if after being notified  |
                              | by the IRS that you are subject to        |
                              | backup withholding you received another   |
                              | notification from the IRS that you are    |
                              | no longer subject to backup withholding   |
                              | do no cross out such item (2).            |
                              |                                           |
                              | THE IRS DOES NOT REQUIRE YOUR CONSENT TO  |
                              | ANY PROVISION OF THIS DOCUMENT OTHER      |
                              | THAN THE CERTIFICATIONS REQUIRED TO       |
                              | AVOID BACKUP WITHHOLDING.                 |
                              |                                           |
                              | SIGNATURE______________ DATE____________  |
                              |                                           |
                              | NAME____________________________________  |
                              |                (Please Print)             |
                              |                                           |
                              | BUSINESS NAME___________________________  |
                              |             (If different) (Please Print) |
                              |                                           |
                              | ADDRESS_________________________________  |
                              |                (Please Print)             |
                              |                                           |
- --------------------------------------------------------------------------------------------------------------------


NOTE:     FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
          WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE
          EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR
          CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM
          W-9 FOR ADDITIONAL DETAILS.


                                       14



YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
SUBSTITUTE FORM W-9

- -------------------------------------------------------------------------------
             CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
- -------------------------------------------------------------------------------
     I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (2)
I intend to mail or deliver an application in the near future. I understand
that if I do not provide a taxpayer identification number by the time of
payment, 31% of all reportable payments made to me will be withheld, but that
such amounts will be refunded to me if I then provide a taxpayer identification
number within sixty (60) days.

Signature__________________________________ Date_______________________________

Name___________________________________________________________________________
                                 (Please Print)

Address________________________________________________________________________
                                 (Please Print)

- -------------------------------------------------------------------------------


                                       15



            GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                         NUMBER ON SUBSTITUTE FORM W-9

How to Get a TIN

If you don't have a taxpayer identification number (a "TIN"), apply for one
immediately. To apply, get Form SS-5, Application for a Social Security Number
Card (for individuals), from your local office of the Social Security
Administration, or Form SS-4, Application for Employer Identification Number
(for businesses and all other entities), from your local IRS office. For
individuals who do not have and are not eligible to obtain a Social Security
Number, apply for an IRS taxpayer identification number on Form W-7 which is
available from your local IRS office.

If you do not have a TIN, write "Applied For" in the space for the TIN in Part
1, sign and date the form, and give it to the requester. Generally, you will
then have 60 days to get a TIN and give it to the requester. If the requester
does not receive your TIN within 60 days, backup withholding, if applicable,
will begin and continue until you furnish your TIN.

NOTE:  Writing "Applied For" on the form means that you have already
applied for a TIN or that you intend to apply for one soon.

As soon as you receive your TIN, complete a Form W-9, include your TIN, sign
and date the form, and give it to the requester.

Specific Instructions

Name. If you are an individual, you must generally enter the name shown on your
social security card. However, if you have changed your last name, for
instance, due to marriage, without informing the Social Security Administration
of the name change, please enter you first name, the last name shown on your
social security card, and your new last name.

Sole Proprietor. You must enter your individual name (enter either your social
security number ("SSN") or your employer identification number ("EIN") in Part
1). You may also enter your business name or "doing business as" name on the
business name line. Enter your name as shown on your social security card and
business name as it was used to apply for your EIN on Form SS-4.

Part I -- TIN

You must enter your TIN in the appropriate box. If you are a sole proprietor,
you may enter either your SSN or your EIN. Also see the chart on the attached
page for further clarification of name and TIN combinations. If you do not have
a TIN, follow the instructions under "How to Get a TIN" above.

Part II -- For Payees Exempt from Backup Withholding

Individuals (including sole proprietors) are not exempt from backup
withholding. Corporations are exempt from backup withholding for certain
payments. If you are exempt from backup withholding, you should still complete
this form to avoid possible erroneous backup withholding. Enter your correct
TIN in Part I, write "Exempt" in the space provided, and sign and date the
form.

If you are a nonresident alien or a foreign entity not subject to backup
withholding, give the requester a completed Form W-8, Certificate of Foreign
Status.

The following is a list of payees exempt from backup withholding. For interest
and dividends, all listed payees are exempt except the payee in item (ix). For
broker transactions, payees listed in items (i) through (xiii), and a person
registered under the Investment Advisors Act of 1940 who regularly acts as a
broker are exempt.

(i)    a corporation;
(ii)   an organization exempt from tax under Section 501(a) of the Internal
       Revenue Code of 1986, as amended (the "Code"), or an individual
       retirement account, or a custodial account under Section 403(b)(7) of the
       Code if the account satisfies the requirements of Section 401(f)(2) of
       the Code;
(iii)  the United States or any of its agencies or instrumentalities;
(iv)   a state, the District of Columbia, a possession of the United States,
       or any of their political subdivisions or instrumentalities;
(v)    a foreign government or any of its political subdivisions, agencies
       or instrumentalities;
(vi)   an international organization or any of its agencies or
       instrumentalities;
(vii)  a foreign central bank of issue;
(viii) a dealer in securities or commodities required to register in the
       United States or a possession of the United States;
(ix)   a futures commission merchant registered with the Commodity
       Futures Trading Commission;
(x)    a real estate investment trust;
(xi)   an entity registered at all times during the tax year under the
       Investment Company Act of 1940;
(xii)  a common trust fund operated by a bank under Section 584(a) of
       the Code;
(xiii) a financial institution;
(xiv)  a middleman known in the investment community as a nominee or
       who is listed in the most recent publication of the American Society
       of Corporate Secretaries, Inc., Nominee List; or
(xv)   a trust exempt from tax under Section 664 or described in Section
       4947.

Privacy Act Notice -- Section 6109 requires you to give your TIN to persons who
must report certain payments to the IRS. The IRS uses the numbers for
identification purposes. Payers must be given the numbers whether or not
recipients are required to file tax returns. Payers must generally withhold 31%
of taxable interest, dividend, and certain other payments to a payee who does
not furnish a taxpayer identification number to a payer. Certain penalties may
also apply.

Penalties

(1) Penalty for Failure to Furnish Taxpayer Identification Number. If you fail
to furnish your TIN to a requester, you are subject to a penalty of $50 for
each such failure unless your failure is due to reasonable cause and not to
willful neglect.

(2) Civil Penalty for False Information with Respect to Withholding. If you
make a false statement with no reasonable basis which results in no backup
withholding, you are subject to a penalty of $500.

(3)  Criminal Penalty for Falsifying Information. Willfully falsifying
certifications or affirmations may subject you to criminal penalties
including fines and/or imprisonment.

FOR ADDITIONAL INFORMATION CONTACT YOUR TAX
CONSULTANT OR THE INTERNAL REVENUE SERVICE.





            GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                         NUMBER ON SUBSTITUTE FORM W-9

Guidelines for Determining the Proper Name and Identification Number to Give
the Requester.--Social Security numbers have nine digits separated by two
hyphens: i.e. 000-00-0000. Employer identification numbers have nine digits
separated by only one hyphen: i.e. 00-0000000. The table below will help
determine the number to give the requester.

                                                                                     
- ---------------------------------------------------------   ---------------------------------------------------------
For this type of account:       Give the SOCIAL             For this type of account:         Give the TAXPAYER
                                SECURITY NUMBER                                               IDENTIFICATION
                                of--                                                          NUMBER of--
- ---------------------------------------------------------   ---------------------------------------------------------

1. An individual's account      The individual              10.   Corporate account           The corporation

2. Two or more individuals      The actual owner of the     11.   Religious, charitable, or   The organization
   (joint account)              account or, if combined           educational organization
                                funds, the first                  account
                                individual on the
                                account(1)                  12.   Partnership account held    The partnership
                                                                  in the name of the
3. Husband and wife (joint      The actual owner of the           business
   account)                     account or, if joint
                                funds, the first            13.   Association, club, or other The organization
                                individual on the                 tax-exempt organization
                                account(1)
                                                            14.   A broker or registered      The broker or nominee
4. Custodian account of a       The minor(2)                      nominee
   minor (Uniform Gift to
   Minors Act)                                              15.   Account with the            The public entity
                                                                  Department of Agriculture
5. Adult and minor (joint       The adult or, if the              in the name of a public
   account)                     minor is the only                 entity (such as a State or
                                contributor, the                  local government, school
                                minor(1)                          district, or prison) that
                                                                  receives agricultural
6. Account in the name of       The ward, minor, or               program payments
   guardian or committee for a  incompetent person(3)
   designated ward, minor, or
   incompetent person

7. a. The usual revocable       The grantor-trustee(1)
      savings trust account
      (grantor is also trustee)

   b. So-called trust account   The actual owner(1)
      that is not a legal or
      valid trust under State
      law

8. Sole proprietorship account  The owner(4)

9. A valid trust, estate, or    The legal entity (Do not
   pension trust                furnish the identifying
                                number of the personal
                                representative or trustee
                                unless the legal entity
                                itself is not designated
                                in the account title.)(5)



(1)   List first and circle the name of the person whose number you furnish.
(2)   Circle the minor's name and furnish the minor's social security number.
(3)   Circle the ward's, minor's or incompetent person's name and furnish such
      person's social security number.
(4)   Show your individual name. You may also enter your business name. You may
      use either your Social Security Number or Employer Identification Number.
(5)   List first and circle the name of the legal trust, estate, or pension
      trust.

Note: If no name is circled when there is more than one name, the number will
      be considered to be that of the first name listed.

EX-99.2

                                                                   EXHIBIT 99.2


                     FORM OF NOTICE OF GUARANTEED DELIVERY

                                      for

                             6 5/8% NOTES DUE 2004
                             6 7/8% NOTES DUE 2006
                             7 1/4% NOTES DUE 2011

                                       of

                               FEDEX CORPORATION


     This form or one substantially equivalent hereto must be used to accept
the Exchange Offer of FedEx Corporation, a Delaware corporation (the
"Company"), made pursuant to the Prospectus, dated           , 2001 (as the same
may be amended or supplemented from time to time, the "Prospectus"), if
certificates for the outstanding 6 5/8% notes due 2004, outstanding 6 7/8%
notes due 2006 or outstanding 7 1/4% notes due 2011 of the Company (together,
the "Old Notes") are not immediately available or if the procedure for
book-entry transfer cannot be completed on a timely basis or time will not
permit the Old Notes, the Letter of Transmittal and all other required
documents to reach The Bank of New York (the "Exchange Agent") on or prior to
5:00 p.m., New York City time, on the Expiration Date of the Exchange Offer.
This Notice of Guaranteed Delivery may be delivered by hand, overnight courier
or mail, or transmitted by facsimile transmission, to the Exchange Agent as set
forth below. See "The Exchange Offer--Procedures for Tendering" in the
Prospectus. Capitalized terms used herein but not defined herein have the
respective meanings given to them in the Prospectus.


- --------------------------------------------------------------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON          , 2001 UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION
DATE").
- --------------------------------------------------------------------------------


                  To: The Bank of New York, as Exchange Agent


By Mail or Hand/Overnight Delivery:                       By Facsimile:

The Bank of New York                                      (212) 815-6339
Reorganization Unit
101 Barclay Street - 7E                                   Confirm by Telephone:
New York, New York 10286
Attention: Santino Ginocchetti                            (212) 815-6331


     DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS, OR
TRANSMISSION VIA FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A
VALID DELIVERY.

     THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE
SIGNATURES. IF A SIGNATURE ON THE LETTER OF TRANSMITTAL IS REQUIRED TO BE
GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE
SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.





Ladies and Gentlemen:

     The undersigned hereby tender(s) to the Company, upon the terms and
subject to the conditions set forth in the Prospectus and the related Letter of
Transmittal, receipt of which is hereby acknowledged, the aggregate principal
amount of Old Notes set forth below pursuant to the guaranteed delivery
procedures set forth in the Prospectus under the caption "The Exchange
Offer--Guaranteed Delivery Procedures."

     All authority herein conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death or incapacity of the undersigned
and every obligation of the undersigned under this Notice of Guaranteed
Delivery shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.

                                                           
- --------------------------------------------------------      ------------------------------------------------------
               PLEASE SIGN AND COMPLETE                       Certificate No(s). of Old Notes (if available):

Signature(s) of Owner(s) or
Authorized Signatory:___________________________________      ______________________________________________________

________________________________________________________      ______________________________________________________

Principal Amount of Old 6 5/8% Notes Due 2004                 Date:_________________________________________________
Tendered:*
                                                              Name(s) of Registered Holder(s):
________________________________________________________      ______________________________________________________

________________________________________________________      ______________________________________________________
Principal Amount of Old 6 7/8% Notes Due 2006 Tendered:*
                                                              Address:______________________________________________

                                                              ______________________________________________________

________________________________________________________      Area Code and Telephone No.:__________________________

Principal Amount of Old 7 1/4% Notes Due 2011 Tendered:*      If Old Notes will be tendered by book-entry transfer
                                                              provide the following information:
________________________________________________________
                                                              Signature:____________________________________________
________________________________________________________
                                                              DTC Account Number:___________________________________

                                                              Date:_________________________________________________
- --------------------------------------------------------      ------------------------------------------------------



     This Notice of Guaranteed Delivery must be signed by the holder(s) of Old
Notes exactly as its (their) name(s) appear on certificates for Old Notes or on
a security position listing as the owner of Old Notes, or by person(s)
authorized to become holder(s) by endorsements and documents transmitted with
this Notice of Guaranteed Delivery. If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer or other person acting in a
fiduciary or representative capacity, such person must provide the following
information.


                      Please print name(s) and address(es)


Name(s):________________________________________________________________________

________________________________________________________________________________

Capacity:_______________________________________________________________________

________________________________________________________________________________

Address(es):____________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________


                                       2




DO NOT SEND OLD NOTES WITH THIS NOTICE OF GUARANTEED DELIVERY. NOTES SHOULD BE
SENT TO THE EXCHANGE AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED
LETTER OF TRANSMITTAL.


             THE GUARANTEE ON THE OPPOSITE PAGE MUST BE COMPLETED.

- --------------------
* Must be in denominations of $1,000 and integral multiples thereof, provided
that if fewer than all of the Old Notes of a holder are tendered for exchange,
the untendered principal amount of the holder's remaining Old Notes must be
$1,000 or any integral multiple of $1,000 in excess thereof.













                                       3




                                   GUARANTEE
                    (Not to Be Used for Signature Guarantee)

     The undersigned, a firm or other entity identified in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") as an
"eligible guarantor institution," including (as such terms are defined
therein): (i) a bank; (ii) a broker, dealer, municipal securities broker,
municipal securities dealer, government securities broker or government
securities dealer; (iii) a credit union; (iv) a national securities exchange,
registered securities association or clearing agency; or (v) a savings
association that is a participant in a Securities Transfer Association
recognized program (each of the foregoing being referred to as an "Eligible
Institution"), hereby guarantees to deliver to the Exchange Agent at the
address set forth above, either the Old Notes tendered hereby in proper form
for transfer, or confirmation of the book-entry transfer of such Old Notes to
the Exchange Agent's account at The Depository Trust Company, pursuant to the
procedure for book-entry transfer set forth in the Prospectus, in either case
together with one or more properly completed and duly executed Letters of
Transmittal (or facsimile thereof or agent's message in lieu thereof) and any
other required documents within three New York Stock Exchange trading days
after the Expiration Date.

     The undersigned acknowledges that it must deliver the Letter of
Transmittal (or agent's message in lieu thereof) and Old Notes tendered hereby
to the Exchange Agent within the time period set forth above and that failure
to do so could result in financial loss to the  undersigned.


                                                           
- --------------------------------------------------------      ------------------------------------------------------

Name of Firm:___________________________________________      ______________________________________________________
                                                                            (Authorized Signature)
Address:________________________________________________
                                                              Name:_________________________________________________
________________________________________________________
                  (Include Zip Code)                          Title:________________________________________________

Area Code and                                                 Date:_________________________________________________
Telephone No.:__________________________________________

- --------------------------------------------------------      ------------------------------------------------------




DO NOT SEND OLD NOTES WITH THIS NOTICE OF GUARANTEED DELIVERY. NOTES SHOULD BE
SENT TO THE EXCHANGE AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED
LETTER OF TRANSMITTAL.

EX-99.3

                                                                    EXHIBIT 99.3


                                                                          , 2001


                        FORM OF EXCHANGE AGENT AGREEMENT

The Bank of New York
Reorganization Unit
101 Barclay Street - 7E
New York, New York 10286
Attention: Santino Ginocchietti

Ladies and Gentlemen:

     FedEx Corporation, a Delaware corporation (the "Company"), proposes to make
an offer (the "Exchange Offer") to exchange up to $250,000,000 principal amount
of its 6 5/8% notes due 2004, $250,000,000 principal amount of its 6 7/8% notes
due 2006 and $250,000,000 principal amount of its 7 1/4% notes due 2011 (the
"New Notes") for a like principal amount of its respective outstanding 6 5/8%
notes due 2004, 6 7/8% notes due 2006 and 7 1/4% notes due 2011 (the "Old
Notes"). The terms and conditions of the Exchange Offer are set forth in a
Prospectus (the "Prospectus") included in the Company's registration statement
on Form S-4 (File No. 333- ), as it may be amended from time to time (the
"Registration Statement"), filed with the Securities and Exchange Commission,
and proposed to be distributed to all record holders of the Old Notes. The Old
Notes and the New Notes are collectively referred to herein as the "Notes."
Capitalized terms used herein and not defined shall have the respective meanings
ascribed to them in the Prospectus or accompanying Letter of Transmittal.

     The Company hereby appoints The Bank of New York to act as exchange agent
(the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to The Bank of New York.

     The Exchange Offer is expected to be commenced by the Company on or about ,
2001. The Letter of Transmittal accompanying the Prospectus (or in the case of
book entry securities, either the Letter of Transmittal or the Automated Tender
Offer Program ("ATOP") system) is to be used by the holders of the Old Notes to
accept the Exchange Offer and contains instructions with respect to the delivery
of certificates for Old Notes tendered.

     The Exchange Offer shall expire at 5:00 P.M., New York City time, on ,
2001, or on such later date or time to which the Company may extend the Exchange
Offer (the "Expiration Date"). Subject to the terms and conditions set forth in
the Prospectus, the Company expressly reserves the right to extend the Exchange
Offer from time to time and may extend the Exchange Offer by giving oral
(confirmed in writing) or written notice to you before 9:00 A.M., New York City
time, on the next business day after the previously scheduled Expiration Date.

     The Company expressly reserves the right, in its sole discretion, to amend
or terminate the Exchange Offer, and not to accept for exchange any Old Notes
not theretofore accepted for exchange. The Company will give oral (confirmed in
writing) or written notice of any amendment, termination or nonacceptance to you
as promptly as practicable.

     In carrying out your duties as Exchange Agent, you are to act in accordance
with the following instructions:

     1. You will perform such duties and only such duties as are specifically
set forth in the section of the Prospectus captioned "The Exchange Offer," in
the Letter of Transmittal accompanying the Prospectus or as







specifically set forth herein; provided, however, that in no way will your
general duty to act in good faith and without gross negligence or willful
misconduct be limited by the foregoing.

     2. You will establish an account with respect to the Old Notes at The
Depository Trust Company ("DTC") for purposes of the Exchange Offer within two
business days after the date of the Prospectus, and any financial institution
that is a participant in DTC's systems may, until the Expiration Date, make
book-entry delivery of the Old Notes by causing DTC to transfer such Old Notes
into your account in accordance with DTC's procedures for such transfer. In
every case, however, a Letter of Transmittal (or a manually executed facsimile
thereof) or an agent's message, properly completed and duly executed, with any
required signature guarantees and any other required documents must be
transmitted to and received by you prior to the Expiration Date or the
guaranteed delivery procedures described in the Letter of Transmittal must be
complied with.

     3. You are to examine each of the Letters of Transmittal and certificates
for Old Notes (and confirmation of book-entry transfers of Old Notes into your
account at DTC) and any other documents delivered or mailed to you by or for
holders of the Old Notes, to ascertain whether: (i) the Letters of Transmittal,
certificates and any such other documents are duly executed and properly
completed in accordance with instructions set forth therein and that such
Book-Entry Confirmations are in due and proper form and contain the information
required to be set forth therein, (ii) the Old Notes have otherwise been
properly tendered, (iii) the Old Notes tendered in part are tendered in
denominations of $1,000 and integral multiples thereof, and (iv) holders have
provided their taxpayer identification number ("TIN") or required certification.
In each case where the Letter of Transmittal or any other document has been
improperly completed or executed, or where Book-Entry Confirmations are not in
due and proper form or omit certain information, or where any of the
certificates for Old Notes are not in proper form for transfer or some other
irregularity in connection with the acceptance of the Exchange Offer exists, you
will endeavor to inform the presenters of the need for fulfillment of all
requirements and to take any other action as may be necessary or advisable to
cause such irregularity to be corrected.

     4. With the approval of the President, any Vice President, the Secretary or
any Assistant Secretary of the Company (such approval, if given orally, to be
confirmed in writing) or any other person designated by such an officer in
writing, you are authorized to waive any irregularities in connection with any
tender of Old Notes pursuant to the Exchange Offer.

     5. At the written request of the Company or its counsel, you shall notify
tendering holders of Old Notes in the event of any extension, termination or
amendment of the Exchange Offer. In the event of any such termination, you will
return all tendered Old Notes to the persons entitled thereto, at the request
and expense of the Company.

     6. Tenders of Old Notes may be made only as set forth in the Letter of
Transmittal and in the section of the Prospectus captioned "The Exchange Offer,"
and Old Notes shall be considered properly tendered to you only when tendered in
accordance with the procedures set forth therein. Notwithstanding the provisions
of this paragraph 6, Old Notes which the President, any Vice President, the
Secretary or any Assistant Secretary of the Company or any other person
designated by any such person shall approve as having been properly tendered
shall be considered to be properly tendered (such approval, if given orally,
shall be confirmed in writing). New Notes are to be issued in exchange for Old
Notes pursuant to the Exchange Offer only (i) against deposit with you prior to
the Expiration Date or, in the case of a tender in accordance with the
guaranteed delivery procedures outlined in Instruction 1 of the Letter of
Transmittal, within three New York Stock Exchange trading days after the
Expiration Date of the Exchange Offer, together with executed Letters of
Transmittal and any other documents required by the Exchange Offer or (ii) in
the event that the holder is a participant in DTC's system, by the utilization
of DTC's ATOP and receipt of any evidence required by the Exchange Offer.

     7. You shall advise the Company with respect to any Old Notes received
subsequent to the Expiration Date and accept its instructions with respect to
disposition of such Old Notes.

     8.   You shall accept tenders:




                                        2





          (a) in cases where the Old Notes are registered in two or more names
          only if signed by all named holders;

          (b) in cases where the signing person (as indicated on the Letter of
          Transmittal) is acting in a fiduciary or a representative capacity
          only when proper evidence of his or her authority so to act is
          submitted; and

          (c) from persons other than the registered holder of Old Notes
          provided that customary transfer requirements, including those
          regarding any applicable transfer taxes, are fulfilled.

     You shall accept partial tenders of Old Notes when so indicated and as
permitted in the Letter of Transmittal and deliver certificates for Old Notes to
the registrar for the Old Notes (the "Security Registrar") for split-up and
return any untendered Old Notes to the holder (or such other person as may be
designated in the Letter of Transmittal) as promptly as practicable after
expiration or termination of the Exchange Offer.

     9. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Company will notify you (such notice, if given orally, to be
confirmed in writing) of its acceptance, promptly after the Expiration Date, of
all Old Notes properly tendered and you, on behalf of the Company, will exchange
such Old Notes for New Notes and cause such Old Notes to be canceled. Delivery
of New Notes will be made on behalf of the Company by you at the rate of $1,000
principal amount of New Notes for each $1,000 principal amount of the Old Notes
tendered promptly after notice (such notice, if given orally, to be confirmed in
writing) of acceptance of said Old Notes by the Company; provided, however, that
in all cases, Old Notes tendered pursuant to the Exchange Offer will be
exchanged only after timely receipt by you of certificates for such Old Notes
(or confirmation of book-entry transfer into your account at DTC), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees (except as described in the section of the
Prospectus captioned "The Exchange Offer--Procedures for Tendering") and any
other required documents. Unless otherwise instructed by the Company, you shall
issue New Notes only in denominations of $1,000 or any integral multiple
thereof.

     10. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Old Notes tendered pursuant to the Exchange Offer may be
withdrawn at any time on or prior to the Expiration Date in accordance with the
terms of the Exchange Offer.

     11. The Company shall not be required to accept for exchange any Old Notes
tendered if any of the conditions set forth in the Exchange Offer are not met.
Notice of any decision by the Company not to accept for exchange any Old Notes
tendered shall be given (and confirmed in writing) by the Company to you.

     12. If, pursuant to the Exchange Offer, the Company does not accept for
exchange all or part of the Old Notes tendered because of an invalid tender, the
occurrence of certain other events set forth in the Prospectus or otherwise, you
shall as soon as practicable after the expiration or termination of the Exchange
Offer return the certificates for those unaccepted Old Notes (or effect
appropriate book-entry transfer), together with any related required documents
and the Letters of Transmittal relating thereto that are in your possession, to
the persons who deposited them (or effected such book-entry transfer).

     13. All certificates for reissued Old Notes, unaccepted Old Notes or for
New Notes (other than those effected by book-entry transfer) shall be forwarded
by (a) first-class certified mail, return receipt requested, under a blanket
surety bond obtained by you protecting you and the Company from loss or
liability arising out of the nonreceipt or nondelivery of such certificates or
(b) by registered mail insured by you separately for the replacement value of
each of such certificates.

     14. As soon as practicable after the Expiration Date, you shall arrange for
cancellation of the Old Notes submitted to you or returned by DTC in connection
with the ATOP. Such Old Notes shall be cancelled and retired by you as you are
instructed by the Company (or a representative designated by the Company) in
writing.




                                        3





     15. You are not authorized to pay or offer to pay any concessions,
commissions or other solicitation fees to any broker, dealer, commercial bank,
trust company or other nominee or to engage or use any person to solicit
tenders.

     16.  As Exchange Agent hereunder, you:

          (a) shall have no duties or obligations other than those specifically
          set forth in the Prospectus, the Letter of Transmittal or herein or as
          may be subsequently agreed to in writing by you and the Company;

          (b) will be regarded as making no representations and having no
          responsibilities as to the validity, sufficiency, value or genuineness
          of any of the certificates for the Old Notes deposited with you
          pursuant to the Exchange Offer, and will not be required to and will
          make no representation as to the validity, value or genuineness of the
          Exchange Offer;

          (c) shall not be obligated to take any legal action hereunder which
          might in your reasonable judgment involve any expense or liability,
          unless you shall have been furnished with reasonable indemnity;

          (d) may reasonably rely upon and shall be protected in acting in
          reliance upon any certificate, instrument, opinion, notice, letter or
          other document or security delivered to you and reasonably believed by
          you to be genuine and to have been signed by the proper party or
          parties;

          (e) may reasonably act upon any tender, statement, request, comment,
          agreement or other instrument whatsoever not only as to its due
          execution and validity and the effectiveness of its provisions, but
          also as to the truth and accuracy of any information contained
          therein, which you shall in good faith believe to be genuine or to
          have been signed or represented by a proper person or persons;

          (f) may rely upon and shall be protected in acting upon written or
          oral instructions from any officer of the Company as set forth herein;

          (g) may consult with your counsel with respect to any questions
          relating to your duties and responsibilities, and the written opinion
          of such counsel shall be full and complete authorization and
          protection in respect of any action taken, suffered or omitted to be
          taken by you hereunder in good faith and in accordance with the
          written opinion of such counsel; and

          (h) shall not advise any person tendering Old Notes pursuant to the
          Exchange Offer as to whether to tender or refrain from tendering all
          or any portion of Old Notes or as to the market value of, or the
          decline or appreciation in market value of, any Old Notes that may or
          may not occur as a result of the Exchange Offer or as to the market
          value of the New Notes;

provided, however, that in no way will your general duty to act in good faith
and without gross negligence or willful misconduct be limited by the foregoing.

     17. You shall take such action as may from time to time be requested by the
Company or its counsel (and such other action as you may reasonably deem
appropriate) to furnish copies of the Prospectus, Letter of Transmittal and the
Notice of Guaranteed Delivery (as described in the Prospectus) or such other
forms as may be approved from time to time by the Company to all persons
requesting such documents and to accept and comply with telephone requests for
information relating to the Exchange Offer, provided, that such information
shall relate only to the procedures for accepting (or withdrawing from) the
Exchange Offer. The Company will furnish you with copies of such documents at
your request.

     18. You shall advise by facsimile transmission or telephone, and promptly
thereafter confirm in writing to Charles M. Buchas, Jr., Corporate Vice
President and Treasurer of the Company (telephone number (901) 818-7040,




                                        4





facsimile number (901) 818-7121) and to Andrew M. Paalborg, Staff Vice
President-Securities and Corporate Law of the Company (telephone number (901)
818-7035, facsimile number (901) 818-7103) and such other person or persons as
the Company may request, daily (and more frequently during the week immediately
preceding the Expiration Date and if otherwise requested), up to and including
the Expiration Date, as to the number and aggregate principal amount of Old
Notes which have been duly tendered pursuant to the Exchange Offer and the items
received by you pursuant to the Exchange Offer and this Agreement, separately
reporting and giving cumulative totals as to items properly received and items
improperly received. In addition, you will also inform, and cooperate in making
available to, the Company or any such other person or persons designated by the
Company upon oral request made from time to time prior to the Expiration Date of
such other information as it or he or she reasonably requests. Such cooperation
shall include, without limitation, the granting by you to the Company and such
person as the Company may request of access to those persons on your staff who
are responsible for receiving tenders, in order to ensure that immediately prior
to the Expiration Date the Company shall have received information in sufficient
detail to enable it to decide whether to extend the Exchange Offer, including
the identity of the holders of Old Notes who have not tendered such Old Notes as
of the date such request was made. You shall prepare a final list of all persons
whose tenders were accepted, the number and aggregate principal amount of Old
Notes tendered, the number and aggregate principal amount of Old Notes accepted
and the identity of any Participating Broker-Dealers and the number and
aggregate principal amount of New Notes delivered to each, and deliver said list
to the Company.

     19. Letters of Transmittal, Book-Entry Confirmations and Notices of
Guaranteed Delivery received by you shall be preserved by you for a period of
time at least equal to the period of time you preserve other records pertaining
to the transfer of securities, or one year, whichever is longer, and thereafter
shall be delivered by you to the Company. You shall dispose of unused Letters of
Transmittal and other surplus materials, upon consultation with the Company, in
accordance with your customary procedures.

     20. You hereby expressly waive any lien, encumbrance or right of set-off
whatsoever that you may have with respect to funds deposited with you for the
payment of transfer taxes by reasons of amounts, if any, borrowed by the
Company, or any of its subsidiaries or affiliates pursuant to any loan, credit
or other agreement with you or for compensation owed to you hereunder or under
any other agreement.

     21. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on the Schedule attached hereto.

     22. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them. Any
inconsistency between this Agreement, on the one hand, and the Prospectus and
the Letter of Transmittal (as they may be amended from time to time), on the
other hand, shall be resolved in favor of the latter two documents, except with
respect to the duties, liabilities and indemnification of you as Exchange Agent,
which shall be controlled by this Agreement.

     23. The Company covenants and agrees to indemnify and hold you harmless in
your capacity as Exchange Agent hereunder against any loss, liability, cost or
expense, including reasonable attorneys' fees and expenses arising out of or in
connection with any act, omission, delay or refusal made by you in reliance upon
any signature, endorsement, assignment, certificate, order, request, notice,
instruction or other instrument or document reasonably believed by you to be
valid, genuine and sufficient and in accepting any tender or effecting any
transfer of Old Notes reasonably believed by you in good faith to be authorized,
and in delaying or refusing in good faith to accept any tenders or effect any
transfer of Old Notes; provided, however, that anything in this Agreement to the
contrary notwithstanding, the Company shall not be liable for indemnification or
otherwise for any loss, liability, cost or expense to the extent arising out of
your gross negligence or willful misconduct. In no case shall the Company be
liable under this indemnity with respect to any claim against you unless the
Company shall be notified by you, by letter or by facsimile which is confirmed
by letter, of the written assertion of a claim against you or of any other
action commenced against you, promptly after you shall have received any such
written assertion or notice of commencement of action. The Company shall be
entitled to participate, at its own expense, in the defense of any such claim or
other action, and, if the Company so elects, the Company may assume the defense
of any pending or




                                        5





threatened action against you in respect of which indemnification may be sought
hereunder, in which case the Company shall not thereafter be responsible for the
subsequently incurred fees and disbursements of legal counsel for you under this
paragraph so long as the Company shall retain counsel reasonably satisfactory to
you to defend such suit; provided, however, that the Company shall not be
entitled to assume the defense of any such action if the named parties to such
action include both you and the Company and representation of both parties by
the same legal counsel would, in the written opinion of your counsel, be
inappropriate due to actual or potential conflicting interests between you and
the Company. You understand and agree that the Company shall not be liable under
this paragraph for the fees and expenses of more than one legal counsel for you.

     24. You shall arrange to comply with all requirements under the tax laws of
the United States, including those relating to missing TINs, and shall file any
appropriate reports with the Internal Revenue Service. The Company understands
that you are required, in certain instances, to deduct thirty-one percent (31%)
with respect to interest paid on the New Notes and proceeds from the sale,
exchange, redemption or retirement of the New Notes from holders who have not
supplied their correct TINs or required certification. Such funds will be turned
over to the Internal Revenue Service in accordance with applicable regulations.

     25. You shall notify the Company of the amount of any transfer taxes
payable in respect of the exchange of Old Notes and, upon receipt of a written
approval from the Company, shall deliver or cause to be delivered, in a timely
manner to each governmental authority to which any transfer taxes are payable in
respect of the exchange of Old Notes, your check in the amount of all transfer
taxes so payable, and the Company shall reimburse you for the amount of any and
all transfer taxes payable in respect of the exchange of Old Notes; provided,
however, that you shall reimburse the Company for amounts refunded to you in
respect of your payment of any such transfer taxes, at such time as such refund
is received by you.

     26. THIS AGREEMENT AND YOUR APPOINTMENT AS EXCHANGE AGENT HEREUNDER SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE,
AND WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.

     27. This Agreement shall be binding upon and inure solely to the benefit of
each party hereto, and its successor and assigns, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any other person any
right, benefit or remedy of any nature whatsoever under or by reason of this
Agreement. Without limitation of the foregoing, the parties hereto expressly
agree that no holder of Old Notes or New Notes shall have any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.

     28. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, and all of which taken together shall
constitute one and the same agreement.

     29. In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

     30. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, canceled or waived, in whole or in part, except by a written
instrument signed by a duly authorized representative of the party to be
charged.

     31. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
or similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth below:

     If to the Company, to:

          FedEx Corporation




                                        6





          942 South Shady Grove Road
          Memphis, Tennessee 38120
          Telephone: (901) 818-7040
          Telecopy: (901) 818-7121
          Attention: Charles M. Buchas, Jr.
                     Corporate Vice President and Treasurer

     with a copy to:

          Sarah Beshar, Esq.
          Davis Polk & Wardwell
          450 Lexington Avenue
          New York, NY 10017
          Telecopy (212) 450-4800

     If to the Exchange Agent, to:

          The Bank of New York
          Reorganization Unit
          101 Barclay Street - 7E
          New York, New York 10286
          Telephone: (212) 815-6331
          Telecopy:  (212) 815-6339
          Attention: Santino Ginocchietti

     32. Unless terminated earlier by the parties hereto, this Agreement shall
terminate 90 days following the Expiration Date. Notwithstanding the foregoing,
paragraphs 19, 21, 23 and 25 shall survive the termination of this Agreement.
Upon any termination of this Agreement, you shall promptly deliver to the
Company any certificates for New Notes, funds or property then held by you as
Exchange Agent under this Agreement.

     33.  This Agreement shall be binding and effective as of the date hereof.






                                        7





     Please acknowledge receipt of this Agreement and confirm the arrangements
herein provided by signing and returning the enclosed copy.

                                FEDEX CORPORATION


                                By:
                                   ---------------------------------------------
                                   Name:
                                   Title:

Accepted as of the date first above written:

THE BANK OF NEW YORK,
AS EXCHANGE AGENT


By:
  -------------------------------
     Name:
     Title:




                                        8




                                FEE SCHEDULE FOR
                             EXCHANGE AGENT SERVICES

     Covers review of the Letter of Transmittal, DTC ATOP voluntary offering
instruction ("VOI"), the Exchange Agent Agreement and other related
documentation, if any, as required by the Exchange Offer; set-up of records and
accounts; distribution of materials; all operational and administrative charges
and time in connection with the review, receipt and processing of Letters of
Transmittal/VOI, processing delivery of guarantees, legal items, withdrawals,
record keeping, and answering securityholders' inquiries pertaining to the
Exchange Offer.

                                                            Flat Fee: $_________








                                        9

S-4

   As filed with the Securities and Exchange Commission on April 30, 2001

                                                      Registration No. 333-____
===============================================================================


                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                   ---------

                                   FORM S-4
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933
                               FedEx Corporation
            (Exact Name of Registrant as Specified in Its Charter)

           Delaware                       4513                   62-1721435
(State or other jurisdiction   (Primary Standard Industrial   (I.R.S. Employer
     of incorporation or        Classification Code Number)    Identification
         organization)                                             Number)
                          942 South Shady Grove Road
                            Memphis, Tennessee 38120
                                 (901) 818-7500
   (Address, including zip code, and telephone number, including area code,
                  of Registrant's principal executive offices)

                                   ---------

                              KENNETH R. MASTERSON
                               FedEx Corporation
                           942 South Shady Grove Road
                            Memphis, Tennessee 38120
                                 (901) 818-7500
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)

                                   ---------

                                   Copies to:
                             Sarah J. Beshar, Esq.
                             Davis Polk & Wardwell
                              450 Lexington Avenue
                            New York, New York 10017
                                 (212) 450-4000

     Approximate date of commencement of proposed sale to the public: As soon
as practicable after the effective date of this Registration Statement.

     If the securities being registered on this form are to be offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]

     If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier
registration statement for the same offering.[ ]

     If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.[ ]

                                   ---------


                                                  CALCULATION OF REGISTRATION FEE
=================================================================================================================================
                                                                                           Proposed
                                                                       Proposed            Maximum
                                                                       Maximum             Aggregate
             Title of Each Class                  Amount to be      Offering Price      Offering Price          Amount of
       of Securities to be Registered              Registered       Per  Unit (1)             (1)            Registration Fee
- ---------------------------------------------------------------------------------------------------------------------------------
                                                                                                      
6 5/8% Notes due 2004........................     $250,000,000          100%               $250,000,000           $62,500
6 7/8% Notes due 2006........................     $250,000,000          100%               $250,000,000           $62,500
7 1/4% Notes due 2011........................     $250,000,000          100%               $250,000,000           $62,500
Guarantees of 65/8% Notes due 2004 (2) ......         (3)               (3)                    (3)                  (4)
Guarantees of 67/8% Notes due 2006 (2).......         (3)               (3)                    (3)                  (4)
Guarantees of 71/4% Notes due 2011 (2) ......         (3)               (3)                    (3)                  (4)
- ---------------------------------------------------------------------------------------------------------------------------------
Total........................................     $750,000,000          100%               $750,000,000           $187,500
=================================================================================================================================


(1)   Determined pursuant to Rule 457(f) under the Securities Act of 1933.
(2)   See inside facing page for table of registrant guarantors.
(3)   No separate consideration will be received for the guarantees.
(4)   Pursuant to Rule 457(n), no separate filing fee is required for the
      guarantees.


     The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

===============================================================================





                                                 State or other
                                                 jurisdiction of         IRS Employer
              Exact Name of                     incorporation or        Identification           Address of Registrant
          Registrant Guarantor                    organization              Number           Guarantor's Executive Offices
                                                                                    
American Freightways, Inc.                          Arkansas              71-0562003               2200 Forward Drive
                                                                                                   Harrison, AR 72601

Caribbean Transportation Services, Inc.             Delaware              62-1789751            7304 West Market Street
                                                                                                  Greensboro, NC 27409

Federal Express Corporation                         Delaware              71-0427007             3610 Hacks Cross Road
                                                                                                   Memphis, TN 38125

Federal Express (Australia) Pty Ltd.                Australia                N/A                  215-225 Euston Road
                                                                                                       Alexandria

                                                                                                   NSW 2015 Australia
Federal Express Aviation Services,                  Delaware              58-1689318             3610 Hacks Cross Road
Incorporated                                                                                       Memphis, TN 38125

Federal Express Canada Ltd.                          Canada                  N/A                  5985 Explorer Drive
                                                                                              Mississauga, Ontario L4W 5K6

Federal Express Europe, Inc.                        Delaware              62-1441419             3610 Hacks Cross Road
                                                                                                   Memphis, TN 38125

Federal Express Europe, Inc. & Co.,                  Belgium                 N/A                  Airport Building 119
V.O.F./S.N.C.                                                                                   1820 Melsbroek, Belgium

Federal Express Holdings S.A.                       Delaware              62-1361344             3610 Hacks Cross Road
                                                                                                   Memphis, TN 38125

Federal Express Holdings (Mexico) y                  Mexico                  N/A                   Calle Insurgentes
Compania S.N.C. de C.V.                                                                                 Sur 899
                                                                                                     Napoles 03810
                                                                                                  Mexico D.F., Mexico

Federal Express International (France)               France                  N/A             125/135 Av. Louis Roche 92230,
SNC                                                                                                  Gennevilliers

Federal Express International, Inc.                 Delaware              58-1689315             3610 Hacks Cross Road
                                                                                                   Memphis, TN 38125

Federal Express Japan K.K.                            Japan                  N/A                     Kyodo Building
                                                                                                     16 Ichibancho
                                                                                                       Chiyoda-Ku
                                                                                                  Tokyo 102-0082 Japan

Federal Express Pacific, Inc.                       Delaware              62-1441421             3610 Hacks Cross Road
                                                                                                   Memphis, TN 38125

Federal Express (Singapore) Pte. Ltd.               Singapore                N/A                 3 Khaki Bukit Road #2
                                                                                                    Block A, Unit 3E
                                                                                                Eunos Warehouse Complex
                                                                                                    Singapore 417837

Federal Express Virgin Islands, Inc.           U.S. Virgin Islands           N/A                     Havensite Mall
                                                                                                    Charlotte Amalie
                                                                                            St. Thomas, U.S. Virgin Islands

FedEx Corporate Services, Inc.                      Delaware              62-1808017            942 S. Shady Grove Road
                                                                                                   Memphis, TN 38120

FedEx Custom Critical, Inc.                           Ohio                34-1175962           2088 South Arlington Road
                                                                                                    Akron, OH 44306





                                                 State or other
                                                 jurisdiction of         IRS Employer
              Exact Name of                     incorporation or        Identification           Address of Registrant
          Registrant Guarantor                    organization              Number           Guarantor's Executive Offices
                                                                                    

FedEx Freight System, Inc.                          Delaware              62-1835899         6075 Poplar Avenue, Suite 300
                                                                                                   Memphis, TN 38119

FedEx Ground Package System, Inc.                   Delaware              34-1441019                1000 FedEx Drive
                                                                                                Moon Township, PA 15108

FedEx Ground Package System, Ltd.                    Wyoming              34-1791318          3930 Nashua Drive, Suite 201
                                                                                              Mississauga, Ontario L4V 1M5

FedEx Supply Chain Services, Inc.                     Ohio                34-1614601                5455 Darrow Road
                                                                                                    Hudson, OH 44236

FedEx Trade Networks, Inc.                          Delaware              62-1808886         6075 Poplar Avenue, Suite 434
                                                                                                   Memphis, TN 38119

Tower Group International, Inc.                     New York              16-0807223              128 Dearborn Street
                                                                                                   Buffalo, NY 14207

Tower Group International Canada Inc.                Canada                  N/A              5915 Airport Rd, Suite 1100
                                                                                              Mississauga, Ontario LV4 1T1

Viking Freight, Inc.                               California             94-1620812           6411 Guadalupe Mines Road
                                                                                                   San Jose, CA 95120

World Tariff, Limited                              California             94-3117785        220 Montgomery Street, Suite 448
                                                                                                San Francisco, CA 94101






The information in this prospectus is not complete and may be changed. This
prospectus is not an offer to acquire these securities and it is not soliciting
an offer to acquire these securities in any jurisdiction where the offer,
exchange or sale is not permitted.


                  Subject to Completion, dated April 30, 2001

PROSPECTUS

               , 2001
                                 [FedEx LOGO]

                               Offer to Exchange

                     $250,000,000 6 5/8% Notes due 2004,
                    $250,000,000 6 7/8% Notes due 2006 and
                      $250,000,000 7 1/4% Notes due 2011

                                      for

                    $250,000,000 6 5/8% New Notes due 2004,
                  $250,000,000 6 7/8% New Notes due 2006 and
                    $250,000,000 7 1/4% New Notes due 2011

                                   ---------

     We are offering to exchange up to $250,000,000 of our 6 5/8% notes due
2004, up to $250,000,000 of our 6 7/8% notes due 2006 and up to $250,000,000 of
our 7 1/4% notes due 2011 (collectively, the "New Notes"), which will be
registered under the Securities Act of 1933, as amended, for up to $250,000,000
of our issued and outstanding 6 5/8% notes due 2004, up to $250,000,000 of our
issued and outstanding 6 7/8% notes due 2006 and up to $250,000,000 of our
issued and outstanding 7 1/4% notes due 2011 (collectively, the "Old Notes"),
respectively. We are offering to issue the New Notes to satisfy our obligations
contained in the registration rights agreement we entered into when the Old
Notes were sold in transactions in reliance on Rule 144A and Regulation S under
the Securities Act. The New Notes are guaranteed by all of our subsidiaries,
excluding subsidiaries that are, individually and in the aggregate, considered
minor pursuant to the rules of the Securities and Exchange Commission.

     The terms of each series of New Notes are identical in all material
respects to the terms of the related series of Old Notes, except that the
transfer restrictions, registration rights and additional interest provisions
relating to the Old Notes do not apply to the New Notes.

     The exchange offer and withdrawal rights will expire at 5:00 p.m., New
York City time, on             , 2001 unless extended.

     You should carefully review the risk factors on page 8 of this prospectus.

                                   ---------

     To exchange your Old Notes for New Notes of the same series:

     o    You must complete and send the letter of transmittal that accompanies
          this prospectus to the exchange agent by 5:00 p.m., New York City
          time, on         , 2001.

     o    If your Old Notes are held in book-entry form at The Depository Trust
          Company, you must instruct DTC, through your signed letter of
          transmittal, that you wish to exchange your Old Notes for New Notes.
          When the exchange offer closes, your DTC account will be changed to
          reflect your exchange of Old Notes for New Notes.

     o    You should read the section called "The Exchange Offer" for
          additional information on how to exchange your Old Notes for New
          Notes.


     The Securities and Exchange Commission and state securities regulators
have not approved or disapproved of these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.




                               TABLE OF CONTENTS

                                                                          Page
                                                                          ----
Forward-Looking Statements................................................  2
Where You Can Find More Information.......................................  3
Summary...................................................................  4
Risk Factors..............................................................  8
Selected Consolidated Financial Information............................... 10
No Cash Proceeds to FedEx Corporation..................................... 12
Ratio of Earnings to Fixed Charges........................................ 12
Description of the New Notes.............................................. 13
The Exchange Offer........................................................ 21
Taxation.................................................................. 29
Plan of Distribution...................................................... 30
Notice to Investors....................................................... 31
Validity of the New Notes................................................. 31
Experts................................................................... 32
Subsidiary Guarantors..................................................... 32
Index to Consolidated Financial Statements of American
  Freightways Corporation.................................................F-1

                          ---------------------------

                           FORWARD-LOOKING STATEMENTS

     This prospectus (including the information incorporated by reference in
this prospectus) contains forward-looking statements with respect to the
financial condition, results of operations, plans, objectives, future
performance and business of FedEx Corporation. Forward-looking statements
include those preceded by, followed by or that include the words "believes,"
"expects," "anticipates," "estimates" or similar expressions. These forward-
looking statements involve risks and uncertainties. Neither FedEx nor any other
person assumes responsibility for the accuracy and completeness of these
statements. Actual results may differ materially from those contemplated by
such forward-looking statements due to, among other things, matters described
in the documents incorporated by reference in this prospectus and in the "Risk
Factors" section of this prospectus, such as:

     o    economic and competitive conditions in the markets in which we
          operate;

     o    continued increases in fuel costs and the ability to mitigate the
          effects of such increases through fuel surcharges and hedging
          activities;

     o    our ability to match aircraft, vehicle and sort capacity with
          customer volume levels; and

     o    other uncertainties that we detail from time to time in our SEC
          filings.

     As a result of these and other factors, no assurance can be given as to
our future results and achievements. You should not place undue reliance on the
forward-looking statements, which speak only as of the date of this prospectus
or the date of the document incorporated by reference in this prospectus. We
are under no obligation, and we expressly disclaim any obligation, to update or
alter any forward-looking statements, whether as a result of new information,
future events or otherwise.

     See "Where You Can Find More Information" and "Risk Factors."

                            -----------------------

                                       2



                      WHERE YOU CAN FIND MORE INFORMATION

     We and our largest subsidiary, Federal Express Corporation, file annual,
quarterly and special reports, proxy statements and other information with the
SEC. These SEC filings are available to the public over the Internet at the
SEC's web site at http: //www.sec.gov. You may also read and copy any of these
documents at the SEC's public reference rooms in Washington, D.C., New York,
New York and Chicago, Illinois. Please call the SEC at 1-800- SEC-0330 for
further information on its public reference rooms.

     The SEC allows us to incorporate by reference information into this
prospectus, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. Information
incorporated by reference is considered a part of this prospectus, and later
information filed with the SEC will automatically update and supersede previous
information. We and our largest subsidiary, Federal Express Corporation,
incorporate by reference the documents listed below and all future filings made
with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934 between the date of this prospectus and the completion of the
exchange offer. We expect that each of our other subsidiary guarantors will be
exempt from periodic reporting under the Exchange Act in reliance on Rule 12h-5
under the Exchange Act. See "Subsidiary Guarantors."

                                                   
FedEx Corporation SEC Filings                         Period
- -----------------------------------------------       ------------------------------------------
Annual Report on Form 10-K                            Fiscal Year ended May 31, 2000
Quarterly Reports on Form 10-Q                        Quarters ended August 31, 2000, November
                                                      30, 2000 and February 28, 2001
Current Reports on Form 8-K                           Filed on November 15, 2000 and January 16,
                                                      2001

Federal Express Corporation SEC Filings               Period
- -----------------------------------------------       ------------------------------------------
Annual Report on Form 10-K                            Fiscal Year ended May 31, 2000
Quarterly Reports on Form 10-Q                        Quarters ended August 31, 2000, November
                                                      30, 2000 and February 28, 2001
Current Report on Form 8-K                            Filed on January 16, 2001




     You may request a copy of these filings at no cost, by writing or
telephoning us at:

     FedEx Corporation
     Attention: Investor Relations
     942 South Shady Grove Road
     Memphis, Tennessee 38120
     (901) 818-7200

     To obtain timely delivery, you must request the information no later than
             , 2001, or five business days prior to the expiration date of the
exchange offer if the exchange offer is extended.

     We have filed with the SEC under the Securities Act and the rules and
regulations thereunder a registration statement on Form S-4 with respect to the
New Notes. This prospectus is a part of that registration statement. As allowed
by SEC rules, this prospectus does not contain all the information you can find
in the registration statement or the exhibits to the registration statement.

     You should rely only on the information contained in this prospectus or
that we have referred you to. We have not authorized any other person to
provide you with different information. If anyone provides you with different
or inconsistent information, you should not rely on it. We are not making an
offer of these securities in any state where the offer is not permitted. You
should assume that the information appearing in this prospectus, as well as
information we previously filed with the SEC and are incorporating by
reference, is accurate only as of the date on the front cover of this
prospectus. Our business, financial condition, results of operations and
prospects may have changed since that date.

                                       3



                                    SUMMARY

     The following summary contains basic information about FedEx and this
exchange offer. It may not contain all the information that is important to you
in making your investment decision. More detailed information appears elsewhere
in this prospectus and in our consolidated financial statements and
accompanying notes that we incorporate by reference. "The Exchange Offer" and
the "Description of the New Notes" sections of this prospectus contain more
detailed information regarding the terms and conditions of the exchange offer
and the New Notes.

                               FedEx Corporation

     FedEx is a leading global provider of transportation, e-commerce and
supply chain management services. Services offered by FedEx companies include
worldwide express delivery, ground small-package delivery, less-than-truckload
freight delivery, global logistics, supply chain management and customs
brokerage, as well as trade facilitation and electronic commerce solutions.
FedEx offers its integrated business solutions through a portfolio of operating
companies, including

     -    FEDERAL EXPRESS CORPORATION ("FedEx Express"). FedEx Express is our
          largest subsidiary and is the world leader in global express
          distribution, offering time-certain delivery within 24 to 48 hours
          among markets that comprise more than 90% of the world's gross
          domestic product.

     -    FEDEX GROUND PACKAGE SYSTEM, INC. ("FedEx Ground"). FedEx Ground is
          North America's second largest provider of business and residential
          money-back guaranteed ground package delivery. FedEx Ground provides
          money-back guaranteed, low-cost residential deliveries to many major
          U.S. markets through its new FedEx Home Delivery service.

     -    FEDEX FREIGHT SYSTEM, INC. ("FedEx Freight"). FedEx Freight provides
          less-than-truckload ("LTL") freight service through American
          Freightways, Inc. ("American Freightways") and Viking Freight, Inc.
          ("Viking"). American Freightways is an LTL freight carrier serving
          direct all points in 40 contiguous U.S. states. Viking is an LTL
          freight carrier operating principally in the western U.S. Together,
          these two companies provide regional LTL freight service in 48 U.S.
          states.

     -    FEDEX CORPORATE SERVICES, INC. ("FedEx Services"). FedEx Services
          combines the sales, marketing and technology groups of FedEx, FedEx
          Express and FedEx Ground, allowing us to provide our customers with a
          single point of contact in those areas for easy access to our broad
          portfolio of services. FedEx also offers complete supply chain
          solutions through its FedEx Supply Chain Services, Inc. subsidiary by
          combining worldwide transportation, information and physical
          logistics services.

     -    FEDEX CUSTOM CRITICAL, INC. ("FedEx Custom Critical"). FedEx Custom
          Critical is North America's largest time-specific, critical-shipment
          carrier, offering non-stop, door-to-door delivery of urgent shipments
          and those requiring special care in handling.

     -    FEDEX TRADE NETWORKS, INC. ("FedEx Trade Networks"). FedEx Trade
          Networks provides customs brokerage, trade facilitation and freight
          forwarding solutions, principally through its Tower Group
          International, Inc. and Caribbean Transportation Services, Inc.
          subsidiaries.

                                       4



                               The Exchange Offer

Issuer.................................  FedEx Corporation

New Notes..............................  Up to $250,000,000 aggregate principal
                                         amount of our new 65/8% notes due
                                         2004, up to $250,000,000 in aggregate
                                         principal amount of our new 67/8%
                                         notes due 2006 and up to $250,000,000
                                         in aggregate principal amount of our
                                         new 7 1/4% notes due 2011.

The Exchange Offer.....................  We are offering to issue the New Notes
                                         in exchange for a like principal
                                         amount of outstanding Old Notes of the
                                         same series that we issued on February
                                         12, 2001. We are conducting this
                                         exchange offer to satisfy our
                                         obligations contained in the
                                         registration rights agreement we
                                         entered into when we sold the Old
                                         Notes in transactions pursuant to Rule
                                         144A and Regulation S under the
                                         Securities Act. The Old Notes were
                                         subject to transfer restrictions that
                                         will not apply to the New Notes so
                                         long as you are acquiring the New
                                         Notes in the ordinary course of your
                                         business, you are not participating in
                                         a distribution of the New Notes and
                                         you are not an affiliate of ours.

Maturity...............................  The notes due 2004 will mature on
                                         February 12, 2004, the notes due 2006
                                         will mature on February 15, 2006 and
                                         the notes due 2011 will mature on
                                         February 15, 2011.

Interest Payment Dates.................  For the notes due 2004, February 12
                                         and August 12, of each year commencing
                                         August 12, 2001; and for the notes due
                                         2006 and the notes due 2011, February
                                         15 and August 15, of each year
                                         commencing August 15, 2001.

Redemption.............................  The New Notes are not redeemable prior
                                         to maturity unless certain specified
                                         events occur involving U.S. taxation.

Payment of Additional Amounts..........  We will, subject to the exceptions and
                                         limitations set forth in this
                                         prospectus, pay as additional interest
                                         on the notes any additional amounts
                                         that are necessary so that the net
                                         payment by us or a paying agent of the
                                         principal of and interest on the notes
                                         to a person that is a non-U.S. holder
                                         (as defined under "Description of the
                                         New Notes--Payment of Additional
                                         Amounts") or a foreign partnership,
                                         after deduction for any present or
                                         future tax, assessment or governmental
                                         charge of the United States or a
                                         political subdivision or taxing
                                         authority thereof or therein, imposed
                                         by withholding with respect to the
                                         payment, will not be less than the
                                         amount that would have been payable in
                                         respect of the notes had no such
                                         withholding or deduction been
                                         required.

Ranking................................  The New Notes will be unsecured and
                                         unsubordinated and will rank equally
                                         with all our other unsecured and
                                         unsubordinated indebtedness and other
                                         obligations.

                                       5



Guarantees.............................  The New Notes will be guaranteed by
                                         all of our subsidiaries, excluding
                                         subsidiaries which are, individually
                                         and in the aggregate, considered
                                         "minor" pursuant to the rules of the
                                         SEC.

No Cash Proceeds.......................  We will not receive any proceeds from
                                         the issuance of the New Notes.

Form of the New Notes..................  The New Notes of each series will be
                                         issued in the form of one or more
                                         global securities which will be
                                         deposited with, or on behalf of, DTC
                                         and registered in the name of Cede &
                                         Co., DTC's nominee. Beneficial
                                         interests in the global securities
                                         will be represented through book-entry
                                         accounts of financial institutions
                                         acting on behalf of beneficial owners
                                         as direct and indirect participants in
                                         DTC.

Governing Law..........................  The New Notes, the subsidiary
                                         guarantees and the indenture will be
                                         governed by New York law.

Tenders, Expiration Date, Withdrawal...  The exchange offer will expire at 5:00
                                         p.m., New York City time, on          ,
                                         2001 unless it is extended. To tender
                                         your Old Notes you must follow the
                                         detailed procedures described under
                                         the heading "The Exchange
                                         Offer--Procedures for Tendering"
                                         including special procedures for
                                         certain beneficial owners and broker-
                                         dealers. If you decide to exchange
                                         your Old Notes for New Notes, you must
                                         acknowledge that you do not intend to
                                         engage in and have no arrangement with
                                         any person to participate in a
                                         distribution of the New Notes. If you
                                         decide to tender your Old Notes
                                         pursuant to the exchange offer, you
                                         may withdraw them at any time prior to
                                         5:00 p.m., New York City time, on the
                                         expiration date.

Federal Income Tax Consequences........  Your exchange of Old Notes for New
                                         Notes pursuant to the exchange offer
                                         will not result in a gain or loss to
                                         you.

Exchange Agent.........................  The Bank of New York is the exchange
                                         agent for the exchange offer.

Failure to Exchange Your Old Notes.....  If you fail to exchange your Old Notes
                                         for New Notes in the exchange offer,
                                         your Old Notes will continue to be
                                         subject to transfer restrictions and
                                         you will not have any further rights
                                         under the registration rights
                                         agreement, including any right to
                                         require us to register your Old Notes
                                         or to pay any additional interest.

Trading Market.........................  To the extent that Old Notes are
                                         tendered and accepted in the exchange
                                         offer, your ability to sell
                                         untendered, and tendered but
                                         unaccepted, Old Notes could be
                                         adversely affected. There may be no
                                         trading market for the Old Notes.

                                       6



                                         There can be no assurance that an
                                         active public market for the New Notes
                                         will develop or as to the liquidity of
                                         any market that may develop for the
                                         New Notes, the ability of holders to
                                         sell the New Notes, or the price at
                                         which holders would be able to sell
                                         the New Notes. For more details, see
                                         the section called "Notice to
                                         Investors."

   General Indenture Provisions Applicable to the New Notes and the Old Notes

Indenture..............................  The New Notes will be issued under the
                                         same indenture as the Old Notes.

No Limit on Debt.......................  The indenture does not limit the
                                         amount of debt that we may issue or
                                         provide holders any protection should
                                         we be involved in a highly leveraged
                                         transaction.

Events of Default......................  Each of the following is an event of
                                         default with respect to a series of
                                         notes under the indenture:

                                         o our failure to pay principal of that
                                           series of notes when due;

                                         o our failure to pay interest when due
                                           on the notes of that series and
                                           continuance of such failure for 30
                                           days thereafter;

                                         o our failure to perform other
                                           covenants with respect to that series
                                           of notes for 60 days after receipt of
                                           notice of such failure; and

                                         o certain events of bankruptcy,
                                           insolvency or reorganization of FedEx
                                           or any subsidiary guarantor which
                                           represents more than 60% of our
                                           consolidated total assets.

Remedies...............................  If any event of default occurs and is
                                         continuing, the trustee under the
                                         indenture or holders of at least 50%
                                         in aggregate principal amount of
                                         outstanding notes of that series may
                                         declare the principal thereof
                                         immediately due and payable.

Other..................................  The New Notes and the Old Notes of
                                         each series will vote together as a
                                         single class for purposes of
                                         determining whether the holders of the
                                         requisite percentage in outstanding
                                         principal amount have taken certain
                                         actions or exercised certain rights
                                         under the indenture.

                                       7



                                  RISK FACTORS

     In addition to the information set forth elsewhere in this prospectus, you
should consider carefully the factors set forth below before exchanging your
Old Notes for New Notes.

Our Business Is Subject to Numerous Risks

     We provide a broad portfolio of transportation and supply chain management
services through our principal operating subsidiaries. Our results of
operations and financial condition are subject to certain risks and
uncertainties, including:

     o    economic conditions in the markets in which we operate, which can
          affect demand for our services;

     o    competition from other providers of transportation services;

     o    our ability to compete with new or improved services offered by our
          competitors;

     o    changes in customer demand patterns;

     o    increases in aviation and motor fuel prices;

     o    our ability to match aircraft, vehicle and sort capacity with
          customer volume levels;

     o    work stoppages, strikes or slowdowns by our employees;

     o    our ability to obtain aviation rights in important international
          markets;

     o    changes in government regulation, weather and technological change;
          and

     o    availability of financing on terms acceptable to us.

There Is No Limit on the Amount of Indebtedness That We May Incur

     The indenture, which is described below under "Description of the New
Notes," does not limit the amount of secured or unsecured indebtedness which we
or our subsidiaries may incur. The indenture does not contain any debt
covenants or provisions which would afford the holders of the New Notes
protection in the event of a highly leveraged transaction.

We Depend Upon Our Subsidiaries to Service Our Debt

     We are a holding company and derive all of our operating income from our
subsidiaries. Our only source of cash to pay principal of and interest on the
New Notes is from dividends and other payments from our subsidiaries. Our
subsidiaries' ability to make such payments may be restricted by, among other
things, applicable state and foreign corporate laws and other laws and
regulations. In addition, our right and the rights of our creditors, including
holders of the New Notes, to participate in the assets of any subsidiary upon
its liquidation or recapitalization would be subject to the prior claims of
such subsidiary's creditors, except to the extent that we may ourselves be a
creditor with recognized claims against such subsidiary. The New Notes will be
guaranteed by all of our subsidiaries, excluding subsidiaries which are,
individually and in the aggregate, considered "minor" pursuant to the rules of
the SEC. If our subsidiaries do not provide us with enough cash to make
payments on the notes when due, you may have to proceed directly against these
subsidiary guarantors.

                                       8



Ratings of Our New Notes Could Be Lowered In the Future

     The New Notes are rated "investment grade" by one or more nationally
recognized statistical rating organizations. A rating is not a recommendation
to purchase, hold or sell New Notes, since a rating does not predict the market
price of a particular security or its suitability for a particular investor.
The rating organization may lower our rating or decide not to rate our
securities in its sole discretion. The rating of the New Notes are based
primarily on the rating organization's assessment of the likelihood of timely
payment of interest when due on the New Notes and the ultimate payment of
principal of the New Notes on the final maturity date. The reduction,
suspension or withdrawal of the ratings of the New Notes will not, in and of
itself, constitute an event of default under the indenture.

An Active Trading Market For Our New Notes May Not Develop

     There is no established trading market for the New Notes since they are a
new issue of securities. We do not intend to apply for the listing of any New
Notes on a national securities exchange. We cannot assure you as to the
liquidity of the public market for the New Notes or that any active public
market for the New Notes will develop or continue. If an active public market
does not develop or continue, the market price and liquidity of the New Notes
may be adversely affected.

Old Notes are Subject to Transfer Restrictions and may not have an Active
Trading Market

     If you fail to exchange your Old Notes for New Notes in the exchange
offer, your Old Notes will continue to be subject to transfer restrictions and
you will not have any further rights under the registration rights agreement,
including any right to require us to register your Old Notes or to pay any
additional interest.

     To the extent that Old Notes are tendered and accepted in the exchange
offer, your ability to sell untendered, and tendered but unaccepted, Old Notes
could be adversely affected. There may be no trading market for the Old Notes.

The Guarantees May Be Challenged as Fraudulent Conveyances

     U.S. federal and state fraudulent conveyance or similar laws could limit
the enforceability of a guarantee. For example, creditors of a subsidiary
guarantor could claim that, since the guarantees were incurred for the benefit
of FedEx (and only indirectly for the benefit of a subsidiary guarantor), the
obligation of a subsidiary guarantor was incurred for less than reasonably
equivalent value or fair consideration. If any of our subsidiary guarantors was
deemed to have received less than reasonably equivalent value or fair
consideration for its guarantee, and, at the time it gave the guarantee, that
subsidiary guarantor:

     o    was insolvent or rendered insolvent by giving its guarantee;

     o    was engaged in a business or transaction for which its remaining
          assets constituted unreasonably small capital; or

     o    intended to incur debts beyond its ability to pay such debts as they
          mature,

then the obligations of such subsidiary guarantor under its guarantee could be
avoided or subordinated to its other debts. In this regard, in an attempt to
limit the applicability of fraudulent transfer laws, the indenture limits the
amount of each guarantee to the amount that will result in it not constituting
a fraudulent conveyance or improper corporate distribution. We cannot assure
you as to what standard a court would apply in making a determination as to
what would be the maximum liability of each guarantor.

                                       9



                  SELECTED CONSOLIDATED FINANCIAL INFORMATION

     The following table sets forth certain selected consolidated financial and
operating data for FedEx. In the opinion of FedEx, the accompanying unaudited
interim consolidated financial information contains all adjustments necessary
to present fairly the consolidated financial position of FedEx as of February
28, 2001 and the consolidated results of its operations for the nine-month
periods ended February 28, 2001 and February 29, 2000. Operating results for
the nine-month period ended February 28, 2001 are not necessarily indicative of
the results that may be expected for the year ending May 31, 2001. This
information should be read in conjunction with the detailed information and
consolidated financial statements and accompanying notes incorporated by
reference herein. See "Where You Can Find More Information."

     On January 27, 1998, FedEx acquired Caliber System, Inc. ("Caliber") in a
transaction accounted for as a pooling-of-interests. Accordingly, periods prior
to the merger have been restated to include Caliber in all periods presented.


                                     Nine Months Ended                                    Years Ended May 31,
                              ---------------------------       ----------------------------------------------------------------
                                        (unaudited)
                              February 28,   February 29,
                                  2001           2000           2000           1999           1998          1997(1)         1996
                              ------------   ------------       ----           ----           ----          ------          ----
                                                   (In thousands, except per share amounts and operating data)
OPERATING RESULTS
                                                                                                  
Revenues.................... $ 14,512,437   $ 13,408,138   $ 18,256,945   $ 16,773,470   $ 15,872,810   $ 14,237,892   $ 12,721,791
Operating income............      847,684        794,814      1,221,074      1,163,086      1,010,660        507,002        779,552
Income from continuing
 operations before income
 taxes......................      747,862        732,806      1,137,740      1,061,064        899,518        425,865        702,094
Income from continuing
 operations.................      471,153        443,345        688,336        631,333        498,155        196,104        400,186
Income (loss) from
 discontinued operations(2).           --             --             --             --          4,875             --       (119,614)
Net income..................      471,153        443,345        688,336        631,333        503,030        196,104        280,572
PER SHARE DATA
Earnings (loss) per share:
 Basic:
   Continuing operations.... $       1.65   $       1.51   $       2.36   $       2.13   $       1.70   $       0.67   $       1.38
   Discontinued
   operations(2)............           --             --             --             --           0.02             --         (0.41)
                             ------------   ------------   ------------   ------------   ------------   ------------   ------------
                             $       1.65   $       1.51   $       2.36   $       2.13   $       1.72   $       0.67   $       0.97
                             ============   ============   ============   ============   ============   ============   ============
 Assuming dilution:
   Continuing operations.... $       1.62   $       1.49   $       2.32   $       2.10   $       1.67   $       0.67   $       1.37
   Discontinued
   operations(2)............           --             --            --              --           0.02             --          (0.41)
                             ------------   ------------   ------------   ------------   ------------   ------------   ------------
                             $      1.62    $       1.49   $       2.32   $       2.10   $       1.69   $       0.67   $       0.96
                             ============   ============   ============   ============   ============   ============   ============
Average shares of common
 stock outstanding..........      285,947        293,627        291,727        295,983        293,401        291,426        289,390
Average common and
 common equivalent
 shares outstanding.........      290,373        298,530        296,326        300,643        298,408        294,456        291,686
Cash dividends(3)...........           --             --             --             --             --             --             --

                                      10







                                     Nine Months Ended                                    Years Ended May 31,
                              ---------------------------       ----------------------------------------------------------------
                                        (unaudited)
                              February 28,   February 29,
                                  2001           2000           2000           1999           1998          1997(1)         1996
                              ------------   ------------       ----           ----           ----          ------          ----
                                                   (In thousands, except per share amounts and operating data)
FINANCIAL POSITION
(1996 unaudited)
                                                                                                  
Property and equipment, net. $  7,994,153   $  6,986,482   $  7,083,527   $  6,559,217   $  5,935,050   $  5,470,399   $  4,973,948
Total assets................   13,519,731     11,515,684     11,527,111     10,648,211      9,686,060      9,044,316      8,088,241
Long-term debt, less
 current portion............    2,658,776      1,855,773      1,776,253      1,359,668      1,385,180      1,597,954      1,325,277
Common stockholders'
 investment.................    5,778,579      4,639,069      4,785,243      4,663,692      3,961,230      3,501,161      3,312,440
OPERATING DATA
(unaudited)
FedEx Express:
 Operating weekdays.........          190            192            257            256            254            254            256
 Aircraft fleet.............          666            661            663            634            613            584            557
FedEx Ground:
 Operating weekdays.........          191            187            254            253            256            254            252
Average full-time
 equivalent employees.......      174,204        162,243        163,324        156,386        150,823        145,995

- ---------
(1)  In connection with its restructuring, Viking recorded a pretax asset
     impairment charge of $225,000,000 ($175,000,000, net of tax) in 1997.

(2)  Discontinued operations include the operations of Roadway Express, Inc., a
     wholly-owned subsidiary of Caliber, which FedEx acquired in January 1998
     in a transaction accounted for as a pooling of interests, whose shares
     were distributed to Caliber stockholders on January 2, 1996, and Roadway
     Global Air, Inc., a wholly-owned subsidiary of Caliber, which exited the
     airfreight business in calendar 1995.

(3)  Caliber declared dividends of $3,899,000, $28,184,000 and $54,706,000, for
     1998, 1997 and 1996, respectively. Caliber declared additional dividends
     of $10,833,000 from January 1, 1997 to May 25, 1997 that are not included
     in the preceding amounts. FedEx has never paid cash dividends on its
     common stock.

                                      11



                     NO CASH PROCEEDS TO FEDEX CORPORATION

     This exchange offer is intended to satisfy certain of our obligations
under the registration rights agreement. We will not receive any proceeds from
the issuance of the New Notes and have agreed to pay the expenses of the
exchange offer. In consideration for issuing the New Notes as contemplated in
the registration statement, of which this prospectus is a part, we will receive
in exchange Old Notes in like principal amount. The form and terms of each
series of the New Notes are identical in all material respects to the form and
terms of the related series of Old Notes, except as otherwise described herein
under "The Exchange Offer--Terms of the Exchange Offer." The Old Notes
surrendered in exchange for the New Notes will be retired and canceled and
cannot be reissued. Accordingly, issuance of the New Notes will not result in
any increase in our outstanding debt.


                       RATIO OF EARNINGS TO FIXED CHARGES
                                   (Unaudited)



                                         Nine Months Ended                           Year Ended May 31,
                                   ------------------------------       ---------------------------------------------
                                   February 28,      February 29,
                                       2001              2000           2000       1999      1998      1997      1996
                                   ------------      ------------       ----       ----      ----      ----      ----
                                                                                            
Ratio of Earnings to Fixed
 Charges......................         2.2               2.2            2.4        2.4       2.3       1.6       2.2


     Earnings included in the calculation of the ratio of earnings to fixed
charges represent income before income taxes plus fixed charges, other than
capitalized interest. Fixed charges include interest expense, including
capitalized interest, amortization of debt issuance costs and a portion of rent
expense representative of interest.

     The ratios of earnings to fixed charges set forth above have been restated
to include the results of operations for both FedEx Express and Caliber for all
periods presented.

                                      12



                          DESCRIPTION OF THE NEW NOTES

     The following summary of certain provisions of the indenture and the New
Notes does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all the provisions of the indenture, including
the definitions in the indenture of terms used in this prospectus. Because the
following is a summary, it does not contain all of the information you may find
useful. For further information you should read the indenture and the New
Notes. Copies of these documents are available from us upon request.

General

     The Old Notes were, and the New Notes will be, issued under the indenture
dated as of February 12, 2001, as supplemented, among FedEx, the subsidiary
guarantors and The Bank of New York, as trustee. The terms of each series of
the New Notes are identical in all material respects to the terms of the
related series of the Old Notes, except that the transfer restrictions,
registration rights and additional interest provisions relating to the Old
Notes do not apply to the New Notes.

     The Old Notes and the New Notes will collectively constitute a single
series of notes under the indenture and will therefore vote together as a
single class for purposes of determining whether holders of the requisite
percentage in principal amount thereof have taken actions or exercised rights
they are entitled to take or exercise under the indenture.

     The notes due 2004 will mature on February 12, 2004, the notes due 2006
will mature on February 15, 2006 and the notes due 2011 will mature on February
15, 2011. Each series of notes will be initially limited to $250,000,000
aggregate principal amount, but we may "reopen" the notes of any series and
issue additional notes at any time. The New Notes will bear interest at the
respective rates set forth on the cover page of this prospectus. We will pay
interest on the notes due 2004 on February 12 and August 12 of each year,
commencing August 12, 2001, to the registered holder thereof on the preceding
January 29 and July 29, respectively. We will pay interest on the notes due
2006 and the notes due 2011 on February 15 and August 15 of each year,
commencing August 15, 2001, to the registered holders thereof on the preceding
February 1 and August 1, respectively.

     Except to the extent set forth below under "--Redemption Upon a Tax
Event," we may not redeem the New Notes prior to maturity, and the New Notes
will not have the benefit of a sinking fund. The indenture does not limit the
aggregate amount of debt securities which may be issued under the indenture.
The New Notes will be unsecured obligations of FedEx and will rank equally with
all other unsecured and unsubordinated indebtedness of FedEx. The indenture
does not contain any debt covenants or provisions which would afford the
holders of the New Notes protection in the event of a highly leveraged
transaction.

     All outstanding New Notes will be exchangeable, transfers of New Notes
will be registrable, and principal of and interest, if any, on all New Notes
will be payable, at the corporate trust office of the trustee at 101 Barclay
Street, New York, New York 10286; provided that payment of interest may, at our
option, be made by check mailed to the address of the person entitled thereto
as it appears in the security register or by transfer to an account maintained
by the payee with a bank located in the United States.

     All New Notes will be issued only in fully registered form without coupons
in denominations of $1,000 and any integral multiple of $1,000. Neither FedEx
nor the trustee will impose any service charge for any transfer or exchange of
a New Note; however, we may ask you to pay any taxes or other governmental
charges in connection with a transfer or exchange of New Notes.

Guarantees

     The New Notes are guaranteed by all of our subsidiaries, excluding
subsidiaries which, individually and in the aggregate, constitute "minor"
subsidiaries for purposes of Rule 3-10 of Regulation S-X promulgated by the
SEC. Since we intend to exempt each of our subsidiary guarantors other than
FedEx Express from the periodic reporting requirements of the Exchange Act, we
expect that we will cause additional subsidiaries to become guarantors of the

                                      13



New Notes from time to time if their guarantees are necessary for our
non-reporting guarantors to continue to rely on the exemption from periodic
reporting provided by Rule 12h-5 under the Exchange Act.

     Each of the subsidiary guarantors will fully and unconditionally
guarantee, jointly and severally, the due and punctual payment of principal of
and interest, including any additional amounts, on the New Notes when the same
shall become due and payable whether at maturity, by declaration of
acceleration or otherwise. The guarantees will be unsecured obligations of the
respective subsidiary guarantors and will rank equally with all of their other
unsecured and unsubordinated indebtedness. Each subsidiary guarantee will be
limited in amount to an amount not to exceed the maximum amount that can be
guaranteed by the applicable subsidiary guarantor without rendering the
subsidiary guarantee, as it relates to such subsidiary guarantor, voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer
or similar laws affecting the rights of creditors generally. See "Risk Factors
- - The Guarantees May Be Challenged as Fraudulent Conveyances."

Merger, Consolidation and Sale of Assets

     We have agreed not to consolidate or merge with or into any other person,
or convey or transfer substantially all of our properties and assets as an
entirety to any person, unless:

     o    our successor is a corporation organized and existing under the laws
          of the United States of America, any state or the District of
          Columbia;

     o    our successor shall expressly assume, by a supplemental indenture,
          the due and punctual payment of the principal of and interest on all
          the notes and the performance of every covenant in the indenture that
          we would otherwise have to perform;

     o    immediately after giving effect to the merger, there will not be any
          defaults under the indenture; and

     o    we shall have delivered to the trustee an officers' certificate and
          an opinion of counsel, each stating that the merger and the
          supplemental indenture comply with the indenture.

     Upon the sale or disposition (by merger or otherwise) of any subsidiary
guarantor by FedEx or any subsidiary of FedEx to any entity that is not an
affiliate of FedEx, each such subsidiary guarantor will automatically be
released from all obligations under its guarantee.

     We have agreed that we will not sell or dispose of any subsidiary
guarantor whose assets exceed 10% of the consolidated total assets of FedEx
(determined as of the date of the most recent interim or fiscal year-end
balance sheet of FedEx filed with the SEC prior to the date such guarantee is
released) (each, a "10% Subsidiary Guarantor") unless at least 75% of the net
proceeds of such sale or disposition will consist of any combination of:

     o    cash (including assumption by the acquiror of any indebtedness of
          FedEx or its subsidiaries) or readily marketable securities;

     o    property or assets (other than current assets) of a nature or type
          similar or related to the nature or type of the property or assets of
          FedEx and its subsidiaries existing on the date of such sale or
          disposition; or

     o    interests in companies or businesses having property or assets or
          engaged in businesses similar or related to the nature or type of the
          property or assets or businesses of FedEx and its subsidiaries on the
          date of such sale or disposition.

                                      14



Application of Proceeds upon Release of a 10% Subsidiary Guarantor

     In the event that the net proceeds from the sale or disposition of a 10%
Subsidiary Guarantor consist of cash or readily marketable securities, FedEx
will apply, within 12 months of such sale or disposition, an amount equal to
100% of the fair market value, as determined in good faith by FedEx's board of
directors, of such net proceeds to

     o    repay unsubordinated indebtedness of FedEx or any subsidiary
          guarantor, in each case owing to a person other than an affiliate of
          FedEx;

     o    invest in property or assets (other than current assets) of a nature
          or type similar or related to the nature or type of the property or
          assets of FedEx and its subsidiaries existing on the date of such
          investment; or

     o    invest in a company or business having property or assets or engaged
          in a business similar or related to the nature or type of the
          property or assets or businesses of FedEx and its subsidiaries on the
          date of such investment.

Modification, Amendment and Waiver

     FedEx and the trustee may modify and amend the indenture with the consent
of the holders of a majority in principal amount of each series of notes to be
affected if less than all series are to be affected by such modification.
However, no modification or amendment may, without the consent of the holder of
each note affected thereby:

     o    change the stated maturity of the principal of, or any installment of
          interest on, any note;

     o    reduce the principal amount of or rate of interest on any note;

     o    change any place of payment where, or the currency in which, any
          principal of, or any interest on, any note is payable;

     o    impair the right to institute suit for the enforcement of any payment
          on or with respect to any note on or after the stated maturity; or

     o    reduce the percentage in principal amount of outstanding notes the
          consent of whose holders is required for modification or amendment of
          the indenture, for waiver of compliance with certain provisions of
          the indenture or for waiver of certain defaults.

     The holders of a majority in principal amount of the outstanding notes of
any series may on behalf of the holders of all notes of that series waive any
past default under the indenture and its consequences, except a default in the
payment of the principal of or interest on any notes or in respect of a
covenant or provision which under the indenture cannot be modified or amended
without the consent of the holder of each outstanding note affected.

     In addition, we can modify and amend the indenture without seeking your
consent in order to:

     o    allow a successor to FedEx or a subsidiary guarantor to assume our or
          its obligations under the indenture;

     o    add additional events of default or additional covenants of FedEx or
          a subsidiary guarantor;

     o    secure the notes of any series;

     o    add additional subsidiary guarantors of the notes; or

     o    make any other amendment or supplement to the indenture as long as
          that amendment or supplement does not materially adversely affect the
          interests of any holders of notes.

                                      15



Payment of Additional Amounts

     We will, subject to the exceptions and limitations set forth below, pay as
additional interest on the New Notes such additional amounts as are necessary
so that the net payment by us or a paying agent of the principal of and
interest on the New Notes to a person that is a non-U.S. holder (as defined
below) or a foreign partnership, after deduction for any present or future tax,
assessment or governmental charge of the United States or a political
subdivision or taxing authority thereof or therein, imposed by withholding with
respect to the payment, will not be less than the amount that would have been
payable in respect of the New Notes had no such withholding or deduction been
required.

     Our obligation to pay additional amounts shall not apply:

     o    to a tax, assessment or governmental charge that is imposed or
          withheld solely because the holder, or a fiduciary, settlor,
          beneficiary, member or shareholder of the holder if the holder is an
          estate, trust, partnership or corporation, or a person holding a
          power over an estate or trust administered by a fiduciary holder:

          o    is or was present or engaged in a trade or business in the
               United States or has or had a permanent establishment in the
               United States;

          o    has a current or former relationship with the United States,
               including a relationship as a citizen or resident thereof;

          o    is or has been a foreign or domestic personal holding company, a
               passive foreign investment company or a controlled foreign
               corporation with respect to the United States or a corporation
               that has accumulated earnings to avoid United States federal
               income tax; or

          o    is or was a "10-percent shareholder" of FedEx as defined in
               section 871(h)(3) of the United States Internal Revenue Code or
               any successor provision;

     o    to any holder that is not the sole beneficial owner of the notes, or
          a portion thereof, or that is a fiduciary or partnership, but only to
          the extent that the beneficial owner, a beneficiary or settlor with
          respect to the fiduciary, or a member of the partnership would not
          have been entitled to the payment of an additional amount had such
          beneficial owner, beneficiary, settlor or member received directly
          its beneficial or distributive share of the payment;

     o    to a tax, assessment or governmental charge that is imposed or
          withheld solely because the holder or any other person failed to
          comply with certification, identification or information reporting
          requirements concerning the nationality, residence, identity or
          connection with the United States of the holder or beneficial owner
          of the notes, if compliance is required by statute, by regulation of
          the United States Treasury Department or by an applicable income tax
          treaty to which the United States is a party as a precondition to
          exemption from such tax, assessment or other governmental charge;

     o    to a tax, assessment or governmental charge that is imposed other
          than by withholding by FedEx or a paying agent from the payment;

     o    to a tax, assessment or governmental charge that is imposed or
          withheld solely because of a change in law, regulation, or
          administrative or judicial interpretation that becomes effective more
          than 15 days after the payment becomes due or is duly provided for,
          whichever occurs later;

     o    to an estate, inheritance, gift, sales, excise, transfer, wealth or
          personal property tax or a similar tax, assessment or governmental
          charge;

                                      16



     o    to any tax, assessment or other governmental charge any paying agent
          must withhold from any payment of principal of or interest on any
          note, if such payment can be made without such withholding by any
          other paying agent; or

     o    in the case of any combination of the above items.

     The notes are subject in all cases to any tax, fiscal or other law or
regulation or administrative or judicial interpretation applicable. Except as
specifically provided under this heading and below under "--Redemption Upon a
Tax Event," we do not have to make any payment with respect to any tax,
assessment or governmental charge imposed by any government or a political
subdivision or taxing authority.

     As used herein, the term "non-U.S. holder" means an owner of a note that
is, for U.S. federal income tax purposes, (i) a nonresident alien individual,
(ii) a foreign corporation or (iii) a foreign trust or estate.

 Redemption Upon a Tax Event

     If, with respect to any series of notes, (a) we become or will become
obligated to pay additional amounts as described above under "--Payment of
Additional Amounts" as a result of any change in, or amendment to, the laws (or
any regulations or rulings promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change
in, or amendments to, any official position regarding the application or
interpretation of such laws, regulations or rulings, which change or amendment
is announced or becomes effective on or after February 6, 2001, or (b) a taxing
authority of the United States takes an action on or after February 6, 2001,
whether or not with respect to us or any of our affiliates, that results in a
substantial probability that we will or may be required to pay such additional
amounts, then we may, at our option, redeem, as a whole, but not in part, such
series of notes on any interest payment date on not less than 30 nor more than
60 calendar days' prior notice, at a redemption price equal to 100% of their
principal amount, together with interest accrued thereon to the date fixed for
redemption; provided that we determine, in our business judgment, that the
obligation to pay such additional amounts cannot be avoided by the use of
reasonable measures available to us, not including substitution of the obligor
under such notes. No redemption pursuant to (b) above may be made unless we
shall have received an opinion of independent counsel to the effect that an act
taken by a taxing authority of the United States results in a substantial
probability that we will or may be required to pay the additional amounts
described above under "--Payment of Additional Amounts" and we shall have
delivered to the trustee a certificate, signed by a duly authorized officer
stating, that based on such opinion we are entitled to redeem the notes
pursuant to their terms.

Events of Default

     An event of default with respect to a series of notes occurs if:

     o    we fail to pay interest when due and continue such failure for 30
          days thereafter on any note of that series;

     o    we fail to pay the principal of any note of that series when due;

     o    we fail to perform any covenant in the indenture relating to that
          series of notes and this failure continues for 60 days after we
          receive written notice as provided in the indenture;

     o    we or a court take certain actions relating to the bankruptcy,
          insolvency or reorganization of FedEx for the benefit of our
          creditors; or

     o    any subsidiary guarantor which constitutes 60% or more of our
          consolidated total assets (determined as of the date of the most
          recent interim or fiscal year-end balance sheet of FedEx filed with
          the SEC prior to such determination date) or a court take certain
          actions relating to the bankruptcy, insolvency or reorganization of
          that subsidiary guarantor for the benefit of its creditors.

                                      17



     If an event of default with respect to all notes of any series occurs and
continues, the trustee or the holders of at least 50% in aggregate principal
amount of the outstanding notes of that series may require us to repay
immediately the principal amount of all notes of that series. The holders of a
majority in principal amount of the outstanding notes of that series may
rescind and annul such acceleration if all events of default with respect to
the notes of that series, other than the nonpayment of accelerated principal,
have been cured or waived as provided in the indenture. For information as to
waiver of defaults, see "--Modification, Amendment and Waiver" above.

     Other than its duties in case of a default, the trustee is not obligated
to exercise any of its rights or powers under the indenture at the request or
direction of any of the holders, unless the holders offer to the trustee
reasonable indemnity. If they provide this reasonable indemnity, the holders of
a majority in principal amount of the outstanding notes of such series will
have the right, subject to certain limitations, to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee or
exercising any trust or power conferred on the trustee with respect to any
series of notes.

     No holder of any note of any series will have any right to institute any
proceeding with respect to the indenture or for any remedy under the indenture
unless:

     o    the holder has previously given to the trustee written notice of a
          continuing event of default;

     o    the holders of not less than 50% in principal amount of the
          outstanding notes of that series have made written request, and
          offered reasonable indemnity, to the trustee to institute a
          proceeding as trustee; and

     o    the trustee has not received from the holders of a majority in
          principal amount of the outstanding notes of that series a direction
          inconsistent with the request and the trustee has failed to institute
          such proceeding within 60 days.

     However, the holder of any note will have an absolute right to receive
payment of the principal of and interest on the notes as expressed in the
notes, and to institute suit for the enforcement of any payment.

     We are required to furnish to the trustee annually a statement as to the
absence of certain defaults under the indenture. The trustee may withhold
notice to the holders of notes of any default, except as to payment of
principal or interest with respect to notes, if it considers such withholding
to be in the interest of the holders of the notes.

Defeasance and Covenant Defeasance

     When we use the term defeasance, we mean discharge from some or all of our
obligations under the indenture. If we deposit with the trustee sufficient cash
or government securities to pay the principal, interest and any other sums due
to the stated maturity date of the notes of a particular series, then at our
option:

     o    we will be discharged from our obligations with respect to the notes
          of that series or

     o    we will no longer be under any obligation to comply with certain
          restrictive covenants under the indenture, and certain events of
          default will no longer apply to us.

     If this happens, the holders of the notes of the affected series will not
be entitled to the benefits of the indenture except for registration of
transfer and exchange of notes and replacement of lost, stolen or mutilated
notes. Such holders may look only to such deposited funds or obligations for
payment.

     We must deliver to the trustee an opinion of counsel, which will state the
change in law which provides the basis for the opinion, to the effect that the
deposit and related defeasance would not cause the holders of the notes to
recognize income, gain or loss for United States federal income tax purposes.

                                      18



Global Notes and Book-Entry System

     The New Notes will be issued in book-entry form and will be represented by
one or more permanent global certificates in fully registered form without
interest coupons (the "New Global Notes") and will be deposited with the
trustee as custodian for DTC and registered in the name of Cede & Co. or
another nominee designated by DTC. Beneficial interest in the New Global Notes
will be represented through book-entry accounts of financial institutions
acting on behalf of beneficial owners as direct and indirect participants in
DTC.

     Accordingly, holders that are not direct DTC participants but desire to
purchase, sell or otherwise transfer ownership of, or other interests in, the
New Notes may do so only indirectly through DTC participants, including
Euroclear Bank S.A./N.V., as operator of the Euroclear System ("Euroclear"),
and Clearstream Banking, societe anonyme ("Clearstream, Luxembourg"). In
addition, holders will receive all distributions of principal and interest from
the trustee through the DTC participants. Under the rules, regulations and
procedures creating and affecting DTC and its operation, DTC is required to
make book-entry transfers of notes among DTC participants on whose behalf it
acts and to receive and transmit distributions of principal of, and interest
on, the notes.

     Distributions by DTC participants to holders will be the responsibility of
such DTC participants and will be made in accordance with customary industry
practices. Accordingly, although holders will not have possession of the notes,
the rules of DTC provide a mechanism by which participants will receive
payments and will be able to transfer their interests. Although the DTC
participants are expected to convey the rights represented by their interests
in any New Global Notes to the related holders, because DTC can only act on
behalf of DTC participants, the ability of holders to pledge notes to persons
or entities that are not DTC participants or to otherwise act with respect to
such notes, may be limited due to the lack of physical certificates for such
notes.

     FedEx, the trustee or any other agent of FedEx or the trustee will not be
responsible or liable for any aspect of the records relating to, or payments
made on account of, beneficial ownership interests in the notes or for
supervising or reviewing any records relating to such beneficial ownership
interests. Since Cede & Co., as nominee of DTC, will be the only "holder,"
beneficial owners will not be recognized by the trustee as holders, as that
term is used in the indenture, and beneficial owners will be permitted to
exercise the rights of holders only indirectly through DTC and DTC
participants. DTC has advised us that it will take any action permitted to be
taken by a holder under the indenture only at the direction of one or more DTC
participants to whose accounts with DTC the related notes are credited.

     Certificated Notes. We will issue physical certificates ("Certificated
Notes") to holders of beneficial interests in a New Global Note, or their
nominees, if:

     o    DTC notifies us that it is unwilling or unable to continue as
          depositary and we are unable to locate a qualified successor within
          90 days or if at any time DTC, or any successor depositary, ceases to
          be a "clearing agency" under the Exchange Act;

     o    an event of default occurs under the indenture; or

     o    we decide in our sole discretion to terminate the book-entry system
          through DTC.

     In such event, the trustee will notify all holders through DTC
participants of the availability of such certificated notes. Upon surrender by
DTC of the definitive global note representing the series of notes and receipt
of instructions for reregistration, the trustee will reissue the notes in
certificated form to holders or their nominees.

     Clearing Systems.  Each of the clearing systems has advised us as follows:

     DTC is

     o    a limited purpose trust company organized under the laws of the State
          of New York;

                                      19



     o     a member of the Federal Reserve System;

     o    a "clearing corporation" within the meaning of the New York Uniform
          Commercial Code; and

     o    a "clearing agency" registered pursuant to Section 17A of the
          Exchange Act.

     DTC was created to hold securities for its participants and to facilitate
the clearance and settlement of securities transactions between its
participants through electronic book-entries, eliminating the need for physical
movement of certificates. DTC participants include securities brokers and
dealers, banks, trust companies, clearing corporations and others, some of whom
own DTC. Access to DTC's book-entry system is also available to others, such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a participant, either directly or indirectly.

     Euroclear was created in 1968 to hold securities for its participants and
to clear and settle transactions between its participants through simultaneous
electronic book-entry delivery against payment, thereby eliminating the need
for physical movement of certificates and any risk from lack of simultaneous
transfers of securities and cash. Euroclear provides various other services,
including securities lending and borrowing, and interfaces with domestic
markets in several countries. Euroclear is operated by Euroclear Bank S.A./N.V.
(the "Euroclear Operator"), under contract with Euroclear Clearance Systems,
S.C., a Belgian cooperative corporation (the "Cooperative"). All operations are
conducted by the Euroclear Operator, and all Euroclear securities clearance
accounts and Euroclear cash accounts are accounts with the Euroclear Operator,
not the Cooperative. The Cooperative establishes policy for Euroclear on behalf
of Euroclear participants. Euroclear participants include banks (including
central banks), securities brokers and dealers and other professional financial
intermediaries. Indirect access to Euroclear is also available to others that
clear through or maintain a custodial relationship with a Euroclear
participant, either directly or indirectly.

     The Euroclear Operator was granted a banking license by the Belgian
Banking and Finance Commission in 2000, authorizing it to carry out banking
activities on a global basis. It took over operation of Euroclear from the
Brussels, Belgium office of Morgan Guaranty Trust Company of New York on
December 31, 2000.

     Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing Use of Euroclear
and the related Operating Procedures of the Euroclear System, and applicable
Belgian law (collectively, the "Terms and Conditions"). The Terms and
Conditions govern transfers of securities and cash within Euroclear,
withdrawals of securities and cash from Euroclear, and receipts of payments
with respect to securities in Euroclear. All securities in Euroclear are held
on a fungible basis without attribution of specific certificates to specific
securities clearance accounts. The Euroclear Operator acts under the Terms and
Conditions only on behalf of Euroclear participants and has no record of or
relationship with persons holding through Euroclear participants.

     Distributions with respect to notes held beneficially through Euroclear
will be credited to the cash accounts of Euroclear participants in accordance
with the Terms and Conditions, to the extent received by Euroclear.

     Clearstream, Luxembourg is incorporated under the laws of The Grand Duchy
of Luxembourg as a professional depositary. Clearstream, Luxembourg holds
securities for its participants and facilitates the clearance and settlement of
securities transactions between its participants through electronic book-entry
changes in accounts of its participants, thereby eliminating the need for
physical movement of certificates. Clearstream, Luxembourg provides to its
participants, among other things, services for safekeeping, administration,
clearance and settlement of internationally traded securities and securities
lending and borrowing. Clearstream, Luxembourg interfaces with domestic markets
in several countries. As a professional depositary, Clearstream, Luxembourg is
subject to regulation by the Luxembourg Monetary Institute. Clearstream,
Luxembourg participants are financial institutions around the world, including
securities brokers and dealers, banks, trust companies, clearing corporations
and certain other organizations. Indirect access to Clearstream, Luxembourg is
also available to others that clear through or maintain a custodial
relationship with a Clearstream, Luxembourg participant either directly or
indirectly.

                                      20



     Distributions with respect to notes held beneficially through Clearstream,
Luxembourg will be credited to cash accounts of Clearstream, Luxembourg
participants in accordance with its rules and procedures, to the extent
received by Clearstream, Luxembourg.


                               THE EXCHANGE OFFER

Purpose of the Exchange Offer

     The Old Notes were delivered by us on February 12, 2001 to the initial
purchasers pursuant to a purchase agreement dated February 6, 2001 between us
and certain subsidiary guarantors and the initial purchasers. The initial
purchasers subsequently sold the Old Notes to "qualified institutional buyers,"
as defined in Rule 144A under the Securities Act, in reliance on Rule 144A and
outside the United States in accordance with Regulation S under the Securities
Act. As a condition to the initial sale of the Old Notes, we, certain
subsidiary guarantors and the initial purchasers entered into the registration
rights agreement. Pursuant to the registration rights agreement, we agreed that
we would:

     o    file with the SEC within 135 days after the Old Notes closing date,
          which is the date we delivered the Old Notes to the initial
          purchasers, a registration statement under the Securities Act
          relating to a registered exchange offer;

     o    use our reasonable best efforts to cause such registration statement
          to become effective under the Securities Act within 180 days after
          the Old Notes closing date;

     o    keep the exchange offer open for at least 20 business days (or
          longer, if required by applicable law) after the date notice of the
          exchange offer is mailed to the holders of the Old Notes; and

     o    use our reasonable best efforts to complete the exchange offer no
          later than 45 days after the exchange offer registration statement
          becomes effective.

     We agreed to issue and exchange New Notes for all Old Notes validly
tendered and not withdrawn before the expiration of the exchange offer. A copy
of the registration rights agreement has been filed as an exhibit to the
registration statement of which this prospectus is a part. The registration
statement is intended to satisfy certain of our obligations under the
registration rights agreement and the purchase agreement. In the event that due
to a change in current interpretations by the SEC, we are not permitted to
effect such exchange offer, it is contemplated that we will instead file a
shelf registration statement covering resales by the holders of the Old Notes
and will use our reasonable best efforts to cause such shelf registration
statement to become effective and to keep such shelf registration statement
effective for a maximum of two years from the closing date.

Terms of the Exchange Offer

     Upon the terms and subject to the conditions set forth in this prospectus
and in the letter of transmittal, we will accept any and all Old Notes validly
tendered and not withdrawn prior to the expiration date.

     We will issue $1,000 principal amount of New Notes in exchange for each
$1,000 principal amount of outstanding Old Notes of the same series validly
tendered and not withdrawn pursuant to the exchange offer. Old Notes may be
tendered in the principal amount of $1,000 and integral multiples of $1,000 in
excess thereof, provided that if fewer than all of the Old Notes of a holder
are tendered for exchange, the untendered principal amount of the holder's
remaining Old Notes must be $1,000 or any integral multiple of $1,000 in excess
thereof.

     Each series of New Notes has substantially the same terms as the related
series of Old Notes except that:

     o    the exchange will be registered under the Securities Act and,
          therefore, the New Notes will not bear legends restricting their
          transfer; and

                                      21



     o    holders of the New Notes will not be entitled to any of the
          registration rights of holders of Old Notes under the registration
          rights agreement, which rights will terminate upon the consummation
          of the exchange offer.

The New Notes will evidence the same indebtedness as the Old Notes (which they
replace) and will be issued under, and be entitled to the benefits of, the
indenture, which also authorized the issuance of the Old Notes, such that the
New Notes and the Old Notes will be treated as a single class of securities
under the indenture.

     As of the date of this prospectus, $250,000,000 of notes due 2004,
$250,000,000 of notes due 2006 and $250,000,000 of notes due 2011 are
outstanding, all of which are registered in the name of Cede & Co., as nominee
for DTC. Solely for reasons of administration, we have fixed the close of
business on             , 2001 as the record date for the exchange offer for
purposes of determining the persons to whom this prospectus and the letter of
transmittal will be mailed initially. There will be no fixed record date for
determining holders of the Old Notes entitled to participate in the exchange
offer.

     Holders of the Old Notes do not have any appraisal or dissenters' rights
under the Delaware General Corporation Law or the indenture in connection with
the exchange offer. We intend to conduct the exchange offer in accordance with
the provisions of the registration rights agreement and the applicable
requirements of the Securities Act and the rules and regulations of the SEC
thereunder.

     We shall be deemed to have accepted validly tendered Old Notes when, and
if, we have given oral or written notice thereof to The Bank of New York, the
exchange agent. The exchange agent will act as agent for the tendering holders
of Old Notes for the purpose of receiving the New Notes from us.

     Holders who tender Old Notes in the exchange offer will not be required to
pay brokerage commissions or fees or, subject to the instructions in the letter
of transmittal, transfer taxes with respect to the exchange of Old Notes
pursuant to the exchange offer. We will pay all charges and expenses, other
than certain applicable taxes described below, in connection with the exchange
offer. See "--Fees and Expenses."

Expiration Date; Extensions; Amendments

     The term "expiration date" shall mean 5:00 p.m., New York City time, on
             , 2001, unless we, in our sole discretion, extend the exchange
offer, in which case the term "expiration date" shall mean the latest date and
time to which the exchange offer is extended.

     If we determine to extend the exchange offer, we will, prior to 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
expiration date:

     o    notify the exchange agent of any extension by oral or written notice;
          and

     o    issue a press release or other public announcement which shall
          include disclosure of the approximate number of Old Notes deposited
          to date.

     We reserve the right, in our sole discretion:

     o    to delay accepting any Old Notes;

     o    to extend the exchange offer; or

     o    if, in the opinion of our counsel, the consummation of the exchange
          offer would violate any applicable law, rule or regulation or any
          applicable interpretation of the staff of the SEC, to terminate or
          amend the exchange offer by giving oral or written notice of such
          delay, extension, termination or amendment to the exchange agent. Any
          such delay in acceptance, extension, termination or amendment will be
          followed as promptly as practicable by a press release or other
          public announcement thereof.

                                      22



     If the exchange offer is amended in a manner determined by us to
constitute a material change, we will promptly disclose such amendment by means
of a prospectus supplement that will be distributed to the registered holders
of the Old Notes, and we will extend the exchange offer for a period of five to
ten business days, depending upon the significance of the amendment and the
manner of disclosure to the holders, if the exchange offer would otherwise
expire during such five to ten business day period.

     Without limiting the manner in which we may choose to make a public
announcement of any delay, extension, amendment or termination of the exchange
offer, we shall have no obligation to publish, advertise, or otherwise
communicate any such public announcement, other than by making a timely release
to an appropriate news agency.

Interest on the New Notes

     The New Notes will accrue interest at the rate of 6 5/8% per annum for the
notes due 2004, 6 7/8% per annum for the notes due 2006 and 7 1/4% per annum
for the notes due 2011 from the most recent date to which interest has been
paid on the Old Notes or, if no interest has been paid, from February 12, 2001,
payable semi-annually in arrears, for the notes due 2004, on February 12 and
August 12 of each year, commencing on August 12, 2001, and, for the notes due
2006 and the notes due 2011, on February 15 and August 15 of each year,
commencing on August 15, 2001.

Resale of the New Notes

     With respect to the New Notes, based upon interpretations by the staff of
the SEC set forth in certain no-action letters issued to third parties, we
believe that a holder who exchanges Old Notes for New Notes in the ordinary
course of business, who is not participating, does not intend to participate,
and has no arrangement or understanding with any person to participate in a
distribution of the New Notes, and who is not an "affiliate" of ours within the
meaning of Rule 405 of the Securities Act, will be allowed to resell New Notes
to the public without further registration under the Securities Act and without
delivering to the purchasers of the New Notes a prospectus that satisfies the
requirements of Section 10 of the Securities Act.

     If any holder acquires New Notes in the exchange offer for the purpose of
distributing or participating in the distribution of the New Notes, such
holder:

     o    cannot rely on the position of the staff of the SEC enumerated in
          such no-action letters issued to third parties; and

     o    must comply with the registration and prospectus delivery
          requirements of the Securities Act in connection with any resale
          transaction, unless an exemption from registration is otherwise
          available.

     Each broker-dealer that receives New Notes for its own account in exchange
for Old Notes acquired by such broker-dealer as a result of market-making or
other trading activities must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. The letter of transmittal states
that by so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act. This prospectus, as it may be amended or supplemented from time
to time, may be used by a broker-dealer in connection with resales of any New
Notes received in exchange for Old Notes acquired by such broker-dealer as a
result of market-making or other trading activities. We will make this
prospectus, as it may be amended or supplemented from time to time, available
to any such broker- dealer that requests copies of such prospectus in the
letter of transmittal for use in connection with any such resale for a period
of up to 180 days after the expiration date. See "Plan of Distribution."

Procedures for Tendering

     To tender in the exchange offer, a holder of Old Notes must either:

                                      23



     o    complete, sign and date the letter of transmittal or facsimile
          thereof, have the signatures thereon guaranteed if required by the
          letter of transmittal, and mail or otherwise deliver such letter of
          transmittal or such facsimile to the exchange agent; or

     o    if such Old Notes are tendered pursuant to the procedures for
          book-entry transfer set forth below, a holder tendering Old Notes may
          transmit an agent's message (as defined below) to the exchange agent
          in lieu of the letter of transmittal,

in either case for receipt on or prior to the expiration date.

     In addition:

     o    certificates for such Old Notes must be received by the exchange
          agent along with the letter of transmittal;

     o    a timely confirmation of a book-entry transfer (a "book-entry
          confirmation") of such Old Notes into the exchange agent's account at
          DTC pursuant to the procedure for book-entry transfer described
          below, along with the letter of transmittal or an agent's message, as
          the case may be, must be received by the exchange agent on or prior
          to the expiration date; or

     o    the holder must comply with the guaranteed delivery procedures
          described below.

     The term "agent's message" means a message, transmitted to the exchange
agent's account at DTC and received by the exchange agent and forming a part of
the book-entry confirmation, which states that such account has received an
express acknowledgment from the tendering participant that such participant has
received and agrees to be bound by the letter of transmittal and that FedEx may
enforce the letter of transmittal against such participant. To be tendered
effectively, the letter of transmittal and other required documents, or an
agent's message in lieu thereof, must be received by the exchange agent at the
address set forth below under "--Exchange Agent" prior to 5:00 p.m., New York
City time, on the expiration date.

     The tender by a holder that is not withdrawn prior to the expiration date
will constitute an agreement between such holder and us in accordance with the
terms and subject to the conditions set forth herein and in the letter of
transmittal.

     The method of delivery of Old Notes, the letter of transmittal and all
other required documents to the exchange agent is at the election and risk of
the holder. Instead of delivery by mail, it is recommended that holders use an
overnight or hand delivery service, properly insured. In all cases, sufficient
time should be allowed to assure delivery to the exchange agent before the
expiration date. Do not send the letter of transmittal or any Old Notes to us.
Holders may request their respective brokers, dealers, commercial banks, trust
companies or nominees to effect the above transactions for such holders.

     Any beneficial owner(s) of the Old Notes whose Old Notes are held through
a broker, dealer, commercial bank, trust company or other nominee and who
wishes to tender should contact such intermediary promptly and instruct such
intermediary to tender on such beneficial owner's behalf. If such beneficial
owner wishes to tender on its own behalf, such owner must, prior to completing
and executing the letter of transmittal and delivering such owner's Old Notes:

     o    make appropriate arrangements to register ownership of the Old Notes
          in such owner's name; or

     o    obtain a properly completed bond power from the registered holder.

The transfer of registered ownership may take considerable time.

                                      24



     Signatures on a letter of transmittal or a notice of withdrawal described
below (see "--Withdrawal of Tenders"), as the case may be, must be guaranteed
by an eligible institution unless the Old Notes tendered pursuant thereto are
tendered:

     o    by a registered holder who has not completed either the box entitled
          "Special Issuance Instructions" or the box entitled "Special Delivery
          Instructions" on the letter of transmittal; or

     o    for the account of an eligible institution.

     In the event that signatures on a letter of transmittal or a notice of
withdrawal, as the case may be, are required to be guaranteed, such guarantee
must be made by an eligible institution, which is a member firm of a registered
national securities exchange or of the National Association of Securities
Dealers, Inc., a commercial bank or trust company having an office or
correspondent in the United States, or an "eligible guarantor institution"
(within the meaning of Rule 17Ad-15 under the Exchange Act) which is a member
of one of the recognized signature guarantee programs identified in the letter
of transmittal.

     If the letter of transmittal is signed by a person other than the
registered holder of any Old Notes listed therein, such Old Notes must be
endorsed or accompanied by a properly completed bond power, signed by such
registered holder exactly as such registered holder's name appears on such Old
Notes.

     In connection with any tender of Old Notes in definitive certificated
form, if the letter of transmittal or any Old Notes or bond powers are signed
by trustees, executors, administrators, guardians, attorneys-in-fact, officers
of corporations or others acting in a fiduciary or representative capacity,
such persons should so indicate when signing, and, unless waived by us,
evidence satisfactory to us of their authority to so act must be submitted with
the letter of transmittal.

     The exchange agent and DTC have confirmed that any financial institution
that is a participant in DTC's system may utilize DTC's Automated Tender Offer
Program to tender Old Notes.

     All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered Old Notes will be determined by
us in our sole discretion, which determination will be final and binding. We
reserve the absolute right:

     o    to reject any and all Old Notes not properly tendered and any Old
          Notes our acceptance of which would, in the opinion of our counsel,
          be unlawful; and

     o    to waive any defects, irregularities or conditions of tender as to
          particular Old Notes.

     Our interpretation of the terms and conditions of the exchange offer
(including the instructions in the letter of transmittal) will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of Old Notes must be cured within such time as we shall
determine. Although we intend to notify holders of defects or irregularities in
connection with tenders of Old Notes, neither we, the exchange agent nor any
other person shall incur any liability for failure to give such notification.
Tenders of Old Notes will not be deemed to have been made until such defects or
irregularities have been cured or waived.

     While we have no present plan to acquire any Old Notes that are not
tendered in the exchange offer or to file a registration statement to permit
resales of any Old Notes that are not tendered pursuant to the exchange offer,
we reserve the right in our sole discretion to purchase or make offers for any
Old Notes that remain outstanding subsequent to the expiration date and, to the
extent permitted by applicable law, purchase Old Notes in the open market, in
privately negotiated transactions or otherwise. The terms of any such purchases
or offers could differ from the terms of the exchange offer.

     By tendering Old Notes pursuant to the exchange offer, each holder of Old
Notes will represent to us that, among other things:

                                      25



     o    the New Notes to be acquired by such holder of Old Notes in
          connection with the exchange offer are being acquired by such holder
          in the ordinary course of business of such holder;

     o    such holder is not participating, does not intend to participate, and
          has no arrangement or understanding with any person to participate in
          the distribution (within the meaning of the Securities Act) of the
          New Notes;

     o    such holder acknowledges and agrees that any person who is
          participating in the exchange offer for the purpose of distributing
          the New Notes must comply with the registration and prospectus
          delivery requirements of the Securities Act in connection with a
          secondary resale of the New Notes acquired by such person and cannot
          rely on the position of the staff of the SEC set forth in certain
          no-action letters;

     o    such holder understands that a secondary resale transaction,
          described above, and any resales of New Notes obtained by such holder
          in exchange for Old Notes acquired by such holder directly from us
          should be covered by an effective registration statement containing
          the selling security holder information required by Item 507 or Item
          508, as applicable, of Regulation S-K of the SEC; and

     o    such holder is not an "affiliate", as defined in Rule 405 under the
          Securities Act, of ours.

     If the holder is a broker-dealer that will receive New Notes for such
holder's own account in exchange for Old Notes that were acquired as a result
of market-making activities or other trading activities, such holder will be
required to acknowledge in the letter of transmittal that such holder will
deliver a prospectus in connection with any resale of such New Notes; however,
by so acknowledging and by delivering a prospectus, such holder will not be
deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.

Return of Old Notes

     In all cases, issuance of New Notes for Old Notes that are accepted for
exchange pursuant to the exchange offer will be made only after timely receipt
by the exchange agent of:

     o    Old Notes or a timely book-entry confirmation of such Old Notes into
          the exchange agent's account at DTC; and

     o    a properly completed and duly executed letter of transmittal and all
          other required documents, or an agent's message in lieu thereof.

      If any tendered Old Notes are not accepted for any reason set forth in
the terms and conditions of the exchange offer or if Old Notes are withdrawn or
are submitted for a greater principal amount than the holders desire to
exchange, such unaccepted, withdrawn or otherwise non-exchanged Old Notes will
be returned without expense to the tendering holder thereof (or, in the case of
Old Notes tendered by book-entry transfer into the exchange agent's account at
DTC pursuant to the book-entry transfer procedures described below, such Old
Notes will be credited to an account maintained with DTC) as promptly as
practicable.

Book-Entry Transfer

     The exchange agent will make a request to establish an account with
respect to the Old Notes at DTC for purposes of the exchange offer within two
business days after the date of this prospectus, and any financial institution
that is a participant in DTC may make book-entry delivery of Old Notes by
causing DTC to transfer such Old Notes into the exchange agent's account at DTC
in accordance with DTC's procedures for transfer. However, although delivery of
Old Notes may be effected through book-entry transfer at DTC, the letter of
transmittal or facsimile thereof, with any required signature guarantees and
any other required documents, or an agent's message in lieu of a letter of
transmittal, must, in any case, be transmitted to and received by the exchange
agent at the address set forth below under "--Exchange Agent" on or prior to
the expiration date or pursuant to the guaranteed delivery procedures described
below.

                                      26



Guaranteed Delivery Procedures

     If a holder of the Old Notes desires to tender such Old Notes and the Old
Notes are not immediately available or the holder cannot deliver its Old Notes
(or complete the procedures for book-entry transfer), the letter of transmittal
or any other required documents to the exchange agent prior to the expiration
date, a holder may effect a tender if:

     o    the tender is made through an eligible institution;

     o    prior to the expiration date, the exchange agent receives from such
          eligible institution (by facsimile transmission, mail or hand
          delivery) a properly completed and duly executed Notice of Guaranteed
          Delivery substantially in the form provided by us setting forth the
          name and address of the holder, the certificate number(s) of such Old
          Notes (if applicable) and the principal amount of Old Notes tendered,
          stating that the tender is being made thereby and guaranteeing that,
          within three New York Stock Exchange trading days after the
          expiration date:

            (i)  the letter of transmittal (or a facsimile thereof), or an
                 agent's message in lieu thereof,

           (ii) the certificate(s) representing the Old Notes in proper form for
                transfer or a book-entry confirmation, as the case may be, and

          (iii) any other documents required by the letter of transmittal,

          will be deposited by the eligible institution with the exchange
          agent; and

     o    such properly executed letter of transmittal (or facsimile thereof),
          or an agent's message in lieu thereof, as well as the certificate(s)
          representing all tendered Old Notes in proper form for transfer or a
          book-entry confirmation, as the case may be, and all other documents
          required by the letter of transmittal, are received by the exchange
          agent within three New York Stock Exchange trading days after the
          expiration date.

     Upon request to the exchange agent, a form of Notice of Guaranteed
Delivery will be sent to holders who wish to tender their Old Notes according
to the guaranteed delivery procedures set forth above.

Withdrawal of Tenders

     Except as otherwise provided herein, tenders of Old Notes may be withdrawn
at any time prior to 5:00 p.m., New York City time, on the expiration date.

     To withdraw a tender of Old Notes in the exchange offer, a written or
facsimile transmission notice of withdrawal must be received by the exchange
agent at its address set forth herein prior to the expiration date. Any such
notice of withdrawal must:

     o    specify the name of the person having deposited the Old Notes to be
          withdrawn;

     o    identify the Old Notes to be withdrawn (including the certificate
          number or numbers, if applicable, and principal amount of such Old
          Notes or, in the case of Old Notes transferred by a book-entry
          transfer, the name and number of the account at DTC to be credited);
          and

     o    be signed by the holder in the same manner as the original signature
          on the letter of transmittal by which such Old Notes were tendered
          (including any required signature guarantees or, in the case of Old
          Notes transferred by book-entry transfer, be transmitted by DTC and
          received by the exchange agent in the same manner as the agent's
          message transferring the Old Notes).

                                      27



     If Old Notes have been tendered pursuant to the procedure for book-entry
transfer described above, any notice of withdrawal must specify the name and
number of the account at DTC to be credited with the withdrawn Old Notes and
otherwise comply with the procedures of DTC. All questions as to the validity,
form and eligibility (including time of receipt) of such notices will be
determined by us, in our sole discretion, which determination shall be final
and binding on all parties.

     Any Old Notes so withdrawn will be deemed not to have been validly
tendered for purposes of the exchange offer, and no New Notes will be issued
with respect thereto, unless the Old Notes so withdrawn are validly retendered.
Properly withdrawn Old Notes may be retendered by following one of the
procedures described above under "--Procedures for Tendering" at any time prior
to the expiration date.

Termination of Certain Rights

     All registration rights under the registration rights agreement accorded
to holders of the Old Notes (and all rights to receive additional interest in
the event of a registration default (as defined therein)) will terminate upon
consummation of the exchange offer. However, for a period of up to 180 days
after the last day that the exchange offer is open, we will keep the
registration statement effective and provide copies of the latest version of
the prospectus to any broker-dealer that requests copies of such prospectus in
the letter of transmittal for use in connection with any resale by such
broker-dealer of New Notes received for its own account pursuant to the
exchange offer in exchange for Old Notes acquired for its own account as a
result of market-making or other trading activities.

Exchange Agent

     The Bank of New York has been appointed as exchange agent for the exchange
offer. Questions and requests for assistance, requests for additional copies of
this prospectus or the letter of transmittal and requests for a copy of the
Notice of Guaranteed Delivery should be directed to the exchange agent
addressed as follows:

     By Mail or Hand/Overnight Delivery:               By Facsimile:

          The Bank of New York                         (212) 815-6339
          Reorganization Unit
          101 Barclay Street - 7E                      Confirm by Telephone:
          New York, New York 10286
          Attn.: Santino Ginocchietti                  (212) 815-6331

     The Bank of New York also serves as trustee under the indenture.

Fees and Expenses

     The expenses of soliciting tenders will be borne by us. The principal
solicitation is being made by mail; however, additional solicitation may be
made by facsimile transmission, telephone or other electronic means or in
person by our officers and regular employees or those of our affiliates.

     We have not retained any dealer-manager in connection with the exchange
offer and will not make any payments to brokers, dealers or others soliciting
acceptances of the exchange offer. We, however, will pay the exchange agent
reasonable and customary fees for its services and will reimburse it for its
reasonable out-of-pocket expenses in connection therewith.

     The expenses to be incurred in connection with the exchange offer,
including registration fees, fees and expenses of the exchange agent and the
trustee, accounting and legal fees, and printing costs, will be paid by us.

     We will pay all transfer taxes, if any, applicable to the exchange of Old
Notes pursuant to the exchange offer. If, however, a transfer tax is imposed
for any reason other than the exchange of the Old Notes pursuant to the

                                      28



exchange offer, then the amount of any such transfer taxes (whether imposed on
the registered holder or any other persons) will be payable by the tendering
holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the letter of transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.

Consequence of Failure to Exchange

     Participation in the exchange offer is voluntary. Holders of the Old Notes
are urged to consult their financial and tax advisors in making their own
decisions on what action to take.

     Old Notes that are not exchanged for the New Notes pursuant to the
exchange offer will remain "restricted securities" within the meaning of Rule
144(a)(3) under the Securities Act. Accordingly, such Old Notes may not be
offered, sold, pledged or otherwise transferred except:

     o    to a person whom the seller reasonably believes is a "qualified
          institutional buyer" within the meaning of Rule 144A purchasing for
          its own account or for the account of a qualified institutional buyer
          in a transaction meeting the requirements of Rule 144A;

     o    in an offshore transaction complying with Rule 903 or Rule 904 of
          Regulation S under the Securities Act;

     o    pursuant to an exemption from registration under the Securities Act
          provided by Rule 144 thereunder (if available);

     o    pursuant to an effective registration statement under the Securities
          Act; or

     o    pursuant to another available exemption from the registration
          requirements of the Securities Act, and, in each case, in accordance
          with all other applicable securities laws.

Accounting Treatment

     For accounting purposes, we will recognize no gain or loss as a result of
the exchange offer. The expenses of the exchange offer will be amortized over
the term of the New Notes.


                                    TAXATION

     In the opinion of Davis Polk & Wardwell, the exchange of Old Notes for New
Notes will not be treated as a taxable transaction for U.S. federal income tax
purposes because the New Notes will not be considered to differ materially in
kind or in extent from the Old Notes. Rather, the New Notes you receive will be
treated as a continuation of your investment in the Old Notes. As a result,
there will be no material U.S. federal income tax consequences to you resulting
from the exchange of Old Notes for New Notes.

     You should consult your own tax advisors concerning the tax consequences
arising under state, local, or foreign laws of the exchange of Old Notes for
New Notes.

                                      29



                              PLAN OF DISTRIBUTION

     Each broker-dealer that receives New Notes for its own account in exchange
for Old Notes acquired by the broker-dealer as a result of market-making or
other trading activities must acknowledge that it will deliver a prospectus in
connection with any resale of those New Notes. This prospectus, as it may be
amended or supplemented from time to time, may be used by a participating
broker-dealer in connection with resales of New Notes received in exchange for
such Old Notes. For a period of up to 180 days after the expiration date, we
will make this prospectus, as amended or supplemented, available to any such
broker-dealer that requests copies of this prospectus in the letter of
transmittal for use in connection with any such resale.

     We will not receive any proceeds from any sale of New Notes by
broker-dealers or any other persons. New Notes received by participating
broker-dealers for their own account pursuant to the exchange offer may be sold
from time to time in one or more transactions in the over-the-counter market,
in negotiated transactions or through the writing of options on the New Notes,
or a combination of these methods of resale, at market prices prevailing at the
time of resale or negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such participating
broker-dealer that resells the New Notes that were received by it for its own
account pursuant to the exchange offer. Any broker or dealer that participates
in a distribution of New Notes may be deemed to be an "underwriter" within the
meaning of the Securities Act and any profit on any such resale of New Notes
and any commissions or concessions received by these persons may be deemed to
be underwriting compensation under the Securities Act. The letter of
transmittal states that by acknowledging that it will deliver and by delivering
a prospectus, a broker- dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

                                      30



                              NOTICE TO INVESTORS

     Based on interpretations of the staff of the SEC set forth in no-action
letters issued to third parties, we believe that New Notes issued pursuant to
the exchange offer in exchange for Old Notes may be offered for resale, resold,
and otherwise transferred by a holder (other than broker-dealers, as set forth
below, and any holder that is an "affiliate" of FedEx within the meaning of
Rule 405 under the Securities Act) without further registration under the
Securities Act and without delivery to prospective purchasers of a prospectus
pursuant to the provisions of the Securities Act, provided that the holder is
acquiring the New Notes in the ordinary course of its business, is not
participating and has no arrangement or understanding with any person to
participate in the distribution of the New Notes. Eligible holders wishing to
accept the exchange offer must represent to us in the letter of transmittal
that these conditions have been met. See "The Exchange Offer--Procedures for
Tendering."

     Each broker-dealer who holds Old Notes acquired for its own account as a
result of market-making or other trading activities and who receives New Notes
for its own account pursuant to the exchange offer must acknowledge that it
will deliver a prospectus in connection with any resale of New Notes. The
letter of transmittal states that by acknowledging and delivering a prospectus,
a broker-dealer will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with the resales of New Notes received for the broker-dealer's own account in
exchange for Old Notes where Old Notes were acquired by the broker-dealer as a
result of market- making activities or other trading activities. For a period
of up to 180 days after the expiration date, we will make this prospectus
available to those broker-dealers (if they so request in the letter of
transmittal) for use in connection with those resales. See "Plan of
Distribution."

     The New Notes constitute new issues of securities with no established
public trading market. We do not intend to apply for listing of the New Notes
on any securities exchange or for inclusion of the New Notes in any automated
quotation system. There can be no assurance that an active public market for
the New Notes will develop or as to the liquidity of any market that may
develop for the New Notes, the ability of holders to sell the New Notes, or the
price at which holders would be able to sell the New Notes. Future trading
prices of the New Notes will depend on many factors, including among other
things, prevailing interest rates, our operating results and the market for
similar securities.

     Any Old Notes not tendered or accepted in the exchange offer will remain
outstanding. To the extent that Old Notes are tendered and accepted in the
exchange offer, your ability to sell untendered, and tendered but unaccepted,
Old Notes could be adversely affected. Following consummation of the exchange
offer, the holders of Old Notes will continue to be subject to the existing
restrictions on transfer thereof and we will have no further obligation to
those holders, under the registration rights agreement, to provide for the
registration under the Securities Act of the Old Notes. There may be no trading
market for the Old Notes.

     We will not receive any proceeds from, and have agreed to bear the
expenses of, the exchange offer. No underwriter is being used in connection
with the exchange offer.

     The exchange offer is not being made to, nor will we accept surrenders for
exchange from, holders of Old Notes in any jurisdiction in which the exchange
offer or the acceptance thereof would not be in compliance with the securities
or blue sky laws of those jurisdictions.


                           VALIDITY OF THE NEW NOTES

     The validity of the New Notes will be passed upon for FedEx Corporation by
Davis Polk & Wardwell, New York, New York.

                                      31



                                    EXPERTS

     The consolidated financial statements and schedules of FedEx Corporation
and Federal Express Corporation included in each company's Annual Report on
Form 10-K for the year ended May 31, 2000 and incorporated by reference herein,
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect thereto, and are incorporated by
reference in this prospectus in reliance upon the authority of Arthur Andersen
LLP as experts in giving those reports.

     With respect to the unaudited interim financial information of FedEx
Corporation and Federal Express Corporation for the quarters ended August 31,
2000, November 30, 2000 and February 28, 2001 included in each company's
Quarterly Report on Form 10-Q for such periods, all of which are incorporated
by reference in this prospectus, Arthur Andersen LLP has applied limited
procedures in accordance with professional standards for a review of that
information. However, their separate reports thereon state that they did not
audit and they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their reports on that information should
be restricted in light of the limited nature of the review procedures applied.
In addition, the accountants are not subject to the liability provisions of
Section 11 of the Securities Act for their reports on the unaudited interim
financial information because those reports are not "reports" or a "part" of
the prospectus prepared or certified by the accountants within the meaning of
Sections 7 and 11 of the Securities Act.

     The consolidated financial statements of American Freightways Corporation
at December 31, 2000 and 1999, and for each of the three years in the period
ended December 31, 2000, appearing in this prospectus and registration
statement have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon appearing elsewhere herein, and are included in
reliance upon such report given on the authority of such firm as experts in
accounting and auditing.


                             SUBSIDIARY GUARANTORS

     Each subsidiary guarantor other than Federal Express Corporation, which is
currently an Exchange Act reporting company, is exempt from Exchange Act
reporting pursuant to Rule 12h-5 under the Exchange Act, as:

     o    FedEx has no independent assets or operations;

     o    the guarantees of the subsidiary guarantors are full and
          unconditional and joint and several; and

     o    any subsidiaries of FedEx other than the subsidiary guarantors are,
          individually and in the aggregate, minor.

     There are no significant restrictions on the ability of FedEx or any
subsidiary guarantor to obtain funds from its subsidiaries by dividend or loan.

                                      32



                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                      OF AMERICAN FREIGHTWAYS CORPORATION

                  Years ended December 31, 2000, 1999 and 1998

                                                                           Page
                                                                           ----
Independent Auditors' Report..............................................  F-2

Consolidated Balance Sheets...............................................  F-3

Consolidated Statements of Income.........................................  F-4

Consolidated Statements of Shareholders' Equity...........................  F-5

Consolidated Statements of Cash Flows.....................................  F-6

Notes to Consolidated Financial Statements................................  F-8


                                      F-1



Report of Ernst & Young LLP, Independent Auditors

The Board of Directors and Shareholders
American Freightways Corporation


     We have audited the accompanying consolidated balance sheets of American
Freightways Corporation and subsidiaries as of December 31, 2000 and 1999 and
the related consolidated statements of income, shareholders' equity and cash
flows for each of the three years in the period ended December 31, 2000. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of American Freightways Corporation and subsidiaries at December 31, 2000 and
1999, and the consolidated results of their operations and their cash flows for
each of the three years in the period ended December 31, 2000, in conformity
with accounting principles generally accepted in the United States.

/s/Ernst & Young LLP
Little Rock, Arkansas
January 19, 2001, except for Note 7, as
to which the date is February 9, 2001


                                      F-2



               American Freightways Corporation and Subsidiaries

                          Consolidated Balance Sheets


                                                                                                   December 31,
                                                                                               2000           1999
                                                                                             ---------      ---------
                                                                                                  (In Thousands)
Assets
                                                                                                      
Current assets:
 Cash and cash equivalents (Note 10)....................................................     $   4,341      $   5,345
 Trade receivables, less allowance for doubtful accounts (2000 - $5,420, 1999 -
   $3,016)..............................................................................       148,198        128,417
 Operating supplies and inventories.....................................................         5,973          4,946
 Prepaid expenses.......................................................................        16,392         14,520
 Deferred income taxes (Note 4).........................................................        17,512         17,922
 Income taxes receivable................................................................         1,404          9,760
                                                                                             ---------      ---------
 Total current assets...................................................................       193,820        180,910
Property and equipment (Notes 3 and 6):
 Land and structures....................................................................       346,956        271,376
 Revenue equipment......................................................................       425,968        411,967
 Service, office and other equipment....................................................       182,414        156,443
 Land improvements......................................................................         7,886          4,551
 Construction in progress...............................................................        56,100         52,854
 Accumulated depreciation and amortization..............................................      (364,697)      (314,264)
                                                                                              --------      ---------
                                                                                               654,627        582,927
Other assets:
 Bond funds (Notes 3 and 10)............................................................           360            358
 Other..................................................................................         2,936          2,660
                                                                                             ---------      ---------
                                                                                                 3,296          3,018
                                                                                             ---------      ---------
Total assets............................................................................     $ 851,743      $ 766,855
                                                                                             =========      =========
Liabilities and shareholders' equity
Current liabilities:
 Trade accounts payable.................................................................     $  21,748      $  25,729
 Accrued expenses (Note 2)..............................................................       117,060         90,655
 Current portion of long-term debt......................................................        14,808         13,030
                                                                                             ---------      ---------
Total current liabilities...............................................................       153,616        129,414
Long-term debt, less current portion (Notes 3 and 10)...................................       239,674        251,685
Deferred income taxes (Note 4)..........................................................        76,014         75,032
Shareholders' equity (Notes 3, 5, 7 and 8):
 Common stock, par value $.01 per share; authorized 250,000 shares; issued and
   outstanding 32,687 shares in 2000 and 32,259 shares in 1999..........................           327            323
 Additional paid-in capital.............................................................       118,986        112,641
 Retained earnings......................................................................       263,251        197,885
 Treasury stock, at cost; 15 shares in 2000 and 1999....................................          (125)          (125)
                                                                                             ---------      ---------
Total shareholders' equity..............................................................       382,439        310,724
                                                                                             ---------      ---------

Commitments (Note 6)

Total liabilities and shareholders' equity..............................................     $ 851,743      $ 766,855
                                                                                             =========      =========



See accompanying notes.

                                      F-3



               American Freightways Corporation and Subsidiaries

                       Consolidated Statements of Income


                                                                            Year ended December 31,
                                                                 -----------------------------------------------
                                                                    2000              1999               1998
                                                                 ----------        ----------          ---------
                                                                  (In Thousands, Except per Share Data)
                                                                                              

Operating revenue.....................................           $1,390,791        $1,166,675          $986,286
Operating expenses and costs:
 Salaries, wages and benefits.........................              816,627           700,139           601,813
 Operating supplies and expenses......................              106,417            92,550            79,219
 Operating taxes and licenses.........................               54,950            45,291            41,687
 Insurance............................................               43,826            37,617            31,964
 Communications and utilities.........................               22,834            19,018            17,361
 Depreciation and amortization........................               63,986            58,984            55,712
 Rent and purchased transportation....................               94,119            69,679            58,093
 Other................................................               62,247            49,029            40,227
                                                                  ---------         ---------          --------
                                                                  1,265,006         1,072,307           926,076
                                                                  ---------         ---------          --------
Operating income......................................              125,785            94,368            60,210

Other income (expense):
 Interest expense.....................................              (16,598)          (15,237)          (15,530)
 Interest income......................................                  319               311               307
 Gain (loss) on disposal of assets (Note 11)..........                 (644)            1,938             1,203
 Other, net...........................................                   29                43               117
                                                                  ---------         ---------          --------
                                                                    (16,894)          (12,945)          (13,903)
                                                                  ---------         ---------          --------
Income before income taxes............................              108,891            81,423            46,307

Federal and state income taxes (Note 4):
 Current..............................................               42,133            29,786            11,136
 Deferred.............................................                1,392             3,521             7,670
                                                                  ---------         ---------          --------
                                                                     43,525            33,307            18,806
                                                                  ---------         ---------          --------
Net income............................................            $  65,366         $  48,116          $ 27,501
                                                                  =========         =========          ========
Per share (Notes 1 and 8):
 Net income - basic...................................            $    2.02         $    1.51          $   0.87
                                                                  =========         =========          ========
 Net income - assuming dilution.......................            $    1.98         $    1.47          $   0.87
                                                                  =========         =========          ========
Average shares outstanding (Notes 1 and 8):
 Basic................................................            $  32,384         $  31,956          $ 31,624
                                                                  =========         =========          ========
 Assuming dilution....................................            $  33,043         $  32,673          $ 31,689
                                                                  =========         =========          ========



See accompanying notes.


                                      F-4



               American Freightways Corporation and Subsidiaries

                Consolidated Statements of Shareholders' Equity


                                             Common Stock
                                         --------------------     Additional
                                                       Par         Paid-In        Retained      Treasury
                                          Shares      Value        Capital        Earnings        Stock         Total
                                         --------    --------     ----------      --------      --------        -----
                                                                          (In Thousands)
                                                                                            

Balances at January 1, 1998..........      31,568      $  316        $104,832      $122,268           -       $227,416
       Stock option and purchase
 plans...............................         127           1           1,221             -           -          1,222
       Purchase of 15 treasury shares           -           -               -             -        (125)          (125)
       Net income....................           -           -               -        27,501           -         27,501
                                           ------      ------        --------      --------       -----       --------
Balances at December 31, 1998........      31,695         317         106,053       149,769        (125)       256,014
       Stock option and purchase
 plans...............................         564           6           6,588             -           -          6,594
       Net income....................           -           -               -        48,116           -         48,116
                                           ------      ------        --------      --------       -----       --------
Balances at December 31, 1999........      32,259         323         112,641       197,885        (125)       310,724
       Stock option and purchase
 plans...............................         428           4           6,345             -           -          6,349
       Net income....................           -           -               -        65,366           -         65,366
                                           ------      ------        --------      --------       -----       --------
Balances at December 31, 2000........      32,687      $  327        $118,986      $263,251       $(125)      $382,439
                                           ======      ======        ========      ========       =====       ========



See accompanying notes.


                                      F-5



               American Freightways Corporation and Subsidiaries

                     Consolidated Statements of Cash Flows


                                                                             Year ended December 31,
                                                                  ----------------------------------------------
                                                                     2000                1999             1998
                                                                  ----------           ----------       --------
                                                                                  (In Thousands)
                                                                                               
Operating activities
Cash received from customers................................      $1,362,847           $1,128,859       $968,497
Cash paid to suppliers and employees........................      (1,173,186)            (984,726)      (851,762)
Interest received...........................................             319                  311            307
Interest paid...............................................         (16,713)             (15,542)       (15,438)
Income taxes paid...........................................         (32,816)             (35,757)       (13,884)
                                                                  ----------           ----------       --------
Net cash provided by operating activities...................         140,451               93,145         87,720

Investing activities
Proceeds from sales of equipment............................           4,908                6,919          3,222
Capital expenditures........................................        (141,518)            (142,483)       (94,392)
                                                                  ----------           ----------       --------
Net cash used by investing activities.......................        (136,610)            (135,564)       (91,170)

Financing activities
Proceeds from notes payable and long-term borrowings........          86,059              117,000         45,657
Principal payments on long-term debt........................         (96,292)             (78,079)       (41,771)
Proceeds from issuance of common stock......................           5,388                5,569          1,208
Purchase of treasury stock..................................               -                    -           (125)
                                                                  ----------           ----------       --------
Net cash provided (used) by financing activities............          (4,845)              44,490          4,969
                                                                  ----------           ----------       --------
Net increase (decrease) in cash and cash equivalents........          (1,004)               2,071          1,519
Cash and cash equivalents at beginning of year..............           5,345                3,274          1,755
                                                                  ----------           ----------       --------
Cash and cash equivalents at end of year....................      $    4,341           $    5,345       $  3,274
                                                                  ==========           ==========       ========



See accompanying notes.


                                      F-6



               American Freightways Corporation and Subsidiaries

               Consolidated Statements of Cash Flows (continued)


                                                                               Year ended December 31,
                                                                      --------------------------------------
                                                                        2000             1999          1998
                                                                      --------          -------       ------
                                                                                    (In Thousands)
                                                                                             
Reconciliation of net income to net cash provided by
 operating activities
Net income.....................................................       $ 65,366          $48,116       $27,501
Adjustments to reconcile net income to net cash provided
 by operating activities:
 Depreciation .................................................         63,986           58,984        55,654
 Amortization..................................................              -                -            58
 Provision for losses on accounts receivable...................          8,192            3,907         2,142
 Current tax effect of exercise of stock options...............            961            1,025            14
 (Gain) loss on sales of equipment.............................            644           (1,938)       (1,203)
 Casualty loss on destroyed equipment..........................            280              336           280
 Deferred income taxes.........................................          1,392            3,521         7,670
 Changes in operating assets and liabilities:
   Trade receivables...........................................        (27,973)         (37,860)      (17,906)
   Operating supplies and inventories..........................         (1,027)            (807)       (1,257)
   Prepaid expenses............................................         (1,872)          (3,202)       (2,647)
   Income taxes receivable.....................................          8,356           (6,997)       (2,762)
   Other assets................................................           (278)            (749)         (375)
   Trade accounts payable......................................         (3,981)           8,963         3,856
   Accrued expenses............................................         26,405           19,846        16,695
                                                                      --------          -------       -------
Total adjustments..............................................         75,085           45,029        60,219
                                                                      --------          -------       -------
Net cash provided by operating activities......................       $140,451          $93,145       $87,720
                                                                      ========          =======       =======



See accompanying notes.


                                      F-7



               American Freightways Corporation and Subsidiaries

                   Notes to Consolidated Financial Statements

                               December 31, 2000

1. Summary of Significant Accounting Policies

Consolidation

     The consolidated financial statements include the accounts of American
Freightways Corporation and its subsidiaries (collectively, the "Company"). All
significant intercompany accounts and transactions have been eliminated.

Business

     The Company primarily operates as a regional and an interregional,
scheduled, for hire, less-than-truckload motor carrier, serving all points in
40 contiguous states from a network of 265 customer centers, which constitutes
the Company's only business segment. The Company performs ongoing credit
evaluations of its customers and generally does not require collateral.
Historically, credit losses have been within management's expectations.

Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Revenue Recognition

     The Company recognizes revenue and direct shipment costs upon the delivery
of the related freight.

     The Company's customer contracts specify that a fuel surcharge may be
applied during periods of rising fuel prices. The fuel surcharge is tied to the
Department of Energy's National Diesel Fuel Index and is designed to suspend at
the time this national index moves below $1.15 per gallon. The Company recorded
$42,753,000 and $4,236,000 from the fuel surcharge in 2000 and 1999,
respectively, as a reduction to fuel expenses to offset the increased fuel
costs incurred. The fuel surcharge was not in effect in fiscal year 1998.

Property and Equipment

     Property and equipment, which includes assets recorded under a capital
lease, is recorded at cost. For financial reporting purposes, the cost of such
property is depreciated principally by the straight-line method over the
estimated useful lives of 3 to 12 years for revenue and service equipment, 15
to 40 years for structures and improvements and 3 to 10 years for furniture and
office equipment. Assets under the lease are depreciated by the straight-line
method over the remaining lease term. Capital lease amortization is included in
depreciation expense. For tax reporting purposes, accelerated depreciation or
applicable cost recovery methods are used. Gains and losses are recognized in
the year of disposal. Gains and losses on revenue equipment are recorded as
adjustments to depreciation expense.

Insurance

     As of December 31, 2000, the Company was generally self-insured up to
specified limits for workers' compensation and cargo loss and damage claims
where allowable. In states where approval has not been granted, however,
workers' compensation claims are insured under a $750,000 deductible plan. In
the state of North Dakota, workers' compensation claims are insured under the
mandatory state plan, as private plans are not permitted.


                                      F-8



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

     General and automobile liability claims are insured with a retention limit
of $750,000 per occurrence, with excess coverage on a fully insured basis
providing catastrophic coverage.

Income Taxes

     Deferred income taxes are accounted for under the liability method.
Deferred income tax assets and liabilities reflect the effects of temporary
differences between the carrying amounts of assets and liabilities for
financial reporting and the amounts used for income tax purposes.

Earnings Per Share

     The Company calculates earnings per common share under the following
methods:

     o  Earnings per share - basic are computed based on the weighted average
        number of shares outstanding during each year.

     o  Earnings per share - assuming dilution are computed based on the
        weighted average number of shares outstanding during each year,
        adjusted to include common stock equivalents attributable to dilutive
        stock options.

Cash Equivalents

     The Company considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.

Stock-Based Compensation

     The Company grants stock options for a fixed number of shares to employees
with an exercise price equal to the fair value of the shares at the date of
grant. The Company accounts for stock option grants in accordance with
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock
Issued to Employees," and accordingly, recognizes no compensation expense for
the stock option grants.

Impairment of Assets

     The Company accounts for any impairment of its long-lived assets using
Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of." Under SFAS No. 121, impairment losses are recognized when information
indicates the carrying amount of long-lived assets, identifiable intangibles
and goodwill related to those assets will not be recovered through future
operations or sale.

Advertising Costs

     Advertising costs are expensed to operations in the period incurred.
Advertising costs for 2000, 1999 and 1998 were $797,000, $1,620,000 and
$685,000, respectively.

Recent Accounting Pronouncements

     In June 1998, the Financial Accounting Standards Board issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities." The
Statement has been amended by SFAS No. 137 and 138. It is effective for all
quarters of fiscal years beginning after June 15, 2000. It establishes
accounting and reporting standards


                                      F-9



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

requiring that every derivative instrument be recorded in the balance sheet as
either an asset or liability at its fair value. The Company does not have any
derivative instruments at December 31, 2000. The Company is currently
evaluating the requirements of SFAS No. 133, as amended, and does not
anticipate that the adoption will have a material effect on earnings or the
financial position of the Company.

     In addition the SEC issued Staff Accounting Bulletin ("SAB") No. 101,
"Revenue Recognition in Financial Statements", which provides guidance for all
SEC registrants related to the recognition of revenue. The Company implemented
SAB No. 101 in the current year. The impact was not material.

2. Accrued Expenses

                                                           2000         1999
                                                         --------     -------
                                                           (In Thousands)
Accrued salaries, wages and benefits................     $ 47,787     $32,426
Taxes other than income.............................       11,207       6,081
Accident liability, cargo loss and damage, health,
and workers' compensation claims reserves...........       53,629      48,437
Other...............................................        4,437       3,711
                                                         --------     -------
                                                         $117,060     $90,655
                                                         ========     =======

3. Long-term Debt

                                                           2000         1999
                                                         --------     -------
                                                           (In Thousands)
Bonds payable (1)..................................      $  5,135     $   5,590
Revolving credit agreements (2)....................       130,000       129,000
Mortgage notes (3).................................           468           638
Unsecured senior notes (4).........................       117,000       129,250
Other (5)..........................................         1,879           237
                                                         --------      --------
                                                          254,482       264,715
Less current portion...............................       (14,808)      (13,030)
                                                         --------      --------
                                                         $239,674      $251,685
                                                         ========      ========
- ---------
(1)  Represents the Company's liability under a loan agreement with Arkansas
     Development Finance Authority, issuer of economic development revenue
     bonds to construct customer centers and a general office facility. The
     loan agreement provides that the Company will make payments sufficient to
     pay the principal and interest on the bonds. The bonds have annual
     maturity dates through 2009. The bonds bear interest at fixed rates
     ranging from 4% to 5% and are collateralized by land and structures with a
     net book value of $7,356,000 at December 31, 2000. The loan agreement
     requires that certain bond service funds be maintained. As of December 31,
     2000, there was $360,000 in a debt service reserve fund.

(2)  The revolving credit agreements at December 31, 2000 include an unsecured
     revolving credit agreement, which provides for available borrowings of
     $160,000,000. Borrowings under this revolving credit agreement at December
     31, 2000 totaled $130,000,000. The term of this agreement extends to April
     1, 2003 (unless terminated or renewed). Interest is applied to outstanding
     borrowings at variable interest rates based on the London Interbank rate
     or the prime rate. The weighted average rate on outstanding borrowings at
     December


                                      F-10



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

     31, 2000 was 7.17%. The agreement contains covenants which limit, among
     other things, indebtedness, loans, investments and dividend payments, as
     well as require the Company to meet certain financial tests. The Company
     pays an annual commitment fee based on the unused commitment. At December
     31, 2000, the commitment fee was 0.1875%. As of December 31, 2000, the
     amount available for additional borrowing under this line of credit was
     $30,000,000.

     The Company also has $15,000,000 of available borrowings and letters of
     credit at December 31, 2000 under a separate unsecured revolving credit
     agreement. The terms of this agreement provide for borrowings up to
     $15,000,000 at a rate of interest agreed upon at the time of any
     borrowings. There were no borrowings outstanding at December 31, 2000.
     This agreement matures March 31, 2001, unless terminated or renewed. At
     December 31, 2000, the Company had utilized this line of credit to obtain
     letters of credit totaling $2,382,000.

     The Company also has $20,000,000 of available borrowings at December 31,
     2000 under a separate unsecured revolving credit agreement. The terms of
     this agreement provide for borrowings up to $20,000,000 at a rate of
     interest agreed upon at the time of any borrowings. There were no
     borrowings outstanding at December 31, 2000.

(3)  Mortgage notes are due monthly or annually to November 2003 at an average
     interest rate of 8.26%. The notes are collateralized by land and
     structures with a net book value of $4,263,000 at December 31, 2000.

(4)  Includes an unsecured senior note for $5,000,000 payable in full on
     November 30, 2001. The note bears interest at a fixed rate of 8.91%
     payable semi-annually.

     Also includes seven notes totaling $112,000,000; all issued under an
     unsecured and uncommitted $190,000,000 Master Shelf Agreement with the
     following characteristics:

             Outstanding         Maturity          Interest
              Principal            Date              Rate
             -----------       ------------        --------
             $2,000,000          April 2001          7.55%
             15,000,000        January 2005          8.85
             20,000,000          June 2005           6.92
             25,000,000          May 2006            7.51
             50,000,000         April 2012           8.11

      All notes have fixed interest rates, payable quarterly. These note
      agreements contain covenants, which limit, among other things, loans,
      indebtedness, investments and dividend payments, and require the Company
      to meet certain financial tests.

(5)   Represents the Company's liability under a loan agreement with IBM Credit
      Corporation and a capital lease with Konig Resources LLC. The payments to
      IBM Credit Corporation are due monthly until June 2001. The note bears
      interest at 5.51%. The capital lease is for the customer center in Nitro,
      West Virginia. Payments are due monthly until January 2015. The interest
      rate is 7.75% for liability reduction.

      Annual maturities on long-term debt and capital lease obligations are
      $14,808,000 in 2001, $12,760,000 in 2002, $142,705,000 in 2003,
      $12,633,000 in 2004, $12,665,000 in 2005 and $58,911,000 thereafter.

      Interest costs of $2,593,000, $1,555,000 and $1,044,000 in 2000, 1999 and
      1998, respectively, were capitalized as part of the construction cost of
      certain property and equipment.


                                      F-11



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

4. Federal and State Income Taxes

     Significant components of the Company's deferred tax liabilities and
assets as of December 31, 2000 and 1999, respectively, are as follows:

                                                        2000          1999
                                                      -------       -------
                                                         (In Thousands)
Noncurrent deferred tax liabilities:
 Tax over book depreciation.....................      $76,461       $76,167
 State loss and credit carryovers...............         (447)       (1,135)
                                                      -------       -------
Net noncurrent deferred tax liabilities.........      $76,014       $75,032
                                                      =======       =======
Current deferred tax assets:
 Accrued expenses not deductible until paid.....      $30,080       $24,736
 Allowance for doubtful accounts................        1,742           807
 Revenue recognition differences................       (1,786)          459
                                                      -------       -------
Total current deferred tax assets...............       30,036        26,002

Current deferred tax liabilities:
 Prepaid expenses...............................      (12,524)       (8,080)
                                                      -------       -------
Net current deferred tax assets.................      $17,512       $17,922
                                                      =======       =======


     The reconciliation between the effective income tax rate and the statutory
federal income tax rate is presented in the following table:

                                              2000        1999         1998
                                             -------     -------      -------
                                                     (In Thousands)
Income tax at the statutory federal
  rate of 35%............................... $38,112     $28,498      $16,207
Federal income tax effects of:
 State income taxes.........................  (1,996)     (1,702)        (666)
 Nondeductible expenses.....................   1,227         532          480
 Other......................................     479       1,115          882
                                             -------     -------      -------
Federal income taxes........................  37,822      28,443       16,903
State income taxes..........................   5,703       4,864        1,903
                                             -------     -------      -------
                                             $43,525     $33,307      $18,806
                                             =======     =======      =======
Effective income tax rate...................    40.0%       40.9%        40.6%
                                             =======     =======      =======


     Tax benefits of stock option and purchase plans recorded as paid-in
capital and which did not reduce income tax expense amounted to $961,000,
$1,025,000 and $14,000 in 2000, 1999 and 1998, respectively.

5. Employee Benefit and Compensation Plans

Stock Purchase Plan

     The Company maintains a stock purchase plan covering substantially all
employees of the Company. A total of 1,296,410 shares of common stock remain
reserved for issuance under this plan at December 31, 2000. The plan contains
two six-month offering periods commencing May 1 and November 1 of each year.
During each offering


                                      F-12



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

period, an eligible employee may enroll to purchase up to the lesser of $2,000
or 400 shares of Company stock. The price per share is 85% of the lower of the
fair market value at the date of grant or the date of exercise, which is six
months from the date of grant.

     Shares have been issued under the current and an expired predecessor plan
during 1998, 1999 and 2000 as follows:

                                           Number of            Per Share
Issue Date                               Shares Issued       Exercise Price
- ----------                               -------------       --------------
Predecessor Plan:
 April 30, 1998.....................         59,297              $10.20
 October 31, 1998...................         70,318                7.23
 April 30, 1999.....................         71,199               10.31
 October 31, 1999...................        109,995                7.38

1999 Employee Stock Purchase Plan:
 October 31, 1999...................         53,428               14.61
 April 20, 2000.....................         67,719               15.83
 October 31, 2000...................         82,443               13.71

     During November 2000, employees enrolled for options to purchase 147,394
shares under this plan. These shares will be issued during 2001.

Stock Options and Stock Appreciation Rights

     The 1993 Stock Option Plan provides for the issuance of qualified or
nonqualified options to purchase common stock of the Company and the awarding
of stock appreciation rights payable in shares or cash. The stock appreciation
rights currently outstanding were issued in 1993 and are payable only in cash.
No option or right may be issued for less than the fair market value of the
stock on the date of grant. The options and rights vest over a five-year period
from the date of grant and will expire if not exercised after ten years from
the date of grant. The Company also reserves shares for issuance under the 1999
Chairman Stock Option Plan and the Nonemployee Director Stock Option Plans.

     Collective activity within the plans is summarized as follows:


                                            Stock          Shares                                            Weighted
                                        Appreciation       Under                                              Average
                                           Rights          Option                 Price Range                 Price
                                        ------------     ----------         --------------------------       --------
                                                                                             
Outstanding at January 1, 1998.....       90,650         1,599,170          $3.00      -        $22.13         $13.06
 Granted...........................            -           515,550           9.69      -         11.31          10.12
 Exercised.........................            -           (13,080)          6.31      -          7.63           7.50
 Canceled..........................       (3,600)          (93,850)          6.31                22.13          12.58
                                          ------         ---------          -----               ------         ------
Outstanding at December 31, 1998...       87,050         2,007,790           3.00      -         22.13          12.33
 Granted...........................            -           704,250          11.16      -         21.09          11.31
 Exercised.........................      (39,580)         (360,875)          3.00      -         21.38          10.33
 Canceled..........................       (1,290)         (128,780)         10.19                21.38          11.76
                                          ------         ---------          -----               ------         ------
Outstanding at December 31, 1999...       46,180         2,222,385           6.31      -         22.13          12.42
 Granted...........................            -           708,000          15.28      -         16.34          15.85


                                      F-13






               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)



                                            Stock          Shares                                            Weighted
                                        Appreciation       Under                                              Average
                                           Rights          Option                 Price Range                 Price
                                        ------------     ----------         --------------------------       --------
                                                                                             
 Exercised.........................      (29,740)         (275,940)          6.31      -         21.38          12.86
 Canceled..........................       (1,550)         (151,735)          6.31      -         21.38          13.63
                                          ------         ---------          -----               ------         ------
Outstanding at December 31, 2000...       14,890         2,502,710          $6.31               $22.13         $13.25
                                          ======         =========          =====               ======         ======



     The following table summarizes information concerning currently
outstanding and exercisable options:


                                           Options Outstanding                          Options Exercisable
                             ---------------------------------------------       ----------------------------
                                                 Weighted         Weighted                           Weighted
                                                 Average           Average                           Average
       Range of                Number           Remaining         Exercise         Number            Exercise
   Exercise Prices           Outstanding       Life (Years)         Price        Exercisable          Price
- ----------------------       -----------       ------------       --------       -----------         --------
                                                                                      
$6 - $10..............           95,390         6.0                $9.20            54,490             $8.83
$10 - $15.............        1,573,010         5.6                11.66           801,625             12.36
$15 - $20.............          727,290         8.5                16.03            71,390             17.75
Greater than $20......          107,020         4.2                21.38           106,820             21.38
                              ---------         ---                              ---------
Total.................        2,502,710         6.4                              1,034,325
                              =========         ===                              =========



     The number of shares of common stock reserved for granting future options
under these plans at December 31 was 2,021,815 in 2000, 2,578,240 in 1999 and
864,870 in 1998. At December 31, 2000, options were exercisable to purchase
1,034,325 shares.

     Expense related to the change in value of stock appreciation rights for
2000 and 1999 totaled $473,000 and $454,000, respectively. There was no benefit
or expense related to the changes in 1998.

Accounting for Stock-Based Compensation

     The Company applies APB Opinion No. 25, "Accounting for Stock Issued to
Employees," and related interpretations in accounting for its stock option
plans and, accordingly, does not recognize compensation expense. If the Company
had elected to recognize compensation expense based on the fair value of
options granted at grant date as prescribed by SFAS No. 123, "Accounting for
Stock-Based Compensation," net income and earnings per share - assuming
dilution would have been reduced to the pro forma amounts indicated in the
table below:


                                                                      2000          1999          1998
                                                                   ----------    ----------    ----------
                                                                           (In Thousands, Except
                                                                             Per Share Amounts)
                                                                                      

Net income - as reported.......................................    $   65,366    $   48,116    $   27,501
Net income - pro forma.........................................        63,090        46,428        26,219
Earnings per share - assuming dilution - as reported...........          1.98          1.47          0.87
Earnings per share - assuming dilution - pro forma.............          1.91          1.42          0.83


     The fair value of options was estimated as of the date of grant using the
Black-Scholes option-pricing model with the following assumptions:


                                      F-14



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)



                                                  2000                              1999                           1998
                                        --------------------------       ---------------------------     ------------------------
                                          Option         Purchase          Option          Purchase         Option       Purchase
                                          Plans           Plans            Plans            Plans           Plans         Plans
                                        ----------      ----------       ----------       ----------     ----------      --------
                                                                                                         
Expected dividend yield..........        0.00%           0.00%            0.00%            0.00%          0.00%            0.00%
Expected stock price volatility..       38.30           42.60            35.50            37.20          33.80            38.50
Risk-free interest rate..........        6.33            6.27             4.67             5.33           5.62             4.63
Expected life of options.........        4.0 years       0.5 years        4.3 years        0.5 years      4.3 years      1 year
Weighted average value per
 option..........................       $5.88           $3.68            $4.34            $3.76          $3.68            $2.58


Retirement Plan

     The Company maintains a profit sharing plan for the benefit of all
eligible employees. The plan qualifies under Section 401(k) of the Internal
Revenue Code, thereby allowing eligible employees to make tax deferred
contributions to the plan. The plan permits, at the discretion of the Board of
Directors, elective and matching employer contributions. During 2000, the
Company made elective contributions of 2 1/2% of each eligible participant's
compensation, in addition to a 25% match of the first 6% of compensation
contributed by participants. The Company's contributions to the plan totaled
$17,110,000, $14,631,000 and $12,717,000 for 2000, 1999 and 1998, respectively.

6. Leases and Commitments

     Rent expense, exclusive of amounts related to purchased transportation,
totaled approximately $55,481,000 for 2000, $38,719,000 for 1999 and
$31,324,000 for 1998. The future minimum rental commitments under noncancelable
operating leases having initial or remaining terms in excess of one year as of
December 31, 2000 are as follows:

                                     Land and       Revenue         Other
                      Total         Structures     Equipment      Equipment
                    --------        ----------     ---------      ---------
                                        (In Thousands)
2001..........       $54,643         $13,429        $29,440        $11,774
2002..........        46,842          10,588         29,539          6,715
2003..........        35,112           7,699         25,452          1,961
2004..........        24,739           6,478         18,261              -
2005..........        18,890           4,313         14,577              -
Thereafter....        19,448          12,749          6,699              -
                    --------         -------       --------        -------
                    $199,674         $55,256       $123,968        $20,450
                    ========         =======       ========        =======


     The future minimum lease payments under a capitalized lease consist of the
following at December 31, 2000 (thousands):


                                      F-15



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)


2001....................................................... $    210
2002.......................................................      210
2003.......................................................      210
2004.......................................................      210
2005.......................................................      210
Thereafter.................................................    1,908
                                                            --------
Total minimum payments.....................................    2,958
Amount representing interest...............................    1,161
                                                            --------
Present value of minimum lease payments included
 in long-term debt (Note 3)................................ $  1,797
                                                            ========


     Certain leases have renewal options for periods from one to five years at
the fair rental value of the related property at renewal. Certain of the lease
agreements contain fixed price purchase options. The lease agreements require
the lessee to pay property taxes, maintenance and operating expenses.

     Commitments for land, customer centers and revenue equipment (including
the cost to complete construction in progress) aggregated approximately
$83,412,000 at December 31, 2000.

7. Merger Agreement

     On November 12, 2000, the Company's Board of Directors approved a tender
offer and plan of merger (as amended and restated, the "Merger Agreement")
among the Company, FedEx Corporation ("FedEx") and FDX, Inc. ("FDX"), a wholly
owned subsidiary of FedEx. Through the tender offer, FDX acquired approximately
50.1% of the Company's outstanding shares effective December 29, 2000.

     The Company's Board of Directors previously adopted a rights plan pursuant
to which a dividend of one common share purchase right was declared for each
outstanding share. The rights trade with the common stock and will become
exercisable if a person or group acquires more than 15% of the common shares or
announces a tender or exchange offer for more than 15% of the common shares. On
November 12, 2000, the Company's Board of Directors amended the rights plan to
exclude FedEx and FDX from the definition of acquiring persons, so long as
FedEx and FDX do not become the owner of 15% or more of the outstanding shares
of the Company other than pursuant to the terms of the Merger Agreement.

     In connection with the Merger Agreement, the Company had a contingent
liability for professional fees of $3,994,000 at December 31, 2000, which was
payable at the consummation of the merger.

     In accordance with the Merger Agreement, and upon shareholder approval,
the Company was merged with and into FDX on February 9, 2001, and Company
shareholders received 0.6639 shares of FedEx common stock in exchange for each
Company share and cash in lieu of fractional shares. All outstanding stock
options of the Company were converted into FedEx stock options with the same
terms and conditions as were applicable under such Company options. All
outstanding stock appreciation rights were paid in cash prior to February 9,
2001.

     In anticipation of the violation of certain covenants relating to the
Company's unsecured senior notes, FedEx provided a written guarantee for
payment of the notes, and the Company obtained a waiver on February 6, 2001
until April 13, 2001, at which time prepayment or assumption of senior notes
will be required.


                                      F-16



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

8. Earnings per Share

     Net income for purposes of basic earnings per share and earnings per share
- - assuming dilution was $65,366,000, $48,116,000 and $27,501,000 for the years
2000, 1999 and 1998, respectively. A reconciliation of average shares
outstanding for both computations is presented below:

                                                    2000      1999      1998
                                                   ------    ------    ------
                                                         (In Thousands)
Average shares outstanding - basic.............    32,384    31,956    31,624
Effect of dilutive stock options...............       659       717        65
                                                   ------    ------    ------
Average shares outstanding - assuming dilution.    33,043    32,673    31,689
                                                   ======    ======    ======


     Antidilutive stock options are not included in the earnings per share
calculation. Average antidilutive options were 357,000 in 2000, 244,000 in 1999
and 1,545,000 in 1998.

9. Quarterly Results of Operations (Unaudited)

     The following is a summary of the quarterly results of operations for the
years ended December 31, 2000 and 1999:


                                                                Three months ended
                                         March 31          June 30           September 30          December 31
                                         --------        ---------           ------------          -----------
                                                        (In Thousands, Except Per Share Data)
                                                                                       
2000
Operating revenue..................      $325,193         $356,938             $363,969            $344,691
Operating expenses and costs.......       298,823          321,767              325,844             318,572
Net income ........................        13,376           18,640               20,460              12,890
Net income per share:
 Basic.............................           .41              .58                  .63                 .40
 Assuming dilution.................           .41              .57                  .62                 .38
Average shares outstanding:
 Basic.............................        32,265           32,346               32,390              32,536
 Assuming dilution.................        32,629           32,967               32,967              33,608
1999
Operating revenue..................      $265,404         $291,173             $303,617            $306,480
Operating expenses and costs.......       250,577          266,400              276,100             279,229
Net income ........................         6,775           13,122               14,386              13,833
Net income per share:
 Basic.............................           .21              .41                  .45                 .43
 Assuming dilution.................           .21              .40                  .44                 .42
Average shares outstanding:
 Basic.............................        31,738           31,860               32,026              32,200
 Assuming dilution.................        32,229           32,643               32,977              32,842



                                      F-17



               American Freightways Corporation and Subsidiaries

             Notes to Consolidated Financial Statements (continued)

10. Fair Values of Financial Instruments

     The following methods and assumptions were used by the Company in
estimating fair value disclosures for financial instruments:

     Cash and cash equivalents - the carrying amount reported in the
consolidated balance sheets for cash and cash equivalents approximates fair
value.

     Bond funds - the Company's debt service reserve fund is invested in money
market funds and the carrying amount reported in the consolidated balance
sheets for bond funds approximates fair value.

     Long-term debt - the fair values of the Company's long-term debt are
estimated using discounted cash flow analyses, based on the Company's current
incremental borrowing rates for similar types of borrowing arrangements.

      The carrying amounts and fair values of the Company's financial
instruments at December 31 are as follows:

                                         Carrying Amount     Fair Value
                                         ---------------     ----------
                                             (In Thousands)
2000
Cash and cash equivalents.......             $  4,341        $  4,341
Bond funds......................                  360             360
Long-term debt..................              254,482         259,761

1999
Cash and cash equivalents.......             $  5,345        $  5,345
Bond funds......................                  358             358
Long-term debt..................              264,715         263,965

11. Involuntary Conversion

     During 1999 the Company experienced an involuntary conversion of certain
assets. This involuntary conversion resulted in the recognition of a gain of
approximately $1,760,000, which is included in gain (loss) on disposal of
assets in the consolidated statements of income.


                                     F-18



===============================================================================








                                  [FedEx LOGO]



                     $250,000,000 6 5/8% New Notes due 2004

                     $250,000,000 6 7/8% New Notes due 2006

                     $250,000,000 7 1/4% New Notes due 2011



                  --------------------------------------------

                                   PROSPECTUS

                  --------------------------------------------












                                            , 2001



===============================================================================




                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS


Item 20.  Indemnification of Directors and Officers.

     Section 102(b)(7) of the Delaware General Corporation Law (the "Delaware
Law") permits a corporation to include in its certificate of incorporation a
provision eliminating or limiting the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision may not eliminate or limit the
liability of a director for any breach of the director's duty of loyalty to the
corporation or its stockholders, for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, for the
unlawful payment of dividends, or for any transaction from which the director
derived an improper personal benefit.

     ARTICLE THIRTEENTH of FedEx's Amended and Restated Certificate of
Incorporation, as amended (the "Charter"), provides that no director shall be
personally liable to FedEx or its stockholders for monetary damages for breach
of fiduciary duty as a director, provided that ARTICLE THIRTEENTH does not
eliminate or limit the liability of a director of FedEx (i) for any breach of
the director's duty of loyalty to FedEx or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware Law (relating
to the unlawful payment of dividends) or any amendment or successor provision
thereto, or (iv) for any transaction from which the director derived an
improper personal benefit. ARTICLE THIRTEENTH of the Charter does not eliminate
or limit the liability of a director for any act or omission occurring prior to
the date when ARTICLE THIRTEENTH became effective (December 3, 1997). Neither
the amendment nor repeal of ARTICLE THIRTEENTH of the Charter, nor the adoption
of any provision of the Charter inconsistent with ARTICLE THIRTEENTH, will
eliminate or reduce the effect of ARTICLE THIRTEENTH with respect to any matter
occurring, or any cause of action, suit or claim that, but for ARTICLE
THIRTEENTH, would accrue or arise prior to such amendment, repeal or adoption
of an inconsistent provision.

     Section 145 of the Delaware Law permits a corporation to indemnify any of
its directors, officers, employees or agents who was or is a party, or is
threatened to be made a party, to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation), by reason of the
fact that such person is or was a director, officer, employee or agent of the
corporation (or another enterprise if serving at the request of the
corporation), against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding if such person acted in good
faith and in a manner such person reasonably believed to be in or not opposed
to the best interests of the corporation, and, with respect to any criminal
action or proceeding, had no reason to believe that his or her conduct was
unlawful. In any threatened, pending or completed action or suit by or in the
right of the corporation, a corporation is permitted to indemnify any director,
officer, employee or agent against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection with the defense
or settlement of such action or suit if such person acted in good faith and in
a manner that he or she reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification may be made if
such person shall have been adjudged to be liable to the corporation unless and
only to the extent that the court in which the action or suit was brought shall
determine upon application that, despite such adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnification for such expenses which the court shall deem
proper.

     Article III, Section 13 (relating to indemnification of directors) and
Article V, Section 18 (relating to indemnification of officers and managing
directors) of FedEx's Amended and Restated By-laws provide that FedEx shall
indemnify to the full extent authorized or permitted by the Delaware Law any
person made, or threatened to be made, a party to any threatened, pending or
completed action, suit or proceeding (whether civil, criminal, administrative
or investigative) by reason of the fact that such person or his or her testator
or intestate is or was a director, officer or managing director of FedEx or
serves or served as a director, officer, employee or agent of any other
enterprise at FedEx's request.

                                      II-1



     FedEx also has purchased insurance designed to protect FedEx and its
directors and officers against losses arising from certain claims, including
claims under the Securities Act of 1933, as amended (the "Securities Act").

Item 21.  Exhibits and Financial Statement Schedules.

     (a)  List of Exhibits.

Exhibit
Number                                  Description
- ---------                               -----------

   1.1      Purchase Agreement dated February 6, 2001 among FedEx Corporation,
            the Guarantors named therein and Merrill Lynch, Pierce, Fenner &
            Smith Incorporated, Banc of America Securities LLC, Chase
            Securities, Inc., Commerzbank Capital Markets Corp. and Credit
            Suisse First Boston Corporation, as initial purchasers.
   4.1      Indenture, dated as of February 12, 2001, among FedEx
            Corporation, as Issuer, the Guarantors named therein, and The
            Bank of New York, as Trustee.
   4.2      Form of New Note (included in Exhibit 4.1).
   4.3      Supplemental Indenture No. 1, dated as of February 20, 2001, among
            FedEx Corporation, as Issuer, the Guarantors named therein, the
            Additional Guarantors named therein and The Bank of New York, as
            Trustee.
   4.4      Supplemental Indenture No. 2, dated as of April 27, 2001 among
            FedEx Corporation, as Issuer, the Guarantors named therein, the
            Additional Guarantors named therein and The Bank of New York, as
            Trustee.
   4.5      Registration Rights Agreement, dated as of February 12, 2001, among
            FedEx Corporation, the Guarantors named therein, and Merrill Lynch,
            Pierce, Fenner & Smith Incorporated, Banc of America Securities
            LLC, Chase Securities Inc., Commerzbank Capital Markets Corp., and
            Credit Suisse First Boston Corporation, as initial purchasers.
   5.1      Opinion of Davis Polk & Wardwell regarding the validity of the New
            Notes.
   8.1      Opinion of Davis Polk & Wardwell regarding tax matters (included in
            Exhibit 5.1).
  15.1      Letter of Arthur Andersen LLP regarding unaudited interim
            financial information of FedEx Corporation and Federal Express
            Corporation.
  21.1      Subsidiaries of FedEx Corporation.
  23.1      Consent of Arthur Andersen LLP with respect to FedEx
            Corporation's and Federal Express Corporation's financial
            statements.
  23.2      Consent of Ernst & Young LLP with respect to American Freightways
            Corporation's financial statements.
  23.3      Consent of Davis Polk & Wardwell (included in Exhibit 5.1).
  24.1      Powers of Attorney (set forth on the signature pages to this
            Registration Statement).
  25.1      Statement of Eligibility under the Trust Indenture Act of 1939 on
            Form T-1 of The Bank of New York, as Trustee.
  99.1      Form of Letter of Transmittal.
  99.2      Form of Notice of Guaranteed Delivery.
  99.3      Form of Exchange Agent Agreement.


                                      II-2



     (b)   Financial Statement Schedules.

     Not Applicable.

     (c)   Item 4(b) Information.

     Not Applicable.

Item 22.  Undertakings.

    (a)   The undersigned registrant hereby undertakes:

          (1)  That for purposes of determining any liability under the
               Securities Act, each filing of the Registrant's annual report
               pursuant to Section 13(a) or Section 15(d) of the Securities
               Exchange Act of 1934, as amended (the "Securities Exchange
               Act") (and, where applicable, each filing of an employee
               benefit plan's annual report pursuant to Section 15(d) of the
               Securities Exchange Act) that is incorporated by reference in
               this Registration Statement shall be deemed to be a new
               registration statement relating to the securities offered
               therein, and the offering of such securities at that time shall
               be deemed to be the initial bona fide offering thereof.

          (2)  To respond to requests for information that is incorporated by
               reference into the prospectus contained in this Registration
               Statement pursuant to Item 4, 10(b), 11, or 13 of this Form,
               within one business day of receipt of such request, and to send
               the incorporated documents by first class mail or other equally
               prompt means. This includes information contained in documents
               filed subsequent to the effective date of this Registration
               Statement through the date of responding to the request.

     (b)  Insofar as indemnification for liabilities arising under the
          Securities Act may be permitted to directors, officers and
          controlling persons of the Registrant pursuant to the foregoing
          provisions, or otherwise, the Registrant has been advised that in the
          opinion of the Securities and Exchange Commission such
          indemnification is against public policy as expressed in the
          Securities Act, and is, therefore, unenforceable. In the event that a
          claim for indemnification against such liabilities (other than the
          payment by the Registrant of expenses incurred or paid by a director,
          officer or controlling person of the Registrant in the successful
          defense of any action, suit or proceeding) is asserted by such
          director, officer or controlling person in connection with the
          securities being registered, the Registrant will, unless in the
          opinion of its counsel the matter has been settled by controlling
          precedent, submit to a court of appropriate jurisdiction the question
          whether such indemnification by it is against public policy as
          expressed in the Securities Act, and will be governed by the final
          adjudication of such issue.


                                      II-3



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                            FEDEX CORPORATION


                                            By: /s/ James S. Hudson
                                               ---------------------------
                                               James S. Hudson
                                               Corporate Vice President -
                                               Strategic Financial Planning and
                                                 Control


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                   Capacity                              Date
- -----------------------------------    --------------------------------------------    ---------------------
                                                                                 
/s/ Frederick W. Smith                 Chairman of the Board, President and Chief         April 30, 2001
- -------------------------------        Executive Officer and Director
Frederick W. Smith                     (Principal Executive Officer)


/s/ Alan B. Graf, Jr.                  Executive Vice President and                       April 30, 2001
- -------------------------------        Chief Financial Officer
Alan B. Graf, Jr.                      (Principal Financial Officer)


/s/ James S. Hudson                    Corporate Vice President - Strategic               April 30, 2001
- -------------------------------        Financial Planning and Control
James S. Hudson                        (Principal Accounting Officer)


/s/ James L. Barksdale                 Director                                           April 30, 2001
- -------------------------------
James L. Barksdale


                                     II-4




             Signature                                   Capacity                              Date
- -----------------------------------    --------------------------------------------    ---------------------
                                                                                 


/s/ Robert L. Cox                      Director                                           April 30, 2001
- -------------------------------
Robert L. Cox


/s/ Ralph D. DeNunzio                  Director                                           April 30, 2001
- -------------------------------
Ralph D. DeNunzio


/s/ Judith L. Estrin                   Director                                           April 30, 2001
- -------------------------------
Judith L. Estrin


/s/ F.S. Garrison                      Director                                           April 30, 2001
- -------------------------------
F.S. Garrison


/s/ Philip Greer                       Director                                           April 30, 2001
- -------------------------------
Philip Greer


/s/ J.R. Hyde, III                     Director                                           April 30, 2001
- -------------------------------
J.R. Hyde, III

                                       Director
- -------------------------------
Shirley Ann Jackson


- -------------------------------        Director
George J. Mitchell


- -------------------------------        Director
Joshua I. Smith


- -------------------------------        Director
Paul S. Walsh


/s/ Peter S. Willmott                  Director                                           April 30, 2001
- -------------------------------
Peter S. Willmott



                                     II-5



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                             FEDERAL EXPRESS CORPORATION


                                             By: /s/ Michael W. Hillard
                                                ------------------------------
                                                Michael W. Hillard
                                                Vice President, Controller and
                                                Chief Accounting Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                     Capacity                            Date
- --------------------------------------    --------------------------------------------    ----------------
                                                                                    
/s/ Frederick W. Smith                    Chairman of the Board and Director               April 30, 2001
- --------------------------------
Frederick W. Smith


/s/ David J. Bronczek                     President and Chief Executive Officer            April 30, 2001
- --------------------------------          and Director (Principal Executive Officer)
David J. Bronczek


/s/ Tracy G. Schmidt                      Senior Vice President and Chief Financial        April 30, 2001
- --------------------------------          Officer (Principal Financial Officer)
Tracy G. Schmidt


/s/ Michael W. Hillard                    Vice President, Controller and                   April 30, 2001
- --------------------------------          Chief Accounting Officer
Michael W. Hillard                        (Principal Accounting Officer)



/s/ Robert B. Carter                      Director                                         April 30, 2001
- --------------------------------
Robert B. Carter



                                     II-6




              Signature                                     Capacity                            Date
- --------------------------------------    --------------------------------------------    ----------------
                                                                                    


/s/ Michael L. Ducker                     Director                                         April 30, 2001
- --------------------------------
Michael L. Ducker


/s/ T. Michael Glenn                      Director                                         April 30, 2001
- --------------------------------
T. Michael Glenn


/s/ Alan B. Graf, Jr.                     Director                                         April 30, 2001
- --------------------------------
Alan B. Graf, Jr.


/s/ George W. Hearn                       Director                                         April 30, 2001
- --------------------------------
George W. Hearn


/s/ Kenneth R. Masterson                  Director                                         April 30, 2001
- --------------------------------
Kenneth R. Masterson


/s/ David F. Rebholz                      Director                                         April 30, 2001
- --------------------------------
David F. Rebholz


/s/ Theodore L. Weise                     Director                                         April 30, 2001
- --------------------------------
Theodore L. Weise



                                      II-7



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Moon Township, State of
Pennsylvania, on April 30, 2001.

                                      FEDEX GROUND PACKAGE SYSTEM, INC.


                                      By: /s/ Ronald R. Trombetta
                                         ---------------------------------------
                                         Ronald R. Trombetta
                                         Senior Vice President - Finance and
                                         Administration, Chief Financial Officer
                                         and Treasurer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Frederick W. Smith                    Chairman of the Board and Director                April 30, 2001
- --------------------------------
Frederick W. Smith


/s/ Daniel J. Sullivan                    President and Chief Executive Officer and         April 30, 2001
- --------------------------------          Director (Principal Executive Officer)
Daniel J. Sullivan


/s/ Ronald R. Trombetta                   Senior Vice President - Finance and               April 30, 2001
- --------------------------------          Administration, Chief Financial Officer and
Ronald R. Trombetta                       Treasurer (Principal Financial Officer)



/s/ Gretchen G. Smarto                    Vice President and Controller                     April 30, 2001
- --------------------------------          (Principal Accounting Officer)
Gretchen G. Smarto



                                     II-8




              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Robert B. Carter                      Director                                          April 30, 2001
- --------------------------------
Robert B. Carter


/s/ T. Michael Glenn                      Director                                          April 30, 2001
- --------------------------------
T. Michael Glenn


/s/ Alan B. Graf, Jr.                     Director                                          April 30, 2001
- --------------------------------
Alan B. Graf, Jr.


/s/ Ivan T. Hofmann                       Director                                          April 30, 2001
- --------------------------------
Ivan T. Hofmann


/s/ Rodger G. Marticke                    Director                                          April 30, 2001
- --------------------------------
Rodger G. Marticke


/s/ Kenneth R. Masterson                  Director                                          April 30, 2001
- --------------------------------
Kenneth R. Masterson



                                     II-9



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Jose, State of
California, on April 30, 2001.

                                  VIKING FREIGHT, INC.


                                  By: /s/ Marshall W. Witt
                                     -------------------------------------------
                                     Marshall W. Witt
                                     Vice President - Finance and Administration
                                     and Chief Financial Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Frederick W. Smith                    Director                                          April 30, 2001
- --------------------------------
Frederick W. Smith


/s/ Tilton G. Gore                        President and Chief Executive Officer             April 30, 2001
- --------------------------------          and Director (Principal Executive Officer)
Tilton G. Gore


/s/ Marshall W. Witt                      Vice President - Finance and Administration       April 30, 2001
- --------------------------------          and Chief Financial Officer (Principal
Marshall W. Witt                          Financial Officer and Principal Accounting
                                          Officer)



/s/ Joseph C. McCarty                     Chairman of the Board and Director                April 30, 2001
- --------------------------------
Joseph C. McCarty


/s/ Robert B. Carter                      Director                                          April 30, 2001
- --------------------------------
Robert B. Carter



                                     II-10




              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Douglas G. Duncan                     Director                                          April 30, 2001
- --------------------------------
Douglas G. Duncan


/s/ T. Michael Glenn                      Director                                          April 30, 2001
- --------------------------------
T. Michael Glenn


/s/ Alan B. Graf, Jr.                     Director                                          April 30, 2001
- --------------------------------
Alan B. Graf, Jr.


/s/ Kenneth R. Masterson                  Director                                          April 30, 2001
- --------------------------------
Kenneth R. Masterson



                                     II-11



                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Akron, State of Ohio, on
April 30, 2001.

                                        FEDEX CUSTOM CRITICAL, INC.


                                        By: /s/ Brendan L. O'Sullivan
                                           ------------------------------------
                                          Brendan L. O'Sullivan
                                          Vice President - Finance,
                                         Chief Financial Officer and Treasurer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


               Signature                                     Capacity                            Date
- ---------------------------------------    --------------------------------------------    ----------------
                                                                                     


/s/ R. Bruce Simpson                       President and Director                           April 30, 2001
- -----------------------------------        (Principal Executive Officer)
R. Bruce Simpson


/s/ Brendan L. O'Sullivan                  Vice President - Finance, Chief Financial        April 30, 2001
- -----------------------------------        Officer and Treasurer
Brendan L. O'Sullivan                      (Principal Financial Officer and Principal
                                           Accounting Officer)



/s/ Alan B. Graf, Jr.                      Chairman of the Board and Director               April 30, 2001
- -----------------------------------
Alan B. Graf, Jr.


/s/ Robert B. Carter                       Director                                         April 30, 2001
- -----------------------------------
Robert B. Carter


/s/ T. Michael Glenn                       Director                                         April 30, 2001
- -----------------------------------
T. Michael Glenn



                                     II-12




               Signature                                     Capacity                            Date
- ---------------------------------------    --------------------------------------------    ----------------
                                                                                     


/s/ Kenneth R. Masterson                   Director                                         April 30, 2001
- -----------------------------------
Kenneth R. Masterson


/s/ John G. Pickard                        Director                                         April 30, 2001
- -----------------------------------
John G. Pickard



                                     II-13




                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Mississauga, Ontario, Canada, on
April 30, 2001.

                                        FEDERAL EXPRESS CANADA LTD.


                                        By: /s/ Karl O. Stingily
                                           ------------------------------
                                           Karl O. Stingily
                                           Vice President - Finance


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                    Capacity                            Date
- -------------------------------------    --------------------------------------------    ----------------
                                                                                   


/s/ James S. Hudson                      Authorized Representative in the                 April 30, 2001
- -----------------------------------      United States
James S. Hudson


/s/ Donald F. Colleran                   President (Principal Executive Officer)          April 30, 2001
- -----------------------------------
Donald F. Colleran


/s/ Karl O. Stingily                     Vice President - Finance                         April 30, 2001
- -----------------------------------      (Principal Financial Officer and Principal
Karl O. Stingily                         Accounting Officer)


/s/ Donna Brazelton                      Director                                         April 30, 2001
- -----------------------------------
Donna Brazelton


/s/ Clifford P. Johnson                  Director                                         April 30, 2001
- -----------------------------------
Clifford P. Johnson



                                     II-14





              Signature                                    Capacity                            Date
- -------------------------------------    --------------------------------------------    ----------------
                                                                                   


/s/ Arthur Stanley                       Director                                         April 30, 2001
- -----------------------------------
Arthur Stanley


/s/ Pina Starnino                        Director                                         April 30, 2001
- -----------------------------------
Pina Starnino



                                     II-15



                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Tokyo, Japan, on April 30, 2001.

                                        FEDERAL EXPRESS JAPAN K.K.

                                        By: /s/ David J. Ross
                                           ---------------------------
                                           David J. Ross
                                           Representative Director


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.

      Signature                      Capacity                      Date
- ---------------------    ---------------------------------    --------------


/s/ James S. Hudson      Authorized Representative in the     April 30, 2001
- ---------------------    United States
James S. Hudson


/s/ David J. Ross        Chairman of the Board and            April 30, 2001
- ---------------------    Representative Director
David J. Ross


/s/ Harold W. West       Representative Director              April 30, 2001
- ---------------------
Harold W. West


/s/ Kenji Hagiwara       Director                             April 30, 2001
- ---------------------
Kenji Hagiwara


/s/ Thomas L. Holland    Director                             April 30, 2001
- ---------------------
Thomas L. Holland


                                     II-16



      Signature                      Capacity                      Date
- ---------------------    ---------------------------------    --------------


/s/ Hideo Mori           Director                             April 30, 2001
- ---------------------
Hideo Mori


                                     II-17



                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                        FEDEX TRADE NETWORKS, INC.


                                        By: /s/ Alan J. Meluskey
                                           ---------------------------------
                                           Alan J. Meluskey
                                           Vice President - Finance and
                                           Administration and Chief Financial
                                           Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Frederick W. Smith                    Director                                          April 30, 2001
- ---------------------------------
Frederick W. Smith


/s/ G. Edmond Clark                       President, Chief Executive Officer                April 30, 2001
- ---------------------------------         and Director (Principal Executive Officer)
G. Edmond Clark


/s/ Alan J. Meluskey                      Vice President - Finance and Administration       April 30, 2001
- ---------------------------------         and Chief Financial Officer (Principal
Alan J. Meluskey                          Financial Officer and Principal Accounting
                                          Officer)


/s/ Kenneth R. Masterson                  Chairman of the Board and Director                April 30, 2001
- ---------------------------------
Kenneth R. Masterson



                                     II-18




              Signature                                     Capacity                             Date
- --------------------------------------    ---------------------------------------------    ----------------
                                                                                     


/s/ Robert B. Carter                      Director                                          April 30, 2001
- ---------------------------------
Robert B. Carter


/s/ T. Michael Glenn                      Director                                          April 30, 2001
- ---------------------------------
T. Michael Glenn


/s/ Alan B. Graf, Jr.                     Director                                          April 30, 2001
- ---------------------------------
Alan B. Graf, Jr.


/s/ Gerald P. Leary                       Director                                          April 30, 2001
- ---------------------------------
Gerald P. Leary



                                     II-19



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Buffalo, State of New
York, on April 30, 2001.

                                        TOWER GROUP INTERNATIONAL, INC.


                                        By: /s/ Donald P. Vogel
                                           -------------------------------
                                           Donald P. Vogel
                                           Vice President


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


            Signature                                   Capacity                             Date
- ----------------------------------    ---------------------------------------------    ----------------
                                                                                 


/s/ G. Edmond Clark                   Chairman of the Board, Chief Executive            April 30, 2001
- -------------------------------       Officer and Director (Principal Executive
G. Edmond Clark                       Officer)



/s/ Donald P. Vogel                   Vice President (Principal Financial Officer       April 30, 2001
- -------------------------------       and Principal Accounting Officer)
Donald P. Vogel


/s/ Gerald P. Leary                   Director                                          April 30, 2001
- -------------------------------
Gerald P. Leary



                                     II-20



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Mississauga, Ontario, Canada, on
April 30, 2001.

                                        TOWER GROUP INTERNATIONAL CANADA INC.


                                        By: /s/ G. Edmond Clark
                                           -------------------------------------
                                           G. Edmond Clark
                                           Chief Executive Officer


                                      POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                    Capacity                             Date
- -----------------------------------    ----------------------------------------------    ----------------
                                                                                   


/s/ James S. Hudson                    Authorized Representative in the United            April 30, 2001
- --------------------------------       States
James S. Hudson


/s/ G. Edmond Clark                    Chief Executive Officer (Principal Executive       April 30, 2001
- --------------------------------       Officer, Principal Financial Officer and
G. Edmond Clark                        Principal Accounting Officer)



/s/ Frank van de Geyn                  Director                                           April 30, 2001
- --------------------------------
Frank van de Geyn


/s/ Gerald P. Leary                    Director                                           April 30, 2001
- --------------------------------
Gerald P. Leary


/s/ Terry Owen                         Director                                           April 30, 2001
- --------------------------------
Terry Owen



                                     II-21



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Greensboro, State of
North Carolina, on April 30, 2001.

                                        CARIBBEAN TRANSPORTATION SERVICES, INC.


                                        By: /s/ Lynn H. Turman
                                           ------------------------------------
                                           Lynn H. Turman
                                           Vice President, Controller and
                                           Assistant Treasurer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                    Capacity                            Date
- ------------------------------------    --------------------------------------------    ----------------
                                                                                  


/s/ Richard A. Faieta                   President, Chief Executive Officer and           April 30, 2001
- --------------------------------        Director (Principal Executive Officer)
Richard A. Faieta


/s/ Lynn H. Turman                      Vice President, Controller and Assistant         April 30, 2001
- --------------------------------        Treasurer (Principal Financial Officer and
Lynn H. Turman                          Principal Accounting Officer)


/s/ Joseph C. McCarty                   Chairman of the Board and Director               April 30, 2001
- --------------------------------
Joseph C. McCarty



                                     II-22



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Francisco, State of
California, on April 30, 2001.

                                   WORLD TARIFF, LIMITED


                                   By: /s/ Alan J. Meluskey
                                      ----------------------------------------
                                      Alan J. Meluskey
                                      Vice President, Chief Financial Officer
                                      and Treasurer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                    Capacity                             Date
- -----------------------------------    ----------------------------------------------    ----------------
                                                                                   


/s/ Scott D. Morse                     President, Publisher and Director (Principal       April 30, 2001
- ---------------------------------      Executive Officer)
Scott D. Morse


/s/ Alan J. Meluskey                   Vice President, Chief Financial Officer,           April 30, 2001
- ---------------------------------      Treasurer and Director (Principal Financial
Alan J. Meluskey                       Officer and Principal Accounting Officer)



/s/ G. Edmond Clark                    Chairman of the Board and Director                 April 30, 2001
- ---------------------------------
G. Edmond Clark



                                     II-23



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Mississauga, Ontario, Canada, on
April 30, 2001.

                                        FEDEX GROUND PACKAGE SYSTEM, LTD.


                                        By: /s/ Ronald R. Trombetta
                                           ---------------------------------
                                           Ronald R. Trombetta
                                           Vice President and Treasurer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                    Capacity                            Date
- -------------------------------------    --------------------------------------------    ----------------
                                                                                   


/s/ Sidney M. Ballinger                  President (Principal Executive Officer)          April 30, 2001
- -----------------------------------
Sidney M. Ballinger


/s/ Ronald R. Trombetta                  Vice President and Treasurer (Principal          April 30, 2001
- -----------------------------------      Financial Officer and Principal Accounting
Ronald R. Trombetta                      Officer)



/s/ Ivan T. Hofmann                      Director                                         April 30, 2001
- -----------------------------------
Ivan T. Hofmann


/s/ Rodger G. Marticke                   Director                                         April 30, 2001
- -----------------------------------
Rodger G. Marticke


/s/ Steven H. Taylor                     Director                                         April 30, 2001
- -----------------------------------
Steven H. Taylor



                                     II-24



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                        FEDEX CORPORATE SERVICES, INC.


                                        By: /s/ Robert A. Green
                                           ------------------------------
                                           Robert A. Green
                                           Vice President - Finance


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                     Capacity                            Date
- --------------------------------------    --------------------------------------------    ----------------
                                                                                    


/s/ Frederick W. Smith                    Director                                         April 30, 2001
- --------------------------------
Frederick W. Smith


/s/ T. Michael Glenn                      Chairman of the Board, President, Chief          April 30, 2001
- --------------------------------          Executive Officer and Director (Principal
T. Michael Glenn                          Executive Officer)



/s/ Robert A. Green                       Vice President - Finance (Principal              April 30, 2001
- --------------------------------          Financial Officer and Principal Accounting
Robert A. Green                           Officer)



/s/ David J. Bronczek                     Director                                         April 30, 2001
- --------------------------------
David J. Bronczek


/s/ Robert B. Carter                      Director                                         April 30, 2001
- --------------------------------
Robert B. Carter



                                     II-25




              Signature                                     Capacity                            Date
- --------------------------------------    --------------------------------------------    ----------------
                                                                                    


/s/ Alan B. Graf, Jr.                     Director                                         April 30, 2001
- --------------------------------
Alan B. Graf, Jr.


/s/ Kenneth R. Masterson                  Director                                         April 30, 2001
- --------------------------------
Kenneth R. Masterson


/s/ Joseph C. McCarty                     Director                                         April 30, 2001
- --------------------------------
Joseph C. McCarty


/s/ Daniel J. Sullivan                    Director                                         April 30, 2001
- --------------------------------
Daniel J. Sullivan


/s/ Douglas G. Duncan                     Director                                         April 30, 2001
- --------------------------------
Douglas G. Duncan



                                     II-26



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Hudson, State of Ohio,
on April 30, 2001.

                                        FEDEX SUPPLY CHAIN SERVICES, INC.


                                        By: /s/ Lori A. Lutey
                                           -------------------------------------
                                           Lori A. Lutey
                                           Vice President - Finance and
                                           Administration


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                   Capacity                             Date
- -----------------------------------    ---------------------------------------------    ----------------
                                                                                  


/s/ Douglas E. Witt                    President and Chief Executive Officer             April 30, 2001
- ------------------------------         (Principal Executive Officer)
Douglas E. Witt


/s/ Lori A. Lutey                      Vice President - Finance and Administration       April 30, 2001
- ------------------------------         (Principal Financial Officer and Principal
Lori A. Lutey                          Accounting Officer)


/s/ Joseph C. McCarty                  Director                                          April 30, 2001
- ------------------------------
Joseph C. McCarty



                                     II-27





                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                       FEDEX FREIGHT SYSTEM, INC.


                                       By:/s/ Donald C. Brown
                                          ------------------------------------
                                          Donald C. Brown
                                          Senior Vice President and Chief
                                          Financial Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                    Capacity                            Date
- --------------------------------------    -------------------------------------------    ----------------
                                                                                   


/s/ Frederick W. Smith                    Director                                        April 30, 2001
- -------------------------------
Frederick W. Smith


/s/ Douglas G. Duncan                     President, Chief Executive Officer and          April 30, 2001
- -------------------------------           Director (Principal Executive Officer)
Douglas G. Duncan


/s/ Donald C. Brown                       Senior Vice President and Chief Financial       April 30, 2001
- -------------------------------           Officer (Principal Financial Officer and
Donald C. Brown                           Principal Accounting Officer)



/s/ Robert B. Carter                      Director                                        April 30, 2001
- -------------------------------
Robert B. Carter


/s/ T. Michael Glenn                      Director                                        April 30, 2001
- -------------------------------
T. Michael Glenn



                                     II-28





              Signature                                    Capacity                            Date
- --------------------------------------    -------------------------------------------    ----------------
                                                                                   


/s/ Alan B. Graf, Jr.                     Director                                        April 30, 2001
- -------------------------------
Alan B. Graf, Jr.


/s/ Kenneth R. Masterson                  Director                                        April 30, 2001
- -------------------------------
Kenneth R. Masterson


/s/ Thomas R. Garrison                    Director                                        April 30, 2001
- -------------------------------
Thomas R. Garrison


/s/ Tilton G. Gore                        Director                                        April 30, 2001
- -------------------------------
Tilton G. Gore



                                     II-29



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Harrison, State of
Arkansas, on April 30, 2001.

                                     AMERICAN FREIGHTWAYS, INC.


                                     By: /s/ Frank Conner
                                        ----------------------------------------
                                        Frank Conner
                                        Executive Vice President - Accounting &
                                        Finance and Chief Financial Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


             Signature                                    Capacity                            Date
- ------------------------------------    --------------------------------------------    ----------------
                                                                                  


/s/ Tom Garrison                        President and Chief Executive Officer            April 30, 2001
- -------------------------------         (Principal Executive Officer)
Tom Garrison


/s/ Frank Conner                        Executive Vice President - Accounting &          April 30, 2001
- -------------------------------         Finance and Chief Financial Officer
Frank Conner                            (Principal Financial Officer and Principal
                                        Accounting Officer)


/s/ Donald C. Brown                     Director                                         April 30, 2001
- -------------------------------
Donald C. Brown


/s/ Douglas G. Duncan                   Director                                         April 30, 2001
- -------------------------------
Douglas G. Duncan



                                     II-30



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                      FEDERAL EXPRESS AVIATION SERVICES,
                                      INCORPORATED


                                      By: /s/ James R. Parker
                                         ------------------------------------
                                         James R. Parker
                                         President and Chief Executive Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed below by the following persons on
behalf of the Registrant in the capacities and on the dates indicated.


              Signature                                    Capacity                            Date
- --------------------------------------    -------------------------------------------    ----------------
                                                                                   


/s/ Frederick W. Smith                    Chairman of the Board and Director              April 30, 2001
- ----------------------------------
Frederick W. Smith


/s/ James R. Parker                       President, Chief Executive Officer and          April 30, 2001
- ----------------------------------        Director (Principal Executive Officer,
James R. Parker                           Principal Financial Officer and Principal
                                          Accounting Officer)



/s/ Kenneth R. Masterson                  Director                                        April 30, 2001
- ----------------------------------
Kenneth R. Masterson



                                     II-31



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Alexandria, Sydney, Australia, on
April 30, 2001.

                                        FEDERAL EXPRESS (AUSTRALIA) PTY LTD.


                                        By: /s/ Andrew J. da Roza
                                           ---------------------------------
                                           Andrew J. da Roza
                                           Director


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                   Capacity                           Date
- --------------------------------------    -----------------------------------------    ----------------
                                                                                 


/s/ James S. Hudson                       Authorized Representative in the United       April 30, 2001
- ----------------------------              States
James S. Hudson


/s/ Andrew J. da Roza                     Director                                      April 30, 2001
- ----------------------------
Andrew J. da Roza


/s/ Kim Anthony Garner                    Director                                      April 30, 2001
- ----------------------------
Kim Anthony Garner


/s/ Donald Lee Hardy                      Director                                      April 30, 2001
- ----------------------------
Donald Lee Hardy


/s/ Peter Pi-Tak Yin                      Director                                      April 30, 2001
- ----------------------------
Peter Pi-Tak Yin



                                     II-32




                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Gennevilliers, France, on April 30,
2001.

                                   FEDERAL EXPRESS INTERNATIONAL (FRANCE)
                                   SNC


                                   By: /s/ Alain Chaille
                                      -----------------------------------
                                      Alain Chaille
                                      Director


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


     Signature                               Capacity                        Date
- -------------------           ---------------------------------------   --------------
                                                                  


/s/ James S. Hudson           Authorized Representative in the United   April 30, 2001
- ----------------------------  States
James S. Hudson


/s/ Alain Chaille             Director                                  April 30, 2001
- ----------------------------
Alain Chaille



                                     II-33



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Singapore, on April 30, 2001.

                                        FEDERAL EXPRESS (SINGAPORE) PTE. LTD.


                                        By: /s/ Andrew J. da Roza
                                           -------------------------------------
                                           Andrew J. da Roza
                                           Director


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                   Capacity                           Date
- --------------------------------------    -----------------------------------------    ----------------
                                                                                 


/s/ James S. Hudson                       Authorized Representative in the United       April 30, 2001
- ----------------------------              States
James S. Hudson


/s/ Peter Pi-Tak Yin                      Director                                      April 30, 2001
- ----------------------------
Peter Pi-Tak Yin


/s/ Andrew J. da Roza                     Director                                      April 30, 2001
- ----------------------------
Andrew J. da Roza


/s/ Rhicke S. Jennings                    Director                                      April 30, 2001
- ----------------------------
Rhicke S. Jennings



                                     II-34



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                   FEDERAL EXPRESS EUROPE, INC.


                                   By: /s/ Kenneth F. Koval
                                      ------------------------------------------
                                      Kenneth F. Koval
                                      Vice President and Chief Financial Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


               Signature                                      Capacity                             Date
- ----------------------------------------    ---------------------------------------------    ----------------
                                                                                       


/s/ Robert W. Elliott                       Chairman, Chief Executive Officer,                April 30, 2001
- ----------------------------                President and Director (Principal Executive
Robert W. Elliott                           Officer)


/s/ Kenneth F. Koval                        Vice President, Chief Financial Officer and       April 30, 2001
- ----------------------------                Director (Principal Financial Officer and
Kenneth F. Koval                            Principal Accounting Officer)


/s/ Mark R. Allen                           Director                                          April 30, 2001
- ----------------------------
Mark R. Allen


/s/ Peter Grimm                             Director                                          April 30, 2001
- ----------------------------
Peter Grimm


/s/ Thomas W. O'Hearn                       Director                                          April 30, 2001
- ----------------------------
Thomas W. O'Hearn



                                     II-35




               Signature                                      Capacity                             Date
- ----------------------------------------    ---------------------------------------------    ----------------
                                                                                       


/s/ Christine P. Richards                   Director                                          April 30, 2001
- ----------------------------
Christine P. Richards


/s/ Antje Schuett-Fahrenkrog                Director                                          April 30, 2001
- ----------------------------
Antje Schuett-Fahrenkrog



                                     II-36



                                  SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Melsbroek, Belgium, on April 30,
2001.

                                   FEDERAL EXPRESS EUROPE, INC. & CO.,
                                   V.O.F./S.N.C.


                                   By: /s/ Kenneth F. Koval
                                      ----------------------------------------
                                      Kenneth F. Koval
                                      Vice President and Chief Financial
                                      Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


      Signature                           Capacity                      Date
- ---------------------         ---------------------------------    --------------
                                                             


/s/ James S. Hudson           Authorized Representative in the     April 30, 2001
- ----------------------------  United States
James S. Hudson


/s/ Robert W. Elliott         Director                             April 30, 2001
- ----------------------------
Robert W. Elliott


/s/ Paul A. Evans             Director                             April 30, 2001
- ----------------------------
Paul A. Evans


/s/ Richard F. Gerber         Director                             April 30, 2001
- ----------------------------
Richard F. Gerber


/s/ Kenneth F. Koval          Director                             April 30, 2001
- ----------------------------
Kenneth F. Koval



                                     II-37



      Signature                           Capacity                      Date
- ---------------------        ---------------------------------    --------------


/s/ David W. Slipper         Director                             April 30, 2001
- --------------------------
David W. Slipper


                                     II-38



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Mexico City D.F., Mexico, on April
30, 2001.

                                   FEDERAL EXPRESS HOLDINGS (MEXICO) y
                                   COMPANIA S.N.C. de C.V.


                                   By: /s/ Juan N. Cento
                                      ---------------------------------
                                      Juan N. Cento
                                      Director


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


     Signature                              Capacity                      Date
- --------------------          ----------------------------------    ---------------
                                                              


/s/ James S. Hudson           Authorized Representative in the      April 30, 2001
- ----------------------------  United States
James S. Hudson


/s/ Juan N. Cento             Director                              April 30, 2001
- ----------------------------
Juan N. Cento



                                     II-39



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                   FEDERAL EXPRESS HOLDINGS S.A.


                                   By: /s/ Juan N. Cento
                                      -----------------------------
                                      Juan N. Cento
                                      President


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                   Capacity                            Date
- -------------------------------------    -------------------------------------------    ----------------
                                                                                  


/s/ Juan N. Cento                        President (Principal Executive Officer,         April 30, 2001
- ----------------------------             Principal Financial Officer and Principal
Juan N. Cento                            Accounting Officer)


/s/ Julio Colomba                        Director                                        April 30, 2001
- ----------------------------
Julio Colomba


/s/ Andrew M. Paalborg                   Director                                        April 30, 2001
- ----------------------------
Andrew M. Paalborg


/s/ David F. Rebholz                     Director                                        April 30, 2001
- ----------------------------
David F. Rebholz



                                     II-40



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                   FEDERAL EXPRESS INTERNATIONAL, INC.


                                   By: /s/ David J. Bronczek
                                      -----------------------------------------
                                      David J. Bronczek
                                      Chairman of the Board and Chief
                                      Executive Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


              Signature                                   Capacity                            Date
- -------------------------------------    -------------------------------------------    ----------------
                                                                                  


/s/ David J. Bronczek                    Chairman of the Board, Chief Executive          April 30, 2001
- ----------------------------             Officer and Director (Principal Executive
David J. Bronczek                        Officer, Principal Financial Officer and
                                         Principal Accounting Officer)



/s/ Mark R. Allen                        Director                                        April 30, 2001
- ----------------------------
Mark R. Allen


/s/ Eddy Ka Leung Chan                   Director                                        April 30, 2001
- ----------------------------
Eddy Ka Leung Chan


/s/ Karen M. Clayborne                   Director                                        April 30, 2001
- ----------------------------
Karen M. Clayborne


/s/ Andrew J. da Roza                    Director                                        April 30, 2001
- ----------------------------
Andrew J. da Roza



                                     II-41




              Signature                                   Capacity                            Date
- -------------------------------------    -------------------------------------------    ----------------
                                                                                  


/s/ Michael L. Ducker                    Director                                        April 30, 2001
- ----------------------------
Michael L. Ducker


/s/ Michael T. Mitchell                  Director                                        April 30, 2001
- ----------------------------
Michael T. Mitchell


/s/ Peter Pi-Tak Yin                     Director                                        April 30, 2001
- ----------------------------
Peter Pi-Tak Yin



                                     II-42



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Memphis, State of
Tennessee, on April 30, 2001.

                                        FEDERAL EXPRESS PACIFIC, INC.


                                        By: /s/ Michael L. Ducker
                                           ------------------------------------
                                           Michael L. Ducker
                                           Chairman of the Board and Chief
                                           Executive Officer


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


               Signature                                      Capacity                            Date
- ----------------------------------------    --------------------------------------------    ----------------
                                                                                      


/s/ Michael L. Ducker                       Chairman of the Board and Chief Executive        April 30, 2001
- ----------------------------                Officer (Principal Executive Officer)
Michael L. Ducker


/s/ Michael T. Mitchell                     Vice President and Director (Principal           April 30, 2001
- ----------------------------                Financial Officer and Principal Accounting
Michael T. Mitchell                         Officer)



/s/ Eddy Ka Leung Chan                      Director                                         April 30, 2001
- ----------------------------
Eddy Ka Leung Chan


/s/ David L. Cunningham, Jr.                Director                                         April 30, 2001
- ----------------------------
David L. Cunningham, Jr.


/s/ Andrew J. da Roza                       Director                                         April 30, 2001
- ----------------------------
Andrew J. da Roza



                                     II-43




               Signature                                      Capacity                            Date
- ----------------------------------------    --------------------------------------------    ----------------
                                                                                      


/s/ David J. Ross                           Director                                         April 30, 2001
- ----------------------------
David J. Ross


/s/ Peter Pi-Tak Yin                        Director                                         April 30, 2001
- ----------------------------
Peter Pi-Tak Yin



                                     II-44



                                   SIGNATURES

     Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Saint Thomas, United States Virgin
Islands, on April 30, 2001.

                                        FEDERAL EXPRESS VIRGIN ISLANDS, INC.


                                        By: /s/ Julio Colomba
                                           ------------------------------------
                                           Julio Colomba
                                           President


                               POWER OF ATTORNEY

     Each person whose signature appears below hereby constitutes and appoints
Kenneth R. Masterson, Alan B. Graf, Jr. and James S. Hudson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) and supplements to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

     Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.


            Signature                                   Capacity                             Date
- ----------------------------------    ---------------------------------------------    ----------------
                                                                                 


/s/ Julio Colomba                     President and Director (Principal Executive       April 30, 2001
- ----------------------------          Officer, Principal Financial Officer and
Julio Colomba                         Principal Accounting Officer)



/s/ Roberto Morales                   Director                                          April 30, 2001
- ----------------------------
Roberto Morales


/s/ Michael L. Moss                   Director                                          April 30, 2001
- ----------------------------
Michael L. Moss


/s/ Cletus William                    Director                                          April 30, 2001
- ----------------------------
Cletus William



                                     II-45



                                 EXHIBIT INDEX


 Exhibit
 Number                                Description
 -------                               -----------
   1.1      Purchase Agreement dated February 6, 2001 among FedEx Corporation,
            the Guarantors named therein and Merrill Lynch, Pierce, Fenner &
            Smith Incorporated, Banc of America Securities LLC, Chase
            Securities, Inc., Commerzbank Capital Markets Corp. and Credit
            Suisse First Boston Corporation, as initial purchasers.
   4.1      Indenture, dated as of February 12, 2001, among FedEx
            Corporation, as Issuer, the Guarantors named therein, and The
            Bank of New York, as Trustee.
   4.2      Form of New Note (included in Exhibit 4.1).
   4.3      Supplemental Indenture No. 1, dated as of February 20, 2001, among
            FedEx Corporation, as Issuer, the Guarantors named therein, the
            Additional Guarantors named therein and The Bank of New York, as
            Trustee.
   4.4      Supplemental Indenture No. 2, dated as of April 27, 2001 among
            FedEx Corporation, as Issuer, the Guarantors named therein, the
            Additional Guarantors named therein and The Bank of New York, as
            Trustee.
   4.5      Registration Rights Agreement, dated as of February 12, 2001, among
            FedEx Corporation, the Guarantors named therein, and Merrill Lynch,
            Pierce, Fenner & Smith Incorporated, Banc of America Securities
            LLC, Chase Securities Inc., Commerzbank Capital Markets Corp., and
            Credit Suisse First Boston Corporation, as initial purchasers.
   5.1      Opinion of Davis Polk & Wardwell regarding the validity of the New
            Notes.
   8.1      Opinion of Davis Polk & Wardwell regarding tax matters (included in
            Exhibit 5.1).
  15.1      Letter of Arthur Andersen LLP regarding unaudited interim
            financial information of FedEx Corporation and Federal Express
            Corporation.
  21.1      Subsidiaries of FedEx Corporation.
  23.1      Consent of Arthur Andersen LLP with respect to FedEx
            Corporation's and Federal Express Corporation's financial
            statements.
  23.2      Consent of Ernst & Young LLP with respect to American Freightways
            Corporation's financial statements.
  23.3      Consent of Davis Polk & Wardwell (included in Exhibit 5.1).
  24.1      Powers of Attorney (set forth on the signature pages to this
            Registration Statement).
  25.1      Statement of Eligibility under the Trust Indenture Act of 1939 on
            Form T-1 of The Bank of New York, as Trustee.
  99.1      Form of Letter of Transmittal.
  99.2      Form of Notice of Guaranteed Delivery.
  99.3      Form of Exchange Agent Agreement.


                                      E-1